Toward fair compensation in global supply chains: factory pay assessments in 21 countries

Overview

The compensation element of the FLA’s Workplace Code of Conduct begins with the affirmation of workers’ right to fair compensation. In pursuit of progressive realization of this standard, FLA and its stakeholders—buyers, suppliers, labor rights organizations, and universities—are part of a global effort to improve compensation for workers in global supply chains.

As a contribution to this effort, the FLA presents a first-of-its-kind report that details worker compensation data collected by the FLA in 2015 in mainly apparel and footwear factories. It describes the FLA’s method for due diligence on compensation, a uniform process that enables stakeholders to collect and compare findings.

The report also aims at helping buyers and suppliers set priorities for their efforts to generate measurable and sustainable progress towards compensation that meets the FLA Workplace Code of Conduct standard.

Activities / Outputs / Results

Factory compensation data were collected, organized, reported, and analyzed to present a detailed report, with actual compensation figures in the context of national-level debates over pay. This report suggests 3 key lessons that will help direct the FLA and its stakeholders in determining the next steps toward fair compensation:

Legal pay violations continue
FLA compensation data indicate where average worker compensation buys the least
Legal minimum wages appear to be a primary factor in determining factory compensation levels

The report does not prescribe wage levels to be paid, and does not endorse any sourcing country over any other. Rather, it is intended to help all FLA-affiliated companies--wherever they are sourcing--achieve fair compensation throughout their supply chain, and to publicly present a first annual package of verified data useful to all stakeholders participating in global discussions on supply chain wages.