- September 13, 2018
Sourcing from the Worst Low-Cost Countries?
Written by Russel Beron September 12, 2018
The International Trade Union Confederation (ITUC) recently released it’s 2018 Global Rights Index, a report examining working conditions across the globe. Not surprisingly, some of the key low-cost global retail sourcing countries made the list in a big way.
If this report is an indicator, global conditions for workers are mostly not good and multinational brands and retailers doing business around the world should probably pay attention. The top ten offenders included Algeria, Bangladesh, Cambodia, Colombia, Egypt, Guatemala, Kazakhstan, the Philippines, Saudi Arabia and Turkey. China, Indonesia and Brazil also made the list. Some of the factors considered were restrictions on basic rights and freedoms and limitations on the ability to organize and speak out.
Countries and Regions
According to the report, retailers need to be careful and implement strong supply chain management software when sourcing from the worst regions in the world. Some of the worst regions for workers and retail sourcing were the Middle East and North Africa (MENA), where ongoing wars and conflicts in Libya, Syria and Yemen, were impacting worker rights. Labor movements in Algeria and Egypt were crushed by authorities. Countries such as Saudi Arabia are notorious for ill treatment of migrant labor workers and are routinely exploited, left unpaid and even lashed and imprisoned.
Retail supplier management automation is also recommended in the Asian regions of China, Indonesia, Korea, Myanmar, Cambodia, India and Bangladesh as they were all noted for worker intimidation, anti-union measures and exclusion from labor laws.
Africa and the South America were noted for extreme violence and repression, notably in Colombia, Guatemala and Brazil, where trade unionists are regularly murdered. Europe is mostly noted for the effects of austerity measures which have eroded collective bargaining agreements, workers right to strike were violated and workers were excluded from labor law.
Workers were exposed to physical violence in nearly half of all countries in the 2018 Rights Index. Murders of trade unionists occurred in nine countries: Brazil, China, Colombia, Guatemala, Guinea, Mexico, Niger, Nigeria and Tanzania.
Under international labor standards, all workers without distinction have the right to freedom of association. However, in 2018, 92 out of 142 countries surveyed excluded certain categories of workers from this right, often on the basis of their employment status. In a number of countries, certain categories of public employees are still denied the right to freedom of association, like firefighters and prison staff in Japan. Migrant workers, domestic workers, temporary workers, those in the informal economy and workers in the platform economy usually fall outside of the scope of labor legislation. Temporary agency work was on the rise with 40 million workers worldwide, predominantly in the United States, China, Europe and Japan. Workers in precarious forms of employment, such as part-time work or workers in temporary employment, were frequently excluded from the enjoyment of collective labor rights. The use of these forms of contract has grown globally in recent years.
Workers in the informal economy are particularly vulnerable to abuses, as they are excluded from labor laws in many countries: they are exposed to inadequate and unsafe working conditions, earning less certain, less regular and lower incomes, enduring longer working hours, deprived of the right to collective bargaining or representation and often under-employed or in ambiguous employment status. As retailers select their suppliers mostly based on price and often select suppliers in informal economies, it is imperative to have an extended quality sourcing solution that also automates the supplier management process.
Not all the companies and countries under the spotlight were in low income countries. Amazon was accused of having “intolerable working conditions in low-paid, insecure jobs” in their warehouses in the UK and the USA. Worker strikes took place at Amazon logistics centers in Italy, Germany and Spain for better pay and working conditions. Samsung in South Korea was also noted for its anti-union practices.
Also in South Korea, General Motors was singled out for hiring large numbers of “temporary” workers, who are paid 40-50% less than regular employees for the same work.
Global trends for 2018 that were identified in the report include: the rise of repressive regimes, continuation of armed conflict, the failure of democracy and the growth of corporate influence on worker rights and legislation. Model countries identified were New Zealand, Iceland and Canada.
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