Kmart Group making progress on living wage commitments

As part of Kmart Group’s commitment to respect human rights, we understand the importance of a fair wage to help protect human dignity and enhance quality of life. This is why we have committed to work with our partners to achieve a living wage for factory workers. A living wage is the minimum income necessary for a person to meet their basic needs as well as that of his/her family, including some discretionary income.

The focus of Kmart Group’s living wage efforts is through our membership in Action, Collaboration, Transformation' (ACT), a collaboration between international brands and retailers, and IndustriALL Global Union, the international trade union federation. ACT aims to achieve a living wage in the garment and textile industry in countries such as Bangladesh, Myanmar, Cambodia, Turkey and Vietnam by establishing industry-wide collective bargaining, supported by world-class manufacturing standards and responsible purchasing practices.

In December 2018, ACT publicly released its Global Purchasing Practices Commitments. The commitments are the result of three years of review and consultations aimed at developing a common set of changes and implementation measures on purchasing practices that will support the movement towards living wages in the garment, textile and footwear industry. The commitments cover five broad areas:

Brands commit that purchasing prices include negotiated wages as itemised costs

Brands commit to fair terms of payments

Brands commit to better planning and forecasting

Brands commit to undertake training on responsible sourcing and buying

Brands commit to practice responsible exit strategies.

Kmart Group has committed to fully implementing ACT’s Global Purchasing Practices within suppliers of our own-brand apparel and footwear by December 2023. In the past year, Kmart established a project team to drive the implementation of changes required to meet this commitment. This project team has been focused on the following activities:

the development and implementation of a new open costing sheet with our team and suppliers to itemise and ring-fence labour costs. Approximately 80 per cent of suppliers have now submitted open costing in the new format

continued roll-out of enhanced planning and forecasting mechanisms with strategic and core suppliers to improve accuracy of forecasts and maximise capacity planning in factories

the development and implementation of a responsible exit strategy and procedures in accordance with the ACT Responsible Exit Policy and Checklist

commenced implementation of the ACT purchasing practices baseline assessment with our team and suppliers. Feedback from the survey will be used to measure progress toward our 2023 commitments and identify further opportunities for improvement.

Read more about Kmart Group’s progress on living wage here.