Supply Chain Conversations #1: The involvement of genuine labour-hire firms

labor-is-not-a-_21082502_c80b832137a9a8f847853667bc16e91f0203038dRCSA’s CEO, Charles Cameron, has been posing a number of questions about supply chains for me, lately. In this series of Supply Chain Conversations, we explore the involvement of recruitment and workforce services firms in supply chain operations and learn how they can begin to facilitate the implementation of industry based supply chain governance initiatives.

Our first conversation is about the involvement of genuine labour-hire firms.

CHARLES: Andrew, we hear more and more about supply chain responsibility and how it can be used to clean up unethical labour supply arrangements.  Do ‘labour-hire’ firms actually operate within a supply chain?

ANDREW: The certainly do, Charles. But that’s not the same thing as saying that they operate LABOUR supply chains. The distinction I’m making, here, is based on the ILO’s fundamental principle that labour is not a commodity. Let me explain.

To speak about “labour supply chains” is to reflect a view that labour (and often the workers who perform it) are commodities; and that they move through supply chains in much the same way as horticultural produce, or raw materials for manufacturing. In that sense, something like the Trans-Atlantic slave trade might have been your classic example of a “labour supply chain”. But  we know that’s not how genuine labour-hire firms function at all.

When genuine labour-hire firms operate within a supply chain, they’re more likely to be providing services to support supply chain operations – specifically, arranging for an auxiliary workforce – for example, to support harvest, logistics, software development, or maintenance operations.

So, rather than describe the involvement of labour-hire firms in supply chains in ways that suggest that they’re “delivering workers” or labour as though they were commodities, we’d do better, I think, to look more closely at what’s really going on and recognise that genuine labour-hire firms make a valuable contribution to what is sometimes called the servicification of supply chain operations.

That distinction is important to the way the industry might develop its supply chain governance initiatives.

Andrew C. Wood, Hon FRCSA (Life)

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