The true cost of labour must be worker-defined

To the Editor — Amidst the expanded use of true cost accounting (TCA) frameworks by industry, government and other stakeholders in the food sector, the true costs of labour — of decent work — remain largely absent. Economists and TCA specialists have more successfully evaluated externalities and other market failures affecting the environment and human health, while evaluating labour has remained elusive, inhibited by poorer quality data and less mature methodologies. The research community has struggled to define and determine who decides what an ‘acceptable level of risk’ is for workers in food supply chains. The abatement costs of the transformation from undignified to decent work are contested, with fears of skyrocketing consumer prices or burdensome costs to producers. We propose that TCA could learn from two worker-driven success cases in the USA, which offer market solutions and demonstrate that a costing and value redistribution throughout food supply chains has mutually benefited each node and raised labour standards to levels supported by workers.

The true cost of labour must be worker-defined To the Editor -Amidst the expanded use of true cost accounting (TCA) frameworks by industry, government and other stakeholders in the food sector, the true costs of labour -of decent work -remain largely absent. Economists and TCA specialists have more successfully evaluated externalities and other market failures affecting the environment and human health, while evaluating labour has remained elusive, inhibited by poorer quality data and less mature methodologies. The research community has struggled to define and determine who decides what an 'acceptable level of risk' is for workers in food supply chains. The abatement costs of the transformation from undignified to decent work are contested, with fears of skyrocketing consumer prices or burdensome costs to producers. We propose that TCA could learn from two worker-driven success cases in the USA, which offer market solutions and demonstrate that a costing and value redistribution throughout food supply chains has mutually benefited each node and raised labour standards to levels supported by workers.

Costing fair labour
The reverberations of slavery manifest in precarious and under-protected work, persistent forced labour and legal or culturally accepted exploitation of agricultural, fishing, food processing and service workers globally. Increased pressure for better corporate social responsibility has led many companies to certify products that attain ethical and/or environmental performance thresholds or to calculate the impacts of their operation -increasingly through TCA methodologies. As reliance on TCA grows, impact metrics and monetization factors embedded in TCA frameworks (although variable across frameworks and methodologies) should increasingly signal food system priorities. Yet, true cost proponents must beware of the unaccounted for costs of indecent work and the assumption that monetization with 'fairer' prices will necessarily correct exploitation.
The recent increase in top-down multi-stakeholder initiative (MSI) certifications offers a warning about overreliance on fairer pricing mechanisms for social impact outcomes. MSIs often suffer from weak accountability, with benefits accrued primarily by consumer brands or retailers. While some effectively provide benefit to communities and farmers at the origin, evidence suggests that MSIs show mixed or no impacts for workers and struggle to challenge the underlying power structures that perpetuate indecent conditions [1][2][3] . Workers tend to play nominal roles on MSI governance boards and in negotiating basic rights. Several MSI grievance mechanisms fail to meet United Nations Guiding Principles on business and human rights requirements for accessible and transparent independent monitoring and enforcement systems 4 . Partial solutions have additional social costs if they detract from the expansion of more effective solutions and governance.
Since many TCA examples address impacts on human and social capital (for example, the impacts of low wages in supply chains and the loss or preservation of agricultural land access due to market pressure), stakeholder audiences may assume that decent labour standards are included. However, few TCA studies effectively price decent work or define it in collaboration with workers. Studies that do assess worker impacts largely suffer from insufficient data, potential bias in data collection methods, or opaque valuation methods in their pricing of decent (or exploitative) work conditions [5][6][7][8][9] (these citations are not exhaustive, but represent select examples from the currently underdeveloped field of study). While it remains understandably difficult to price well-being, research estimating the financial costs of negative work environments shows that indecent work conditions counteract the otherwise positive impact of wages, reducing net social welfare 10 . This diagram illustrates the key stakeholders, processes and contractual agreements of WSR, as described and illustrated by the Coalition for Immokalee Workers 1 , which enable worker-driven programs that are legally binding, have buyer-afforded compliance, rigorous monitoring and enforcement, as well as economic incentives for suppliers.

Worker-driven models
Two distinct but related programs in the USA have demonstrated that it is possible to end longstanding abuses, ranging from forced labour to sexual harassment and assault; improve health and safety; raise wages; ensure decent housing; provide protection from employer intimidation and retaliation; and holistically elevate the decency of work 11,12 . The Fair Food Program (FFP) and Milk with Dignity Program (MD) are Worker-Driven Social Responsibility (WSR) models that are transforming the fresh produce and dairy industries, respectively. In both programs, consumer-facing brands sign binding agreements with worker organizations, committing to pay a premium on the product purchased from producers (that is, farm owners) whose farm operations are audited to ensure FFP or MD program compliance. Since their inception, corporate buyers have paid millions, distributed directly to or benefiting workers through the program, with additional support to help farm owners cover compliance costs and support a Standards Council, which handles compliance enforcement through audits and a 24/7 worker support line (Fig. 1). The WSR programs were conceived by two worker-led organizations, the Coalition of Immokalee Workers and Migrant Justice, through the leadership and input of the wider farmworker community who designed the structure of the programs, including a Code of Conduct outlining the rights of workers. Collaborative working groups composed of farm owners and worker representatives inform the ongoing implementation of the on-farm Code of Conduct. Worker-to-worker education at each participating farm empowers workers to act as frontline monitors of their own rights. Workers can report code violations and participate in factual investigations free from retaliation; prompt response has built trust in the reporting and resolution mechanisms. Confirmed violations left unresolved can result in suspension of buyers' purchases and premium payments, creating strong economic incentives for producers to comply.
The FFP and MD programs' premium and buyer support payment indicate the abatement costs of the transformation to decent work, a useful valuation reference for TCA. Despite production cost concerns, the FFP and MD have successfully redistributed benefits across the supply chain and are proving to be economically sustainable and beneficial for participating producers, corporations and consumers, as well as workers. Participating farms have indicated better employee retention rates, workplace communication and morale, and pride in the improved employee benefits; MD farms have fared better on average in a competitive industry amidst dairy closure trends 12 . In supply chains previously marked by scandal, buyers and producing farms benefit from rigorous risk mitigation by the FFP, which transformed an industry formerly dubbed "ground zero for modern slavery" by federal prosecutors. Relative to consumer price, the FFP and MD costs of ensuring safe and dignified work are small; consumers have experienced either no or only nominal price changes.
On the basis of lessons from these programs, we propose that TCA analyses assess five core components evident in WSR, which structurally incentivize decent work, distribute benefits throughout supply chain nodes and lay the groundwork for accurate TCA of labour. These include assessing the degree to which (1) workers are centered in program design and implementation; (2) corporations financially incentivize labor rights compliance among suppliers; (3) labor monitoring and enforcement is swift, rigorous, and worker-informed; (4) buyer-worker agreements are legally binding and enforceable; and 5) economic consequences reward good actors and penalize suppliers where abuse occurs.
Fair labour assessments in TCA should begin by examining the degree to which these five components have been achieved and should then determine whether corporations and their investors or suppliers have resisted implementation of these core components. If worker input is dwarfed by powerful corporate actors or if programs lack accessible complaint and enforcement mechanisms and binding economic and legal consequences, it is unlikely that TCA can accurately assess the labour-related true costs. We recognize that developing rigorous TCA datasets and methods is time-intensive; progress is incremental. At the same time, TCA relying on weak data or methodologies risks further institutionalizing exploitation and distracting from improved governance, safe freedom of association, and a necessary transformation of power dynamics. Full transparency regarding current TCA limitations is needed, and innovative, transdisciplinary research should be pursued to fill gaps. No holistic TCA of food is complete without decent labour, with its broad spillover effects on human health and community welfare. Those deterred by the complexities of pricing and implementing decent labour systems should heed the WSR examples of the FFP and MD and lend their eyes and ears to the worker communities already creating solutions. ❐ Julie Kurtz 1 ✉ , Nicole Tichenor Blackstone 2 , Jessica L. Decker Sparks 3 , Rafaela Rodriguez 4 and Cheryl Pinto 5