BBW Nicer Work Report
BBW Nicer Work Report
Nicer Work? Impactts Benefits for Businesses and Workers Programme 2011 2013
Author: Rosey Hurst
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
CONTENTS
EXECUTIVE SUMMARY ......................................................................................................... 4
INTRODUCTION............................................................................................................................. 7
WHAT WE DID ............................................................................................................................. 10
THE RESULTS............................................................................................................................... 15
What participants say ...............................................................................................................
16
Bangladesh .......................................................................................................................................
18
India.......................................................................................................................................................
20
22
24
RAGS
BBW
RBC
CONTENTS
ACRONYMS
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
EXECUTIVE SUMMARY
EXECUTIVE SUMMARY
Impactts work since 2001 has demonstrated that such a transformation can
be achieved,2 by supporting better quality
jobs funded through productivity and
quality improvements. However, this
approach is expensive, and therefore
not scalable. In 2011, with the launch
of the UK Department for International
Developments RAGS (Responsible and
Accountable Garments Sector) Challenge
Fund, we saw the opportunity to build a
coalition of retailers, brands and factories
to develop a replicable and cost effective
methodology to strengthen export garment
factories in India and Bangladesh and
support them to become better businesses
offering better jobs for workers. This report,
Nicer Work, presents the Benefits for
Business and Workers Programme (BBW),
The tragedies
in Bangladesh
demonstrate
all too clearly
that compliance
alone has not
been able
to achieve a
transformation
in the ability of
many factories
to be good
businesses
providing good
jobs for their
workers
1 http://www.impacttlimited.com/resources/nice-work-are-workers-taking-the-strain-in-the-economic-downturn
2 2011 Impactt: Finding the Sweet Spot, section 3.1 http://www.impacttlimited.com/wp-content/uploads/2012/01/Impactt-15th-anniversary-report_finding-the-sweet-spot.pdf
2008 Impactt: Ethical Trading in the Downturn, Section 3.1 http://www.impacttlimited.com/wp-content/uploads/2012/01/Getting-Smarter_Ethical-Trading-in-theDownturn1.pdf
EXECUTIVE SUMMARY
IN BANGLADESH
BBW aims
to develop a
virtuous circle
of competitive
businesses with
skilled, well
paid, safe and
loyal workforces
producing
excellent
product
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
IN INDIA
Efficiency improved by 26.25% and cut-to-ship ratio by 1.38%, enabling Indian
factories to realise 24,919 of savings due to cut-to-ship and efficiency improvements, a 6-month ROI of 13. Absenteeism reduced by 26.73% and worker turnover
by 26.08%. In year 2 factories, average take-home pay increased by 264.60 Rupees
or 5.09%. This would be equivalent to an increase in annual pay of 614,000 across
all the 17,442 workers employed by participating factories. Factories also performed
well on hourly pay, increasing this by 7.99%.
We compared the performance of BBW factories to a comparable group of 28
factories which did not participate in the programme. Factories in both groups were
broadly similar, in terms of location, product type, price point, export volume and type
of customer. We looked at BBW factory performance at the end of the programme. We
found that BBW factories performed far better overall on all key labour issues in which
we monitor, in both India and in Bangladesh.
This may indicate that BBW participants have improved their labour standards
performance during the programme, and/or may show that the type of factory willing
to join and invest in such a programme is likely to have higher standards. At the
very least, better factories, which are more open to change and prepared to make a
commitment themselves are able to make improvements, with the support of BBW.
There are also strong indications that BBW acts to boost factories which already have
potential, and may also be powerful in starting under-performing factories on the road
to improvement.
Over its
two years,
BBW reached
a total of
102,110
workers,
53%
of them women
WAGES
BBW has been successful in distilling a
low cost group training methodology which
is extremely effective at delivering better
businesses and better jobs in the export
garment industry in Bangladesh and
India. The group plans to roll out the BBW
programme in India and Bangladesh and
trial it in China over the coming months. We
call upon interested brands to come together
to promote Nicer Work within their supply
chains so as to strengthen their supplier
businesses ability to provide good jobs.
EXECUTIVE SUMMARY
3 The Bangladesh living wage is based on the 2011 Asia Floor Wage (12,248 Taka) adjusted up for inflation. The India living wage is an average of: living wage
estimates from 3 NGOs in Tirupur, Gurgaon and Bangalore from 2013, and the Asia Floor Wage from 2011 (7,697 Rupees) adjusted up for inflation.
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
INTRODUCTION
4 http://www.impacttlimited.com/resources/nice-work-are-workers-taking-the-strain-in-the-economic-downturn
INTRODUCTION
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
INTRODUCTION
5 Including Boden, H&M, Marks & Spencer, Mothercare, Next, New Look, Pentland, Gap, Next, Ralph Lauren, Sainsbury, Tesco.
6 In Bangladesh, India and China.
7 Impactt (2009) Getting Smarter: Ethical Trading in the Downturn; Impactt (2008) Progress not Perfection: 10 years of making an Impactt; Impactt (2006)
Changing Overtime: Tackling supply chain labour issues through business practice
MEASURING SUCCESS
We developed a set of indicators to measure the effectiveness of the programme.
Good businesses indicators
We also looked at the social compliance status of factories participating in BBW against
a control group of 28 non-participants to see whether BBW factories were more likely to
be meeting local and international labour law. For details and caveats on the data, please
see the Appendices on pages 28 and 29.
INTRODUCTION
We gathered feedback from workers and managers to understand how the programme
had impacted them.
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
WHAT WE DID
PHASE 1
Building management skills and improving working conditions in 10 pilot factories in India and
Bangladesh.
During the first year of the programme, Impactt and RBC
worked with six factories in India (Delhi, Ludhiana, Bangalore, Tirupur and Chennai) and four in Dhaka, Bangladesh.
Factories were proposed by retailers and selected on the basis
of enthusiasm and highest possible overlap of customer base
with the retailer group. We delivered individual consultancy on
productivity, quality, human resource management, communication and decision-making. Factories produced a broad range
of product including jersey, knitwear, wovens and embellished
garments.
We delivered seven modules in each factory, amounting to an
average of 200-300 hours training per factory.
We identified five key learnings from Phase 1:
The model works factories reported high levels of satisfaction with the consultancy and highlighted
some areas for improvement.
Progress is easier to achieve on good businesses indicators, progress on good jobs tends to lag
behind. Need for more focus on good jobs.
Training must be in local language.
More space needed for practical learning, co-creation and peer learning.
WHAT WE DID
Stronger communication needed between implementation teams and brands in the UK and their
local teams.
10
PHASE 2
Roll-out and Scale-up group training and implementation support for 63 factories
The objective of Phase 2 was to build on the learnings from Phase 1 to develop a training programme
which provided the same or better benefits to participants, but at a much reduced cost and on a much
larger scale. We developed a model based on training factories in groups of six for a six-month period
with factories hosting modules so that learning could be practical. Each factory also received three days
individual follow-up in-factory. Factories paid a fee equivalent to around 2,000 plus local taxes.
Impactt and RBC worked closely with retailers and, in Bangladesh, the Bangladesh Garment
Manufacturers Exporters Association (BGMEA) and UK Trade and Investment (UKTI) to recruit 63
factories for Phase 2. In India, the British High Commission hosted the launch event.
Efforts included:
Brands suggesting factories from their supply bases, some brands made participation a condition of
contract.
Large scale launch events with high profile speakers including testimony from Y1 factory owners.
Small scale events in Chittagong and Tirupur.
Meetings with suppliers hosted by brands.
Individual follow-up with factories, by phone, email and through in-person visits.
Retailers/brands jointly approaching shared suppliers.
Each factory was asked to release six managers to attend each session of the training, specifically the
HR Manager, Welfare Officer, Trial line Supervisor, Production Manager, Industrial Engineer, and Quality
Manager. Bangladesh factories tended to send more participants, including health and safety managers
in latter batches. In total, the team delivered 2,080 training and consultancy hours to 426 people.
WHAT WE DID
The team divided factories into 12 batches, each of up to six factories, according to geographical location
and product type. Batches took place in Dhaka and Chittagong (Bangladesh) and in Delhi, Tirupur and
Bangalore (India). Training was delivered as far as possible in-factory, with factories taking turns to host
modules. This resulted in more practical, shop-floor based training and direct interaction with workers.
In response to the Tazreen fire, later batches in Bangladesh included a fire safety module.
11
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
Building a vision
HR
Improve retention
Better induction
Introduce buddy system
Proper skills assessment and career progression
Improve attendance
Convert unplanned into planned leave
Easy to use leave process
Increase attendance bonus
Formal structures & commitment to invest
in people
Co-created job descriptions
Skills assessment and pro-active training
programmes
Specific training for supervisors
Improved methods
Method study and standardising operations
Better cross-departmental working
Upskilling supervisors to proactively improve
line performance
Rewarding better performance
Production bonuses and incentives schemes
12
Quality
Fire Safety*
Measurement
Understanding and reducing rework
Measuring and reducing Cut-to-ship losses
Review
Why is this important to our business?
Understand current systems
Difficulties within current systems
Incentives
Zero defect operators
Building ownership for quality
13
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
DESCRIPTION OF TRAINING
WHAT WE DID
14
We found
that training
factories in
groups was
extremely
positive. It
encouraged
peer-to-peer
learning and
sharing
experience
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
RESULTS
OVER ITS TWO YEARS, BBW reached a total of 102,110 workers, 54,186 (53%) of
them women. In Bangladesh we reached 41 factories employing 80,526 workers (57%
women) and in India, we reached 32 factories employing 21,584 workers (38% women).
32
Indian factories
41
Bangladeshi factories
8,201
Indian women
13,382
Indian men
34,626
Bangladeshi men
45,899
Interestingly, in both India and Bangladesh, results were better in the Phase 2 group
training than in the bespoke consultancy delivered in Phase 1. This is due largely to
more integration between all elements in the curriculum and the effect of group working,
prompting sharing good practice and peer pressure on laggards.
Overall, participants were extremely positive about the training. 96% of feedback received
from participants scored both the quality of the sessions as either good or very good.
RESULTS
Bangladeshi women
15
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
RESULTS
16
17
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
RESULTS
RESULTS: BANGLADESH
THE TABLE BELOW SHOWS THE
aggregated Good business and Good jobs
indicators for the Bangladeshi Phase 2 factories. The results are extremely positive across
the board BBW does seem to support an
improvement in both the capability of businesses and the quality of jobs for workers.
Efficiency improved by 18.28%. Cut-toship ratio by improved by 1.14%, meaning
that factories were able to ship (and get
paid for) more garments from the same
inputs. This represents a significant saving
for factories. On average, participating
factories saved 40,293 during the 6
month course, due to cut-to-ship improvements, a return on their initial investment
(2,000) of more than 21 over 6 months.
RESULTS: BANGLADESH
18
SUCCESS FACTORS
Looking in more detail at the results, and the
profiles of the factories, we can begin to see
a pattern in terms of which factories tend to
do better, and which less well in Bangladesh.
Factories with more sophisticated
production systems tend to have a
better performance in improving efficiency. These factories also appear to
perform better at reducing absenteeism.
However, there does not appear to be
a link between the level of production
sophistication and increases in pay or
worker turnover. This indicates that this
methodology supports increases in pay
and job quality, regardless of the sophistication of production systems.
Factories which attended all the training
sessions, updated their action plans and
proactively contacted trainers for support
if they faced problems were more
successful than less engaged factories,
particularly in terms of increases in pay
per hour, cut-to-ship and efficiency.
Factories were more likely to be engaged
in the programme if they have a stable,
long term relationship with their buyer.
8 See Appendix 1 for details on the sample, time period and how data was collected and analysed.
Worker
absenteeism
reduced by
34%
Start
End
% Change
Efficiency
47.00%
55.59%
18.28%
Cut-to-ship ratio
95.55%
96.64%
1.14%
7.90%
5.24%
-33.67%
9.72%
4.65%
-52.16%
6,430
6,921
7.64%
25.87
28.96
11.94%
250.10
243.63
-2.59%
42.11%
23.80%
-43.48%
Worker
turnover
reduced by
52%
19
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
RESULTS
INDIA
RESULTS: INDIA
SUCCESS FACTORS
20
9 See Appendix 1 for details on the sample, time period and how data was collected and analysed.
Efficiency
improved
by over
26%
End
% Change
Efficiency
40.92%
51.66%
26.25%
Cut-to-ship ratio
95.86%
97.18%
1.38%
14.44%
10.58%
-26.73%
11.62%
8.59%
-26.08%
5,197
5,461
5.09%
23.36
25.22
7.96%
216.83
212.03
-2.21%
Worker
absenteeism
reduced by
27%
RESULTS: INDIA
INDIA RESULTS
21
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
RESULTS
BBW factories
performed far
better overall
on all key labour
issues
In Bangladesh in BBW factories we found no incidence of forced labour, non-payment of minimum wage, child labour
and harassment and reduced incidence of coached workers, double books and hours over 60 per week, whereas in
non-BBW factories, we found forced labour, in the form of illegal deductions from salaries, in 50% of sites, non-payment
of minimum wage in 11%, child labour in 13%, harassment in 57%, coached workers in 18% and double books in 43%.
FIGURE 4: Incidence of labour standards issues in BBW factories and comparable non-BBW factories.
BANGLADESH: Percentage of factories where
Impactt found labour issues
Forced Labour
22
Non participants
0%
50%
76%
100%
0%
11%
Child labour
0%
13%
0%
25%
97%
100%
Harassment
0%
57%
Coached Workers
7%
18%
Double Books
7%
43%
In India, BBW participants also had lower incidence of labour standards issues than non-participants. In BBW
factories, there were no instances of forced labour, non-payment of minimum wage, child labour, harassment and
coached workers, and lower incidence of hours over 60 per week, no/ineffective worker representation and double
books. Whereas in non-BBW factories, we found workers working over 60 hours per week in 100% of the factories
we visited, non-payment of minimum wages in 25%, child labour in 13%, lack of robust age verification in 60%, no
or ineffective worker representation in 100%, harassment in 11% and coached workers and double books in 27%.
FIGURE 5: Incidence of labour standards issues in BBW factories and comparable non-BBW factories.
BBW participants the
end of the programme
Non participants
0%
0%
78%
100%
0%
25%
Child labour
0%
13%
0%
60%
11%
100%
Harassment
0%
11%
Coached Workers
7%
27%
Double Books
5%
27%
This may indicate that BBW participants have improved their labour standards performance during the programme,
and/or may show that the type of factory willing to join and invest in such a programme is likely to have higher standards.
Looking at wages, in both Bangladesh and India, BBW factories at the end of the programme were paying significantly
more than non-BBW factories, with fewer incidences of long working hours. In Bangladesh, 1730 Tk or 25% more per
month, and in India 158 Rs or 3% more per month. However, in neither country did wages approach current estimates
of living wage. Nevertheless, the project has clearly been successful in putting more money into workers pockets, both
in comparison to the amount they received earlier, and in comparison to other equivalent factories.
FIGURE 6: Wage comparison between BBW and non-BBW factories
n India
11 The Asia Floor Wage figure for Bangladesh in May 2011(12,248 Tk) is updated in two consecutive years with the average yearly inflation rate (9,73% and 7.7%
respectively).
n Bangladesh
12 This figure is calculated based on living wage estimates of 3 NGOs in Tiripur, Gurgaon and Bangalore and the Asia Floor Wage for India in October 2012 updated
with the average yearly inflation rate (6.52%).
23
Non BBW
$
Local Cur
Living wage
estimate
Non BBW
$
Local Cur
Local Cur
11
Local Cur
Non BBW
$
Local Cur
BBW
Non BBW
3000
38
3000
38
6921
87
5191
65
14474
182
-7553
-95
-9284
-117
109%
179%
4797
81
5500
92
5462
92
5304
89
1058312
178
-5121
-86
-5279
-89
94%
100%
At the very least, better factories, which are more open to change and prepared to make a commitment themselves
are able to make improvements, with the support of BBW. There are also strong indications that BBW acts to boost
factories which already have potential, and may also be powerful in starting under-performing factories on the road
to improvement.
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
RESULTS
24
Asked for their top three benefits from the programmes, brands
mentioned:
The programme has shown to make some improvements at all
sites that are engaged.
--------------------------------------------- Access to solid data making communication of the programme
easier. The fact this programme has moved us into a quantitative
space is a really good thing. Its been really useful for everyone.
Ethical Trade Manager, Sainsburys
--------------------------------------------- Addressing intricate challenges through workable measures and
solutions. BBW has the potential to showcase that good CSR and
HR practices can translate into commercial benefits
--------------------------------------------- The training material, content and delivery, one commented,
what a great legacy!
--------------------------------------------- The benefits of collaboration, particularly through Impactts
coordination. Mothercare said that the programme had created
a network of trusted brands and individuals to whom each of us
can turn when we have questions about any supply chain issue.
Another brand mentioned the ability to speak with one voice to
shared factories
--------------------------------------------- A better understanding of what works and what doesnt
--------------------------------------------- Improved transparency and engagement from factories, although
some have reported that this has not always been the case in
subsequent audits.
--------------------------------------------- An internal team equipped with more answers on how to resolve
situations, one said Improved transparency and encouraged
factories to feel confident telling the internal responsible sourcing
team what is really happening and why.
--------------------------------------------- Increased feeling of partnership between brand and factory
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
LESSONS LEARNED
1. BBW WORKS
BBW has
delivered
an additional
4 million
in salary over
12 months
LESSONS LEARNED
25
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
LESSONS LEARNED
26
LESSONS LEARNED
27
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
APPENDIX I
28
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
DATA LIMITATIONS
The data is collected from relatively short assessments. In Impactts experience, when working with
factories on a longer term basis, further issues and
further complexities tend to emerge over time.
This means that this data may under-represent the
prevalence of issues.
The prevalence of audit fraud distorts the findings as
Impactt may have failed to identify all the instances
of document tampering and worker coaching. When
audit fraud is successful it prevents us from verifying
the reality of working practices.
APPENDIX II
29
NICER WORK? IMPACTTS BENEFITS FOR BUSINESS AND WORKERS PROGRAMME 2011-2013
ACKNOWLEDGEMENTS
Impactt would like to thank the companies and organisations which have supported
the Benefits for Business and Workers Programme, in particular the Department for
International Developments RAGS Challenge Fund, Arcadia Group, Marks & Spencer,
Mothercare, New Look, Ralph Lauren, Sainsburys, Tesco and Varner Group.
We would also like to thank Professor Stephanie Barrientos, Institute of Development
Policy and Management Brooks World Poverty Institute and Rachel Wilshaw of Oxfam GB
for their assistance in contributing to and/or critiquing this report.
ACKNOWLEDGEMENTS
We would like to congratulate the amazing field teams, in particular Dr Rajesh Bheda and
his colleagues Maneesha Sharma, Manoj Singh and Santosh Subudhi of Rajesh Bheda
Consulting (RBC), Selima Akhtar and the Impactt team in Bangladesh, Mohammed
Saleem and the Impactt team in India, Dionne Harrison, Magali Martowicz, Holly
Presdee, Alexia Ward and Alex Eastham of Impactt in the UK for their tireless efforts
in making the world of work a little nicer.
30
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