Target and Kmart sell $2 school uniforms, but at what cost?
Date
January 16, 2016
Canberra Times
Major Australian retailers face criticism over extremely cheap school uniforms manufactured in Bangladesh, where the minimum wage is as low as $97 a month.
Major Australian retailers Kmart and Target have come under fire for selling $2 school uniforms while factory workers are paid below levels that can cover basic living expenses.
The $2 polo shirts that are the focus of the Target's national "Back to School" campaign are produced in Bangladeshi factories where wages can be as low as $97 a month.
This national minimum wage is up to 45 per cent below the "living wage" that allows workers to pay for basic food, water, shelter, clothing, and transport, according to Oxfam and international workers unions.
Rival retailer Kmart is also selling $5 button-up school shirts from factories in Bangladesh, while its $2 polos are made in China.
The retail cost of the polos is less than the wholesale amount paid by Best and Less, which was slammed in a 2015 Oxfam report for its transparency on factory conditions.
The founder of ethical clothing brand, Etiko, Nick Savidis, said he was "flabbergasted" by the pricing.
Forhad Mia and his wife Raifa who worked for $65 a month in a factory used by Kmart in 2013. They said their salaries were too low to live on.
"I don't know how they could do that without ripping someone off," he said. "It's not just the supply chain. It's where the fabrics are dyed and woven, where the cotton has grown. I have no idea how they could do it at that price, not to mention the cost of shipping it to Australia."
Target would not comment on how they produced the shirts in Bangladeshi factories at such a low cost but said that it was "working towards," paying factory employees a living wage.
A Kmart spokeswoman said that Kmart had volume agreements that allowed them to "provide prices as low as ethically possible for our customers without compromise to our suppliers and their workers."
The price war comes three years after Bangladesh's garment industry was rocked by the deaths of 1127 workers during the Rana Plaza garment factory collapse.
A lack of fire escapes, poor safety standards and allegations of owners forcing workers back inside to work as the factory began to crumble damaged the reputation of the country's largest industry, which continued to boom by 14 per cent last year. Garments make up 80 per cent of the nation's exports and have lifted millions of workers out of poverty.
Following the Rana Plaza disaster, Target and Kmart were two of the first companies sign the Accord on Fire and Building Safety in Bangladesh.
There are an estimated 5000 garment factories in Bangladesh, employing more than four million people. Bangladeshi wages are some of the lowest in the world.
Discount retailer, Best and Less, who failed to sign the accord, is also selling back to school shirts made in Bangladesh for three times the price of its competitors.
A 2015 report from Oxfam that found the company had "made the least progress," since the Rana Plaza collapse by having an ethical sourcing code that fell short of the bar set by many other brands. It failed to name factory locations and identify how workers safety is monitored after it signed the less rigorous Alliance agreement.
"All of our polos are produced in one factory which is fully accredited with current certification which means all workers are paid a living wage and work freely of their own accord," a Best and Less spokeswoman said, before declining to name the actual factory in which they were produced.
Oxfam's manager of finance, Joy Kyriacou, said that while conditions had vastly improved under the "ground-breaking" accord, with Target and Kmart as key players, the garment sector's mostly female workforce where still working in precarious situations with up to 12-hour days and safety procedures nowhere near international standards. "There are still a lot of dodgy practices," she said.
"The weekly minimum wage is less than what many Australian's are paid an hour. We would like to see Australian companies move towards paying a decent wage," she said.
Ms Kyriacou said she could not comment on the specific factories from which the shirts were sourced from.
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