Ethical Trading Initiative publishes guidance for apparel companies on protecting supply chain workers from economic fall out of pandemic
“ETI publishes guidance to apparel and textile members on payment of orders to workers”, 06 April 2020
… The guidance focuses on ensuring workers receive payment for completed work, urges dialogue with suppliers over ongoing orders and collective action on long-term social protection for workers.
… During these testing times it remains vital that business plays a full role and that companies are transparent about the measures they are taking to minimise the impact of the crisis on workers in their supply chain.
Future orders where no costs have been incurred by suppliers or factories
It is reasonable to cancel these orders … but we expect … dialogue with suppliers about post-Coronavirus orders and support to retain capacity where possible…
Ongoing orders where some costs have already been incurred, but more would be expected with a continuation
We expect … dialogue with suppliers to fully assess the costs incurred so far with the aim of agreeing a reasonable way to share them. For work already completed, we would expect salaries to be paid in full by suppliers and for members …. This will mean understanding the capacity of the factories to support their workforce and making extra efforts where necessary and possible…
Completed orders with full costs already allocated
Payment for completed orders should be honoured and within reasonable time. Brands should consider early payment and not withhold payments to suppliers … Brands should also avoid using Force Majeure provisions in contracts for economic reasons or summarily terminating contracts…