Alta Gracia: Proof that Decent Working Conditions ARE Possible

Diana Karakos of the International Labor Rights Forum reflected on what she learned about living wage apparel from the Kalmanovitz Initiative’s panel discussion of the Alta Gracia factory last month.

The Alta Gracia apparel factory, located in the Dominican Republic, represents a living wage miracle to both the workers who are fortunate enough to have landed a job at the factory as well as labor rights advocates around the world.  Financed by Knights Apparel, the factory produces collegiate sportswear such as sweatshirts and t-shirts.  Knights began renovating the old BJ&B garment factory, which had stood empty in Villa Altagracia for years, in October of 2009 and in February 2010 began hiring workers.  Knights even went so far as to try and hire as many workers as possible from the closed BJ&B factory who had suffered extreme hardship since its closing in February 2007.  This experiment is proving to critics that it is possible to provide a living wage to workers, allow them to unionize in order to reach a collective bargaining agreement with factory management, and still be able to make a profit.  Altagracia has grown from the ashes of the hollow shell that was the old BJ&B factory, an eyesore that only reminded villagers of their misfortune, and has flowered into the Alta Gracia factory, a building that now stands as a beacon of hope for the hard working Dominicans.

On Wednesday, October 27, 2010, I was fortunate enough to have the opportunity to attend a forum sponsored by the Kalmanovitz Initiative for Labor and the Working Poor at Georgetown University about this extraordinary factory.  A highly diverse panel of experts was present to speak on this subject, including Scott Nova from the Workers Rights Consortium, Cathy Feingold from the AFL-CIO, Bob Stumberg from the Georgetown University Law Center, and John Kline from the Walsh School of Foreign Service at Georgetown University, the man who conducted the research for the report released entitled “Alta Gracia: Branding Decent Work Conditions.” Jennifer Luff of the Kalmanovitz Initiative moderated this event.
According to John Kline, one of the most important aspects of the Alta Gracia factory is that it represents a successful alternative to the current sweatshop model. Knights Apparel has proved it is possible to pay its workers a living wage and it has also proved that this is only possible if the company is willing to commit to paying its workers this wage.  In the Dominican Republic it has been determined that a living wage is equivalent to 340% of the legal minimum wage.

Dr. Kline also emphasized the impact that this factory’s success has had on the workers.  In Spanish, a living wage is called a “salario digno” meaning that the workers are receiving a dignified wage.  For the workers, earning this money is about being able to provide for their families and for regaining their much-deserved dignity.  But it is not just about the money.  The Alta Gracia factory’s environment is completely different from the other “sweatshop” factories.  There is an atmosphere of respect.  They are treated like human beings, their opinions are respected by management, they are not fearful that they will be fired for being a part of the union or if they make a mistake.  The difference is in how Knights Apparel has approached the task of creating this extraordinary work environment.  Instead of setting out with the goal being to earn the maximum profit possible, Knights starts from the workers’ perspective.  They set a minimum standard for good working conditions and are willing to take a cut in their profit margin to ensure that the workers are provided these conditions.

Within Dr. Kline’s report there is a very important section entitled “What Difference does it Make?”  Within this section, he redefines what words like “food,” “home renovation,” “home improvement,” “education,” “transportation,” and “paying off debts,” mean to poor people versus rich people.  For example, he defines “home renovation” as the ability to “buy cinder blocks each paycheck to complete solid construction of a one-room house where ill-fitting wooden boards now provide the upper half of walls that support the tin roof.”  I know that this definition is not what immediately came to my head when I heard “home renovation.”  Was it for you?  This is the daily reality for the Dominican workers.  With the payment of a living wage, the families will be able to build stronger houses and supply nutritious food for their children rather than just buying something they can put on the table to fill their stomachs.  However, the workers at Alta Gracia do not see it as up to them to ensure the factory’s success.  They are relying on you, the consumer, to make smart, educated choices about your clothing purchases.  Without your help, factories such as Alta Gracia will close and leave the workers either unemployed or forced to go work in the harsh, sweatshop conditions of another factory.

According to Cathy Feingold, the Alta Gracia factory has brought back much needed hope to the members of the community.  The success of the union at the factory has breathed life into the Dominican union movement, one that has been consistently trampled upon in the past.  The success has challenged the workers to think beyond traditional collective bargaining agreements.  They have been encouraged not to ask for a 50 peso wage increase, but to instead think long-term, requesting things that will allow their family to live better, longer.  The workers now know that they can ask for more and that in most cases they will get what they asked for.  Once the success of this model has been made widely known, hopefully other companies and their factories will adopt it.
Scott Nova prefaced his presentation by highlighting the two main goals of the Alta Gracia Project.  The first one was to restore unionized apparel production to a country that has struggled with this concept for years, facing flighty companies that at the slightest hint of union formation closed their factories and moved to a different location.  The second goal was to establish an alternative model to the existing, dominant “sweatshop” model of apparel production.

Mr. Nova explained that the anti-sweatshop movement has been challenging the existing model for the past 15 – 20 years.  While the movement has succeeded in making companies take responsibility for the conditions in their contract factories, it has failed in the sense that it has not forced companies to make long-term commitments to factories and workers that are determined to make the change to improve working conditions.  Instead, we still see apparel brands putting pressure on factory management to keep the cost of production low and at the same time increase total production rate.  As a result of this, workers today are actually making less in “real terms” than they were ten years ago.

Also, many companies have developed codes of conduct that they are supposed to be holding their factories accountable to follow.  However, companies still have not agreed to pay the higher price necessary to maintain these standards in the workplace.  This guarantees the perpetuation of the sweatshop conditions in factories unless the industry pushes for a complete change.
The Alta Gracia experiment represents the effort to establish a different model for garment production.  It shows that it is not the obligation of the worker, but instead the obligation of the employer, in this case Knights Apparel, to agree to ensure that the factory is operated under safe and healthy conditions, to provide a living wage to the workers, and to support the existence of a union.  This model can be used to convince other companies that they can still be successful if they create these decent working conditions within their factories.  In fact, there is only a modest impact on the selling price of the products.  For example, the average t-shirt sold by Knights in a college bookstore which retails for between $18 to $20 is typically bought for  about $4.00, but at the Alta Gracia factory, Knights Apparel buys t-shirts for $4.80.  This means that the difference between paying a living wage to these hard workers is only 80 cents per t-shirt.  This seems like a reasonable price to pay to enable these workers to provide for themselves and their families and live dignified lives.

Many of you may be asking both how a living wage was determined for the Dominican workers and how that living wage was defined.  Bob Stumberg explained that at the Alta Gracia factory, a reasonable workweek is defined as 44 hours, the wage will support both the worker and two children, and that it will support about 75% of the family’s basic needs.  Basic needs have been defined as food and water, housing, energy, clothing, health care, transportation, education, childcare, modest savings, and discretionary spending.  In order to afford this, it was determined that the worker needs to earn at least $497 per month or a total of $5,964 per year.

Although these numbers can only be specifically applied in the Dominican Republic, this information can be used to check models that are being developed and hopefully be applied worldwide to determine a living wage for each country.  Before this, there was really no way to check the accuracy of these models.

The continued success of the Alta Gracia factory is crucial if we ever want to see a change in the sweatshop conditions that millions of workers worldwide are forced to endure everyday.  The first shipments of college apparel were delivered in late August and early September and the factory is already receiving requests for second orders.  Please continue to support the efforts of the Alta Gracia workers buy purchasing apparel made at the factory at your college bookstore and by spreading the word about the existence of this factory.

To see the work that ILRF has done to promote anti-sweatshop labor, click here. Remember you, as the consumer, have a large part to play in the success of the Alta Gracia factory and in the overall accomplishment of the goal to eradicate sweatshop labor world-wide!