Hanging On by Thread
Hanging On by Thread
Hanging On by Thread
BY A THREAD
Garment worker rights amidst rising costs
and wage violations in Pakistan
Original research: Conducted by Farhat Parveen, who
is a labour rights expert in Pakistan with more than
three decades of experience. She has conducted similar
Contents
research focusing on export-oriented tanneries, leather,
footwear and accessories suppliers. The research was 1 Executive summary
carried out for PILER as part of a global project to advance
international labour rights in Pakistan.
2 Introduction
Pakistan Institute of Labour Education and Research
(PILER) is a Pakistani NGO that does research, advocacy, 4 Rising costs, low wages
labour education, training and organisation. As a
distinguished labour rights organisation with over 40
years of experience, PILER has represented labour
6 Rights undermined, working
issues for Pakistani workers nationally, regionally and conditions
internationally.
SUMMARY
Amidst political upheaval, economic instability conditions for workers, through buying decisions that
and mass inflation, workers’ rights in Pakistan are squeeze suppliers to deliver orders at ever cheaper
in a state of crisis. costs.
Climate change led to heat waves followed by This report dives down into the situation for workers
devastating floods in 2022, which affected 33 in Pakistan, as a case study on how workers have been
million people and left many without their homes or impacted by the economic downturn globally and how
livelihoods and in need of work in the cities. Economic in the face of increasing economic pressure employers
crisis in Pakistan has further driven down quality of seek to cut costs at the expense of workers. Findings
life for the working class in recent months, with the show suppliers cutting costs and reducing their
cost of basic goods and amenities sky rocketing. liability, at the expense of workers, through paying
illegally low wages, unpaid overtime, not providing
In a time of economic downturn post-COVID, global
contractual documents, increasingly moving away
fashion corporations continue to extract wealth from
from permanent to temporary contracts and using
South Asian economies and mass produce clothing
third parties to sub-contract workers, in an industry
for Western markets, while displacing risk away
already characterised by sub-contracting across
from themselves, towards labour. Factory closures
borders to evade accountability for rights violations
or downsizing of factory capacity appears common,
and exploitation.
and suppliers are increasingly informalising workers’
employment conditions. Inflation in Asian garment There is an urgent need for governments, employers,
producing nations is far outstripping wage increases, and brands to deliver workers’ rights in Pakistan,
making living conditions increasingly precarious for to stop the erosion of wages and improve access to
workers at the bottom of supply chains. Brands with remedy.
the power and money at the top continue to dictate
with more than three million additional people falling Pakistan’s exports in a slump
below the lower middle income class poverty line of
$3.65 (2017 ppp) per day in recent years, facing food Pakistan’s economy is currently under severe stress
insecurity due to rising food prices and low wages. with low foreign reserves, a depreciating currency,
Many of the 82 million people who fall in the category and inflation reaching record levels.
will be linked to the garment sector.
In May 2023, the Pakistan Bureau of
Statistics reported that Pakistan textile
exports were down 14% for the fiscal year
22/2023 (runs July – June), dropping to 13.7
billion USD, compared to 15.9 billion in the
previous year.5
Copywrite: Shutterstock
Workers at a towel manufacturer, Karachi,
December 2020.
IMF to push back the imminent threat of default.6 The The sample of workers interviewed aimed to ensure
bailout loan however came with various high-cost an approximately representative spread across
provisos, including the elimination of energy price supplier types: homebased venues, yarn export
subsidies, and export controls. These “pro-investor” suppliers, composite textile mills (spinning, weaving
measures are further fuelling inflation in a way that and processing factories that make fabric) and textile
is impacting significantly on the working class, whose and garment factories where clothes and other textile
domestic energy and travel prices have increased products are sewn.
beyond control. The depreciation of the rupee
Data was collected from Karachi, Lahore and
compared to the dollar is also driving up the cost of
Faisalabad, which are the three main hubs of textile
oil and other imports needed for Pakistan’s textile
production in Pakistan. The geographical spread
industry to function.
of interviews conducted for this research was
proportionate to the size of each region’s contribution
Research methodology to Pakistan’s textile output: 44% of interviewees
In order to understand the reality of conditions for were based in Karachi, 28% in Lahore, and 28% in
workers in the garment sector in Pakistan in the face Faisalabad.
of this economic upheaval, researchers collected
detailed data for the purpose of a baseline survey, In addition, key informant interviews were held to
which this report is based on. corroborate the findings and provide context.
Researchers asked workers how inflation had The data also indicated a lack of choice over
impacted their costs, and 70% said inflation impacts healthcare services. 30% of workers said they did not
had increased household expenses mainly, while 13% have access to healthcare services at all. For those
said this was mostly an increase in food costs. Looking who did have access, 86% said they could not go to the
at the average monthly costs, workers were spending hospital of their choice, predominantly for economic
significantly more on utility bills than house rent. reasons.
Poor housing, many residents On this topic, Khalid Mahmood from LEF said: “The
Of the workers surveyed, 2% said they live in “kachaa” state is not providing for the workers. There is little
5
support for the workers’ medical needs. Although Half of the workers surveyed reported
there are government hospitals, the workers are that their total household income was
so burdened that they cannot leave their jobs and below PKR 45,000 (around £122 a month),
go to the hospitals. They end up getting medicine
from the quacks. In education there are not enough and over a third said that household
primary schools in localities where workers live so income was under PKR 35,000 (£95 a
they have to spend from their wages on the education month).
of their children. Housing is not subsidised. The state
is not taking on these responsibilities and then the
Living wage estimates for Pakistan for a family vary
minimum wage is not enough.”
based on methodology, but the Asia Floor Wage
Alliance put a family decent basic income at 67200
Household income not enough PKR7 in 2022 and the Global Living Wage Coalition put
The average household size for the sample was 6.3 a family income for a decent living between 49677 and
members, so we looked at the number of income 52749 PKR for 2022.8 These estimates from last year
earners and household income and budget, to see will not have taken into account the sky-rocketing cost
how total household finances supported living costs. of living this year with inflation rates the highest they
have been in five decades. Even so, these estimates
30% of the workers had 1 income contributor per outstrip current average household incomes
family, while 43% had 2-3 income earners, and significantly.
26% had 3-4 income earners. When asked about
whether there were children under 18 contributing One worker stated: “I am a skilled worker but we do
towards household earnings, there was a mean of not get the salary for our skill. Minimum wage should
1.36 children per household contributing to income. be 60,000 rupees to make both ends meet. We have to
Despite this high skew towards multiple household buy everything; water for drinking and other usage so
income contributors, total household incomes for an 32,000 will not be enough.”
average household of 6.3 were remarkably low.
Worker testimony:
The piece rate shift
“What happened after the minimum wage
increase announcements during the past
many years was that workers were asked
to resign or sent for a few days off and
reemployed on the basis of piece rate.
There are more workers working on piece
rate than before. There used to be 7,000
workers working in our factory, but now
only 4,000 are working as salaried workers.
The rest have been fired and most of these
were rehired on a piece rate. It happens
every time there is an increase in the
minimum wage. Workers protested outside
the factory but to no avail.”
7
Working hours excessive through some audit process. So the fact that only 23%
of workers have received an appointment letter is
Workers were working between 8 and 12 hour days,
and 84% of workers were working 6 days a week. A
small sample at 5% said they were doing 7 days. Long
hours were particularly notable for homeworkers
where over two thirds said they were doing 12 hour
days as standard. One worker said: “I work as a
machine operator in the label line. Mine is an eight-
hour shift but usually I work overtime for another six
hours.”
60% of workers said they were doing some overtime,
and of these 89% said the overtime they were doing
added up to 2 hours or more per day. But the majority
of workers reported that they weren’t being paid fairly
for their overtime under the law. Only 36% said they
were receiving the double overtime rate, and almost
half said they were just getting a single rate pay, the
same as their normal hours. Only 2% of workers said that there were
children working in their factories, mostly
This form of wage theft has increased in recent years as helpers or stackers.
according to Zehra Khan from HBWWF, who said
that overtime is considered simply a part of regular
working hours: “The majority of the workers, even the
workers working in the brands factory, are not getting alarming. A large majority does not have a proper
the minimum wage. If they are getting the minimum proof of work, necessary to claim salaries and other
wage it depends on the length of service over the rights at the workplace. It also reflects on the quality
whole day. They go to the factory at 9am then leave of audits that are undertaken at the workplace.”
at 9pm which is 12 hours of work. Overtime is not
seen as overtime, it is seen as mean working hours. Increasing informalisation through
They are not paid the minimum wage because the contractors
minimum wage is for 8 hours of work, not for 12.”
Although 53% of workers researchers spoke to were
permanently employed, a significant proportion
No contracts, no proof of work were on temporary contracts (29%) or employed via a
A large majority of workers still do not have proper contractor to work in the factories (15%). Zehra Khan
proof of work, which is necessary in order to claim said that informalisation has increasingly been used
their wages and other rights. by employers to deny workers their rights: “After
covid, informalisation has increased. I know many
Only 23% of the workers surveyed had factories where previously the unit was working
as permanent workers, but now the whole unit
received a letter of appointment. shifted and all the workers are now the employee
of the contractor. Management in some cases said
73% reported having a duty card but this only serves
to us, these workers are not our employees, but
to mark attendance, and in the vast majority of cases
at the same time, said to the contractor not to hire
does not show the workplace, address, department
someone they don’t like.” Some factories had many
or employment ID needed to prove work and claim
contractors supplying workers to the factory, making
workers’ rights.
it difficult for auditors to track data on employee
Farhat Parveen, researcher for this report said: “It is numbers and employment rights. From the worker
worrying that all of the factories that we have covered perspective also, the legal link between workers and
in our sample are working for the export- oriented factory management as employer, meaning workers
market, and these factories are supposed to go have limited recourse to justice if they need to raise
WORKING CONDITIONS,
CONTINUED...
complaints about conditions in the factory. for one to two meals, and go home to eat.”
.
9
Zehra Khan
General secretary of the Homebased
Women Workers Federation:
“Informalisation within the formal sector
is increasing. People can’t form their
union, can’t demand for their rights, and
experience very bad working conditions.
Home-based workers are not seen as
links in the supply chain. We are asking
for transparency. Brands should keep a
list of all the workers in a whole supply
chain - home-based workers and the
cotton pickers – and ensure their rights are
protected. With this kind of transparency
from brands, I think there could be better
work in the future.”
Audits not picking up violations there was one unit in which there was a wiring issue.
But if workers are not informed, if they do not have
Looking to labour department inspections and third- a trade union, if they do not have an appointment
party auditing as one of the current solutions put letter, then they cannot speak out on these issues.
forward by brands and government to check on health This is why we demand a tripartite auditing system,
and safety, workers had very little confidence in the in which workers representatives sit in to ensure we
effectiveness of these systems. Only 30.5% of workers get accurate reports, amendments can be demanded,
said that they had seen the labour department and followed up by workers representatives. After
inspect their factory. 65.1% of workers said they didn’t all, workers are the ones spending most of their
think they inspected efficiently. 72% of workers said time in the factory, all workers want and need a safe
that inspectors didn’t even speak to workers at their workplace.”
suppliers.
Khalid Mahmood stated: “Things can only develop
When asked if they thought their factory abided by the when the workers have a voice. The workers on a daily
labour law, 59% of workers said no. One worker said: basis need to highlight the issues and be sure they
“Auditors come to our factory but they do not talk will be heard. Safety committees are not currently
to us. We have not heard of the labour department working. If there were true representation from
inspection but auditors do come. They always meet the workers in safety committees, then this culture
with the management, check the machines, take a could be developed. We hear of certain incidents of
round, enjoy the hospitality of the employers, and fire, building collapse from time to time. This is not
leave.” Another worker stated: “We are asked to lie stopping. I would say this is still a big problem in the
or keep quiet during the audit process. We are being industry. The industry will not develop until there are
told to say that we get minimum wages, leaves, and systems that are able to take care of health and safety.
holiday, and are registered in social security, EOBI, Freedom of Association is vital for this.”
and the Workers Welfare Board.”
Nasir Mansoor, general secretary of the National
On auditing, Zehra Khan, of the HBWWF trade union, Trade Union Federation in Pakistan said: “We need all
stated: “The main issue with auditing is that the brands with production in Pakistan to sign the Accord
employer hires the auditor. They can simply ask them as soon as possible. And, once brands sign, they must
to write what they want the report to say. The other not sit back and relax. Only after inspections begin
key issue is that the auditors do not share the reports and workers can hand in complaints, will the risk
with employers, workers, or the labour department. of the next factory fire or collapse actually start to
When I read the auditing reports from before the Ali lower.”
Enterprises fire9 for 3 years they had mentioned that
FREED OM OF ASSOCIATION,
A KEY SOLUTION
While workers in Pakistan do have on-paper rights Unionised workers know their rights
to form plant-level unions, in practice levels of
unionisation remain very low, and there are many 71% of unionised workers surveyed, compared to 53%
obstacles to collective bargaining. Trade union of non-unionised workers surveyed, knew the number
membership across industries in the country is and types of leave from work that they are entitled to
estimated to be as low as 2%. Of the workers surveyed take. As many as 89% of unionised workers, compared
for this research, only 8% were members of a union to 44% non-unionised workers said they were working
and almost 80% of workplaces had no unions. 71% in a factory that is registered under the Factories Act
of workers said they faced resistance from their 1934, while 53% of non-unionised workers compared
employers to forming a union. to only 9% unionised workers said they did not
know whether their factory was registered under
Researchers spoke with one garment worker, the Factories Act or not. This demonstrates better
employed in a factory supplying a big UK brand, who knowledge of rights and compliance where workers
said: “Unionisation efforts are dealt with a heavy hand are members of unions.
whenever workers try to form a union. Managers and
employers come together and make an example out Unionised workers receiving better
of such workers who are trying to organise.” Another wages
worker, working in a factory supplying well-known UK
and European brands said: Only 16% of unionised workers were being paid on a
piece rate basis, compared to 38% of non-unionised
“If we try to form a union we will be workers. 78% of unionised workers versus 59% of
non-unionised workers were receiving their wages
kicked out.” in the form of a monthly salary. A difference was
found also in terms of total monthly income between
While the number of unionised workers is low, the unionised and non-unionised workers. 33% of
results of our research provide a clear indication unionised workers received more than PKR 30,000
of the ways in which organised workers, who are per month, compared to just as against 24% of non-
members of independent trade unions, are better off unionised workers.
with respect to a whole range of other labour rights.
Unionised workers experiencing
better working conditions
Across working hours, availability of leave and nature
of contracts workers in unions were experiencing
better working conditions than those who were not
members. 86% of unionised workers compared to
73% of non-unionised workers reported receiving sick
pay when they are off work due to illness.
at all, which was not the case for any unionised process as well. They have to involve themselves
workers. or involve independent people from outside, in the
process of ensuring collective bargaining and union
Collective bargaining is the key elections are fair. They have to ensure that these
things are happening.”
These findings from the baseline survey data
support an argument that the labour movement in Zehra Khan from HBWWF added this: “The key is
Pakistan – and internationally – has always made: collective bargaining, because through collective
the surest way to ensure improvements for workers bargaining workers can bring all the other issues.
across every area of labour rights is to facilitate an And when one win is achieved, workers can fight for
enabling environment for freedom of association. This more. For example, the minimum wage is 25,000. But
means treating democratically elected trade union through collective bargaining we can fight for more,
workplace representatives as the voice of workers, for 30,000, for 50,000. We do not have to stop once
and recognising independent trade unions of workers’ we achieve compliance with the law, we can ask for
choice as the legitimate collective bargaining agent more. The mindset of employers needs to change:
rather than the worker-management joint councils workers are not their slaves, workers are increasing
with supposed workers representatives who are too the employers’ profit so they should recognise their
often hand-picked by management. value.”
Khalid Mahmood from Labour Education Foundation From wages, to working conditions, to occupational
had this to say about worker-management joint health and safety, the findings of our research provide
councils: “The brands have to get rid of workers a snapshot of the many ways garment workers
management joint councils. They think that this is in Pakistan face systematic violations of even the
the replacement of the trade union and freedom of most basic legal standards. But as Zehra Khan says,
association. They have to clearly say that we need these workers, whose labour makes clothes people
CBAs in the factories. We do not need joint workers around the world wear, and the profit global fashion
management joint councils. This is one important corporations pocket, deserve far more than just the
thing. And when we see CBAs they need to see the bare legal minimum needed to scrape by.
RECOMMENDATIONS
AND CONCLUSIONS
“International buyers are the driving force. If they want to source products from Pakistan, they should
at least take responsibility for ensuring that conditions for workers who make their profits are in
accordance with the law. Workers rights should not be exploited in Pakistan, or anywhere. If brands
really want change, they could easily give a little from their surplus value to ensure workers conditions
are good. And to push the brands, the catalyst can be the consumer in Europe and western countries.
This solidarity is important for our movement.” (Zehra Khan, HBWWF)
The emphasis of the recommendations in this • Workers must be paid at least the minimum
report will focus on the action fashion brands as wage in return for an 8 hour day of work, with
international buyers, and their suppliers, can take the double overtime rate paid on top for any
to ensure garment workers rights in Pakistan are additional overtime undertaken
upheld. There is however a significant role also for
governments, provincial labour departments, the • Suppliers should stop using piece-rate contracts,
legal system, social auditors, international finance and stop unilaterally transferring workers to these
institutions, and more in delivering changes needed. systems to save costs.
Brands and suppliers must work together to: • Workers should be paid by bank transfer, an
electronic record kept of wages, and wage slips
provided to workers.
1. Stop the increasing
1. • Brands must factor in full cost recovery wage
informalisation in factories in prices into purchasing practices, ensuring all costs
Pakistan relating to worker pay and benefits under the
national labour law are taken into account in their
• Brands and suppliers must ensure formal
calculations. The new PKR 32000 minimum wage
contracts and a letter of appointment are
should immediately factor in prices increasing.
provided to all workers with key terms and
conditions particularly regarding pay, leave, • Brands should price in living rather than minimum
overtime. Duty cards are no replacement for this. wages into their purchasing practices with
suppliers.
• Suppliers should employ their workers directly,
on permanent contracts, rather than using
contractors or temporary contracts in their 3. Fix monitoring and complaints
operations. Where contractors are used, suppliers mechanisms
must ensure their role is visible and that contract
• An effective worker-driven complaints mechanism
workers are afforded the exact same rights and
should be present in all suppliers, with a
privileges as formal workers, and their role is
transparent process for resolution and protection
transparently declared with auditors, registered
for workers. Where no record of complaints and
in labour office statistics, and workers employed
resolutions is kept, brands should take action to
under all kinds of contract are registered officially
investigate.
for social security.
• Social auditing is currently failing to pick up most
2. Ensure the minimum wage is worker rights violations in Pakistan. Brands
paid for all workers and adopt should actively engage in finding solutions to
progressive policies that work the causes of this. Brands should also publish all
towards payment of a living wage audit reports and keep public records of aims and
progress by supplier, to ensure better remediation
• Brands and suppliers must ensure that the efforts, in collaboration with national labour
minimum wage is paid to all workers, regardless inspectorates, unions and workers’ rights groups.
of their position within the supply chain.
15
A climate demonstration that labour groups in Sindh took part in, uniting under a
banner declaring ‘Workers of the world unite against capitalist plunderers of our earth.’
• Brands should map their whole supply chain • Brands must monitor CBA numbers and work
– including home-based workers, contracted to ensure CBA negotiations take place, and that
workers, subcontracted workers, piece rate the clauses are implemented, to progressively
workers and cotton pickers – and work with improve workplace rights and wages.
suppliers to ensure pricing and processes are
Endnotes
References: 1
2
[1] Employment and wages rising in Pakistan’s garment sector, P. Huynh, ILO, Feb
2017, https://www.ilo.org/wcmsp5/groups/public/---ed_protect/---protrav/---travail/ 3
documents/publication/wcms_544182.pdf 4
5
[2] Textile (Value Addition) Sector Profile Pakistan, BOI, accessed September 2023
https://invest.gov.pk/textile#gallery-2
6
7
[3] https://databankfiles.worldbank.org/public/ddpext_download/poverty/987B9C90- 8
CB9F-4D93-AE8C-750588BF00QA/current/Global_POVEQ_PAK.pdf
9
[4] Ibid 2, p.4
[5] https://tribune.com.pk/story/2418100/textile-exports-plummet-by-14-to-137-billion
[6] https://www.imf.org/en/News/Articles/2023/07/12/
pr23261-pakistan-imf-exec-board-approves-us3bil-sba
[7] Asia Floor wage for 2022, based on 1600 PPP$ https://asia.floorwage.org/
living-wage/
[8] GLWC estimates for 2022, rural and urban benchmarks, estimating costs of a basic
but decent living for a family of 5.5 and 5 respectively https://globallivingwage.org/
living-wage-benchmarks/rural-pakistan/
[9] On 11 September 2012, the Ali Enterprises factory in Karachi burnt down just
three weeks after being awarded SA8000 certification upon inspection overseen by
RINA. At least 250 workers were killed. The audit failed to notice that the factory had a
number of glaring safety defects that violated both Pakistani safety regulations and the
auditor’s own guidance, including locked fire escapes; blocked windows; a defunct fire
alarm system; a wooden mezzanine; piles of garments blocking exits; unsafe escape
routes; and a lack of measures to keep a fire from spreading, including insufficient fire-
fighting equipment.
www.labourbehindthelabel.org