Fair Compensation Toolkit
FLA believes every worker has the right to a living wage, and we’ve created the tools to help companies make that right a reality.
Workers worldwide have felt the pressure of long hours and low wages for more than a century, and these challenges persist globally due in part to a lack of practical approaches for companies to honor the rights and needs of workers.
In 2020, FLA published a new strategy to forge a practical path to living wages. The strategy includes plans to develop and deploy tools to overcome knowledge barriers so that companies understand what workers are earning and how those earnings compare to prevailing industry wages and the Global Living Wage Coalition’s living wage estimates.
In addition, the plan commits FLA to identify and test tactics to close the gap between what workers earn and what they need and share progress publicly in the spirit of advancing living wage efforts across the globe.
Real progress on living wage
For too long, a living wage was considered an unattainable ideal for apparel and footwear workers, with long hours as the only apparent solution to low pay. A recent study of companies using FLA’s Fair Compensation Toolkit demonstrates otherwise.
- Companies and factories in the study reduced excessive overtime and increased wages within two to three years;
- Net wage increases ranged from 29 percent to 57 percent, exceeding the rate of inflation in all cases;
- Incentive pay played a key role to improving productivity during the regular workweek; all examples show changes to productivity bonuses and other incentives leading to increases that ranged from 89 percent to 330 percent; and
- Each case required workforce engagement and participation to ensure all workers understood why overtime hours would decrease and how a new wage system would improve wages during the regular workweek.
Award-winning living wage work: Fair Compensation Toolkit
For years, labor-intensive methods for measuring wages, coupled with a lack of clarity on living wage benchmarks, prevented progress on living wage for workers in manufacturing industries, such as apparel and footwear.
Today, with scalable tools developed by FLA, there is an opportunity to move toward tangible progress on fair compensation.
FLA’s groundbreaking Wage Data Collection Tool and Fair Compensation Dashboard are award-winning living wage resources that work together to show companies the gap between what workers earn and what they need.
The Wage Data Collection Tool is an Excel-based model that is straightforward and scalable, allowing companies to gather worker wage data from apparel and footwear factories. It is freely available for use.
The companion Fair Compensation Dashboard allows companies to analyze average worker wages, measure those wages against living wage benchmarks from more than 30 countries, and track progress over time.
More than 50 of the largest global fashion companies use the Fair Compensation Toolkit to measure living wage progress and improve worker wages and quality of life.
FLA periodically shares aggregate data to show the prevailing wage in sourcing regions; for the latest data, click here. The analysis can be used by trade unions and workers to advocate better wages through collective bargaining and minimum wage setting.
50More than 50 of the largest global fashion companies use FLA's Fair Compensation Toolkit.
30FLA's Fair Compensation Dashboard allows analysis against living wage benchmarks from more than 30 countries.
FLA is committed to providing a practical pathway for companies from across industries to improve wages for workers around the world.
All FLA member companies must collect and analyze wage data from a representative sample of their supply chains using the FLA’s Fair Compensation Toolkit. The Fair Compensation Dashboard is available to non-member companies and their production facilities on a subscription basis.
Interested in learning more? Contact us.