Glossary

Thursday, 01 November 2007 19:35

Collective bargaining (CB). An arrangement whereby working conditions and wages are fixed by negotiation between workers’ representatives (a trade union or other body) and their management.

Corporate Social Responsibility (CSR). Efforts made by companies voluntarily (or under pressure from NGOs and trade unions) to reduce their negative impact on society, or to create a positive impact. For example, compliance programmes.

Code of conduct. A statement, usually by a retailer or brand, of the way it expects suppliers to act, in particular regarding w orkers’ rights.  Also called Code of Practice, Terms of Engagement.

Compliance. A term used widely within the garment industry to refer to the implementation, monitoring and verification of a code of conduct (i.e., compliance with the standards set out in a code of conduct). It assumes that responsibility for the conditions that create poor working conditions rests solely with the supplier, who must ‘comply’ with the conditions set by the buyer.

Ethical Trading Initiative (ETI). A UK-based MSI. Corporate members commit to working towards the standards of the ETI’s base code of practice, and annual reporting of their efforts on social compliance. Best practice is developed and shared through working groups.

Freedom of Association (FoA). The right of workers to form and join independent trade unions or other representative organisations of their own choosing.

Living wage. Where the earnings from a standard working week are sufficient to meet the basic needs of workers and their dependents, and to provide some discretionary income. Distinguished from both the minimum wage and prevailing industry wage. See the main report for more information on this.

Monitoring and verification (M&V).  Monitoring is the internal process by which a company measures the actual working conditions at its suppliers against its code of conduct. Verification is the external process by which an independent third party checks working conditions.

Multi-stakeholder Initiative (MSI). An organisation bringing together companies, NGOs and trades unions. Some, like the European Fair Wear Foundation, act as independent verifiers of working conditions; others, like the ETI, function as forums for the exchange of best practice.  For the purposes of this report, we have included only MSIs such as these two through which companies can work on living wages, freedom of association and monitoring and verification, and which have codes of conduct placing obligations on member companies.

Non-Governmental Organisation (NGO). At its most broad, any organisation independent of political institutions. In the field of labour rights, NGO typically refers to an organisation, other than a trade union or government agency, that is seeking to alleviate poverty, defend workers, and improve working conditions.

Piece rate. A method of paying workers by the number of items they produce, rather than the number of hours they work.

Social audit. Inspection of working conditions in a factory, usually against the criteria set out in a code of conduct.

Trade union. An organisation of workers offering mutual support and representation. In particular, trade unions negotiate with management on employment matters. Globally, fewer than 5% of garment workers are unionised.