A living wage should cover a decent standard of living for the worker and their family.
Most factory workers in the apparel industry do not earn a living wage and must make tradeoffs to cover their basic needs. Patagonia has worked hard to ensure that workers in our partner factories are paid according to the law with regards to the minimum wage, overtime pay, and statutory benefits, and yet we know that those wages are not enough to afford a decent standard of living. This is particularly important to recognize during the Covid-19 pandemic: many workers have seen their wages reduced, while others have lost their jobs and source of income.
Living Wages: A Basic Human Right
UN and its International Labor Organization (ILO) have declared living wages a basic human right.
After extensive research on living wages and discussions with other brands, NGO’s, and living wage organizations, Patagonia supports the Global Living Wage Coalition’s (GLWC) definition for a living wage: The remuneration received for a standard workweek by a worker in a particular place sufficient to afford a decent standard of living for the worker and her or his family. Elements of a decent standard of living include food, water, housing, education, health care, transportation, clothing, and other essential needs including provision for unexpected events.
Historically, there had been little data on wages and the cost of living across different regions. The launch of the Anker Methodology in 2017 made it possible to estimate living wages and compare them across different countries while also looking at local costs for a typical family within a specific area. Patagonia supports the Anker Methodology because it works with local people and organizations to estimate the cost of a basic but decent lifestyle for a worker and their family in a particular place. This requires transparency and detailed research, which leads to estimated living wage benchmarks that are solid and credible. The GLWC, one of the founders of the methodology, has already completed living wage benchmarks across 20+ countries, with more to come.
Where We Are
As of 2019, 35% (11 out of 31) of our apparel assembly factories are paying their workers a living wage, on average.
This data was gathered before the Covid-19 pandemic, which has impacted workers significantly and led to job loss throughout the apparel industry. We are currently working to understand the extent of this impact on wages and we are looking into ways of strengthening our Responsible Purchasing Practices program in order to help our suppliers maintain their workforce.
We’re also looking at different ways to help our suppliers and apparel workers face unpredictable economic or climate shocks. And living wages and safety nets for workers are foundational for this work.
You have the power to change the way clothes are made Informed customers can vote with their dollars and support brands that are working towards living wages. Ask your favorite brands questions on how they’re trying to achieve living wages. Demand better practices—what you buy is what the industry will become.
Our Road to Living Wages Our living wage strategy is built on four key principles:
- We believe in working with our factories directly to find and pilot tailored, multi-prong approaches to achieving and maintaining living wages.
- We are committed to working with other companies, suppliers, workers, NGOs, unions, experts, academics and customers to achieve these goals.
- We want to implement a sustainable living wage strategy that makes it easier for suppliers to pay a living wage even during fluctuations in their business.
- We want to share our lessons, including what’s worked and what hasn’t, so that solutions can be scaled up. We’re doing this by joining industry conferences and meetings, as well as one-on-one calls with other brands and NGOs.
- Read about the history of our social responsibility work, including our 4-Fold approach, Responsible Purchasing Practices, Supplier Buy-In, Multi-Stakeholder Initiatives, Transparency, Management Support, Supplier Workplace Code of Conduct, Monitoring our Supply Chain, Fair Labor Association, Fair Trade certification, and our living wage journey. All these programs have helped us get to where we are in implementing our living wage strategy.
- Get familiar with the Anker Methodology for estimating living wages.
- Read about our philosophy for working with factories to promote and sustain fair labor practices.
- Seek out experts and organizations working to increase wages.
- Consider joining an organization like the Fair Labor Association or the Fair Wear Foundation, for example, which provide access to the tools and support you need to develop a program.
Are you a brand looking to start their journey toward living wage? Companies play an important role in raising wages for workers. Start by examining your company’s supply chain and business practices and then talk with experts on living wages. Achieving living wages is challenging for companies working with a large number of factories, but brand collaboration will be the catalyst for change. Here are some tips to get you started:
Phase 1: Launch 2010-2011: Patagonia’s SER team helped develop the Fair Labor Association’s Supplier Code of Conduct language that requires its member brands to work towards a living wage.
2013: We published our revised Supplier Code of Conduct that included a living-wage component. We also began our partnership with Fair Trade USA®, our first step on the journey towards living wage.
2014: We were a part of a multi-stakeholder consultation to create the FLA’s Fair Compensation Workplan, the FLA’s vision for how to achieve living wages in apparel and footwear assembly factories. In anticipation of the Workplan, we created a Patagonian internal Fair Wage Taskforce, a cross-departmental team tasked with supporting the FLA and figuring out the company’s pathway to achieving living wages in our supply chain.
Phase 2: Taking Stock 2015: The FLA published its Fair Compensation Workplan, which we used as the foundation for our living wage work.
2016: We began our work with FLA members to build the best method for gathering and analyzing wage data for our apparel assembly factories. We piloted a tool to collect wage data with ten of our apparel assembly factories.
2017: We continued to work with the FLA by completing our pilot to gather wages for 10 apparel assembly factories. As we tried to understand which of Patagonia’s apparel assembly factories deserved immediate attention to narrow the gap between current wages and a living wage, we asked MIT students in the Sustainable Business Lab to help us find an easier way to gather wage data across a large supply chain. The students developed a model for streamlined collection of this data.
2018: Early in the year we piloted the FLA’s improved wage data collection tool with ten apparel assembly factories. The pilot went well, and before using the tool with all suppliers, we scheduled interactive training webinars with all of our apparel assembly suppliers. In this webinar we officially launched our living wage program with our suppliers, announced our goal, defined the living wage, showed the importance of the living wage, communicated our strategy for achieving living wage, discussed next steps and our program timeline, and answered questions and receive feedback. After the official launch of our program with our suppliers, we then finished collecting wage data. With this data in tow, we enlisted the help of the MIT Sustainable Business Lab to help analyze it.
2019: In 2019, we updated our analysis of living wages in our apparel assembly supply chain. Our report showed that 35%, or 11 out of 31 apparel assembly factories, were paying a living wage, on average, at that time. This data was gathered before the Covid-19 pandemic and reflects a significantly different economic reality for these workers and factories.
Phase 3: Learning, Planning & Making Change 2020 and ongoing: We had started planning pilots for how to partner with our apparel assembly suppliers to increase worker wages without jeopardizing the competitiveness of these factories, and we had planned to roll out one or two pilots per year, with the commitment to share the results with the FLA in order to create a helpful forum for participating brands and suppliers to work together towards a common goal. However, with the onset of the Covid-19 pandemic we have been unable to move forward with pilots in 2020 due to the significant economic impacts on our business and our suppliers, and the logistical difficulties involved in doing work onsite when there are risks of spreading Covid-19. We are now reevaluating where our suppliers are and will adapt our work to see how we can make the most impact.