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Wage and Workers’ Voice: Labour and Global Production in Cambodia

Wage and Workers’ Voice: Labour and Global Production in Cambodia. Dennis Arnold Postdoctoral Fellow Mellon Foundation Sawyer Seminar, ‘Precarious Work in Asia ’ University of North Carolina at Chapel Hill arnold.dennis@ gmail.com. Presentation overview.

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Wage and Workers’ Voice: Labour and Global Production in Cambodia

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  1. Wage and Workers’ Voice: Labour and Global Production in Cambodia Dennis Arnold Postdoctoral Fellow Mellon Foundation Sawyer Seminar, ‘Precarious Work in Asia’ University of North Carolina at Chapel Hill arnold.dennis@gmail.com

  2. Presentation overview • FOCUS: Do garment workers in Cambodia have the collective voice and ability to negotiate a living wage? Which factors or institutions shape outcomes? • Role of the state • Trade patterns and ‘competitiveness’ • Challenges for workers and trade unions • Living wage negotiations and the 2010 strike

  3. Changing role of the state • Decades of war left state eviscerated and without an autonomous development agenda • Cambodian Peoples’ Party entrenched from ~2008 • Shrinking space for independent or opposition trade unions, and other civil society org’s • ‘Rule of law’ considered weak • Lacking economic development policy implementation

  4. Textile and garment industry basics • Nearly 350,000 directly employed in 2011 • Production-related employment 53% of total generated (EIC 2007) • Cambodians employed in lowest skill/wage jobs • 85-90% of workers are rural-urban migrant women • Garments roughly 90% of annual export revenue (~70% to USA) • Low value added garment assembly • Product and market concentration=vulnerable

  5. US Imports of Male and Female Cotton Shirts and Trousers Top 5 (plus Cambodia, #6), US$ Millions (MFA Product Categories, Safeguard Items) Source: USOTEXA

  6. Cambodia in global apparel sourcing • Not deemed competitive in price, quality and speed to market • Prices considered high compared to CMT’competitors’ • Shielded by MFA quotas and safeguards until 2008 • Economic upgrading minimal • Low wage and BFC monitoring primary competitive advantages

  7. Challenges for workers and unions • Fixed duration contracts • Unregistered subcontracting factories • High proportion of trade unions • Low wage often requires excessive OT • Indicates social downgrading to compete in global markets • Weak position vis-à-vis employers and government

  8. Living wage • Living wage = US$93 per month (CIDS 2009a) • Absolute minimum ‘Survival Wage’= US$72-US$75 per month (CIDS 2009b) • $61/$56 per month = New minimum wage from October 2010 through 2014 • GMAC claim average wage is $94 (July 2011) • Averages include OT, allowances, bonuses, etc

  9. Wage negotiations and the 2010 strike • No rationale for the US$5 increase • Claims of trade unions co-opting to employers and gov’t positions • Arbitrary court rulings during strike & threats from gov’t officials • Employers seek to destroy leading unions and sack activist workers • Tri-partite negotiations in form, but not in content

  10. Conclusions & questions • BFC help build IR system in Cambodia • Unions and workers “part of the process” • Initial steps for state as mediator (?) • GMAC (employers) appears intransigent • Recent mass faintings—wage, welfare issue unresolved • How to facilitate social & economic upgrading in bottom tier sourcing countries? • How to ‘internationalize’ a living wage in textile and garment GPNs?

  11. Key Findings • Decent work challenges for Cambodia’s garment workers: • fixed duration contracts, • unregistered & unmonitored subcontracting factories, • high proportion of trade unions, • global apparel sourcing and trade fluctuations. • Shrinking space for trade unions and civil society organizations • Confrontational industrial relations environment, despite rigorous monitoring programs. • Living wage negotiations highlight power imbalances in Cambodia’s emerging industrial relations, but also opportunities. Title of paper: Wage and Workers’ Voice: Labour and Global Production in Cambodia Name of presenter: Dennis Arnold Email address: arnold.dennis@gmail.com

  12. Recommendations (Specify if recommendation is for Governments (host, donor, trading partner):Businesses (buyer, supplier); International Organization • Gov’t, Business and IOs: Recognize living wages and ensure implementation. • Buyers & suppliers: Disclose unregistered subcontracting factoriesand bring into monitoring systems; eliminate misuse of fixed duration contracts. • Gov’t, Business and IOs: Identify unique needs of bottom tier sourcing countries and facilitate social & economic upgrading. Title of paper: Wage and Workers’ Voice: Labour and Global Production in Cambodia Name of presenter: Dennis Arnold Email address: arnold.dennis@gmail.com

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