What If the Garment Industry Had 'Ethically Made' Labels?

Racked is no longer publishing. Thank you to everyone who read our work over the years. The archives will remain available here; for new stories, head over to Vox.com, where our staff is covering consumer culture for The Goods by Vox. You can also see what we’re up to by signing up here.

Muhammad Yunus, the first Bangladeshi to win a Nobel Prize, is among the many voices calling for change in the garment industry in the wake of the factory building collapse that has claimed 1,126 lives. Writing in the Guardian, Yunus argues for the creation of a Garment Workers Welfare Fund in Bangladesh, to be funded by a 50-cent surcharge on every item of apparel and accessories the South Asian nation produces. He proposes that clothing whose price contributes to the fund could have a special label, to show its provenance:

If we could create a Garment Workers Welfare Trust in Bangladesh with that additional 50 cents, we could resolve most of the problems workers face – safety, work environment, pensions, healthcare, housing, their children's health, education, childcare, retirement, old age and travel. Everything could be taken care of through this trust.

Bangladesh exports garments worth $18bn each year. If all the garment buyers accept this proposal, the trust would receive $1.8bn each year. That's $500 in the trust for each of the 3.6 million workers.

Of course, international buyers may argue that extra 50 cents would reduce the demand for the product and that their profits would shrink. But we would offer them an arrangement whereby their sales would go up, instead of down. The extra 50 cents could be a marketing tool to make the product more attractive to consumers. We could put a special tag on each piece of clothing, saying: "From the happy workers of Bangladesh, with pleasure. Workers' wellbeing guaranteed." It could be endorsed by Grameen, the NGO Brac, or some other respected international organisation. There could be a beautiful logo to go with it.

The death toll from the collapse of the Rana Plaza factory building is still expected to rise as more bodies are found. It is by far the deadliest tragedy in the history of the apparel industry, but it is only one of thousands of fatal accidents that occur due to unsafe working conditions in garment factories every year. And that's to say nothing of the other problems Yunus highlights, to do with pensions, healthcare, child care, and economic development.

Bangladesh has become the world's second-largest exporter of clothing, after China, and it has one of the planet's lowest minimum wages for garment workers: $37/month. Would a 50-cent surcharge, provided it went directly into a fund for garment workers, make a difference? Would you be more likely to buy clothing if it had a label like Yunus is suggesting—sort of the fashion industry equivalent of the Fair Trade certification on some coffee beans? Obviously there remain questions of oversight and implementation—who would control this fund and ensure it reached the people who need it most, and who would audit the factories using the labels to make sure their workers' wellbeing was, in fact, "guaranteed." But this idea goes some way to solving perhaps two of the biggest problems in the apparel industry: the lack of transparency and independence of current safety regulations, and the powerlessness and lack of knowledge that many Western consumers currently feel about the clothes they buy.

Yunus also writes in favor of establishing a global minimum wage of at least 50 cents per hour (or roughly double the current minimum wage in Bangladesh). He says he worries that if changes are not implemented, the reputation of the apparel industry in Bangladesh will become permanently tainted, and foreign buyers will pull out of the country entirely:

Did we learn anything at all from this terrible loss of life? Or will we have completed our duty by merely expressing our deep sympathy? What should we do, now that news of a deadly fire in another factory in Dhaka reaches us?

Important questions have been raised about the future of the garment industry. Pope Francis has said buyers are treating the garment workers like slave labourers. A very large foreign buyer, Disney, has decided to pull out of Bangladesh. Others may follow. If that happens, it will severely damage our social and economic future. This industry has brought about immense change in our society by transforming the lives of women. We cannot allow it to be destroyed.

— Jenna Sauers

· After the Savar Tragedy, Time for an International Minimum Wage [Guardian]
· Would You Pay More for Target's Phillip Lim Collab if it Were Ethically Made? [Racked]