Clothing outwork: Union strategy, labour regulation and labour market restructuring

Citation: Weller, S. A. (1999). Clothing outwork: union strategy, labour regulation and labour market restructuring. Journal of IndustrialRelations, 41(2):203-27.

Clothing Outwork:Union Strategy, Labour Regulation and Labour Market Restructuring

Sally Weller*

Abstract

On 12 March 1998 the Australian Industrial Relations Commission found

that the clauses of the Clothing Trades Award dealing with the

regulation of outwork in the clothing industry were allowable in their

entirety under s. 89A2(t) of the Workplace Relations Act 1996. This

decision preserves the mechanisms that will enable the award to be

enforced via the industry’s Homeworker Code of Practice. This paper

describes the union’s community action campaign against unregulated

clothing outwork, a campaign which has successfully focused public

attention on the need to establish safeguards for outworker employment

at a time when employee protection more generally is under threat. It

attributes the progress in regulating outwork to the union’s public

awareness campaign and its uneven impact on the competitive position

of employers; a resultant change in employer attitudes and strategies;

and to the Government’s desire to quiet opposition to its industrial

relations agenda.

* TCF Industry Study, University of Melbourne, PARKVILLE 3052. Weller: Regulating Clothing Outwork 1

Introduction

Since the mid-1980s numerous reports have exposed the exploitation

of clothing outworkers1 in Australia, yet there has been mounting

evidence that the local clothing industry is now structured around

outworker-based production (see O’Donnell1988, Working Women’s

Centre 1986, Tassie 1989, Mayhew and Quinlan 1998, TCFUA 1995,

Parliament of Australia 1996). The outworker-based production

system consists of highly competitive buyer-driven commodity chains

that have developed in response to both global and domestic

pressures (Webber and Weller 1998). In this structure retailers

and leading clothing firms at the apex of hierarchically structured

supply chains dictate design, price, quality and delivery schedules

to subordinate subcontractors in what is known as the ‘cut-make-

trim’ part of the industry. Subcontractors either arrange to have

work carried out by outworkers or subcontract to yet another firm

in the chain. Subcontractors are often called ‘middlemen’ because

they occupy a space between leading clothing firms and the labour

of outworkers. A feature of the outworker-based system is intense

competition between subcontractors. By playing one subcontractor

against another, leading firms enhance their control and their

ability to realise profit, while at the same time creating a

volatile environment in the lower ranks of the hierarchically

structured chain. Outworkers carry the burden of that volatility

Weller: Regulating Clothing Outwork 2

through intermittent employment. They also supply the sector’s

cost competitiveness through low wages and poor working conditions.

Although the employment of outworkers is governed by the Clothing

Trades Award (1982)2, a large proportion of outworker-based

production in Australia is carried out in the unregulated sector by

firms that do not observe the award (Parliament of Australia 1996).

For many years the Textiles Clothing and Footwear Union of

Australia has campaigned for the enforcement of the award. This

paper traces the development and outcomes of the union’s campaign

against unregulated outwork since 1993, when the union redirected

its efforts to a more community based approach. The paper begins

with a short introduction to the history of the regulation of

clothing outwork in Australia. Next, it describes the union’s

public awareness campaign and explores the clothing employers’

perspective on outwork. Together these sections explain why

clothing employers elected to cooperate with the union to regulate

outwork through the agreed Homeworker Code of Practice. The development

of the Code is reported in some detail. This leads into a

discussion of the Government’s response to the outwork campaign and

to outwork’s role in the debate over changes in industrial

relations legislation.


The regulation of clothing outwork

The existence of an unregulated outwork sector operating outside

labour, taxation and business law and the industrial relations

system has significant social implications. At the 1996 Labour Law

Conference the Hon. Justice Marshall (Marshall and Ginters 1996)

listed the reasons why outworker production should not be allowed

to exist as a sector operating beneath formal industrial relations

arrangements:

(a)The exclusion of outworkers from the mainstream industrial

relations system intimates a dual standard of equity. Allowing

the outwork sector to operate without regulation would imply

community acceptance of a second-tier workforce to which the

usual tenets of employee protection did not apply.

(b)Outworkers are predominantly first-generation migrants. A

failure to act to protect the conditions of their employment

would imply a racist basis for labour standards.

(c)The labour contract is a necessary, but not a sufficient basis

for socially acceptable regulation of the employment

relationship. The Government has a responsibility to set

minimum standards and to intervene in the contractual

relationship between employer (contractor) and employee

(outworker) to ensure that an acceptable standard maintains.


(d)Failure to provide social protection for outworkers, or their

exclusion from mainstream social protection, would encourage

more employers to substitute outwork for standard work. This

would undermine both labour and social security laws.

(e)Allowing unregulated outwork in the clothing sector would

encourage greater prevalence of unregulated employment across

the economy.

(f)Finally, outwork raises questions of equality in the labour

market and the welfare state, since most outworkers are women.

Outwork has had a long tradition in the clothing industry (Ellem

1991), but throughout the early part of the century discourses

about the protection of women justified the exclusion of outworkers

from the mainstream of industrial regulation (Williams 1996). The

craft-dominated factory-based male work force of the pre-World War

II clothing industry saw outwork in simple terms, as a threat to

factory jobs. Accordingly, industrial legislation dealt with

clothing outwork by attempting to limit its incidence.3 In 1939

clauses restricting the use of subcontractors were inserted into

the clothing award (39 CAR 251) in a not particularly successful

attempt to prohibit the “deplorable practice” of outwork. In

recognition of its persistence, a 1957 amendment (87 CAR 327)

reintroduced a permit system for the registration of individual


outworkers, a move that effectively pushed outwork underground

(Ellem 1989). Until the mid-1980s, clothing outworkers were

invisible to both the union and interested social reformers. In

1995 the then National Secretary of the Textiles Clothing and

Footwear Union of Australia, Anna Booth, commented that in the past

the union:

… had the wrong approach to outworkers, regarding them as scabs

who undercut factory workers' rates and cost them jobs … In the

period before the early 1980s the union had not much changed

its position and view of the world since the 1950s, and

believed outworkers were our enemies. (quoted in Workplace

Magazine, Winter 1995).

The union’s attitude to outwork began to change in the mid-1980s.

After intense debate in National Council meetings, the union

accepted that outworkers were legitimate workers in need of union

protection. Since then the union has unequivocally supported the

regulation of home-based work as a legitimate part of the industry.

The union began a media campaign against unregulated outwork,

focusing on the structural disadvantage of migrant labour and

depicting women in the outwork sector as victims of their own


limited options. During 198187 the central concern of the

campaign was to highlight the exploitation of outworkers and the

fiction of their portrayal as small business contractors.4 The

union stressed that depicting outworkers as small-time

entrepreneurs seriously misrepresented their situation since the

individual outworker had (and has) minimal real control over the

work she performs. The union argued that outworkers were

indistinguishable from employees and should be guaranteed the same

rights as other workers.5 Clarification of outworkers’ employment

status was vitally important because as subcontractors outworkers

were doubly disadvantaged. They were excluded from the protection

afforded to employees (representation in industrial tribunals,

union coverage, and employee entitlements such as sick and holiday

leave) but under common law did not escape the obligations of

employees (Brooks 1991:45).

The union won an important victory in 1987 when the Australian

Conciliation and Arbitration Commission agreed that outworkers were

employees. In bringing down his decision on the union’s 1987 4 This occurred in the context of a changing status of women within theACTU. In 1984 the previously independent Working Women's Centres were integrated into the ACTU policy structure, increasing the influence of feminist labour market analysis in the ACTU and bringing women’s labour issues to the fore (Booth and Rubenstein, 1990). It was also a period of increasing feminisation of the CATU bureaucracy (Ellem 1989).5 The campaign to extend basic employment rights to migrant women has implications for citizenship and the notion of an Australian national identity. See Kilic (1997).


Application to vary the Clothing Trades Award 1982, Deputy President Riordan

deemed outworkers to be employees because:

Outdoor workers working as machinists are not permitted to use

personal initiative. Their work is performed to rigid

specifications of quality, quantity and style as well as the time

by which it must be completed. They have no say in the design.

The garments are received ready cut for sewing or the garments may

already be partly sewn are require further specialised machining.

Their work is inspected and then may be passed on to some other

person for the performance of an additional function such as

further machining or pressing until the manufacture of the garment

is complete. They are certainly subject to control and direction,

their work is an integral part of the business of those for whom

they work and the advertisements which many answered to obtain

their jobs were in many cases for employees. This work could not

be described as the work of an independent contractor within the

ordinary and usually accepted meaning of that term (19 IR 416 at

439).

The 1987 amendments to the Clothing Trades Award deemed all

outworkers to be employees unless proved otherwise, set down the

wages and conditions of outworkers and required employers to

register their use of outworkers. From that point on, the union


considered all outworkers to be potential employees, regardless of

the fact that the vast majority were paid on piecework rates and,

the union argued, rarely had an explicit knowledge of their

employment status.

Despite the fact that outwork was brought under the award,

enforcement mechanisms were largely ineffective (Mayhew and Quinlan

1998). The Commonwealth Department of Industrial Relations showed

little interest in pursuing breaches of the award. Furthermore,

enforcement relied on a complaints-based system that workers with

no job security and limited English language skills were unlikely

to use. The union’s capacity to enforce the award was inhibited by

restrictions on their right of entry to business premises (Mayhew

and Quinlan 1998). In November 1993, in response to union

pressure, the NSW Department of Industrial Relations and Employment

conducted raids on NSW clothing firms thought to be operating

outside the law. The action discovered 145 breaches of the Award,

mainly concerning occupational health and safety issues. However,

in her March 1994 speech to the NSW Parliament at the release of a

report on the raids, NSW Industrial Relations Minister Chikarovski

claimed that the union had exaggerated the extent of illicit

clothing production (Lyons 1994). Many subcontracting firms

continued to treat outworkers as small business subcontractors and


continued to ignore labour and taxation laws. It was clear that

traditional approaches to enforcement of the award were failing to

control outwork production.

The union’s public awareness campaign

The union continued to campaign against outwork by refocusing its

efforts through the media and in public policy forums. Media

exposés repeatedly demonstrated that many clothing industry

subcontractors operated illegally, flaunting taxation law,

industrial laws, occupational health and safety regulations and a

host of other regulatory obligations. In the realm of public

policy, the union constructed illicit outworker-based production as

an issue to be addressed by a range of regulatory agencies. It

exerted pressure on government and the sections bureaucracy with

responsibilities relevant to outwork at both federal and state

level, including women’s departments, ethnic affairs bureaus,

occupational health and safety agencies, employment, training and

industrial relations departments, taxation and police departments.


Public awareness activities expanded in July 1994 with the

establishment of a federally funded Outworker Awareness Campaign

which aimed to inform outworkers of their rights and to collect

information about the exploitation of migrant women workers. At

the launch of the Campaign’s phone-in, its joint coordinator Annie

Delaney accused retailers of dictating unrealistically low prices

to manufacturers. Her speech drew a parallel between the plight of

outworkers and ‘third-world’ employment conditions.

The cherished ‘Made in Australia’ label should include an

explanation "under exploitative third-world (sic) conditions”

(Sexton 1994).

The focus of the campaign now more strongly emphasised the

commonalities between outwork in Australia and plight of home-

workers in the global economy.6 By 1994 the definition of the

outwork problem had also shifted: the conflict was no longer

between factory-based production and outwork. The union action now

more overtly distinguished between the regulated and the

unregulated outworker sectors. The union began lobbying the

Federal Government for an amnesty to allow outworkers to normalise

their position with taxation and social security departments, and

to bring them into the legitimate work force.7


The change in direction of the campaign reflected a growing

awareness of, and links with, the global labour movement. Home-

based work was becoming an issue of international labour standards

and labour control associated with the simultaneous ‘feminisation’

and ‘peripheralisation’ of industrial employment.8 Work by

feminists and community campaigners in Europe in the early 1990s

highlighted clothing industry exploitation. New organisations,

such as the global ‘Clean Clothes Campaign’ based in the

Netherlands, worked to develop international strategies to harness

community and consumer protest action against exploitation in the

clothing industry, expose the activities of transnational

corporations and to force globalised firms to adopt ethical

sourcing policies.9 In 1995, an International Labour Organisation

(ILO) Conference on Homework established a global network known as

Home-net to promote coordinated global action to improve the

working conditions of homeworkers. Community action also led to

the 1996 International Labour Office Convention on Homework. The Textiles

Clothing and Footwear Union of Australia campaign is deeply

embedded in these global campaigns. The union is active in Home-

net, as are a number of community-based groups in Australia.

Through internet technology the Australian union has been able to

stay abreast of international information, strategies and campaigns


concerning homework. By the same means, a broad range of

interested individuals and organisations have found advice and

support for their own local campaigns against outwork.

The union’s Outwork Awareness Campaign culminated in a report

titled The Hidden Cost of Fashion, released in March 1995 (Textiles

Clothing and Footwear Union of Australia, 1995). The report

attracted a great deal of media attention, largely due to its high

estimate of outworker numbers. Interest stemming from the

publication of the report led to the distribution of lists of well-

known firms that used outworkers. These were later tabled in the

Federal Parliament. After discussion of its employment practices

in the Parliament, fashion retailer Country Road Clothing Company

issued a press release defending its subcontracting arrangements.

However, Country Road was slow to respond to criticism on outwork

and its ‘socially aware’ middle-class customers effectively

boycotted its products. Country Road and other leading retailers

claimed to have suffered commercial injury as a result of the media

attention on outwork arising from the Hidden Cost report. According

to the union, targeting Country Road was essentially opportunistic.

The strategy was successful because at the more expensive end of

the clothing market consumer purchases are less price-driven and

public information campaigns have greater potential impact.10


Consumer pressure is also most effective when the targeted company

has a marketing image to defend from public criticism.

A national community-based protest, the Fair Wear Campaign, was

launched in 1996. It was established under the auspices of the

Uniting Church and comprised a coalition of church, union and

community groups interested in social justice. The Fair Wear

Campaign came into existence because of community development work

by the Textiles Clothing and Footwear Union of Australia, and is

linked to the global ‘Clean Clothes Campaign’. The union brought

in Greenpeace activists to train Fair Wear members in effective

non-violent protest strategies. A Fair Wear Information Kit,11 which

contained examples of creative and effective protest actions, was

developed to assist local groups generate their own campaign

strategies. Fair Wear groups subsequently instigated local

community-based protests against uncooperative retailers. These

local campaigns are independent of any organisational structure and

continue with a momentum of their own: their decentralised nature

makes them resistant to control. The effectiveness of the Fair

Wear campaign is evidenced by its success in prompting retailers to

cooperate with the union. Both Coles-Myer and Sportsgirl (leading

fashion retailers) signed union agreements on the use of outworkers

on the eve of Fair Wear protests outside their stores.


Changing employer attitudes to outwork

Sustained negative publicity successfully convinced the wider

community that conditions in the clothing industry were

unacceptable. In turn, clothing sector employers became convinced

of the need to counter that negative perception by shifting their

policies to support more effective regulation of outworker-based

production.

In November 1993 changes to the clothing employers organisation,

the Textile Clothing and Footwear Council of Australia, altered

employer attitudes to the outwork issue. The Council abandoned its

‘old-style’ protectionist image and adopted an approach more in

tune with the internationalisation policies of the Keating Labor

Government. The Council's newly elected president, Tim Todhunter,

stated that the new Council’s aim for the industry was to “erase

its traditional, but now inappropriate, sweatshop image” (Wood

1993:5). This new focus emphasised creative design and marketing,

improved work force relations and aimed to strengthen the

relationship between local suppliers and retailers. The

revitalised employer organisation, renamed the Textiles and Fashion

Industries of Australia, soon established a committee to define its


approach to outwork. Consistent with its new image, the

association sought to distance itself from illegal outworker

operations.

In the debate about homework, clothing industry employers had much

at stake. They wished to counter negative publicity and to develop

a new public presence as a modern, export-oriented industry.

Managers with marketing and brand development expertise understood

how important the public image of the industry would be as the

Industry Commission commenced its review of industry assistance

arrangements in 1997.12 It was imperative that the outdated

‘sweatshop’ image be erased from the public perception.

Employer support for the control of unregulated outwork also had

strategic business objectives. By 1992 factory-based clothing

employment was declining rapidly and the viability of factory-based

employers had begun to come under threat. This heralded a period

of tacit cooperation in which unions and employers united in

opposition to ‘backyard operators’ who undercut factory-based 12 The structure of protection of local clothing manufacturers from overseas competition has been gradually dismantled. This began with the Whitlam tariff cuts of 1973. The 1988 Button Industry Plan, the amendments in the 1991 March Economic Statement, and the 1995 TCF 2000 Package progressively exposed the sector to overseas competition. The purpose of the 1997 Industry Commission Inquiry was to recommend assistance arrangements after the year 2000. The industry successfully argued that the rate of change should be slowed to give it more time to adjust to global competition.


clothing manufacturers. Alan Trumble, then President of the

Textiles Clothing and Footwear Council of Australia, was quoted as

saying of outwork:

To any legitimate manufacturer it’s diabolical they get

killed by the backyarders (Brunswick Sentinel, 1992).

In a similar vein, Mr Brendan Wood, joint Victorian Secretary of

the Textile, Clothing and Footwear Union of Australia stated that

outworkers:

… threatened the viability of factories that paid

award wages (Conroy 1993).

By 1994 the outworker-based system was clearly ascendant. Many

leading fashion companies had redirected their ‘making-up’

contracts away from factories and to subcontractors that used

outworkers. Larger firms, who formed the core of the Textiles and

Fashion Industries of Australia’s membership, were producing

garments through subcontractors and paying them at rates that

assumed workers to be employed under the award. The high public

profile of these larger firms gave them no option but to abide by

industrial and labour laws. Not all contractors, however, paid


their outworkers under the award, and (smaller) ‘unregulated’

subcontractors who were not party to the Clothing Trades Award

consistently undercut those who complied. There is no doubt that

garments made in the unregulated outwork sector are less expensive

to produce than those made by workers paid under the award.13 The

problem, as leading firms saw it, was not award-sanctioned

outworker wage levels but rather the structure of the outworker-

based production system that allowed subcontractors or ‘middlemen’

to take margins at each stage in the production process. This left

only a small fraction of the price being paid for the garment going

to outworkers’ wages.

Both outworkers and firms who observed the award were

disadvantaged. Firms that paid outworkers at award rates sought to

create a ‘level playing field’ for business competition by forcing

all firms to operate in accordance with the award. If all

outworkers were paid at award rates the competitive advantage of

subcontractors in the ‘unregulated’ part of the industry would

simply disappear.

The growth of outwork in the late 1980s and early 1990s was part of

an industry restructuring that occurred as firm’s adjusted to the

lower protection environment of the 1990s. It was fuelled by


labour shortages as the southern European women who had provided

the industry’s labour force approached retirement. The Button TCF

Plan’s Labour Adjustment strategy and the intensification of work

as firms introduced “Just-in-Time” production strategies

accelerated their exit (Webber and Weller 1998). Restructuring

involved the entry into the clothing production industry of a new

strata of subcontractor entrepreneurs whose firms replaced many of

the longstanding but inefficient factory-based producers of

previous decades. These new firms won their place in the industry

through their low labour costs, made possible by their use of

outworkers. Many subcontractors were men from ethnic communities

who, as middlemen in the production chain, acted as well-paid

gatekeepers to the migrant women’s labour that was the source of

their competitive edge (Peck 1990; 1992). For larger clothing

firms, bringing outwork into the legitimate sector would secure

their access, at award rates, to this newly created labour force of

low-cost home-based workers. The end point of effective regulation

of outwork, as employers saw it, would be a second restructuring of

the clothing industry. This would remove many of the entrepreneurs

who operated small subcontracting firms in the middle-ranking links

of clothing production chains, and produce a new structure

featuring first-tier design houses and large sourcing companies

directly managing larger pools of outworkers paid under the award.14


The union believed that regulation of outwork would also create a

greater professionalism of the home-based clothing work force, who

would become more like their factory-based counterparts.

From this perspective, employers’ support for the regulation of

outwork can be seen as traditional organised capital reasserting

its dominance and control over the outwork labour force. It

appears that the powerful employers in the legitimate sector have

in effect formed an alliance with the union to eliminate the

unregulated firms. If this is successful, the outcome will be the

exclusion of (migrant) entrepreneurs and a reassertion of (Anglo-

dominated) employer and union control over migrant women’s labour.15

Ethical sourcing and the Homeworker Code of Practice

Although the overall policy environment was conducive to

cooperation by employers, much of the union’s outwork campaign

relied on pressuring individual firms to enter into ethical

sourcing agreements concerning their use of outworkers. In an

Industrial Relations Commission hearing in January 1995, the union

demanded that Target Stores,16 as a respondent to the Clothing

Trades Award, provide it with a full list of suppliers. It also


demanded that Target ensure that each subcontractor making its

garments complied with award conditions for their employees. The

union aimed to force Target Stores to pay award rates for

outworkers and to set a precedent that would make retailers

responsible for clothing produced on their behalf. On 4 November

1995 Target Stores agreed to ensure that its suppliers used fair

employment practices when employing home-based workers. The retail

sector specialist magazine Ragtrader heralded Target’s signing of

the union’s ethical sourcing Deed of Cooperation as an ‘Outworker

Breakthrough!’ and noted that the union had served 50 major

retailers with a claim for similar agreements (di Piramo 1995).17

This was the first of a series of prosecutions instigated by the

union, all of which were settled before hearing.

The union strategy involved pressuring individual companies to

formally agree to operate under Award conditions. One of the first

to sign a Deed of Cooperation concerning its use of outworkers was Done

Art and Design, owned by the artist Ken Done who is active in

UNICEF and other social projects. However, before signing the

Deed, Done Art had already implemented its own ethical sourcing

policy in response to adverse media attention. Furthermore, the

company’s internal policy had actually been more restrictive on the


employment of outworkers than the Textiles Clothing and Footwear

Union of Australia’s Deed.

Other companies began to consider pre-empting union action by

implementing their own versions of ethical sourcing agreements.

This response also reflected global trends. In the early 1990s

world leaders in clothing production, such as Levi Strauss and

Company, had developed ethical sourcing policies to protect the

reputation and integrity of their brand (Howard 1990; Harvard

Business School 1994). Business schools became interested in

ethical practices as community groups in the United States and

Europe developed increasingly effective strategies to expose

exploitative companies. The damage caused to the Nike brand after

sustained criticism of its employment practices in low-wage

countries, for example, has been widely reported in Australia.18

Australian clothing and retail managers concerned with brand

reputation should have been aware of these developments, although

there was no widespread, firm-instigated move to ethical sourcing

policies in the clothing sector. By 1997 the management media was

recommending that firms implement ethical sourcing policies as a

protection against community action groups (Roinick 1997). At the

same time the Clean Clothes Campaign worked on a strategy to ensure


that firms observed the requirements of their own ethical sourcing

policies (CCC 1998).

In adopting or rejecting the union’s ethical sourcing agreements

there are then two issues at stake for firms one is ethical

sourcing policy and the other control of the regulation of sourcing

and the extent to which firms will countenance union involvement.

Issues of ethical sourcing are therefore intimately related to

attitudes to organised labour. Opponents of the union action on

outwork have never (publicly) opposed the idea of ethical sourcing,

but have stood against the union’s close monitoring of outwork and

its role in policing the award.

The widespread adoption of ethical sourcing agreements will

undoubtedly produce a permanent change in the nature of

relationships through the subcontracting chain. Prior to public

scrutiny of subcontracting, firms could perceive their

subcontracting arrangements as mutually advantageous networks, or

developmental business partnerships (AMC 1991, Weiss and Mathews

1991). By requiring subcontractors to observe ethical sourcing

policies, firms at the apex of the production chain exert their

power in the relationship. Ethical sourcing agreements therefore

force more overtly hierarchical and less convivial relationships.


If the success of a supply chain is dependent on the quality of

trust in inter-firm relationships (Sabel 1989), then social

distancing from subcontractors may be to leading firms’ long-term

detriment.

With the pressure to sign legally binding Deeds of Cooperation,

employers began to view some regulation of outwork as their best

option. In June 1995 employers agreed to a variation in the

Clothing Trades Award that strengthened reporting requirements for

outwork contractors and provided for outworkers to receive ‘plain

English’ information about employment rights. Deputy President

Williams of the Australian Conciliation and Arbitration Commission

said the variation would:

... strengthen the existing award provisions in relation to the

keeping of appropriate records by outworkers and employers and

the inspection of those records by the TCFUA and other relevant

authorities. The variation will also require employers to

provide outworkers with specific information as to their

entitlements under the award (Decision of 12 June 1995 of

Williams DP (Print M3574)).

Following this, the Textiles and Fashion Industries of Australia

and the union released a joint statement indicating that they would Weller: Regulating Clothing Outwork 24

work together to develop a standard manufacturer’s contract. The

union would be responsible for developing a model statement that

would put the onus for outworker regulation on retailers and label

owners. The Textiles and Fashion Industries of Australia, for its

part, agreed to develop a standard written contract and conduct a

consultation with members with a view to developing a voluntary

code of practice (Sinclair 1995). Employers sought to develop a

code of practice that would self-regulate the outwork sector,

expunge the industry’s sweatshop image and perhaps help stave off

government intervention through Industrial Relations legislation.19

Despite extensive discussion, the end of 1996 saw manufacturers and

the union at an impasse, and the complex negotiations paused to

allow the industry to concentrate on the Industry Commission

Inquiry into the future of the textiles, clothing and footwear

industries after the year 2000. A final Code of Practice was not

agreed until March 1998 (Textiles Clothing and Footwear Union of

Australia 1998, summarised in Appendix 1). Details of its

implementation are still to be negotiated.

The Code set down the obligations of retailers, manufacturers and

contractors that require them to observe the relevant clauses of

the Clothing Trades Award 1982. It extends responsibility through

the subcontracting chain by using the reporting requirements


already embodied in the award. This enables the union to track

chains of production subcontractors from the retail buyer to

individual outworkers, providing it with the means to enforce the

award. When and if the Code is fully implemented, firms that are

signatories will pay an annual licence fee for the right to display

a ticket or other marker to identify their products as ethically

sourced and produced under award conditions.

The wages and payments aspects of the Code are crucial to its

successful implementation. In early 1996 a team of consultants

began developing a new measurement system for home-based garment

assembly. This will be a refined piece rate system based on a

simple rate per garment and varying with a three-tier

classification of the skill level (simple, medium or complex)

required for sewing tasks. Rates will be based on the

internationally agreed General Sewing Data (GSD) standard, which

applies to factory-based production, but will incorporate an

allowance for bundling and other non-machining tasks performed by

home-based workers. The payment structure will assume that

outworkers can meet standard work rates, implying that under the

new system novices and those working with substandard equipment

will earn a lower equivalent hourly rate than the current award

rate. The payment amount will compensate workers for their loss of


sick pay, holiday pay and other benefits. This is likely to

include paying full-time rates, rather than the higher casual

rates, for workers who work more than 35 hours per week. Home-

based workers will not earn overtime or penalty rates for working

at odd times of day and night, since the employers have argued that

people work at home for the flexibility to choose their own hours

of work. The actual payment rates, yet to be finalised at the time

of writing, are the linchpin of the Code.

The employers’ cooperation with the union over the development of

the Code needs to be understood in the context of the then imminent

Industry Commission Inquiry into the future of the textiles,

clothing and footwear industries. The importance of the industry

shedding its ‘sweatshop’ image has already been mentioned. Action

was also imperative to secure goodwill and support from the

Australian Labor Party, Australian Democrats and social reformer

constituencies in the lead-up to the Inquiry. Nevertheless, within

the Textiles and Fashion Industries of Australia, some textile

firms that supply fabric to the outwork sector are opposed to any

action that would reduce the viability of their client base. The

organisation’s position on outwork thus reflects the declining

importance of the textile sector in the political profile of

industries.


Critics argue that the Code is flawed because of its failure to

require that leading firms and retailers continue to source

products in Australia. They believe that the regulation of outwork

will increase import penetration of the local market. But whether

local production moves offshore or is replaced by imports depends

on whether the fashion garments produced in Australia could be

sourced elsewhere at a competitive price and within the time frames

demanded of fashion production. The union believes that the quick

response requirements of the fashion industry preclude offshore

production of those garments currently produced by outworkers.

This may be too optimistic: airfreight from Hong Kong does not take

long, and the possibilities of global quick response production are

improving continuously.

Responses in the retail sector

Attitudes to the regulation of outwork were different in the retail

sector. Retailers’ initial position was that outwork was not their

responsibility. They promoted the view that their role was simply

to purchase clothing from various makers, and that they had no

interest in production matters (Sinclair 1995). This attitude was

widespread in 1994 and 1995, and at that time retailers accused the


union of trying to make them the scapegoats for actions that were

the responsibility of subcontractors (Lyons 1994). However,

retailers were gradually and reluctantly pulled into outwork

regulation through the union’s court actions supported by

community-based direct protests at retail stores.

Unlike the regulated part of the clothing manufacture sector,

retailers gain no direct advantage by limiting their interactions

with outworker contractors working outside the regulatory

framework. Apart from ethical concerns, their only motivation for

supporting fair work practices is to avoid negative publicity that

would affect store reputation and consumers’ attitudes to their

products. Retailers promote brand recognition because a strong

brand diverts consumer attention from the location of production

and from the conditions under which garments are produced. At

least until the appearance of campaigns such as Fair Wear, this

insulated them from any negative repercussions in the market that

might arise from their sourcing decisions. Community based

campaigning is successful because it targets brand and store

reputation.

At the institutional level too, retailers were initially unwilling

to accept responsibility for outwork. A new national organisation,


the Australian Retailers Association was created in June 1996. One

of its stated objectives was to address the problem of outwork, but

from the position that "the remedy is not in the retailers' hands"

(Ryan 1996). The association’s executive included key players from

the department store sector (Coles-Myer and David Jones) and

speciality stores (including Country Road and Sussan, both of whom

considered themselves to be victims of the outwork campaign). In

October 1996 two days of negotiation between the union and the

association failed to reach agreement on the outwork Code of Practice.

Despite this, individual retailers continued to sign the union’s

code, beginning with the Witchery and Just Jeans retail chains

(Country Road had previously agreed to a Deed of Cooperation with

the union). The Australian Retailer’s Association did not agree to

Homeworkers Code of Practice, in its ‘retailer’ version, until March 1998.

Government response

Public attention on outwork also forced the Government to address

the issue of outwork. It could no longer ignore illegal activity

in the face of continued public exposure and had to be seen to

intervene when confronted with what appeared to be deliberate and

systematic breaches of the rule of law. Thus, the media’s human-


interest stories exposing outwork were fundamental to the success

of the campaign for its regulation.

In September 1995, as a result of the attention of outwork

generated by the Hidden Cost report and associated campaigns, the

Keating Labor government asked the Senate Economic References

Committee to investigate outwork. The Committee was asked to

consider all aspects of remuneration and working conditions of

outworkers, the effect of outwork on children under the age of 15,

the extent to which outwork breached existing laws, and to report

on contracting policies and procedures.

The union used the Inquiry to emphasise its position and to spell

out the sorts of legislative interventions it saw as necessary to

control illegal outworker activity. The union viewed the Inquiry

as a means to force other clothing industry players to publicly

state their position on outwork in a forum where the social

consequences of business decisions would be taken into account.

The Textiles and Fashion Industries of Australia’s submission to

the Inquiry was conciliatory. It supported the Code of Practice

and advocated further tripartite discussions. The Inquiry provided

an opportunity for the Australian Chamber of Manufactures and the

Australian Business Chamber to expand on their views, which in


essence opposed further government intervention to regulate

outwork.

The Inquiry was somewhat overtaken by events, as the Liberal

Government came to power before its final report was tabled. The

incoming government quickly announced that it saw outwork as an

integral part of clothing production. The Hon. Peter McGauran,

representing the Minister at the Textiles Clothing and Fashion

Industries of Australia’s 1996 Outlook Conference (Textiles and

Fashion Industries of Australia 1995), stated:

Outworkers are essential to the industry. But the community

is not going to tolerate or excuse exploitation if and when it

occurs. Businesses that operate fairly should not be

disadvantaged by unscrupulous businesses.

In distinguishing between legitimate and illegitimate work

practices, this statement is consistent with both the union and

employer positions at the time. The newly elected regime was

however quick to withdraw funding from the union’s outwork

information campaign.20 Nevertheless, there were strong incentives

for the Government to outlaw illegitimate practices in the clothing

industry. Public acceptance of Employment Minister Reith’s


Industrial Relations agenda required the protection of minimum

employment standards and public reassurance that industrial law

would not be compromised.

The Senate Committee’s initial recommendations, given the

intensity of the previous debate, were disappointing, although the

final report (Parliament of Australia 1998) had a stronger

flavour. It supported the Homeworkers Code of Practice and the

progress towards its implementation, and recommended that

government departments and agencies cooperate with the Code. The

committee lamented the lack of progress on clarification of the

employment status of outworkers, but noted the difficulty of

federal jurisdiction in this respect:

Any Commonwealth legislation seeking to alter theemployment status of persons who might otherwise (atcommon law) not be employees would need to depend onconstitutional powers other than the conciliation andarbitration power, such as the Commonwealth's power tolegislate with respect to corporations and would belimited it its scope accordingly. (Parliament of Australia1998:3)

While strongly supporting deeming outworkers employees, the

committee proposed referring the matter to the Labour Ministers

Meeting for further discussion with the States. It also supported

inclusion of clauses to protect the conditions of outworkers in the

award simplification process (which will be discussed in the next


section), encouraged the Government to review its 1996 decision not

to sign the International Labour Organisation’s Convention on

Homework,21 and supported action on child labour. Improvements to

occupational health and safety, statistical collection, access to

English language training and taxation compliance issues were

recommended.

Government Senators dissented from the most crucial of the

Committee’s recommendations. Their additional comments indicated

they did not support deeming outworkers employees – ”It is

reasonable for an outworker to make a legitimate choice whether to

be an employee or an independent contractor” – although they agreed

that the matter should be considered by Labour Ministers

(Parliament of Australia 1998:12). They argued that it was

“inappropriate” for the Committee make recommendations on the issue

of “allowable matters” in the Workplace Relations Act 1996 since that

would interfere with the Government’s statutory obligation to

review awards. The Government Senators also sidestepped expressing

an opinion on the ILO Convention on Homework, arguing that the

States had not yet been consulted.

Some employers have also promoted the notion of outworkers as small

business subcontractors, and by doing so, revive pre-1987 attitudes


to outwork. The story of the development of the Homeworker Code of

Practice has highlighted developments within the clothing production

and distribution sectors and the common interests of the union and

larger employers. The negotiations leading to the Code of Practice had

concerned details and financial implications for workers and firms,

not whether regulation was warranted. In this way the development

of the Code ran contrary to the national trend, which in recent

years has been towards less rather than more labour market

regulation.

The attitude of the Australian Chamber of Manufactures has been

less sympathetic to regulation and is illustrative of a perspective

wider than the immediate concerns of clothing industry firms.

Acting as advocate for smaller employers who use outworkers, the

Chamber’s stance in the outwork debate has been less accommodating

than the Textiles and Fashion Industries of Australia position,

which is aligned with leading firms. The Chamber argued in the

Senate Inquiry that outworker-based production was not necessarily

exploitative and that it was sometimes the preferred option for

both employer and employee. The Chamber’s submission claimed that

the Inquiry's terms of reference wrongly assumed an employee–

employer relationship, which they described as a "distorted view"

of the reality. While agreeing that standards were needed to


regulate the contracting, allocation and distribution of

outworkers’ work, the Chamber wanted to include the caveat that

regulations would not take work away from outworkers and would

distinguish between outworker employees and outworker contractors.

The Chamber agreed that compliance with the Clothing Trades Award

was poor but claimed that the existing registration process created

an opportunity for unions to “coerce” outworkers to take up union

membership (Australian Chamber of Manufactures 1995:13).

Registration of outworkers, the Chamber argued, should not be the

employers’ responsibility; rather the onus should rest with the

outworker. They proposed moving the administration of outwork

registration procedures away from the Industrial Relations

Commission and the union and placing it with an independent body.

The Chamber also advocated extending the amnesty given to

outworkers during the Outworker Awareness Campaign to employers, so

they too might rectify legal breaches without prosecution.

The views of the Australian Chamber of Manufactures highlight the

need for regulatory measures to be sensitive to the complex

realities of a fluid production system. In identifying the problems

of status definition, the Chamber raises the possibility that

further regulation of outwork might simply encourage more

individuals to establish themselves as small subcontractor


businesses in order to escape regulation. Almost by definition,

the unregulated part of the outworker production sector continues

to exist “outside” regulation, since that is the essence of its

competitive advantage. The purposefully illicit part of the

industry will flow into and exploit any new opportunities created

by changes in regulations.

Backyard firms supplying markets and stalls, too, will continue to

operate on the edge of the industry and in the informal economy.

The potential for the development of a growing informal clothing

production sector has not been a primary consideration in the local

outwork debate. Research in the United States, however, suggests

that the growth of an informal sector servicing the clothing needs

of low-income households may become a centre of economic growth in

the future (Portes, Castells and Benton 1989).

Despite its general opposition to the further regulation of home-

based work, the Australian Chamber of Manufactures belatedly signed

the Code of Practice in March 1998. Their change of heart stemmed from

internal pressure exerted by members who were also members of the

Textiles and Fashion Industries of Australia and opened the way for

their participation in a new campaign on outwork being organised by

the Commonwealth Workplace Relations and Industrial Relations


Department. In addition, signing the Code ensured that the Chamber

would be included in the negotiations that would finalise the

Code’s implementation. The Chamber’s participation brings

regulation of clothing outwork firmly into the industrial relations

arena and shifts the outwork debate from an emphasis on social

justice to focus on the nature of the employment contract and

remuneration.

The Department Employment, Workplace Relations and Small Business’s

outworker information campaign was launched in June 1998. This new

campaign presented the distinction between outworkers as employees

or contractors ambiguously, leading the union to accuse the

Government of deliberately designing a campaign to educate

employers in methods to avoid the Homeworker Code of Practice by

encouraging outworkers to establish themselves as independent

subcontractors. This government campaign, the union argued,

undermined actions intended to curb exploitative practices in the

clothing industry.

Outwork and the Workplace Relations Act 1996

As the Howard Government’s industrial relations program was debated

in 1996, outwork became closely linked to the Australian Council of


Trade Union’s campaign against individualised employment contracts.

Socially isolated outworkers have no access to collective

bargaining and enforcement of award conditions is difficult when

there is no ‘workplace’ in the traditional sense. The Australian

Council of Trade Union’s research officer Sue Kenna described

outwork as a:

... vital example of the dangers of deregulating

industrial relations policy and especially individual

contracts (quoted in Salmons 1996).

In the debate leading up to passing the Workplace Relations Act 1996,

exploitation of outworkers in the clothing industry became a symbol

of what many saw as the logical outcome of individual workplace

bargaining. The importance of the outwork issue to the national

industrial changes cannot be stressed strongly enough. Public

approval of the Howard Government’s industrial relations reform

agenda and micro-economic changes to the labour market has relied

upon the claim that changes to awards and conditions would not make

low paid workers worse off, and would not sanction exploitative

work practices. By this argument, the unregulated outwork sector

became the ‘rotten apple’ in the industrial relations basket that

needed to be isolated if the ‘reform’ process was to proceed. This


imperative secured both employer and Government support for the

control of exploitative practices in the outworker production

sector.

1 The Clothing Trades Award 1982 (CTA), as amended in 1987, defines anoutworker as ‘a person who performs work in the clothing industry the subject of this award for an employer outside the employer’s workshop or factory under a contract of service’ (Re Clothing Trades Award 1982 (1987)19 IR 416 at 417).

2 The 1987 amendments of the CTA included additional clauses on the regulation of outwork. These are Clause 26 - Contract work; Clause 27 – Outworkers; and Clause 27A - Registration of respondents for clauses 26 and 27. The Award applies only to employers that are respondent to it, whoare obliged to abide by award conditions. In November 1996 only 79 companies were registered as using outwork contractors.

3 See Australian Conciliation and Arbitration Commission (1987) for a review of the history of legislation to control outwork.6 See Boris and Prugl (1996); Mies (1982); Mitter (1986); and Ross (1997).

7 The amnesty was granted and ran from December 1995 to April 1996.8 See Mies (1982) and also Beneria and Roldan (1987), who provide an interesting discussion of clothing homework in the context of ‘developing’ country export industries.9 See http://www.cleanclothes.org

10 The strategy echoes consumer boycotts used in campaigns against sweatshops in the United Kingdom at the turn of the last century. A hundred years ago, women of the middle class saw it as their civil responsibility to protect their less fortunate sisters from exploitation insub-standard clothing factories (Boris 1996). 11 See Fair Wear (1997) or http:/www. ucaqid.com.au/community/fairwear/13 One manager told the Industry Commission Inquiry that paying award rates and conditions to outworkers would add 16 percent to his production costs. The union believes that the regulation of homework would increase production costs by 30 percent14 Within this general trend, the large regional and firm-based differences in the structure and management of clothing production systems will of course persist as each firm seeks to implement strategies that enhance their competitive position in the market.


http://www.cleanclothes.org/

Nevertheless, as the details of the Workplace Relations Act 1996 were

translated into legal practice, its provisions became more hard-

edged. At one stage it appeared that the regulation of outworkers’

employment would not even be included as an ‘allowable matter’ in

the new Act. However, when the Workplace Relations Act 1996 passed

through the Parliament,22 an amendment by the Australian Democrats

15 This, of course, may not occur. If the outworker-based production system is predicated on ethnic social network relationships, as Phizacklea (1990), among others, contends, then large firms are unlikely to develop sufficient social links into outwork networks be able to sustain the production system in its present form. Large firms without social links tothe labour force will have to devise new strategies to secure workers’ commitment to the demanding work schedules of intermittent quick response production. The fear for leading firms working within the Award is that inthe struggle between large suppliers and small subcontractors for the control of migrant women’s labour, the small subcontractors would win.

16 Target is a major discount department store chain and part of the Coles-Myer group, which controls perhaps 60 percent of the Australian clothing retail market.

17 The Deed of Cooperation signed by Target is legally binding and is more stringent than the later agreements with manufacturers in the Homeworker Code of Practice. The Code of Practice agreements relies the relevant clauses of the Clothing Trades Award for enforcement. 18 See Ross (1997) and Rowbotham and Mitter (1994). 19 Legislative regulation of outwork was a long-term objective of the union campaign, but success depended on Australia signing the ILO Convention on Homework in 1996, an unlikely outcome after the Liberal Government was elected. Signing the ILO Convention was important not only as an issue of international citizenship. If Australia signed the federal government could then use its external affairs powers to extend jurisdiction to aspects of industrial legislation (eg occupational health and safety) that are currently the responsibility of the states. SeeInternational Labour Conference (1994), Marshall and Gintis (1996).20 A series of business support programs and the tripartite Australian Manufacturing Council were abolished at the same time (Burton and Lewis 1996).21 ILO Convention 177 and Recommendation 184 on Homework, adopted by theInternational Labour conference in June 1996.


ensured that outwork was included as one of the twenty allowable

matters:

Allowable matter: s. 89A2(t) pay and conditions for outworkers, but

only to the extent necessary to ensure that their overall pay and

conditions of employment are fair and reasonable in comparison with

the pay and conditions of employment specified in a relevant award or

awards for employees who perform the same kind of work at an employers

business or commercial premises.

The qualifier in this definition is consistent with the ILO

Convention on Homework, which sets the benchmark for pay and

conditions of homeworkers in comparison to their factory-based

counterparts (ILO 1996). The union nevertheless feared that this

definition would be interpreted as restricting the coverage of

outwork in the award to the bare minimum of concern with pay and

conditions. The exclusion from the award of compliance procedures

such as the registration and recording of outworker activity from

the award would, the union believed, make enforcing the outworker-

related clauses of the award impossible: the Code of Practice would

surely collapse. Furthermore, the union feared that without the

outwork clauses in the award there would be nothing to prevent

employers from negotiating individual workplace agreements with

each home-based worker. Given the power differential between the Weller: Regulating Clothing Outwork 42

home-worker and the subcontractor, individual workplace agreements

would signal lower standards of pay and conditions for home-based

workers. While the ‘no-disadvantage’ rule should in theory protect

workers from this eventuality, the union was rightly sceptical.

The Full Bench of the Australian Industrial Relations Commission

(Vice President McIntyre, Deputy President Duncan and Commissioner

Blair) heard evidence on outworker provisions as allowable award

matters in December 1998 and January 1999. On 12 March 1999 they

accepted the union’s arguments that the protection provided by

Clauses 26, 27 and 27A of the Clothing Trades Award 1982 were allowable

in their entirety (C0037CRA Dec 232/99 Print 2749). The

Commissioners concluded that if one or more of the clauses were

removed, the remainder would be rendered ineffective. The decision

relied on the Commissioner’s interpretation of the meaning of the

qualification in s 89A2(t) of the Workplaces Relations Act 1996, which they

understood as ‘requiring the Commission to consider any evidence or

other material before it that is relevant to it in forming a view

as to what is necessary to ensure the situation specified in the

qualification’. Given the full acceptance of existing provisions,

employer and government proposals that the relevant clauses be

modified under s51 of the Workplace Relations Act 1996 were not

considered. However, since the neither the Government nor employers


challenged the union’s evidence regarding the nature and extent of

outwork, their position must be interpreted as tacitly supporting

the pre-1996 award.

Conclusion

This paper has described how the union’s outwork campaign, which

was based on links with community groups concerned with social

justice and implemented through pressure at the consumer level,

forced action on the use of outworkers in the clothing industry.

This led to the development of the Homeworker Code of Practice, which,

if fully implemented, would enforce the award’s outwork provisions

and bring outworker production into the mainstream of industrial

relations regulation. The union campaign enjoyed considerable

success in 19941997. This was largely due to the support of

employers who wanted to improve the clothing industry’s image and

to ‘level the playing field’ with regard to labour costs, and to

the Howard Government’s need to act on outwork to smooth the

passage of the Workplace Relations Act 1996 through Parliament.

More recently, the Department of Employment, Workplace Relations

and Small Business outwork information campaign and the discussion

of “allowable matters” in the Workplace Relations Act 1996 suggest that


the Government was less than committed to regulating outworker

production. However, by accepting the outwork provisions of the

Award, the AIRC has cleared a path for implementation of the

Homeworker Code of Practice to proceed. That outcome owes at least as

much to business demands for regulating price competition as it

does to social justice concerns.

Community pressure is likely to ensure that high-profile retailers

and firms producing brand-name apparel continue to comply with

ethical sourcing policies. That pressure will, however, have

little effect on the organisation of production in the price-

sensitive non-branded clothing market. The future prospects for

clothing outworkers will depend then on the union’s capacity to

organise an increasingly home-based clothing production workforce.

As the union’s action will better police larger employers, clothing

outworkers’ wages and conditions are likely in the future to depend

on the product market characteristics of the different garments

they sew. The union plans to pursue outwork regulation using a

community development approach centring on the establishment of

local support groups and regional leaders,23 a strategy that extends

and adapts ideas developed by the Self-Employed Women’s Association

(SEWA) in India. The applicability of this model in Australia’s

culturally diverse clothing industry is yet to be seen. However,


without effective organisation, the wages of home-based workers are

unlikely to keep pace with increases negotiated under workplace

agreements in unionised or any other workplaces.

Acknowledgments

Michael Webber’s comments on an earlier draft helped clarify some

the ideas presented here, and the detailed comments of three

anonymous referees resulted in a more coherently structured paper.

Endnotes

1 The Clothing Trades Award 1982 (CTA), as amended in 1987, defines anoutworker as ‘a person who performs work in the clothing industry the subject of this award for an employer outside the employer’s workshop or factory under a contract of service’ (19 IR 416 at 417). 2 The 1987 amendments of the CTA included additional clauses on the regulation of outwork. These are Clause 26 - Contract work; Clause 27 – Outworkers; and Clause 27A - Registration of respondents for clauses 26 and 27. The Award applies only to employers that are respondent to it, who are obliged toabide by award conditions. In November 1996 only 79 companies were registered asusing outwork contractors. The existence of a large unregulated outwork sector isundisputed.3 See Australian Conciliation and Arbitration Commission (1987) for a review of the history of legislation to control outwork.4 This occurred in the context of a changing status of women within the ACTU.In 1984 the previously independent Working Women's Centres were integrated into the ACTU policy structure, increasing the influence of feminist labour market analysis in the ACTU and bringing women’s labour issues to the fore (Booth and Rubenstein, 1990). It was also a period of increasing feminisation of the CATU bureaucracy (Ellem 1989).5 The campaign to extend basic employment rights to migrant women has implications for citizenship and the notion of an Australian national identity. See Kilic (1997).6 See Boris and Prugl (1996); Mies (1982); Mitter (1986); and Ross (1997).7 The amnesty was granted and ran from December 1995 to April 1996.8 See Mies (1982) and also Beneria and Roldan (1987), who provide an interesting discussion of clothing homework in the context of ‘developing’ country export industries.9 See http://www.cleanclothes.org10 The strategy echoes consumer boycotts used in campaigns against sweatshopsin the United Kingdom at the turn of the last century. A hundred years ago,


http://www.cleanclothes.org/

women of the middle class saw it as their civil responsibility to protect their less fortunate sisters from exploitation in sub-standard clothing factories(Boris 1996). 11 See Fair Wear (1997) or http:/www. ucaqid.com.au/community/fairwear/.12 The structures protecting local clothing manufacturers from overseas competition have been gradually dismantled, beginning with the Whitlam tariff cuts of 1973. The 1988 Button Industry Plan, the acceleration of tariff cuts in the 1991 March Economic Statement, and the 1995 TCF 2000 Package progressively exposed the sector to overseas competition. The purpose of the 1997 Industry Commission Inquiry was to recommend assistance arrangements after the year 2000. The industry successfully argued that the rate of change should be slowed to allow more time for production to adjust to global competition. 13 One manager told the Industry Commission Inquiry that paying award rates and conditions to outworkers would add 16 percent to his production costs. The union believes that the regulation of homework would increase production costs by30 percent.14 Within this general trend, of course, regional and firm-based differences in the structure and management of clothing production would persist as firms strive to enhance their competitive position in the market.15 This, of course, may not occur. If the outworker-based production system is predicated on ethnic social network relationships, as Phizacklea (1990), amongothers, contends, then large firms are unlikely to develop sufficient social links into outwork networks be able to sustain the production system in its present form. Large firms without social links to the labour force will have to devise new strategies to secure workers’ commitment to the demanding work schedules of intermittent quick response production. The fear for leading firms working within the award is that in the struggle between large suppliers and small subcontractors for the control of migrant women’s labour, the small subcontractors would win. Union officials in Australia have argued that the outwork sector is no longer shaped by ethno-specific social networks.16 Target is a major discount department store chain and part of the Coles-Myer group, which controls perhaps 60 percent of the Australian clothing retail market.17 The Deed of Cooperation signed by Target is legally binding and is more stringent than the later agreements with manufacturers in the Homeworker Code of Practice. The Code of Practice relies the relevant clauses of the Clothing Trades Award for its enforcement. 18 See Ross (1997) and Rowbotham and Mitter (1994). 19 Legislative regulation of outwork was a long-term objective of the union campaign, but that depended on Australia signing the ILO Convention on Homework in 1996 an unlikely outcome after the Liberal Government was elected. Signing the ILO Convention was important not only as an issue of international citizenship. If Australia signed the Convention the federal government could then have used its external affairs powers to extend jurisdiction to aspects of industrial legislation (eg occupational health and safety) that are currently theresponsibility of the states. See ILO (1996), International Labour Conference (1994) and Marshall and Gintis (1996).20 A series of business support programs and the tripartite Australian Manufacturing Council were abolished at the same time (Burton and Lewis 1996).21 ILO Convention 177 and Recommendation 184 on Homework, adopted by the International Labour conference in June 1996. 22 For an introduction to the Workplace Relations Bill 1996 see Coulthard (1997).


23 See Tate (1996) for a discussion of the emerging global homework links. Rowbotham and Mitter (1994) and Ross (1997) provide examples of the organisation of home-based and sweatshop workers.


APPENDIX 1

Stopping exploitation of home based outworkers.

What the Code is about The homeworkers' code of practice has been developed by the TCFUA together withrepresentatives of the retail and manufacturing in the textile, clothing andfootwear industries. The Code is a self-regulatory system that intends toregulate and monitor the production chain from the retailer to the homeworker. Italso attempts to simplify the reporting requirements of manufacturers buildingsolidly on award entitlements to workers.

There are two parts of the code.

Part one is the part relevant to retailers, "The Statement of PrinciplesRegarding Homeworkers Wages and Conditions". This includes: Ten principles that outline the parties to the agreement intent. The acceptable work conditions and pay rates homeworkers should receive. That parties to the agreement will promote that manufacturers must comply withthese standards. Retailers who purchase products not produced by exploited labour may use oridentify these products with a logo or other sign of compliance. Retailers commit not to sell products which have been produced by exploitedlabour, this may include terminating a relationship with a supplier.

The Code will lead to garments carrying a sign that they are manufacturedethically and that shops will carry a logo if they stock such clothing. Retailersmay promote the fact that they only deal with accredited manufacturers who do notexploit homeworkers. Part Two The Code of Practice: This part sets out the criteria for participatingmanufacturers. There is a Code of Practice Committee which will oversee the setting up andongoing management of the Code. It involves an accreditation procedure whereby manufacturers who give work tocontractors or directly to homeworkers seek accreditation. The accreditation process will ensure that from the retailer down to thehomeworker the chain is transparent.

This will be achieved by the following steps: Retailer signatory to the Principles will provide to the union lists of theirsuppliers Retailer will require their suppliers in their purchase contracts, to comply withall laws and regulations including payment of the sewing garment rate relevant tohomeworkers. Manufacturers or suppliers to retailers will seek accreditation Accredited suppliers will provide documentation to Code Committee verifying thatthe subcontractors they use are keeping all appropriate documentation and payingtheir homeworkers according to the agreed garment sewing time manual standard.

Pay rates for homeworkers


The introduction of a timing manual where garments will be classified into threelevels of complexity and become the standard for fixing sewing time ratestranslated into pay rates for homeworkers. The minute sewing time per garment provided to the homeworker to sew will beadjusted with percentages for annual leave and public holidays. The homeworkermust receive with each batch of work paperwork which identifies that thehomeworker is being paid correctly according to the standard. The code also specifies the minimum garments (total amount of work) per week a homeworker can receive from a contractor over a two week period as well as the maximum work load they can receive over a two week period.

Manufacturers will risk loosing accreditation and contracts with retailers if their contractors fail to pay homeworkers correctly.

Code of Practice Committee: The committee will undertake an education and information program to educate andinform Manufacturers, Homeworkers and Consumers about the code.

Source: http//:www.vic.acu.org/fairwear


APPENDIX 1(b)Signatories of Homeworkers Code of Practices (at October 1998)

1995/1996 ‘Deed of Co-operation" Australia PostCountry Road Pty LtdKen Done & Associates Pty LtdTarget Australia

Retailers Homeworkers Code of Practice Best and Less Big W Brown SugarColes Supermarket Daimaru David JonesDotti Events Fashion FairFosseys Gowings Jacqui EJag Just Jeans Pty Ltd KatiesKmart Lowes Manhattan Maggie TMyer Grace Bros Najee Pelaco Pty LtdPortmans Rockmans Roger DavidSaba Sussan Suzanne GraeThe Clothing CompanyWestco Jeans Witchery Fashions Pty Ltd

Woolworths

Manufacturers, Fashion Houses and Wholesalers: Homeworkers Code of Practice

Adidas Anthea Crawford AFG Kidswear Australian Defence Apparel Brian Rochford Carla Zampatti P/L Casco Blue Pty Ltd Clothes Scene Pty Ltd Consolidated Apparel P/L Cue C.T.M. Clothing Dara Star FashionsDepict Distributors Depict Knits Dewspot Diamond Cut* Dimension Clothing G A Fashions Gazal General Pants* Hadfom P/L Hallmark Mitex Hot Clothing Co. P/L Hot Gossip Hot Tuna Pty Ltd Hound Dog Australia P/L House of David House of Stitches Ivorie Australia K Mart Kenwall Clothing Co. P/L King Gee Clothing Co. Konange Pty LtdL A Shirts Lisa T Shirts Mont Adventure Equip’tMy Garment Co. P/L Neater FashionsPacific Brands Berlei Bonds IndustriesHoleproof Jockey/Red Robin Candy Footwear Park Lane Fashions Peter Weiss Pty Ltd PaddymadeRanier P/L Resort Report* PhysicoRumours Scuttle ReviewSimona Sara Lee Intimates SheridanSportsgirl/Sportscraft S F Corporate ClothingSport Fashion GroupStafford Group Sportsknit P/L S&R FashionsTajura Fashions Sunny Textile Industries Table Eight


Trent Nathan P/L Time Sportswear TrackmasterTurning Point Yaramovsky Pty Ltd

Industry Associations: Homeworkers Code of PracticeARA - Australian Retailers Association (specific section within the Code for ARA members)TFIA - Textile Footwear Industry AssociationABC - Australian Business ChamberACM - Australian Chamber of Manufactures

Source: http://www.acu.org.au/fairwear


http://www.acu.org.au/fairwear

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ANESBWA (1996). 'Submission to the Senate Committee Inquiry into theGarment Industry Outworking’. The Association of Non-English Speaking Background Women of Australia. Sydney.

AMC (1991) ‘Networking and Industry Development’. Melbourne: Australian Manufacturing Council. April.

Australian Conciliation and Arbitration Commission (1987) ‘In the matter of an application by the Clothing and Allied Trades Union of Australia to vary the Clothing Trades Award 1982 in relation to contract work.’ Decision by Mr Deputy President Riordan, (19 IR 416)7 April, Melbourne.

Australian Conciliation and Arbitration Commission (1995) Decision byMr Deputy President Williams on Application to vary the Clothing Trades Award 1982. (1610/1995 IRCommA). Melbourne.

Australian Chamber of Manufactures (1995) ‘Submission for the Inquiryinto Garment Industry Outworking’. mimeo. Melbourne.

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NOTE: these are duplicated endnotes – delete.

22 For an introduction to the Workplace Relations Bill 1996 seeCoulthard (1997).23 See Tate (1996) for a discussion of the emerging global homework links. Mitter (1986); Rowbotham and Mitter (1994) and Ross(1997) provide examples of the organisation of home-based and sweatshop workers.

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Clothing outwork: Union strategy, labour regulation and labour market restructuring

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