Companies which contract clothing manufacturing in Australia face a growing array of commercial challenges.
Recent years have witnessed repeated instances of designer labels being manufactured in garages, back yards, and in individual’s homes. These situations are, frequently, the downstream effect of deficient internal systems within fashion houses.
Insufficient capacity to accurately track the outsourcing of production has combined with inadequate real time quality assurance, to create a range of substantial commercial risks for the unwary fashion house.
Failure to secure strategic oversight in relation to outsourced production can undermine the corporate capacity to control key production parameters such as product quality and adherence to directed time constraint commitments. Resulting logistical problems may have very real implications for the integrity of intellectual property assets as well as potentially exposing companies to unforseen legal liabilities for which there are heavy penalties.
The Union is prepared to work cooperatively with any fashion design house committed to a clean clothing industry which profits from its efficiency, transparency and productivity.
This outcome can only be facilitated by the adoption of well organised systematic approaches to contracting on the part of fashion houses. To this end, the Union encourages your company to contact us to discuss the status of your supply chain, and to work collaboratively on its improvement.
For Companies wishing to become recognised as ethical under the NoSweathopLabel accreditation process, please first ensure that you are Award compliant. Award compliance is a core criteria for accreditation.
Tips for Brands and Fashion Houses:Getting Your Supply Chain in Order!
Contrary to popular belief amongst fashion houses, our Union is NOT “out to get you.”.
In fact, a lot of our time and resources are put to assisting businesses’ – large and small – get their contracting practices above board and better streamlined.
“Why would the Union do that?” I hear you ask.
Simple really: a well organised, well thought out supply chain, where records are kept and manufacturers checked is at least 3 times more likely to support legal employment conditions for workers. And that is good news to us.
On the other hand, the supply chains we see 90% of the time are in disorderly mess. Factory Registration has not been sought by contractors, many of whom are in houses or garage sweatshops and contracting their work to homeworkers for cash: off the books. Employment records are not kept, super is not paid and workers comp is a miserable joke.
A large proportion of the work – at least 3 quarters, is undertaken by outworkers who have been refused factory jobs, and refused legitimate work as homeworkers by unscrupulous subcontractors who persist in skimming money out of the clothing supply chain to line their own pockets.
These outworkers, who exist at the bottom of the supply chain, more often than not subsist on cash payments, and irregular work. Their income is highly uncertain, and hours of work are blown out by rush orders which have been passed through several hands before the work even makes it to them, thus shortening the amount of time allowed for completing the work. This frequently causes outworkers to work round the clock during busy periods. Many of these issues of price and hours are directly caused by bad planning and checking systems on the part of the fashion house in question!
The simple truth is this: THERE ARE JOBS to be had in the clothing trades, that pay the minimum wage or above, particularly for skilled and experienced machinists. Yet we still find these workers getting $3, $6, $8 an hour.
Largely, the problem arises at the sub-contracting level, where the heretofore legitimate factory you thought was doing your work actually subs it out further…. The work, in the legal sense then “disappears”. There are invoices yes, and an address, yes, but the address turns out to be a school, a temple… or a hole in the ground… or Strathfield plaza… I kid you not. All the mobile numbers turn dead, and the contractor turns coy about the person to whom the work was ultimately given.
How is this the fashion house’s fault?
Well a few problems which continually repeat are these:
Work flows across contractors:
There are many instances where a fashion house will run production across a 9 month year, and have work to give (we all know the industry has dead periods) BUT they split the production across contractors unnecessarily, leaving smaller manufacturers more often than not, floundering for large stretches of the year.
Failure to keep a sewing time:Logic: a missing factor in the contracting practices of many fashion houses. The requirement for companies to issue a sewing time when contracting out manufacturing is being ignored. It’s a legal requirement under the Award. Start keeping one and providing it to your contractors when you issue make/production sheets. There are systems available to fashion houses, such as the Garment Sewing Data program (available under the Homeworkers Code Accreditation process) and resources such as time and motion engineers which can be called upon to calculate sewing times. If a fashion houses calculates the time themselves, using for example, their sample room, the time must be demonstrably accurate to real life conditions. If the fashion house cannot prove how a sewing time was come by, it is taken that they are not abiding by the Award. Prices which do not reflect the labour cost component:
Profits and overheads aside, a lot of costings for contracted manufacturing are completely illogical in this industry. How do you expect a contractor to legally produce your label if you don’t pay them enough to cover the minimum Wage, Super and Workers Comp?
If these calculations do not form a part of your internal logic then do NOT be surprised when the Union finds your work being performed for cash, at home, by someone working for half the minimum wage.
This farcical contracting must stop, and the Union is taking serious action against those businesses who continue to perpetuate this illegitimate and irresponsible behaviour.
However, we are also giving those fashion houses who may not have been aware of the problem a heads up.
Here it is: Put Your House In Order.
If you want assistance on the Award requirements for record keeping, the Union would be happy to oblige.
If you want assistance to evaluate the risks posed to fashion houses throughout their supply chain, the transparency provisions in the Award allow the Union to assist you there as well., Great success has been achieved recently through rational discussion between the fashion house, the manufacturers and the Union all at the same table, where solutions to problems arising in this seasonal and highly volatile industry can be discussed.
Use your common sense. Evaluate your contracting practice with an eye to ensuring that the work CAN be performed legitimately, put yourself in your contractors shoes.
We encourage you as a fashion house, to contact us if you need assistance with your supply chain. We will work with you to ensure that –at the end of the day, the workers manufacturing your designs are receiving at least their minimum entitlement under the law and that they are working in safe and healthy conditions.
Questions?
Call our Assistant Secretary Steve Davies on
(02) 9789 5233
