Labour Behind the Label has calculated a wage it says should be used as a minimum for workers.
One of the root causes of poverty wages in the industry is the power of global buyers to constantly relocate production in search of ever lower prices and better terms of trade. This power is used to exert a downward pressure on wages and conditions – labour being one of the few 'production costs' or 'inputs' that can be squeezed.
The basic idea of the Asia Floor Wage is to put a 'floor' under this, thereby preventing this competition from forcing wages below poverty levels and making sure gains are more equitably shared along the supply chain. The Asia Floor Wage alliance have formulated a unified, regional demand for a minimum living wage which is decent and fair and which can be standardised and compared between countries. This regional collective bargaining strategy will unite workers and their allies from different Asian countries behind one wage demand.
The goal is to attain this standardised minimum living wage for workers across Asia through negotiations between garment industry employers and workers’ representative organisations and with the mediation and support of governments, inter-governmental organisations and social movements.
The Asia Floor Wage concept and all the decisions were led by workers and unions from garment producing countries. The Asia Floor Wage Alliance, a large coalition of unions and labour organisations spread across Asia, supported by trade unions, labour NGOs, anti-sweatshop movements, and scholars from Europe and the USA, worked on the formula. Together they agreed:
The Asia floor wage should provide enough for food costs and non food costs of a standard family of 2 adults and 2 children.
That a basket of food is based on a standard calorific intake of 3000 calories per adult, 1500 per child.
The ratio between food costs and of other non food costs such as clothing, housing and utilities, healthcare, social security, education, and savings should be 50% food 50% non food.
The wage should be earned during each country’s legal maximum working week, though not above 48 hours.
The alliance then went through a process of: working out a living wage figure for each country based, comparing these figures between countries using purchasing power parity dollars, agreeing an average regional figure (475 PPP$) and converting this back into local currencies.
Below are the living wage
figures arrived at for the Asia Floor Wage
Bangladesh 10,754 taka 1,662 taka
China 1,638.75 yuan 687 yuan
India 6,968.25 rupees 4,238 rupees
Indonesia 1,868,650 rupiah 972,604 rupiah
Sri Lanka 16,705.75 rupees 5,046 rupees
Thailand 7,566.75 baht 4,368 baht
Source: Labour Behind the Label