Chapter Five
Industry Co-operation
1.1 Union Action (TCFUA)
1.2 In recent years the Textiles, Clothing and Footwear Union of Australia
(TCFUA) has initiated a number of actions aimed at improving the conditions
under which outworkers are employed. The more significant of these are:
the National Outwork Information Campaign and associated Report (The
Hidden Cost of Fashion); a Statement of Cooperation between the Union
and the Council of Textile and Fashion Industries of Australia (CTFIA);
and negotiations with individual companies to sign Deeds of Cooperation.
In addition to these specific actions, the Union had worked for many years
to achieve employer compliance with award wages and conditions for outworkers.
1.3 Ensuring Payment of Award Rates
1.4 The TCF Union has been concerned with the regulation of outwork for
over 75 years and during this time the Union has tried a number of strategies
to improve their position in the workforce. Prior to 1985, the Union tried
to persuade employers to licence outworkers, and to only use outworkers
when those outworkers could prove that circumstances necessitated them
working from home. These efforts failed because employers did not encourage
outworkers to get licences. Furthermore, the very many unlicensed outworkers
then considered themselves to be 'illegal' employees thus were reluctant
to approach the Union for help.
1.5 In 1987, Federal and State TCF Awards were extended to outworkers
and individual contractors. These Awards stipulated that no outworker
could work for less than was set out in the award. However, because of
difficulties of enforcement, the requirement that outworkers be employed
under award conditions has largely been ignored by unscrupulous contractors.
In addition, because of the isolation of outworkers, many have been unaware
of their entitlements.
1.6 Government Funding for Outworker Projects
1.7 Under the previous Labor Government, a grant was made available to
the Union through the Department of Industry Science and Tourism for continued
work on problems relating to outworkers. The total grant was to be $400,000.
Of this, $100,000 had been paid prior to the March 1996 election. However,
upon taking up office, the new government cancelled the grant and requested
that any monies not spent be refunded. [1]
1.8 In evidence to the Committee the Union stated that the grant was
very important and called for its reinstatement. The Union further recommended
that a designated allocation be made in the Department of Industrial Relations
budget for the Union to implement strategies designed to eliminate the
exploitation of outworkers. [2]
1.9 In this context, the Committee notes that the Future Strategies Committee
Report of 1994 had commented on 'the concerns of the TCFUA regarding outworkers,
particularly in relation to exploitation and equity' [3]
and had consequently recommended:
… that the Union program for informing outworkers of their entitlements
should continue to be adequately resourced by the Government. [4]
1.10 In the recent Government Budget (August 1996), an amount of $400,000
was identified as part of the TCF 2000 Development Package to be used
for projects relating to outworkers.
1.11 Voluntary Agreements - Deeds of Cooperation
1.12 Over the last few years, the Union has promoted the idea of deeds
of cooperation between retailers (or another principal) and suppliers
which would ensure that outworkers were employed under no less favourable
terms and conditions than contained in the award. The Standard Industry
Deed developed by the Union is a common law agreement and promotes the
concept of best practice. Under the Deed, the principal is responsible
for calculating the terms of payment to the supplier and for ensuring
that the supplier observes the contract. If the retailer becomes aware
of any breach of the Deed, they must take action to remedy the situation
and inform the Union of the outcome. The retailer must give preference
of employment to TCF Union members. In return, the Union recognises the
retailer as a best practice employer.
1.13 Under the Deed, the principal agrees to:
- keep records of contracts and allow access by the Union;
- send details of suppliers to the Union every three months;
- calculate the time it would take to make an item when calculating
rates of pay;
- enter a specific form of contract with intermediaries who are in turn
obliged to ensure that award conditions are met; and
- investigate breaches of contracts by intermediaries, report these
to the Union and take steps to remedy any breaches.
1.14 Although there is a standard Deed, agreements being reached with
individual companies differ from each other in contractual detail, particularly
with regard to enforcement, reporting requirements and any union preference
provisions. [5]
1.15 The Union has had discussions with a number of individual companies
about improvements to conditions and pay for outworkers making their products.
At the time of publishing its report, The Hidden Costs of Fashion,
the Union considered that, with a couple of exceptions (noted below),
it had had little success in the initiation of voluntary agreements. [6]
However, a number of retailers have now entered into voluntary agreements,
as proposed by the Union to ensure that outworkers who sew garments for
them, either directly or indirectly, are paid under award conditions.
[7]
1.16 Agreements have also been reached between the TCFUA and Country
Road [8] and Australia Post
and an agreement is expected to be signed by Just Jeans and the
NSW Government shortly. [9] However, while many
retailers are proving to be cooperative, some are not. [10]
1.17 Further to these voluntary agreements, the Union recommended in
its submission to the Committee that the Federal Government promote Ethical
Sourcing Agreements by ensuring that companies which are beneficiaries
of government assistance (such as Work Place and Quick Response programs)
be required to source their supplies from companies which have signed
such agreements. In addition, the Union recommended that preference be
given in awarding Government contracts to companies who have entered into
Ethical Sourcing Agreements. [11]
1.18 Although the federal Department of Industrial Relations supported
this initiative 'to the extent to which they operate as a voluntary code
of conduct', [12] it is the view of the Department
that it would be difficult for the Union to enforce the agreements under
common law.
1.19 Done Art and Design Agreement
1.20 Done Art and Design is a design and marketing business and
all manufacturing is carried out by contract manufacturers. The agreement
signed with the TCFUA in early December 1995, and witnessed by the then
NSW Premier, Mr Bob Carr, requires the company to ensure that all persons
employed in the manufacture of garments are employed under award conditions,
whether they are employed in a factory or work elsewhere.
1.21 This agreement, however, simply formalised a practice that the company
had used for many years. Eight years ago the company agreed to inform
the TCFUA of the name and address of all makers. In addition, the company
has always required makers to sign individual agreements through which
the contracting company must show proof of having a registered factory
premises, pay award wages as a minimum, and not to send work outside without
informing Done Art.
1.22 Target Australia Agreement
1.23 The signing of a Deed of Cooperation by Target Australia Pty
Ltd with the TCFUA on 28 July 1995 was based on the belief that exploitation
of workers is not acceptable and that all suppliers and manufacturers
should abide by their legal obligations in the employment of outworkers.
Prior to signing the agreement, all Target suppliers were notified
in writing and were required to respond confirming that they were not
involved in the exploitation of outworkers. The main points in the Deed
include:
- a definition of 'exploitation' which is linked to the Federal Clothes
Trade Award 1982;
- agreement with the Union to assist through the provision of information
relating to contracts (ie. suppliers, qualities, costs);
- specifies the duration of records to be kept, and conditions for delivery
to the TCFUA;
- the Union will inform Target of any alleged exploitation and
provide any material supporting the allegation, and a process for resolving
whether exploitation in happening and action to be taken;
- if a supplier is engaged in exploitation Target will take all
reasonable action to remedy the exploitation and possible terminate
the contract. [13]
1.24 Target Australia Pty Ltd uses a standard contract with suppliers
in its sourcing of merchandise which states, inter alia:
- that it expects suppliers to comply fully with legal requirements
of the countries in which they operate and be alert to any signs that
a production process involves exploitation or represents a danger to
health, safety or the environment; and
- that exploitation of children is particularly unacceptable and Target
will not do business with suppliers who fail to share this view. [14]
1.25 Corporate Action
1.26 Independent Company Contracts
1.27 Many garment manufacturing companies already require contractors
to complete documentation relating to award compliance whenever work is
distributed. [15] However, as pointed out by
the Australian Chamber of Manufactures, despite the best efforts of garment
manufacturers it is very difficult to monitor the activities of subcontractors
and it would require considerable administrative work to maintain detailed
records of the extent of outwork. [16]
1.28 Voluntary Industry 'Homeworkers Code of Practice'
1.29 In evidence to the Committee, the Council of Textile and Fashion
Industries of Australia (CTFIA) put forward a draft proposal for a voluntary
'Homeworkers Code of Practice'. [17] The aim
of the code is to achieve the elimination of the exploitation of outworkers.
Its basic tenet is that all parties in the garment manufacturing and retailing
chain be accredited. Retailers would therefore only deal with manufacturers
who have been properly accredited and, in turn, manufacturers would only
deal with contractors and subcontractors who are themselves properly accredited.
The strength of the Code lies in the ability of retailers and manufacturers
to apply commercial sanctions to parties further down the chain if they
do not comply with the provisions of the Code. [18]
1.30 Others elements of the proposed Code include:
- the Code covers all parties operating within the garment manufacturing
and resale chain;
- the Code is underpinned by cascading contractual arrangements and
accreditation;
- accurate records will be kept by all parties and must be made available
upon request to retailers and the TCFUA;
- the system of payment to homeworkers is calculated as a rate per garment
based on the Clothing Trades Award 1982 (GSD - general sewing data [19]);
- where there is a failure or unwillingness to adhere to the Code, the
arrangements contained in Clauses 26, 27 and 27A of the Award will apply;
- there will be an organisation responsible for accreditation and review
(the actual organisation has yet to be decided);
- consumers will know that a garment had been made by labour paid according
to agreed rates through an appropriately worded 'swing tag'.
1.31 In seeking endorsement of the Code, the CTFIA has held a number
of meetings with the Union and with the Retailers Council of Australia.
It has also received support in principle for the proposal from some of
the larger garment retailers. [20] Just prior
to the publishing of this report, however, negotiations on the Code were
complicated by the introduction of further amendments proposed by the
Retailers Council which were not acceptable to the Union. [21]
1.32 In conjunction with the Code of Practice, the CTFIA recommended
that the Government provide assistance and financial support for an education
program to inform homeworkers of their entitlements and employers of their
responsibilities. [22]
1.33 Conclusions and Recommendations
1.34 The Committee notes the cancellation of the grant by the current
Government to the Textiles Clothing and Footwear Union of Australia for
outworker related activities. The Committee believes that the grant made
by the previous Government to the Union for outworkers activities had
already resulted in a number of beneficial outcomes. The Committee
recommends to the Government that in evaluating proposals for expenditure
from the TCF 2000 Development Package, consideration be given to the need
for outworker projects similar to those carried out recently by the Union.
1.35 The Committee endorses the approach taken by the Union in promoting
and establishing Deeds of Cooperation between the Union and garment retailers,
manufacturing companies and government purchasers of clothing. The
Committee recommends to all government agencies involved in clothing procurement
that they consider whether outworkers are used in the manufacture of that
clothing and, if so, whether they are able to enter into such Deeds of
Cooperation.
1.36 The Committee notes that a number of companies, including Target,
Ken Done and Country Road have become signatories to voluntary Deeds of
Cooperation which aim to ensure that outworkers are employed under proper
terms and conditions. The Committee endorses this approach and congratulates
those companies which have participated in such voluntary agreements.
1.37 The Committee believes that the draft voluntary industry 'Homeworkers
Code of Practice' originally promoted by the Council of Textile and Fashion
Industries of Australia could be an important step in changing the circumstances
under which outworkers are employed. The Committee fully endorses this
approach and encourages all parties involved in garment manufacture to
become parties to such a Code.
Footnotes
[1] Evidence, pp. E 38, 45, 851, 919.
[2] Evidence, p. E 27.
[3] TCF Future Strategies Committee Future
Strategies for the Textiles, Clothing and Footwear Industries 1996-2000.
December 1994, p. 16.
[4] ibid.
[5] Evidence, p. E 656.
[6] Textiles Clothing & Footwear Union of
Australia The Hidden Cost of Fashion - Report on the National Outwork
Information Campaign. March 1995. p. 18.
[7] Evidence, p. E 13.
[8] However, it should be noted that Country
Road has stated that by early 1997 all its garments will be produced
in manufacturing environments without outworkers. Press Release Country
Road 22 August 1996.
[9] Evidence, p. E 38.
[10] Evidence, p. E 839.
[11] Evidence, p. E 26.
[12] Evidence, p. E 656.
[13] Evidence, p. E 439; the full draft Deed
of Cooperation is given at Evidence, pp. E 441-449.
[14] Evidence, p. E 440.
[15] See for example, Evidence, p. E 334-5,
p. 345.
[16] Evidence, p. E 318.
[17] Evidence, p. E 822ff.
[18] Evidence, p. E 396-7.
[19] For a description see Evidence, p. E 894-5.
[20] Evidence, p. E 836 and 827, respectively.
[21] Letter dated 29 November 1996 from Ms
Lidia Jerkovic, Assistant National Secretary, TCFUA, and telephone conversation
with Mr Michael Iaccorino, CTFIA, 5 December 1996.
[22] Evidence, p. E 366.