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COVID-19 Puts Millions of Global Supply Chain Workers at Risk

Businesses Should Cushion Economic Impact

A woman sews face masks at a furniture factory in Eldorado Park, Johannesburg, Tuesday, March 24, 2020. © 2020 AP Photo/Shiraaz Mohamed

There are an estimated 450 million people working in global supply chains, many of whom face reduced income or job loss as a result of the COVID-19 pandemic.

Companies around the world are closing shops, cancelling orders, and stopping production. The garment industry is particularly hard-hit, but other businesses like mining, jewelry, or automobile sectors are suffering too. Workers in these supply chains are among the most vulnerable and most affected by the crisis.

If it was not clear before COVID-19, it is now: Businesses are connected through a world wide web of global supply chains, and the behavior of large companies impacts those working at the bottom of these supply chains.

So what does responsible company behavior look like in this pandemic?

Companies that have closed temporarily have found ways to pay their workers in supply chains. For example, South African suppliers and textile workers unions have agreed to a national collective bargaining agreement paying workers six weeks in full during the lockdown. By contrast, many suppliers in Myanmar, Cambodia, and Bangladesh have suspended work without paying workers even for work already completed. Global brands who source from suppliers in these countries should pay for the orders that have already been completed or were in progress. A few retailers, including H&M, have done this for their global suppliers but many others have left their suppliers hanging.

Where factories or other workplaces are still operating, workers’ health needs to be protected, including through protective gear, social distancing, and flexible work arrangements. Workers across the supply chain also need to be able to take paid leave when they’re sick or to care for ill relatives.

Many companies are struggling immensely in this crisis. But they should not forget about the workers in their supply chains. Companies should do what they can to ensure workers are safe and continue to have an income to be able to feed their families. More generally, they should use this moment to review their supply chains and ensure they have robust protections for workers, in line with international standards, and ensure that the purchase prices they pay factor in workers’ social protection.

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