Information for the Clothing Industry

The Ethical Clothing Trades Extended Responsibility Scheme (PDF - 62Kb) is an initiative of the NSW Government, which come into effect on 1 July 2005.

It is designed to address the exploitation of clothing outworkers and was the key recommendation of the Ethical Clothing Trades Council. The Council was established by the NSW Government as part of the Behind the Label Strategy to improve compliance with industrial law in the NSW clothing industry and advise the Government on ways to address the issues facing clothing workers. The Council's members included the Australian Industry Group, Australian Retailers Association, Australian Business Limited and the Textile Clothing and Footwear Union of Australia. The Behind the Label Strategy formally concluded 30 June 2005. For information on the Strategy go to our archived site.

Reporting requirements under the Scheme

Information for Clothing Suppliers and Manufacturers (pdf)
Information for NSW Clothing Retailers (pdf)

Outworkers in NSW

Outworkers are people who manufacture clothing products outside registered factories. They may work in their own homes, converted residential premises, or unofficial factories.

They are a particularly vulnerable group of workers: predominantly women from non-English speaking backgrounds who work extremely long hours, often in cramped conditions and unsafe conditions. They suffer a greater incidence of occupational injuries and are mostly engaged casually with little or no official documentation.  They can often earn as little as $3 per hour.

What does the Scheme do?

The Scheme places certain obligations on clothing retailers, suppliers, contractors and sub-contractors, about clothing goods made in Australia and sold within NSW.

These obligations generally relate to keeping and exchanging information about the manufacture of clothing, and making those records open to inspection. 

The impact of these changes will be to make it very difficult for unethical employers to take advantage of clothing outworkers. This in turn will help business people who behave ethically and pay in accordance with the award.

For every order of clothing products made in Australia for retail sale in NSW:

Retailers will need to:	Suppliers will need to:
·         establish whether the supplier or their contractors will be engaging outworkers to make the clothes	·         provide the retailer, with each invoice, details about the manufacture of the clothing goods, including the details of any outworkers used
·         provide their basic particulars to the supplier	·         in each invoice, indicate to retailers whether any or all of their clothing goods were made in Australia
·         keep information received from the supplier about the manufacture of the clothing products, including the invoice	·         give the retailer an undertaking that any outworkers used in the manufacture of clothing are engaged under conditions no less favourable than under the Clothing Trades (State) Award
·         send lists of suppliers to the Office of Industrial Relations and the Textile, Clothing & Footwear Union	·         provide the retailer details of any contractors and if they engage outworkers
·         allow records kept under the Scheme to be made available for inspection on request by the Office of Industrial Relations and the Textile, Clothing & Footwear Union (TCFUA)	·         provide any contractors who are manufacturing clothes with a copy of the business details of the relevant retailer.  The contractor must also provide this information to any subcontractors engaged
·         not make an agreement with a supplier that doesn't comply with their responsibilities	·         inform the retailer if there is any change to the information provided by contractors under the Scheme or if there is any false or misleading information
·         report suspected instances of outworkers being engaged under less favourable terms than the relevant award.	·         comply with these requirements even if their business is located outside NSW
	·         inform the retailer if they pass on or receive all or part of an order to or from another supplier.

Clothing retailers, suppliers and contractors must keep any information required under the Scheme for six years. Any records made available are deemed confidential under the Scheme.

The Office of Industrial Relations will provide forms and information to assist clothing retailers, suppliers and contractors comply with the Scheme.

Is there an alternative to complying with the Scheme?

Yes, the clothing industry has a voluntary code of practice which was jointly developed by industry and unions. The code sets out business practices that lead to ethical dealings with outworkers in the clothing industry.

The code has two parts, one for retailers and the second for suppliers, fashion-houses, wholesalers and manufacturers. 

Retailers

By signing up to the Voluntary Retailers Ethical Clothing Code of Practice:

• The retailer becomes part of the process in helping stamp out exploitation of outworkers by simply sending a list of suppliers to the Textile, Clothing and Footwear Union (TCFUA).
  
• The retailer only needs to provide full records to the TCFUA upon request.
  
• The Voluntary Code of Practice allows the retailer to work with the TCFUA to rectify any situation to ensure compliance. 

For more information on the Voluntary Code of Practice you can contact the Australian Retailers Association - NSW on 02 9290 3766 or visit the Australian Retailers Association website www.ara.com.au and go to the Outworkers Code of Practice.

Suppliers, Fashion-Houses, Wholesalers and Manufacturers

To become a signatory to the Homeworkers Code of Practice, the manufacturer undertakes an accreditation process, which is assessed by the Homeworkers Code Committee, to demonstrate their (and their suppliers) compliance with legislative and award obligations.

Accredited manufacturers can display their commitment to ethical employment practices by using the 'No Sweatshop' label and store signage.

If you would like more information about accreditation under the voluntary Homeworkers Code of Practice please contact the Homeworkers Code of Practice Committee on 03 9347 3377 or email hspyrou@tcfvic.org.au.

If you sign up or get accredited to these voluntary Codes of Practice and comply with their terms, then you are exempted from the obligations of the Scheme.

What if I just ignore this Scheme?

Section 13 of the Industrial Relations (Ethical Clothing Trades) Act 2001 prescribes a maximum penalty of 110 penalty units ($11,000) for a contravention of the Scheme.