Time for a living wage around the world

by Medea Benjamin

Global Exchange, Fall 1998

In the midst of a crushing economic crisis, Nike workers in Indonesia now make ten cents an hour and live in dire poverty. Dominican workers sewing pants for JC Penney make 60 cents an hour, which is one-third of what the Dominican government says a family needs to meet its basic needs. Chinese workers making expensive shirts for Ralph Lauren earn 23 cents an hour to work 15 hour shifts, six days a week.

Yes, life is certainly less , expensive in China than it is in the United States, and workers overseas are not asking for US wages. But they are asking for wages that allow them to cover their basic needs and live a dignified life. They don't want mere survival wages; they want wages that will pull them out of poverty.

In an effort to come up with a common definition of a living wage and a strategy to push the garment industry to pay decent wages, some 50 key anti-sweatshop activists from around the world came together in July for a conference in the San Francisco Bay Area organized by Sweatshop Watch and Global Exchange. Participants included workers, activists, unionists and academics from around the U.S., as well as from China, Mexico, Central America, the Dominican Republic, Canada and Europe.

Individual company Codes of Conduct and the code devised by the White House Task Force on Sweatshops say that workers should earn at least the legal minimum wage or the prevailing wage of the industry. But in many countries, the minimum l wage is deliberately set below subsistence by governments trying to attract foreign investors. These rock-bottom wages force workers to add exhausting hours of overtime in order to make ends meet.

In order to eliminate sweatshops, minimum wage or prevailing industry wage is not enough. Companies must undertake studies of what the cost of living is in the various places their goods are being produced, and pay workers-for a normal work week not exceeding 48 hours-enough to fulfill those basic needs.

A sub-group of the conference focused on developing a formula at for calculating a living wage in any given country or region of a country. The formula takes into account the average number of family members in a region, the average number of adult wage earners per family, as well as various categories of essential expenses: housing and energy, food and potable water, clothing, education, child care, health care and transportation. The formula adds 10 percent for savings. The formula addresses actual take-home pay, after deductions for taxes, social security and national health insurance. Several conference participants plan to start "market basket" surveys in various countries to test the formula on the ground.

Right now, there is no company that has publicly acknowledged its responsibility to pay workers a living wage. A subcommittee formed at the conference will target certain companies for a high-profile pressure campaign. Immediately following the conference, some of the participants met with Levi Strauss and an umbrella business organization called Business for Social Responsibility to ask them to sponsor wage studies.

During the past school year, students on a number of campuses negotiated with their administration to adopt codes of conduct for licensees who act as go-betweens between the university and businesses that produce goods with the university's logo. These negotiations have been taking place at universities such as Duke, Brown, Harvard and the University of California. While these codes address issues such as child and prison labor, they do not make companies responsible for paying a decent wage. Students at the conference, representing not only their own schools but a newly formed group called Students United Against Sweatshops, will return to their universities to seek inclusion of a living wage provision in their codes. And students on campuses which have not yet adopted a code will now make a living wage a demand in their negotiations. Exposes such as the one recently done by the U.S. garment union UNITE show that Dominican workers earn a miserly 8 cents for making university baseball caps that sell for $19.95, and this will add fuel to the campus-based organizing effort.

Companies that cry poverty when asked to pay their workers a living wage ought to look at management compensation as a place to trim the fat. While U.S. CEOs make an obscene 326 times the salary of the average U.S. factory worker, they make 27,710 times the average Chinese or Indonesian factory worker! The inequalities are obscene, and pointing this out to shareholders, consumers and workers themselves will be a key component of the living wage campaign.

The conference participants recognized that in countries where democratic, independent unions can bargain contracts, workers will decide for themselves what wage to demand in contract negotiations, rather than relying upon a complex algebraic formula. Moreover, we recognize that worker empowerment, through organizing independent, democratic unions or associations, is the most important ingredient for eliminating sweatshops. All anti-sweatshop efforts should therefore give support to organizing efforts by workers themselves. In countries like China or Free Trade Zones in many regions where workers are not able to freely stand up for their rights, consumer-based campaigns can be a critical interim measure to advocate for decent jobs for all garment workers.

What can you do ?

Contact Nike and ask them to pay their overseas workers a living wage, which would be a mere $3 a day in Indonesia, Vietnam and China-the countries where Nike makes most of its shoes. A $9 billion-dollar company that pays athletes like Michael Jordan millions just to wear the shoes, Nike can certainly afford to pay the workers who make the shoes $3 a day! Call Nike at 1-800-344-6453, then press 3, or write CEO Philip Knight at Nike, 1 Bowerman Dr., Beaverton, OR 97005 or contact them through their website at www.nikeworkers.com.

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