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2020-04-15 RPP Webinar How Brands Can Protect Workers During the COVID-19 Crisis April 15, 2020 Who’s on the webinar? Please answer the poll question. Watching on Facebook? You can answer in the comments. Technical issues? Content questions? Dr. Marsha Dickson President and Co-Founder of Better BuyingTM Better Buying is a global initiative that carries out independent research to promote the improvement of buyer purchasing practices, supply chain management, worker conditions, and the natural environment. Dr. Dickson is also Irma Ayers Professor, Department of Fashion and Apparel Studies, at the University of Delaware. She is a widely recognized global academic leader for her research, teaching, and practical engagement with global suppliers, retailers/brands, and sustainability groups. Through sustained engagement, Dickson has built thoughtful working relationships with leaders in corporate social responsibility and sustainability, buying groups, suppliers, industry associations, civil society organizations, and foundations. Kelly Allen Strategic Partnerships Manager at Better Buying Kelly has industry experience in wholesale sales and recently completed her master’s degree with an emphasis on sustainable apparel business. Kelly manages Better Buying’s Learning Loops pilot program and supports additional special projects and partnerships. Renee Bowers Director of Social Compliance at Fair Labor Association Renee oversees factory-level monitoring and business level accreditation and leads FLA’s fair compensation program. Previously she served as the executive director of the Fair Trade Federation, an association of businesses dedicated to supporting artisan and farmer communities through fair trade practices. In that role she worked with stakeholders to develop and uphold criteria involving fair wages, sustainable purchasing practices, and ethical production. She also spent seven years as a fair trade buyer, where she worked directly with producers in India and Sri Lanka to build their business capacity and ensure sustainable practices on the ground. Renee holds a graduate certificate in Socially Responsible and Sustainable Apparel Business from the University of Delaware and was a senior research fellow with the American Institute of Indian Studies. Tiffany Rogers Manager of Responsible Sourcing & Production at the Fair Labor Association Tiffany Rogers manages the FLA’s fair compensation and living wages program; and assesses company’s headquarter social compliance programs and purchasing and production practices for accreditation. Prior to working at FLA, Tiffany worked for Tracy Reese as her collection designer and completed her Master of Science in Apparel & Fashion Studies at the University of Delaware. Better BuyingTM is a global TM initiative that provides Better Buying Retailers, Brands, and Suppliers a cloud-based platform to obtain data- driven insights into purchasing-related activities. Better Buying’s transparency promotes improved purchasing practices, stronger supply chain partnerships, and mutually beneficial sustainability outcomes. TM COVID-19 Supplier Micro-survey ▪ 294 suppliers from 39 countries participated between March 18-31, 2020 ▪ Regional differences in how suppliers are being impacted ▪ What challenges are YOUR suppliers experiencing? TM Short-term: Crisis Management Better BuyingTM Guidance: Best Practices: Accept and pay all existing purchase orders for goods that have been shipped, are ready or in progress, or are cut. Do not resort to outright cancelations. “One customer is going to great lengths to help with the liquidity crisis of their suppliers, including early payment” Secure the cash your company needs in order to cover its contractual obligations, including accounts payable with suppliers. “Our core partners that are delaying the shipment of goods are offering to pay us a small deposit = 25-35% to help ease the Discuss with your suppliers their financial health and whether they have cash flow crunch while we wait for them to advise revised shipment schedule” the cash/liquidity necessary to retain workforce for at least three months. “Agreeing to pay invoices for held Pay a portion of orders that have not been cut and future orders that are garments Reducing quantities but paying affected by changes in volume, have delayed shipping deadlines, or are on full price to cover reduced quantities.” hold. What is the role of partnership? TM Medium-term: Recovery Phase Better BuyingTM Guidance: Best Practices: Obtain the cash necessary to pay up-front or upon delivery for new orders. “The customer assists with supplier and follow-up delivery, to ensure the time of material arrival at the factory.” Closely coordinate with nominated raw materials and other suppliers to align lead times, deliveries, and payment terms with Tier 1 suppliers’ needs. “arrange earlier payment to help our cash flow” Make efficiency a high priority in corporate operations and day-to-day business "Ask first to vendor for providing any with suppliers. sustainable recommendation for order reduction candidates based on current fabric/production status which are not incurring liability." What about the workers? TM FAIR LABOR ASSOCIATION BACKGROUND Founded in 1999 Multi-stakeholder Members Focuses Initiative Non-Profit Business, Civil Society, 50+ Apparel & Accountability & Universities footwear companies & Transparency suppliers Accreditation of social 8 Food & beverage compliance programs companies & Factory/farm suppliers assessments 10 Civil society & Civil society & union union members engagement 100+ Universities Safeguards for 2000+ Collegiate workers apparel licensees Training & capacity building FAIR LABOR ASSOCIATION’S GUIDANCE DURING THE COVID-19 CRISIS ORDER CANCELLATION IS THE LAST RESORT; NOT A FIRST RESPONSE COUNTRY-SPECIFIC GUIDANCE RESPONSIBLE PURCHASING PRACTICES ¡ Regular legislative mandates are issued on ¡ Do not cancel orders that have been social distancing, quarantine, and business completed or started; do not renegotiate terms closures ¡ Maintain clear and constant communication ¡ Medical & sick leave with suppliers ¡ Social security contribution suspensions ¡ Ensure workers’ access to functioning grievance mechanisms ¡ Bail out & relief funds WHAT CAN BRANDS & RETAILERS DO INSTEAD OF CANCELING ORDERS? Collaborate Transition Utilize Pursue to push out the time & to designing PPE and ordered materials to steps towards liquidity action calendar; slow protective coverings transition to protective to support cash flow down deliveries (Face masks, shields, accessories through 2021 fascinators, and gloves) Health & Safety •Spread out workstations; uphold social distancing; explore adding shifts to reduce the number of workers in the factory at one time •Provide daily PPE and clean soap and water •Regularly disinfect workstations; during and between shifts WHAT CAN •Provide sick leave for workers SUPPLIERS DO TO Hours of Work PRODUCE ORDERS •Ensure workers can rest so they stay healthy; all workers should receive at least 1 day off every 7 days; and no worker should work more than 60 hours per week & MITIGATE THE •Ensure overtime is voluntary SPREAD OF THE Migrant Workers •Provide safe and clean housing; expand housing accommodations for social distancing VIRUS? •Follow national government instructions on continued employment for migrant workers Retrenchment •Provide support to retrenched workers with filing of social security benefits & ensure workers receive their legally owed severance benefits •Provide grievance mechanisms to retrenched workers WHAT CAN EVERYONE DO? ¡ Engage with civil society & worker representatives ¡ Use your voice to urge the fashion industry to change and adapt during the COVID-19 crisis ¡ Coordinate & collaborate with friends & foes on solutions MAKE DECISIONS THAT PROTECT WORKERS Q&A.
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