Encouraging developments in worker awareness as ‘Together For Decent Leather’ project concludes

28 June 2023

How does state-sponsored health insurance help a shoe factory worker in Tamil Nadu’s Ambur? It could prevent the worker from falling into a debt trap while raising funds for a medical emergency. Though factories of Ambur, which is South India’s biggest leather manufacturing cluster, supply for high-end global brands, they pay their workers grossly insufficient wages, sometimes lower than the bare minimum (below Rs. 10,000 p.m).

Not many workers are aware of their claims under statutory benefits like the Employee State Insurance (ESI) that could go a long way in easing financial burdens. And that’s why it was surprising to see a group of workers from Ambur come together a few months ago to demand their rights. With the assistance of local activists and CSOs, they submitted a memorandum to the local taluk office asking ESI facilities (offices and dispensaries) to be extended to all parts of Tirupattur district and for a district-level speciality hospital to treat occupational health problems. The intervention helped and soon, the ESI department extended the facilities and sanctioned a dispensary in the area, recalls Kohila Senbagam, Project Coordinator (Leather sector).

Kohila says that the workers’ mobilization played a big role in this remarkable development. And this gathered momentum after the awareness creation done by the local Cividep team. ‘We were able to talk about ESI and other rights in detail to the workers as part of the Together for Decent Leather project, which concluded recently,’ she says.

Focussed Interventions Help

The Together for Decent Leather project, initiated in 2020, is a multi-country civil society consortium striving to improve working conditions in global leather supply chains across South Asia. The project comes to a close this year, after three years of collaborative work across partners in India, Bangladesh, Pakistan, Netherlands, Austria, and Germany.

Kohila and Cividep Program Lead Pradeepan Ravi have been at the helm of leather sector activities, since 2016. They say that more workers now know about worker rights, statutory benefits, and have developed leadership skills through Cividep’s training sessions. “Shoe factory workers protested when there was an instance of sexual harassment by a supervisor. The person was dismissed,” says Kohila.

Homeworkers (as seen in the pic above) too are now motivated to stand up for their rights. “They recently demanded that the village Gram Sabha (village council) formally recognise the local homeworkers’ collective,” says Pradeepan. Further, they collectively refused to take work from a subcontractor who was paying very low piece rates. “The project really helped workers experience the benefits of solidarity,” he says.

Through the project, Cividep has been able to reach out to more than 1000 workers (factory, homeworker and tannery) through training programs, health camps, and social security assistance. Additionally, a health and safety handbook has been designed in Tamil for leather homeworkers and tannery workers.

Labour abuses in supply chains uncovered. Leather and leather shoes from India

17 April 2023

The leather and leather goods industry in India makes a substantial contribution to global demands for leather and leather goods, as well as contributing a decent share to the country’s Gross Domestic Product (GDP). In 2019, Indian leather exports totalled about 5.5 billion USD and helped to employ nearly 4.42 million formal workers. All stages of leather production take place in India – from larger export tanneries and factories manufacturing leather goods to smaller workshops and home-based workers stitching leather uppers for shoes by hand. The sector is often
associated with poor working conditions, such as low wages, long working hours, health and safety issues, informal employment relationships and challenges when it comes to freedom of association.

New information about the working conditions in India, Bangladesh and Pakistan was gathered for the Together for Decent Leather programme. Three field studies were carried out in each of these countries. In this briefing paper, we provide an overview of the study’s main findings about the working conditions of leather workers in the state of Tamil Nadu in India. This briefing paper turns the spotlight on the leather cluster in Tamil Nadu, and how this cluster relates to the Indian leather industry and export market. An important aspect of this paper is the link that is made with international companies that are related to the Tamil Nadu leather industry – and therefore face potentiel risks in their supply chains. This report is based on the full field study report (which can be found here) published under the umbrella of Together for Decent Leather.

Download the report here.

Hides & Hardship. Caste-based discrimination in the leather industry in India, Bangladesh, and Pakistan

31 March 2023

Leather work is seen in India, Bangladesh, and Pakistan as dirty and undesirable. Many of the people who work in the industry – and in India the overall majority – occupy marginalised places in society and often lack any other livelihood option. They are vulnerable to exploitation and have little if any possibility of moving forward in work or in life to break the cycle of poverty and discrimination for themselves or their children.

A specific connection between caste and the leather industry can be identified, while a religious aspect is present as well, especially in India. Since religious minorities face many challenges in these three countries, the interlinkages between caste, religion, and leather work cannot be ignored when looking at discriminatory practices in the industry in these countries.

This paper shows that caste and related discriminatory practices, at times specifically interlinking with religion, are high risk factors for businesses that source leather or leather products from India, Bangladesh, or Pakistan. It explains how caste-based and religious-based discrimination presents itself in these countries and how this connects to the leather industry.

Download the report here

INKOTA/Südwind Austria

Label Check: Leather and Leather-Shoes

29 March 2023

Labour rights and social criteria are neglected by the most common leather and shoe labels. The shoe and leather industry does not sufficiently implement the requirements of the German Supply Chain Act, but hides behind voluntary standards. This is the result of a joint research by INKOTA and Südwind Austria.

„Consumers get no information about working conditions and social standards when buying leather goods and shoes; a blatant lack of consumer information. Companies advertise with standards that are not mandatory”, explains Berndt Hinzmann, senior policy advisor at INKOTA.

The six quality labels examined include the “Blue Angel eco-label for shoes”, “Oeko-Tex Leather Standard”, “IVN certified natural leather”, the “Austrian eco-label” and the two business-to-business certification systems “Leather Working Group (LWG)” and “Higg Brand and Retail Module (HiggBRM)”. Only two, the Blue Angel and the Austrian Eco-label, are based on legal regulations. The other schemes base their selection of technical, environmental or social criteria primarily on the interests of the companies involved. The majority of the certification systems described focus on the collection of environmental and material-related indicators.

None of the quality labels include information on living wages or the risk-based approach to due diligence. The certifications also have major shortcomings when it comes to social criteria: in the case of the Leather Working Group, the Oeko-Tex Leather Standard and HiggBRM, no social criteria are necessary for the award of the seal. With the Leather Working Group, it is even possible to obtain the “Gold Medal” label without a social audit. The HiggBRM does not make public any information at all that gives insight into the risk analysis and the measures companies take to minimise or avoid risks along the supply chain.

„There is an urgent need for action to address the structural risks leather and footwear workers are facing. We need a strong EU supply chain law and a review of the implementation of the German supply chain law. Accepting home-made, non-transparent industry standards is not the solution”, states Berndt Hinzmann.

The Decent Leather Label Check examines a selection of quality labels that companies referred to in the company survey “Human Rights Due Diligence in Practice”. The companies stated that they fulfill the requirements of the German Supply Chain Due Diligence Act via so-called business-to-business standards.

The Organisation for Economic Co-operation and Development (OECD) has identified leather production as a special risk sector. Massive labour rights violations are not uncommon in the production of leather goods and shoes. Low wages, extremely long working days and hardly regulated working conditions are the rule. In addition, there is intensive use of hazardous chemicals, inadequate protective equipment and far-reaching environmental risks.

Download the report here.

OECD side session on “Working better in leather”

29 March 2023

From 13 – 17 February 2023, The OECD organised a Forum on Due Diligence in the Garment and Footwear Sector. Arisa, on behalf of the consortium Together for Decent Leather, organised a (virtual) side session entitled “Working better in leather: stakeholder engagement and worker empowerment as key aspects of due diligence”. The session explored stakeholder engagement and empowerment of workers in the leather and leather products manufacturing industry in India, Pakistan, and Bangladesh.

Empower workers

While human rights due diligence laws are developing, research finds evidence of poor labour situations, including challenges for unionisation, regularly accompanied by a shrinking civic space. Challenges to worker’s rights in the leather sector in Bangladesh, India and Pakistan persist. Ashraf Uddin Mukit, executive director at Bangladesh Labour Foundation (BLF), and Farhat Parveen, executive director at NOW Communities (Pakistan), stressed during the side session that national and international stakeholders in the leather supply chain must collaborate with organisations on the ground such as BLF and NOW Communities. Organisations like theirs are in direct contact with the workers and have first-hand knowledge on the situations of workers. They empower and support workers by engaging in regular contact, trust-building, and training.

To improve their due diligence processes, companies should amongst others look into- and understand the full scope of the labour force at all stages of their supply chain, must speak and work with a range of CSO, be proactive in stakeholder engagement and companies should not wait until problems manifest to engage in dialogue to improve their due diligence, be transparent on their sourcing, source from unionised suppliers and factories, and apply fair pricing- and purchasing practices which enable suppliers to pay fair wages.

Improving due diligence

Elmie van Hoof, Sustainability Manager at Goosecraft (the Netherlands), acknowledged that due diligence topics are often complex for companies. According to her, companies are still learning they can benefit from discussions with various stakeholders. These discussions help to gain a better understanding of the realities of sourcing countries, which is essential for improving due diligence processes. According to Goosecraft, stakeholder engagement also helps to build stronger, sustainable relations with stakeholders.

There are multiple ways in which Goosecraft engages with stakeholders in relation to its due diligence practices. The company engages in meetings with stakeholders to gain information on on-the-ground situations. A good example of this is the meeting and continuous collaboration with NOW Communities, SOMO and Arisa. Based on these organisations’ research findings and long-term knowledge and experience of the situation on the ground, all stakeholders involved discuss labour conditions and the possibilities of change.

Meaningful dialogue

Jules Beelen, a representative of the Social and Economic Council of the Netherlands (SER), emphasised that the preparation phase of stakeholder dialogue is important to set it up more thoughtfully and be more effective. Their concept guidelines for companies to conduct and achieve meaningful dialogue with their stakeholders helps stakeholders collaboratively bring to light information, challenges, roles, ideas and necessary actions relevant for improving due diligence processes. The SER identified three preconditions to make collaboration work, namely that parties are able to provide a relevant contribution and are willing to cooperate, willing to invest time and resources to build up a collaborative relationship based on equality, and that the roles, tasks and expectations among the various parties are clearly agreed upon. The SER developed a concept of meaningful dialogue that provides information on how companies can engage with their stakeholders in a meaningful way. Download the document here.

SOMO

Unsafe and Underpaid: Working conditions in South Asia’s leather, leatherwear, and footwear factories

14 February 2023

Bangladesh, Pakistan, and India play a major role globally in the export of leather for further processing as well as for products, such as shoes, clothing, bags, suitcases, and belts. It is an industry that contributes significantly to these countries’ economies. There are approx. 200 mainly small and medium-sized tanneries in Bangladesh. Around 80% is produced for direct export and 20% for domestic processing. The main site is an industrial park in Savar, near Dhaka. There are also a smaller number of workshops and factories in the former tannery hub of Hazaribagh in Dhaka’s old town. Leather products, mainly footwear and accessories, are manufactured in the country’s many other production zones. Leather garments are produced in relatively low numbers. It is estimated that the entire sector employs more than 850,000 people.

Four recent regional studies on the leather industry and working conditions in Bangladesh, Pakistan, and India conducted in 2022 by the Together for Decent Leather consortium provide comprehensive information on the sector. The studies examine tanneries in Savar near Dhaka, tanneries and leather-processing facilities in Karachi in the Pakistani province of Sindh, and in the cities of Vellore and Ambur in the Indian state of Tamil Nadu.

All of the selected regions are key leather production hubs. The analysis is based on surveys of a total of 345 leather workers, interviews with local experts from civil society, business, and government, analysis of publicly available commercial data (e.g. concerning leather shoes produced in Bangladesh), as well as a survey of brand[1]name companies and leather importers. This factsheet summarizes the studies’ most important findings. Further details can be found in the respective publications.

Download the factheet here.

Tamil Nadu footwear sector minimum wage revision: A reminder for global brands to pay living wages

8 March 2022

Last year, in July 2021, the Tamil Nadu government notified the revision of minimum wages for workers employed in the state’s footwear manufacturing industry. This latest revision, although late by two years, assumes significance as it was announced at a time when workers in the sector were facing enormous hardships. While the state government revised the minimum wages, the key question is whether it is justifiable for the industry to continue to pay workers using minimum wages as the basis when they are still recovering from the debilitating effects of the pandemic?

Revised wages – does it make a difference?

As per the revised rates notified in July 2021, the minimum basic wage rate for an unskilled worker in Ambur is fixed at INR ₹4,843 per month. This is a 24 per cent increase from the basic wage rates fixed for this category of workers in 2014. Similarly, basic wage rates for other categories of workers in the footwear sector have also been increased proportionally. In addition to the increase in basic wage rates, all categories of workers are also eligible to receive a variable Dearness Allowance (DA) which is linked to the Consumer Price Index (CPI). At the outset this increment comes across as a progressive step towards increasing the wage standard for the industry, and any increment is a succour in these pandemic-ridden times. Nevertheless, it is pertinent to look at this wage revision in view of the current economic model.

The pandemic has made visible workers’ vulnerabilities in global supply chains like never before. Several studies have pointed out that low-wage workers do not have any savings to tide over crisis periods and they resort to borrowing money to make ends meet. One of the main reasons for this is the poverty wages that workers receive. It does not allow them to save for crisis periods. Since 2019, the rate of retail inflation in India has been rising consistently. In the last two years the average rate of inflation has been above six per cent. The price of essential commodities such as cereals, pulses, vegetables, fruits, meat and cooking gas has gone up. In light of this economic situation, the revision in minimum wages is nothing more than an eyewash that simply allows workers to sustain their hand-to-mouth existence.

Industry fixation with minimum wages

Low wages are one of the main features of employment in India’s leather and footwear sector. The main reason is that the industry prefers to use minimum wages as the basis for wage payment. Whereas in the footwear sector, a majority of workers are women who are not organised. Their lack of power to bargain makes it impossible to negotiate better wages with employers. This has resulted in stagnation of the wage rate for several years, leaving workers at the mercy of minimum wage rates set by governments.

The Minimum Wage Advisory Board set up by the state government decides the basic minimum wage rates. It follows a set of rigid criteria pronounced in the Minimum Wages Act, 1948. In practice, however, its process has been critiqued for not being completely transparent and for not having enough consultations with workers or their representatives. The very fact that revised wages were announced after a two-year delay, and without any measures to compensate workers for back wages points to this.

While suppliers stick to paying only minimum wages, the shortcomings of this are not completely unknown to international brands who source from footwear units in Tamil Nadu. International brands rely on social audits to ensure compliance with social standards in their supplier factories. These audits use minimum standards prescribed by local laws as indicators of compliance. The result is that such an exercise reinforces minimum wage as the standard wage for supplier factories. Although international standards encourage brands to pay living wages in their supply chains, they have not made any visible efforts to move in this direction.

Paying living wages is the way to go

We know from studies that the purchasing and other business practices of brands, and the standards they adopt to monitor their supply chains have a direct bearing on working conditions in factories. Therefore, shouldn’t living wages be the basis of labour costing in manufacturing contracts, instead of minimum wages? Unless brands address this question, it is very unlikely that suppliers will make real efforts towards paying wages above the minimum floor wage. While there are various efforts by civil society actors to push brands to review their purchasing practices, what is really required are statutory interventions mandating them to pay living wages to workers. The proposed EU-level mandatory Human Rights and Environmental Due Diligence (mHREDD) legislation has a huge opportunity to address this gap. If this law is successful in making it mandatory for brands to ensure payment of living wages, it would pave way for addressing many other connected supply chain-related risks to human rights. In addition, the legislation should also obligate brands to implement effective grievance mechanisms for workers, and ensure that freedom of association is respected. Providing an enabling environment where workers have the opportunity to bargain collectively for better wages will also contribute towards improved working conditions. Finally, a robust and ongoing system to conduct human rights due diligence in supply chains involving all relevant stakeholders would go a long way in mitigating social risks and maximising social outcomes.

This blog is written by Pradeepan Ravi from Cividep

Asim Rafiqui | NOOR Images

The impacts of the Covid-19 crisis on leather workers in Bangladesh, Pakistan and India

11 October 2021

The coronavirus pandemic has had a huge impact on the garment and footwear industry, particularly on workers. The Corona chronicles bring to light the dramatic consequences of the crisis on leather workers in Bangladesh, Pakistan and India by portraying six of them. They speak about their experiences during the first lockdowns in 2020 and how the pandemic has affected them in terms of employment, livelihoods, rights, and how they fear for the future.

Millions of people worldwide work to produce leather garments, leather footwear and leather accessories. This global production network includes various phases, from animal husbandry to slaughter; from the tanning of raw hides to the finishing of leather; from the cutting of leather components to the production of a wide variety of leather end-goods, such as jackets, trousers, shoes, gloves, bags, trunks, and accessories.

With the coronavirus outbreak, production came to an abrupt halt. The international transport system, including container shipping, was completely upset. Supply chains were disrupted due to a lack of inputs and later on by the cancellation of orders by brands and retailers.

The six stories in this paper – composed by SOMO – were selected from a substantial number of interviews conducted by BLF in June 2020 in Bangladesh, by Cividep in July 2020 in India, and by NOW Communities in September 2020 in Pakistan. Both Cividep and BLF have published reports and analyses about the impacts of coronavirus on garment and leather workers in India and Bangladesh.

Added to these worker testimonies, the paper presents a set of recommendations to governments and businesses, to ensure better protection of workers’ rights.

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The story of Amrita – India

8 June 2021

Amrita is a 50-year-old widow who works in a shoe factory in Ambur, a city in the Indian state of Tamil Nadu. The Corona pandemic has had a dramatic impact on Amrita’s life. When her workplace closed, Amrita lost out on her wages. She and her family suffered from hunger and she got herself into debt. Since the factory reopened, Amrita has had to work longer hours for less wages.

Single earner

As a single earner, Amrita takes care of a son and a daughter. Amrita lives with her son; her daughter is studying to become a nurse. When the Indian government proclaimed the lockdown in March 2020, Amrita’s daughter was doing an internship away from home. With the sudden lockdown, her internship was abruptly called off, and with the transport system not operating, she could not come back home. Amrita had to pay for her daughter’s accommodation in a hostel, expenses that were way above her budget.

Amrita lives in a modest rental house in Ambur. When Amrita’s wages were cut, she still had to pay full rent. The family received a one-time payment of 1,000 rupees as emergency relief from the state government, which was welcome but far from enough to make up for the financial hardship they faced.

The lockdown and the financial stress were also felt in other ways. The marriage of Amrita’s son had to be postponed. Big gatherings were not allowed during the lockdown and the marriage was not financially feasible either. In the same period, the family could not attend the funeral of a relative, as there was no way to reach the ceremony location.

Amrita’s factory

The factory where Amrita is working produces uppers for women shoes. Amrita’s job is fusing, putting together the leather parts. This factory is part of a big privately-owned group, which owns several companies. The group produces shoes for men and women as well as finished leather, both for the domestic market and for export destinations.

Massive lay-offs

When Amrita’s factory reopened in late May 2020, Amrita could resume her job. Many co-workers, however, were not called back. Of the 1,500 people working in her factory almost half of the workers were laid off after the lockdown was lifted. Before the Corona crisis the factory had 15 production lines; now only six or seven lines were kept running. Temporary workers and helpers were most affected; they were dismissed first. The factory management told the workers that the dismissals were the result of a reduced number of orders and that the factory would make losses if the entire workforce was kept on. Dismissed workers did get a sum of money as compensation, the amount depending on the time they had worked for the factory, but definitely not enough to make up for the loss of employment.

Health and safety measures

One point that Amrita was positive about were the health and safety measures that were introduced by management in the factory. She mentioned the screening of workers’ temperatures and the provision of sanitizer at the compound’s entrance. Workers are instructed to wear masks, and keep a safe distance from each other. Inside the factory, however, no additional facilities for washing hands have been installed.

More work, less pay

During lockdown, as well as since Amrita started working again, she has not received even a third of her normal salary and no festival bonuses. She said that she had no hopes to ever receive her back wages. After the factory reopened, management introduced a new workplan: Amrita now has to work nine hours every day, instead of the eight hours she used to work. This is six hours of extra work per week. The pay, however, is significantly less than before the lockdown. Instead of 7,000 INR (a mere 79 EUR) per month, Amrita now only gets 6,500 INR (73.4 EUR). Overtime hours are not paid at the proper rate. Amrita does not have an employment contract, so she cannot take formal legal action to address this.

Corona in India

The India garment and footwear sector has been badly affected by the Corona pandemic. Early 2020, the import of key inputs like chemicals, adhesives, dyes and footwear components such as soles, buttons and zippers was severely interrupted, which badly impacted production capacity in the various leather hubs in India. The lockdowns in the US and the EU in the first quarter of 2020, including closure of retail shops, further disturbed production the sector, as it brought the demand for leather products to an immediate halt. As a result, many factories and workplaces in India closed. Late March 2020, the Government of Indian called for the first domestic lockdown, causing further havoc to India economy. In April 2021, a new wave of the Covid pandemic hit the country, forcing the country again into regional lockdown. Only since early June 2021, with case numbers declining, Indian states started easing lockdowns.

Sudwind

Trends in production and trade: Leather products from India

19 May 2021

The leather sector in India takes up a prominent place in the country’s economy. It is known for its high consistency in export earnings and is placed in the top 10 of foreign exchange earners for India. This overview of trends in the production of leather and leather goods in India bundles together information on key products produced in India, as well as key export markets for its leather and leather goods. The report maps key leather manufacturers and buying companies.

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