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 Home Campaigns Fair Trade Resources
Fair Trade and Labour RightsA product merits to be called ‘traded fairly’ if each part of the supply chain got a fair deal. Both those who grow (the small-scale farmers, that grow coffee, cocoa or cotton, for example) and those who produce (coffee roasters, etc) are paid a decent price for their work. As a result they are able to make a living without having to struggle for survival each day. A fair price is one that is above the prices on the world market, which are artificially kept low by subsidies of industrialised nations to their domestic products. These prices regularly do not even cover the costs of production. According to a statement issued by the United Nations Development Programme (UNDP) in 2005, rich countries spend $1 billion a day on subsidies for overproduction, whereas their agricultural aid for poor countries is just $1 billion a year. Furthermore cooperatives within the fair trade movement often receive an additional amount of money - a few cents per kilo - to support their communities' economic and/or social development. So what's the fundamental difference between free and fair trade?Free trade is about cheap prices. The welfare of the multinationals is at the centre of this regime. They want to sell as much as possible with a profit margin as high as possible. Surveys prove that transnationals - corporations, whose operations transcend international boarders - are the prime beneficiaries of today's unfair trading system. They control 70% of global trade and thus hold the power and stand to reap the profit from globalisation - at the expense of the world's poor and environment. With fair trade the welfare of the producer is the main priority. And, because fair trade takes the welfare of the producer into account, it can address the issue of poverty directly. The producers' standard of living is increased immediately and rigorously; they have the chance to make a living, feed themselves, send their children to school and create a better future for the next generation. The 'mythical' formula promoted by World Trade Organisation (WTO) as well as World Bank and International Monetary Fund (IMF) to tackle the problems of the developing countries goes: freer trade = economic growth = less poverty. According to economic rationalists, free trade leads to economic growth, because if all trade restrictions like import tariffs, subsidies and quotas are dropped, each country will do what it does best and all will prosper. This, so the WTO claims, will automatically alleviate poverty - a concept, which does not always work well. Fledgling industries in developing countries need some form of protection against multinational countries in order not be crushed or forced out of competition. Fair trade is the system of free trade but made fairer. The fair trade movement gives consumers the opportunity to use their purchasing power to support small-scale producers in developing nations. Each one of us can now tilt the balance, however slightly, in favour of the poor. For millions of people, fair trade has become the difference between hand-to-mouth existence and being able to plan for the future. The more consumer awareness of the treatment of producers in poor countries increases, so to does the demand for fairly traded goods and thus retailers are forced to stock up on them. This means that a growing number of poor people and communities are directly benefiting as a result of the Fair Trade movement. Fair trade also stands for a safe and healthy working environment for producers. These products are manufactured without use of child labour, too. However, fair trade does not forcibly indicate respect of the most basic labour rights. Workers in developing countries are still deprived of rights, which are taken for granted by workers in the richer nations, such as the right to associate, form trade unions and bargain collectively. In many countries union activities are repressed violently and advocates of a labour movement are harassed and attacked. Union Aid Abroad - APHEDA believes that the key to a better and fairer world is a global labour movement. Strong trade unions are a viable response to labour rights violations and exploitations of workers in developing countries. A way to strengthen these fledging unions is to 'buy union' - to show support by purchasing products made by unionized workers. Where to go?Shops do not make it easy for us. You will not find a 'union section' in your local supermarket, next to the organic section and the diary section. Only certain shops and organisations offer goods which are 'union-made' and sweatshop free. The workers who manufactured those products were duly represented by independent trade unions. They received a fair wage and further benefits such as health insurance for themselves and their families, maternity allowance and pension. For more information visit the following sites: Another way to support the compliance with international labour rights is to buy products from companies which made a 'framework agreement'. The main purpose of these agreements is to establish a relationship between the multinational company and the international arm of the respective trade unions. This is supposed to help solve problems and to work in the interest of both parties. The content of these agreements differs from one to another, but the general aim is to achieve certain minimum standards for workers based on the conventions of the International Labour Organisation (ILO). Prominent signatories are Volkswagen, DaimlerChrysler, Renault, Ikea, Danone, Chiquita and Club Mediterranee. However, such agreements often just pay lip service to the company's respect of the labour rights. Many multinationals see these treaties as an easy way to improve their public image. By contracting with only a single union, responsible for just one of their several supplier branches and leaving out all the other branches, they minimize their obligations and still have the pleasant effect of an image boost. A furniture company, for example, could easily deceive the public opinion by concluding an agreement with the wood workers' union and ignoring the metal workers, who provide the screws, and the textile workers, supplying the cloth stock. Click here for more information on framework agreements. A further approach to support the struggle for workers' rights and their dignity is to buy 'co-op made' - to purchase goods produced by co-operatives. This term stands for companies wholly owned and democratically controlled by their workers. They range from small-scale to multi-million dollar businesses across the globe and employ some 100 million women and men. As there are no outside owners and only workers are allowed to hold shares, they have the direct control over the management of the businesses. Therefore, workers are in the fortunate position to be able to set up rules and working conditions for themselves, which - in the ideal case - results in respect of labour rights and a decent life for each one of the "worker-owners". According to the International Labour Ogranisation (ILO), co-operative enterprises make fair globalisation a reality. However, cooperatives have been exposed to criticism for various reasons in recent years. Some of the larger cooperatives in Europe struggle with great tensions since there are huge gaps between manager and worker payscales and factories were relocated in order to stay competitive. They were accused of using the cooperative ideals only as a marketing fig leaf. Smaller cooperatives happen to struggle with the typical small business sacrifices, meaning that workers sometimes work day and night to keep their business afloat. For more information go to Sweatshop Watch The Fair Trade movement has been extremely successful in opening the eyes of the public to the inequities of today's unfair trading system as well as in highlighting the widening gap of welfare between rich multinationals and their poverty-stricken suppliers in developing countries. Ultimately trade can never be entirely fair as long as basic human rights, such as the right to associate, form trade unions and bargain collectively, are not respected and protected. Union Aid Abroad - APHEDA would like to see these rights included within the framework of defining a product as fairly traded. Every human being is entitled to decent work and dignity. Union Aid Abroad - APHEDA believes collective bargaining and international labour standards are vital to achieving this.Contact Details Union Aid Abroad - APHEDA Ph: (02) 9264 9343 Fax: (02) 9261 1118 office@apheda.org.au Fair Trade Resources
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