More and more imposed overtime and unpaid work
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Spotlight interview with Annie R. Adviento, National Coordinator for the Philippines of the International Textile, Garment, and Leather Workers' Federation (ITGLWF)
"More and more imposed overtime and unpaid work"
Brussels, 7 July 2005 (ICFTU OnLine): : As the ICFTU is publishing a new report called "Surviving without quotas in the Philippines" (http://www.icftu.org/www/PDF/RP_Garment_Report_170605edited_260605EN.pd f), Annie R. Adviento, National Coordinator for the Philippines of International Textile, Garment, and Leather Workers' Federation (ITGLWF), on what the Multifibre Arrangement (MFA) phase-out means for the Philippine garment workers and how local trade unions are responding to this new quota-free context.
How important is the garment sector to the Philippine economy? How many workers does it employ?
Since the '70s and up to now, the garment sector in the Philippines has become the second largest industry in terms of both volume and value of exports behind the electronic sector. Our major market remains the United States which accounts to 74.6% of our garment exports or US$2.04 billion. In terms of job creation, the garment sector is the second biggest employer within the manufacturing sector. In 2002, 400,000 workers were employed in the garment sector although surveys by non-governmental organizations estimated that some other 700,000 workers were active in the informal sector.
Historically our garment and textile sector, while still classified as a cottage industry in the '50s, really took off in the early '70s. When the Philippines entered the General Agreement on Tariffs and Trade (GATT) in 1974 and subscribed to the Multifibre Arrangement (MFA), we became dependent on quotas. And our industry kept on growing. Within six years our garment exports rose from 7.18% to 21.7% because of the preferences given to us by the United States.
For more than three decades the quota system established by the Multifibre Arrangement (MFA) regulated the global trade in textile and apparel products. January 1, 2005 marked a new quota-free era for the garment industry. The Philippines must now compete with other cheap-labour Asian exporters such as China. At what extent have the Philippine workers been affected by the MFA phase-out?
Let us clarify that the quota phase-out has been gradual. As early as 2000 we could already feel the phase-out's negative impact. In some categories of items removed in 2002 such as the luggage products, Philippine exports fell by 54% while China's increased by 664%, according to government statistics. On the baby clothing, which is one of the Philippines' niches, our exports fell by 17% while China increased by 826%.
The sector was indeed larger before. The number of workers dropped from 700,000 in 2000 to 400,000 in 2002 and eventually to 311,000 in 2003. From 2000 to first half of 2003, almost 160 factories shut down and 23,500 workers lost their job. On the other hand, the Philippine government who announced that there were154 new manufacturing facilities and 35,000 new workers for the same period argued that the situation had been improving, even without the quota.
But let us look at the quality of this newly created employment. We noted that most of the workers who were laid off were unionized and regular employees; while new companies are all located in the export-processing zones where labour unions are not always welcome. And we don't know what kind of employment those "new" workers have.
Could we clearly associate the end of the quota system with the job losses? Are there other factors that must also be taken into consideration?
Although the quota phase-out is believed to be one of the major factors contributing to the job losses, it surely can not be regarded as the only one. There are others. For example, labour cost in the Philippines is often said to be higher than in Thailand or in other exporting countries in the South-East Asian region. It is the same for the electricity price.
Under the quota system, the Philippines was guaranteed with jobs. Now, without the quota system, there is no more guarantee. It is free for all. Many companies have been relocating to Vietnam claiming that doing business in the Philippines is too expensive.
Stiffer competition in the global free market is also likely to intensify the downward pressure on working conditions in order to reduce costs. Aside from the jobs lost, have you noted this so-called "race to the bottom" tendency on the remaining employment?
Yes, very much. Nowadays cases of forced overtime or unpaid work are much more frequent than before in the Philippines. For example, when a worker is given a certain production quota and she cannot make it by the end of the day, she is instructed to finish the work without overtime payment. Such complaints are regularly filed.
Sometimes coffee breaks are sacrificed and lunch hour is shortened so that the workers meet the quotas. Sometimes the day off is suspended and employees work seven days a week. Team work in "line" system no longer allows one sewer to go to the toilet or drink water while others are still working. Besides, many of the garment factories are not properly ventilated unlike in the electronic sector where air-conditioning is required because of the nature of the work.
In this new quota-free context, what competitive advantage can the Philippine garment sector offer in comparison with its Asian neighbours?
The Philippine garment industry employs a lot of skilled workers who are known to be fast-learners and good English speakers. Actually a company which closed its doors in the Philippines and reopened in Sri Lanka hired a hundred Filipinos to train Sri Lankan workers for three years there. Even the Chinese government seems to be interested in employing Filipinos to train Chinese garment workers. Basically it is recognition of the Filipinos' skills. In terms of quality, we are confident we can compete with other Asian countries.
One of the main problems is that we knew for a long time that the quotas would be phased out. The Philippine government has been very complacent about it. And it admitted that not much has been done to prepare the industry for the quota-free context. It said that not all the companies here are ready for the quota phased-out because of their obsolete machineries.
Up to now the Department of Trade and Industry (DTI) has been very consistent in painting a rosy picture of the garment sector. According to the government, the quota system limited the diversification of the industry. From the employers' perspective, too, the end of the MFA is seen as an opportunity. According to them, being no longer dependent on quota allows us to look for new markets and develop new products.
What about the response from the Philippine trade union movement? Was ITGLWF able to mobilize its affiliates and campaign on the possible implications of the quota phase-out for the workers?
As early as two years ago we started preparing the trade unions by launching our campaign on the quota phase-out. We hoped that generating awareness among our affiliates could help them initiate some activities to mitigate the phase-out's possible impact. In 2002, we came out with our own study in which we documented many problems affecting the garment industry. The most serious issue was that we cannot produce the raw materials required for our exports since the Philippines has literally no textile industry.
Before the year 2000 the government and the employers who considered themselves as the engineers of the industry came up with a formula to revive the industry called the Industry Transformation Plan (ITF). But trade unions felt that sentiments of the workers were not heard during the past two years. The government simply assumed that the workers would be happy if the industry was saved. That is not what trade unions wanted. We wanted to be in, to be part of the process.
Did you eventually get the garment workers' voice heard by the government?
Yes. Based on this plan, some companies began to introduce new productivity models and changed some management systems. Trade unions reacted very violently and rejected those changes at the workplace. In 2002, the government accepted to include labour unions in the discussion. But their initial idea was that it was just a consultation. There was no plan to initiate a real continuing dialogue with labour unions.
We then invited various federations and labour unions from the garment sector and agreed to work together on what are the priority issues for the workers. And we called ourselves the "Labor Forum Beyond the MFA." The role assigned to ITGLWF was to act as a secretariat for the "Labor Forum."
After a few meetings we were able to formulate an eight-point agenda that we presented to the government and the employers. One of our eight proposals was a structural reform that included the creation of a tripartite body to address the garment industry's concerns. It took almost three years before we eventually got the Clothing and Textile Industry Tripartite Council (CTITC) approved. The meeting was only held early this year 2005.
In dealing with the management representatives and government officials, what is your line or your main guiding principle?
We recognize the difficulties the garment industry is facing. We are not asking the companies to stay in the Philippines even if they are losing their money. We are ready for closures and downsizing of activities. But trade unions insist that whatever decision is taken the workers' rights must be protected. That is the guiding factor: the right to due process must be observed. What is happening now? Some companies let their workers work only for two or three days this week; and the next week when they go back to work, the factory is closed without them getting wages or separation fees.
Engaging in tripartite bodies can be a challenging -sometimes frustrating- experience for trade unions. Is it worth dedicating so much energy to bring all those actors around the discussion table?
In some countries, trade unions are very critical about tripartism. But in the Philippine environment we would rather be in than out. Why not participate in making the changes from within instead of just criticizing the system from outside? In the overall context of the quota phase-out, ITGLWF has always been pushing for social dialogue. But we recognize that there is a danger.
There is no point for the labour sector as being only a stamp pad in the council. In all labour sector meetings suspicious views are aired. We are hopeful. But we need to have a meaningful representation. We would like the six labour sector representatives to be able to voice workers' concerns within the CTITC. If they need capacity-building support, information gathering, consultation mechanism, they know ITGLWF can help them.
At this moment, we see CTITC as one big positive development for the garment workers. It is a big opportunity. For two years we have aimed to be part of the system. Now we are in. Of course initiating this tripartite body will not prevent us from playing our traditional usual trade union's role in strengthening collective bargaining and organizing workers.
Interview by Laurent Duvillier
See also: End of global textiles agreement leads to worsening labour conditions in the Philippines, new ICFTU report submitted to the WTO : http://www.icftu.org/displaydocument.asp?Index=991221988&Language=EN
The ICFTU represents 145 million workers in 231 affiliated organisations in 154 countries and territories. ICFTU is also a member of Global Unions: http://www.global-unions.org