An effective and functioning grievance mechanism is a critical tool for businesses, Jeff Vockrodt, president of the Fair Labor Association, said in a webinar last week.
Not only does it allow workers to seek remedy when labor violations arise, in turn promoting employee morale and job satisfaction, but it also allows companies to “really understand” what’s happening on the ground at the factories that produce their goods, safeguarding their reputations with consumers and investors.
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“I think it’s fair to say that brands without effective grievance mechanisms are much more likely to find themselves the target of negative campaigns focusing on issues that the workers are aware of, are unhappy with and that remain unresolved,” he said.
The problem is that grievance mechanisms often look better on paper than they do in practice. It’s why the Washington, D.C.-based multistakeholder group has launched a “toolkit” to provide what it says is a “detailed, actionable, step-by-step guide” to ensure that the systems companies have in place offer a structured way for workers, unions and civil society organizations to raise concerns and seek resolution.
“When a grievance mechanism works effectively, it signals to workers that management values their input and is committed to listening and responding, said Andrea Ackerman, director of civil society organization engagement at the Fair Labor Association. “In contrast, when grievance mechanisms are weak or absent, workers lose trust. They often feel unheard, and dissatisfaction may grow.”
The United Nations’ guiding principles on business and human rights have defined effectiveness criteria for grievance mechanisms. Whatever form they take, whether as a physical box, a digital platform or an open-door policy, mechanisms must be trustworthy, accessible, predictable, transparent, equitable and confidential. They must also be anchored by engagement and dialogue, ensuring that workers and other stakeholders have a voice in the design and resolution of the process.
While much of the conversation around human rights revolves around due diligence and sustainability reporting, access to remedy is just as important, said Pradeepan Ravi, programs lead at Cividep India, a nonprofit headquartered in Tamil Nadu.
“In fact, grievance redressal is really a key to make due diligence meaningful,” he said in the webinar. “I would stress on that because identifying and preventing risks in the value chain is one thing, and effectively responding when harm happens is another. We want that response to be timely, accessible, predictable, as well as fair. Otherwise, it’s not something workers can actually use.”
Ravi has seen firsthand how grievance systems work—or rather don’t—in production countries when most of the world’s clothing is made. Where labor laws exist, a lack of enforcement ends up holding no one accountable when systems are dysfunctional. Then there is the “structural reality” of the garment industry. Production spans across many small and medium units with a largely informal, temporary workforce, making it nearly impossible for formal mechanisms to function effectively.
“In order to fill the gap left by this weak enforcement of judicial mechanisms, many brands and MSIs have created their own grievance channels in the form of hotlines, helplines, email addresses, mobile applications and so on,” he said. “These non-judicial grievance mechanisms ave been around for nearly two decades or more, but unfortunately, we have to admit that they are not working in practice, and the reasons are, workers often don’t know these systems exist. They are not trained to use them and don’t trust them to lead to real outcomes.”
Such is the state of affairs that workers often stay silent until conditions become intolerable and the fear of the status quo outweighs the fear of retaliation, Ravi said.
“These non-judicial mechanisms tend to treat grievances as individual problems of workers, while many issues, as we know, are collective and structural by nature,” he said. “There’s no clear process, no predictable outcome, and there’s no guarantee for anonymity. Also, and most importantly, these mechanisms do not have space for the people who workers trust, be it their representatives or unions or collectives.”
Neither will grievance mechanisms work if the root causes of worker discontent and dissatisfaction aren’t addressed. Job security, for one, is a critical barrier “when your job is insecure, raising a complaint is a huge risk,” Ravi said. Poor purchasing practices such as tight lead times, last-minute changes to orders and unrealistic production volumes are another. In numerous workplaces, he added, shouting and verbal abuse are seen as normal management tools to discipline workers—women especially.
“We have to go beyond just awareness sessions and training,” he said.
The Fair Labor Association collaborated with multiple stakeholders, including staff members, companies, auditors and civil society organizations such as Cividep India, to ensure that its toolkit is “practical and realistic and grounded in real-world experience,” Ackerman said. It was designed primarily for brands, but it can also help factories set up grievance systems or strengthen their existing ones. Civil society organizations, trade unions and worker representatives that engage with or monitor grievance mechanisms could also find it useful. The gist, however, is for companies to move away from a “check-the-box” mentality that shuns long-term relationship building and fails to meet workers where they are.
“Since factories often produce for multiple brands, any grievances raised there are shared responsibility,” she said. “Collaboration on remediation is one of the most effective ways to drive sustainable change. Even if brands have different products or timelines, the grievances should be seen as shared challenges.”
There’s a clear business case for properly managing worker complaints, too, said Tzlil Rubenstein, the Fair Labor Association’s social compliance program officer. When a grievance mechanism works well, she said, issues are addressed and resolved. When it doesn’t, however, the consequences for businesses can be serious and even irreversible.
“A main risk associated with an effective grievance mechanism is reputational damage,” she said. “This often happens when grievances go unaddressed and advocacy groups respond with campaigns that bring negative attention to the brand damage. Reputation can quickly lead to consumer loss, which directly impacts revenue. It can also affect ESG ratings and trigger pushback from responsible investors, putting at risk both investment and shareholder confidence. Reputational damage can also bring legal and regulatory risks.”
For Rubenstein, one thing that’s overlooked is what she describes as the “true cost” of worker turnover when employees who feel unheard or are mistreated end up leaving for other jobs. When the workforce is in flux, for instance, severance pay and related expenses can quickly add up. Vacancy costs can also start trickling in when permanent staff can’t be secured.
“Factories often rely on temporary hires who may not stay long, may not be the right fit and still need training, and that training is another cost on its own because most factory work is brand-specific,” she said. “Hiring costs are another example: the repeated time and resources HR and administrative staff need to spend on recruitment, onboarding and offboarding.”
Other challenges can include the loss of institutional knowledge when experienced workers leave and an unstable workforce that undermines client confidence.
“An ineffective grievance mechanism doesn’t just affect workers, it directly undermines business stability, performance and long-term sustainability,” Rubenstein added.
