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Covid-19: A global approach to protecting garment workers in supply chains as Cambodia faces up to 500,000 job losses

Garment factory workers like those pictured are facing an uncertain future as major orders are lost. KT/Pann Rachana

The Garment Manufacturers Association in Cambodia (GMAC) has stated approximately 60 percent of its factories have been severely affected by cancelled orders of ready-made garment exports, due to the COVID-19 pandemic.

Ken Loo, secretary-general of GMAC told Khmer Times that the majority of buyers of Cambodian garments and textiles have already cancelled their orders. However, the association could not put a specific monetary value on what the cancellations will cost.

“A large majority of buyers have cancelled orders with our factories, however, we have not been able to determine a specific dollar value, as of yet. We do know that the bulk of these cancelled orders have come from both the US and EU markets, which represent 28 percent and 46 percent of our export market respectively,” Ken said.

“If we do a calculation on these two figures we reach 74 percent, out of the approximate 750,000 workforce in the garment sector – this equates to around 500,000 workers that have been impacted by these cancellations,” Ken added.

Magnify this problem globally and the situation becomes totally dire. Apparel companies around the world responded to the Covid-19 crisis with an immediate resort to the risk-mitigating measures built into global supply chains. Their mass cancellation of orders has left factories around the world without cash to pay their workers.

A statement by the International Organization of Employers (IOE) and Global Unions published Wednesday provides a collective approach to mitigating the massive loss of life, jobs and income in garment supply chains caused by the Covid-19 pandemic.

The joint statement endorsed by trade unions and employer organizations sets brands and retailers upon a much needed path of addressing this global crisis in a collaborative manner and in cooperation with worker representatives.

Brands endorsing this statement commit to a minimum of immediate measures such as paying for orders in production, engaging with governments and international financial institutions to take responsibility for establishing funds to address the immediate needs of workers, and strengthening social protection floors in supply chains.

It is essential that all parties act upon the commitment in the joint statement to move with utmost haste to secure funding from international financial institutions to sustain workers’ incomes.

This funding must serve to maintain workers in current employment relationships; deliver support to all workers who were making apparel or textiles at the outset of the crisis, regardless of job classification, contractual status, or migration status; and ensure that this support is sufficient to provide workers with at least their normal take-home income for as long as the crisis persists. This funding must be accompanied by time-bound commitments to strengthen social protection systems.

It is of utmost importance that brands and retailers do not cancel orders, do not seek sanctions or discounts, and pay suppliers for all orders completed or in production, as the statement sets forth, and that they do so in full and on the original payment terms, in order to avoid exacerbating the crisis, forcing suppliers into bankruptcy, and causing widespread job loss.

Labour rights organizations united in the Clean Clothes Campaign global network are urging all brands and retailers that are still refusing to pay for orders to do so immediately and will be monitoring whether brands and retailers that have committed to do so are keeping their promise. It is vital that brands start paying for their orders as soon as possible, as workers around the world are still waiting for their March wages.

Decades of prioritizing cost reduction and profit maximization over workplace safety and living wages by brands and retailers, have left workers across apparel supply chains with virtually no protection against the economic fallout of the pandemic.

Pricing and purchasing practices along with tax reduction mechanisms and union busting have contributed to underfinanced and inadequate public health and social security systems in many garment producing countries.

To mitigate the crisis and to ensure that workers are never again left so unprotected, it is essential to rebalance power relations, reduce inequalities built into supply chains, and reform the garment sector’s buying practices and labour relations in the medium and long term. Brands and retailers must negotiate and sign enforceable agreements with unions that obligate them to pay higher prices for products, with those additional funds directed to paying living wages to workers and to supporting government social insurance systems and other means of social protection for workers.

Garment supply chains of the future need to be characterized by new costing models, allowing for social security systems and living wages, as well as transparent and enforceable regulations. EcoTextile

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