University of Cape Town

The copyright of this thesis vests in the author. No quotation from it or information derived from it is to be published without full acknowledgementTown of the source. The thesis is to be used for private study or non- commercial research purposes only. Cape Published by the University ofof Cape Town (UCT) in terms of the non-exclusive license granted to UCT by the author. University A study of changes and continuities in the organization and regulation of work with an empirical examination of the South African and Lesotho clothing/retail value chain Town Shane David Godfrey Cape of Thesis presented for the Degree of Doctor of Philosophy in the Department of Sociology, Faculty of Humanities, University of Cape Town University February 2013 Supervisor: Emeritus Professor Johann Maree 1 Dedication To my late parents, John and Eileen Godfrey. Town Cape of University 2 Acknowledgements I have worked and interacted with many people over the years who have added to my experience as a researcher and influenced my thinking, all of which has indirectly benefitted this study. It would be impossible to list all of them but I would like to acknowledge in a general way their contribution to the on-going process that led to this thesis. Having said that, I would like to name for special thanks two people, without who this thesis would probably never have been written or would have been much the poorer. I owe a tremendous amount to my supervisor, Johann Maree, who has had a great influence on my academic development over the years and who was also instrumental in obtaining the funding for the scholarship that enabled me to complete the study. I also want to thank Jan Theron, my long-timeTown colleague in the Labour and Enterprise Policy Research Group (LEP), who has had a profound intellectual influence on me and who gave me space within LEP to work on the thesis. Finally, I would like to thank the anonymous donor who provided the funding for the scholarship that allowed me to take off significantCape blocs of time to work on the thesis. His or her generosity was essential to meof being able to finish the thesis. I would also like to acknowledge the contributions of the many, many interviewees who participated in this study. All gave up valuable time in order to share their experience and insights. Without the information that they provided to me this dissertation would have been impossible to complete. I owe them my sincere appreciation. University Finally, I would like to thank my wife, Estelle, and my son, Lawrence, for their patience while I brooded about or worked on the thesis. The space and time they gave me was essential, as was the impetus they occasionally gave me when their frustrations boiled over. And, of course, there is also Twinkle, who constantly reminded me that it is the simple things in life that count. 3 Abstract The thesis uses world-systems analysis, together with the role of modern legal systems, to examine continuities between the early history of capitalism and aspects of contemporary capitalism. The focus of these continuities is the legal forms through which firms organise work and arrange employment, which relates to how labour is utilized and controlled. Once industrialization gathered momentum industrial capital asserted itself over commercial capital. The high point was the period of Fordism, which also saw the consolidation of the standard employment relationship and entrenchment of comprehensive labour regulation in developed countries. From about 1970 the Fordist model began to unravel, large corporations Towndecentralized, production facilities were relocated, employment was externalized and casualized, labour regulation rolled back, and huge retailers emerged that play an increasingly important role as controllers of global, regional and local value chains. World-systems analysis allows one to situate Fordism and the more recentCape period of ‘flexibility’ in a long-term historical context, and within a widerof geo-political and economic development context, in order to better understand how the legal forms of property and contract are able to accommodate but maintain control over different work and employment arrangements to the detriment of labor regulation. But firms take account of labour regulation when restructuring so it is an important influence on the way in which work and employment arrangements are organised. University The methodological approach was broadly deductive rather than inductive. Besides the historical and theoretical framework provided by world-systems analysis, together with the addition of a legal dimension, different sets of secondary literature were synthesized to examine developments with regard to the employment relationship, management control, the legal form of the firm, the changing organisation of work and employment, and global value chains and production networks. All of the above literature was used to develop a set of research questions and informed the empirical component of the research. 4 The empirical focus of the thesis is the clothing and retail segments of the local and regional value chains in parts of Southern African that comprise different geographical and regulatory zones. Secondary literature on the clothing and retail sectors was examined, but the main research method was interviews with senior managers of retailers, clothing manufacturers, design houses, cut, make and trim (CMT) operations, as well as key informants. The interviews focused on understanding the relationships that link different stages of clothing production with the retail sector. This research was largely exploratory and illustrative: it tracked differently structured value chains and sought in-depth ‘factual’ data on the relationships in the clothing/retail value chain, as they had previously been constituted as well as the ones that are forming and re-forming as the industry restructures. There are significant continuities between earlier forms of contracting for work and contemporary trends such as externalization. These continuitiesTown derive from the flexibility of the underlying private law institutions of property and contract. The difference is that labour regulation is much more prevalent now than in the earlier period, even if it has weakened since the endingCape of Fordism. Labour regulation is therefore a key factor that shapes the architecture and geography of the regional and local clothing industry, providing a moreof complex series of core, semi-peripheral and peripheral zones. Another important factor is the power of the retail sector vis-à-vis clothing manufacturers. The process of segmenting the clothing production process and relocating its components has been facilitated by the embedding of management control in the structure of the production process through an advanced division of labour. Retailers Universityand design houses can now transfer control down the value chain through a focus on quality and on-time delivery, leaving direct control of production workers to the owners of CMTs. The latter are also responsible for the labour regulatory obligations attached to the employment relationship. The flexibility that property and contract law allows to capital is being matched by flexibility in the arrangement of work. This poses a major challenge for labour regulation. 5 List of Acronyms ACP African, Caribbean and Pacific (Group of States) AGOA African Growth and Opportunity Act AMSA Apparel Manufacturers of South Africa ANC African National Congress ATC Agreement on Textiles and Clothing BLNS Botswana, Lesotho, Namibia and Swaziland BWL Better Work Lesotho CLOFED Clothing Federation CMT Cut, Make and Trim Town COMESA Common Market for Eastern and Southern Africa COSATU Congress of South African Trade Unions CSP Customised Sector Programme CSR Corporate Social Responsibility DCC Duty Credit Certificate Cape DTI Department of Trade and Industry EAC East African Communityof EBA Everything But Arms EPC Electronic Product Code EU European Union FTA Free Trade Agreement GATT General Agreement on Trade and Tariffs GCC Global Commodity Chain GEAR Growth, Employment and Redistribution GEIS UniversityGeneral Export Incentive Scheme GMROI Gross Margin Return on Investment GNP Gross National Product GPN Global Production Network GSP Generalised System of Tariff Preferences GVC Global Value Chain HR Human Resources ICT Information and Communication Technology IDC Industrial Development Corporation IDP Industrial Development Plan ILO International Labour Organisation IPAP Industrial Policy Action Plan ISI Import Substituting Industrialisation IT Information Technology KAP Key Action Programme 6 KZN KwaZulu-Natal LDC Less Developed Country LEP Labour and Enterprise Policy Research Group LNDC Lesotho National Development Corporation MFA Multi-Fibre Arrangement MOLE Ministry of Labour and Employment M&T Make and Trim NCCC Newcastle Chinese Chamber of Commerce NEDLAC National Economic Development and Labour Council NGO Non-Governmental Organisation NIPF National Industrial Policy Framework QC Quality Control RFID Radio Frequency Identification RIDP Regional Industrial Development Programme SA South Africa SACTWU Southern African Clothing and Textile Workers’ Union SACU Southern African Customs Union SADC Southern African Development Community TBVC Transkei, Bophuthatswana, Venda and Ciskei TDCA Trade, Development and Cooperation Agreement UCT University of Cape Town Town UK United Kingdom US United States WAB Wages Advisory Board WTO World Trade Organisation Cape of University

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