In the Lahore, Pakistan factory that produces t-shirts for the Econscious brand, workers are reported to have been paid the minimum wage of 4600 Pakistan Rupees per month during the winter of 2007-2008, plus overtime. The average worker at that factory for Econscious took home PKR. 5344.75 (equivalent to US $89) in a month for an average of 222 hours of work (on average approximately 51 hours a week).
Is that a living wage?
It’s not so easy to answer that question as you may think.
The concept of a “living wage” is open for interpretation. Is it equatable to the legal minimum wage in a region, or does it require more? The brief SA8000 discussion for “living wage” is a good example of the typical murkiness of discussion.
SA8000: A Formula, with Exceptions
The company shall respect the right of personnel to a living wage and ensure that wages paid for a normal work week shall always meet at least legal or industry minimum standards and shall be sufficient to meet the basic needs of personnel and to provide some discretionary income.
In international apparel production, there is no stated industry minimum standard, so that can be tossed right out. So what else might help us define a “living wage?”
The terms “living wage,” “basic needs,” and “discretionary income” are nowhere else discussed in the SA8000 standard. I have purchased the additional SA8000 Guidance Document, written to guide auditors on the ground. I am unfortunately forbidden by SA8000 from sharing with you the content of this document by upload or quotation, but I can tell you it has a wavering definition of “living wage,” first starting with “basic needs” and then deviating from it. “Basic needs” are defined by the SA8000 Guidance Document as capable of sustaining 1/2 an average sized family with food, clean water, clothing, housing, transportation, schooling, that undefined “discretionary income,” and health care. Then, after waving its hands, page 102 of the SA8000 guidance document I’m forbidden from sharing with you goes ahead and says that in the actual audit, as long as the factory declares it would like to raise wages in the future, it can go ahead and use the legal minimum wage in a country as acceptable for SA8000 certification, at least on an initial basis. This implies that SA8000 certification is not certification that workers are earning enough wages to meet even SA8000’s definition of “basic needs.” (It is unclear at this point whether the Econscious factory in Pakistan has earned SA8000 certification.)
From a Formulaic Approach to a Negotiated Approach?
David Steele of the Ethical Trading Initiative wrote an informative piece back in 2000 discussing the gist of the SA8000 determination of “living wage” — it’s nine years old but still matches the current SA8000 methodology. Steele also identifies an alternative method he calls the “Negotiated Approach,” in which interested parties on the ground (NGOs, worker collectives, factory owners, government representatives) meet and determine for themselves what a “living wage” would be.
An advantage of the negotiated approach Steele mentions is that it involves people living in an area, investing them with responsibility for deciding what’s best for them. It is just the sort of thing that would warm the heart of a co-op member, and perhaps for good reason, since it creates connection and community and respects locality. But one disadvantage of the negotiated approach is that (just as at your local co-op) any inequalities different parties bring to the discussion table may be reflected in the resulting definition. Another disadvantage of this approach is that interested parties who aren’t local but nevertheless have an ethical stake in decisions (to invest or not invest, to sell or not sell) don’t have a way of figuring for themselves how working conditions align with their values and whether they should engage or disengage.
Is a Hybrid Approach Possible?
If an answer to the question “What is a Living Wage in Lahore, Pakistan?” must be answered differently by distant observers and local members of the community of Lahore, then are the answers arrived at by distant observers and community members irreconcilable? I don’t know; perhaps the only way to find out is to try to obtain and to reconcile them, and see if it works.
From my vantage point, that means looking for evidence of the vantage points of others in Lahore, some high (see LUMS cost of living estimate) and some not as high. It also means looking for externally quantifiable measurements of “basic needs” living requirements (such as caloric intake requirements and the local cost of foods) and making the quantitative determination of whether pay at certain income levels is compatible with the satisfaction of basic needs. Finally, it means looking for and asking for others’ qualitative and quantitative reports.
If you are one of the millions of people who live in Lahore, Pakistan and who have direct experience of the cost of living there, I welcome you to enrich the knowledge of those of us who don’t live there by sharing what you know here, in the comments section below. Thank you.