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ILR outlines global severance pay program

Millions of garment workers at factories around the world lost pay and jobs during the early stages of the pandemic, bringing to light the precarious work environment they have faced for decades.

“COVID was a stress test for systems – private  ones run by fashion brands and public ones built by national governments – to protect workers in the global apparel industry,” says Jason Judd, executive director of the ILR School’s New Conversation Project. “Most were found wanting. We were asked by IndustriALL, the global union that represents apparel workers, to evaluate past efforts and possible models for a global severance fund to compensate apparel workers who have lost their jobs and income.”

The resulting paper, “Security for Apparel Workers: Alternative Models” was authored by Judd, Professor Sarosh Kuruvilla and J. Lowell Jackson ’17. In it, the researchers outline existing approaches that have attempted to provide apparel workers with some degree of income security, and use those to assemble the necessary elements of a “global severance program.”

According to Judd and Kuruvilla, the academic director of the New Conversations Project and ILR’s Andrew J. Nathanson Family Professor in Industrial and Labor Relations, the “gold standard” to help laid-off workers is a “comprehensive national unemployment benefits model accompanied by severance requirements that cover all workers regardless of sector.” However, the reality is that less than half of the world’s population has access to any form of social protection, “leaving the vast majority of the world’s people unprotected in times of need, from national or global economic shocks or the devastation of global pandemic or extreme weather events.” 

In the report, the authors recommend:

  • A global severance fund should be established with money provided as a result of an  agreement between global unions and global brands.
  • A global governing body should be established for unions, suppliers and fashion brands with a small number of seats (voting or observing) reserved for national governments, a representative of an international financial institution, and NGOs which are active in the apparel supply chain sphere.
  • National level bodies to monitor the process of establishing, improving national social security systems, educating workers about the fund and its purpose, and, potentially, a role in disbursing funds nationally.
  • An “inspection function” that allows union participants across dozens of countries, supported by the global fund, to verify compliance with the terms of the agreement.

Additionally, they lay out four “must haves” for systems of this type to work:

  • Global companies must do more to ensure workers have a voice and the ability for collective bargaining.
  • Brand accountability for responsible purchasing practices, including fair prices and paying for orders that are in process or have been completed.
  • Long-term commitments by buyers to suppliers will provide stability to the program.
  • The ability of leading global brands to pay into the fund.

A full version of this story can be found on the ILR website.
Julie Greco is a communications specialist in the ILR School.

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