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Decent Work in Global Supply Chains

Chapter 6.4 Supply chain bargaining: the example of the ACT Initiative

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An example is the cooperation of apparel MNC operating in Cambodia and IndustriALL. They sent a letter dated 18 September 2014 to the government of Cambodia and the Garment Manufacturers Association in Cambodia (GMAC), urging them to foster collective wage bargaining by involving all of the vested parties, namely the government, the trade association and the workers' representatives.
Below are a couple of extracts from the letter:

"[…] Workers in all production countries have the right to a fair living wage. To ensure this, we expect an assured, inclusive and consistently applied national collective bargaining process between the legitimate parties within the labour market. This process must allow consideration of suggestions brought to the bargaining table by all parties, including the labour, employer and government representatives. […]
We further expect the installation of an annual industry collective bargaining process for wages that is fair and takes into account the ILO technical expertise. We will support the installation of this process by working closely to promote mature industrial relations through capacity building with our suppliers, their factories and the labour representatives, optimally via the BFC platform. […]".

As a result of negotiations between the parties, on 12 November 2014 the Cambodian Government announced a new minimum salary of $128/month for the garment and footwear sector for 2015, which represents a 28% rise. This is an achievement which, thanks to technical support from the ILO and the agreement between unions, employees and the Government, aims to guarantee that each worker enjoys a standard of living that is compatible with human dignity, as set out in the Cambodian Work Act.

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