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23 Jan 2018
Farm workers stand to earn more through a new partnership for Fairtrade poinsettias
Poinsettias have been a sign of Christmas in many countries for a century or more. Now, these houseplants are also a sign of a new opportunity for workers on young plant farms. Fairtrade International announced today a new initiative that encourages buyers in the poinsettia supply chain to top up the amount they pay for Fairtrade poinsettia cuttings and direct it to a new bonus fund for workers. This pilot project heralds a new approach in moving towards a living wage in a historically low-paying sector.
Image © Wagagai
Fairtrade Standards already require the payment of an additional amount on top of the sale price, called the Fairtrade Premium, which is invested by workers in projects to benefit their communities, such as to improve education or health care. The new pilot project calls for companies in the poinsettia supply chain to pay an additional few cents to the Fairtrade certified cuttings supplier, to go into a fund that is used to pay additional income directly to the supplier’s workers. This is a new concept that builds on existing Fairtrade Standards by testing new and innovative mechanisms for improving worker incomes on plantations and in factories.
Most poinsettias sold in Europe start out in Africa, cultivated on farms and sold to importers as cuttings which are then grown to full plants in countries across Europe, before they are sold to consumers. In many developing countries, even when basic wages in agriculture meet legal minimum wage standards, they are well below a living wage: what a family needs to cover its essential needs.
“Fairtrade views a living wage as a human right, vital for a decent standard of living and promotion of decent work,” according to Wilbert Flinterman, Fairtrade International’s senior advisor for workers’ rights and trade union relations. “In many sectors, moving towards a living wage for workers at the start of supply chains is extremely challenging. For flower plantations to be able to increase worker incomes and remain economically viable, all stakeholders – including employers, trade unions, buyers, retailers and consumers – must make a joint effort. This project is particularly promising because it is employer driven. That’s why we are so optimistic about the impact for workers and are looking to bring more partners on board.”
The initiators and first partners implementing this model are Wagagai, a young plant farm in Uganda, and their importing partner Selecta one, a breeding company based in Germany. The seeds of the project developed from a discussion between Wagagai CEO Olav Boenders and Selecta one CEO Per Klemm.
At Wagagai, the required Fairtrade Premium is half a eurocent per poinsettia cutting. The Fairtrade Cents pilot model requires traders to pay an additional 4.5 cents into a separate bonus fund, governed by representatives from the trade union, Fairtrade Africa, Wagagai and the participating trading partners. The financial transactions will be audited by FLOCERT, the independent certifier for the Fairtrade system.
“There are many social benefits we provide as a company, but we would love to do more,” says Mr. Boenders of Wagagai. “We want to pay a living wage, but our margins and our volumes just don’t allow it, or the company would have to close its doors. This new model can be a big step forward, and takes just a few cents extra to create more and more impact for workers. It all depends on volumes: the more we can sell as Fairtrade, the bigger the impact.”
Since November 2017, Wagagai has sold 900,000 Fairtrade poinsettia cuttings which brought in €40,500 to the Fairtrade Cents Bonus Fund – enough to pay the 1,400 workers in the lowest three wage brackets (two-thirds of the farm’s total workforce) an extra month’s salary. Wagagai’s goal for 2018 is to sell at least 5 million Fairtrade cuttings (about 10% of its total production), which would add up to almost five months of salary for each of those workers.
The pilot period will run through 1 January 2020, and include two Christmas selling seasons: 2018 and 2019. During this time, Fairtrade International hopes that importers, growers and retailers will sign on to source more Fairtrade poinsettias, thus contributing to the Fairtrade Cents Bonus Fund.
Fairtrade, Wagagai and Selecta one are expressly inviting other producers and traders in the sector to join the project in order to scale up the impact for young plant farm workers even further.
“We welcome every company trading in poinsettias to join this effort and help to make a success of this model to improve the income of workers. Together we can achieve the scale needed to make an even bigger difference to farm workers, something our customers ask of us and part of our company’s mission,” says Mr. Klemm of Selecta one.
Fairtrade International is announcing this new project at the IPM global horticultural trade fair held in Essen, Germany, where buyers and suppliers are meeting this week. Although the Christmas season has just passed, sales agreements for seasonal plants are made early in the year.
Fairtrade International supports the Fairtrade Cents Pilot as part of its program for wage improvement articulated in the Fairtrade Global Strategy. In this program, different mechanisms that create extra value in the supply chain are tested and will be evaluated on the impact to workers’ incomes. Learnings from this pilot will be used to further develop Fairtrade's approaches to wage improvement in other products and geographic regions.
Media and interested parties are invited to attend briefing sessions at the Selecta one booth at the IPM trade fair, located in hall 2, stand D21. Sessions with Fairtrade International, Wagagai and Selecta one will take place on daily from 23-26 January, at 10:00 and 15:00.
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For more information, please contact:
Giovanna Schmidt, Media Relations Manager, Fairtrade International, +49 228 949 23 236, press@fairtrade.net
About Fairtrade
Fairtrade changes the way trade works through better prices, decent working conditions and a fairer deal for farmers and workers in developing countries. By choosing Fairtrade products, people can create change through their everyday actions, and farming communities can improve their lives and invest in their future. www.fairtrade.net
About Selecta one
The family company Selecta one is a world-leader in breeding, producing and marketing vegetatively propagated ornamental plants. The breeding activities include bedding and balcony plants, poinsettias, perennials and cut flowers. With eleven production sites and distribution companies in Europe, Africa, Asia and America, the corporate group serves all relevant markets worldwide. Quality and sustainability are our key concepts for innovations in the product and marketing sector, whilst responsibility and reliability are the basic principles for our dealings with customers, members of staff and the environment. Our commercial objective is to create a green product world, to win over and inspire gardeners, the trade and the end consumer.
About Wagagai
The family owned company Wagagai is a world leader in propagation of plant cuttings. The farm is located near Entebbe, Uganda. It employs over 2,100 workers and produces over 500 million plant cuttings from 37 hectares of greenhouses. It is one of the largest plant cutting propagation companies in the world. They produce mainly chrysanthemums, poinsettia, begonia and many varieties of potted plant cuttings for their two clients, Selecta one and the Beekenkamp Group.