Does the advertising industry have a problem with the Modern Slavery Act?

The climate crisis. Diversity, inclusion and equity. These are all initiatives detailed to be addressed in the United Nations 17 Sustainable Development Goals to change the world. At the start of the Sustainable Development Goals process, ending modern slavery was not a clear priority. Following significant campaigning, in a last-minute addition, the final draft of the Sustainable Development Goals included wording calling for efforts to end modern slavery.  These goals, which all governments can now adopt, were finalised by the UN General Assembly in September 2015.

According to the law firm, Norton Rose Fulbright, At its broadest, the term ‘modern slavery’ refers to any situations of exploitation where a person cannot refuse or leave work because of threats, violence, coercion, abuse of power or deception”.

So, what does this mean for the advertising industry? Well, if you read the industry trade media and listen to the agency leaders at any of the virtual or real industry conferences, nothing. It would appear the industry has all of the United Nations 17 Sustainable Development Goals in hand and underway.

And while I am not suggesting the advertising industry is practising ‘slavery, servitude, the worst forms of child labour, forced labour, human trafficking, debt bondage, slavery-like practices, forced marriage and deceptive recruiting for labour or services’ this topic is becoming an area of increasing importance for procurement teams globally. Therefore, it is worth looking at where advertising agencies may need to rethink their processes, culture and behaviours. Here are three that immediately come to mind.

The intern

Despite a number of industry actions and discussions on this over recent years, the practice of taking on unpaid interns potentially falls under the modern slavery act. While it is unfortunate that often young people will have to undertake unpaid internships in a number of agencies before they can get the opportunity for paid work, it is particularly distressing when you hear about interns doing the work of paid staff for 6 months for more.

There are specific rules outlined for work experience and internships.  Yet, many have reported that the expectations of the agencies are that they are not there to be formally trained but to do unpaid work, with initial short term engagements extending into months, with the promise of employment made, but never realised. It is worse still if the agency is charging out their work to clients or even including them as a resource under a retainer agreement.

If you check out some of the profiles of recent graduates on LinkedIn, you will find often more than a year of intern work for some, usually unpaid. Just search ‘intern’ for the Marketing and Advertising category.

The newbie

So, if they survive the intern process and manage to land an entry-level position in an agency, then the two issues arise with their salary of $35,000 p.a. reflecting the minimum wage for 1650 hours per year. The first is this often includes their mandatory superannuation contribution. The second is that they are expected to work more like 2400 hours per year with unpaid overtime – or effectively less than $15 per hour.

Okay, so they are underpaid and overworked. Many of the more experienced industry players will put this down to doing your time and earning your stripes. This culture of unpaid overtime is rife throughout the industry, even at the most junior levels. But what happens next, if not exploitation, is possibly fraudulent. In these days of fiscal stringency, the newbie is told that pay rises are on hold. While they may get a title increase, they get a very modest or non-existent pay increase to go with the new title. It is called a title promotion and we first noticed it in 2010.

But with the title promotion comes new responsibilities, with new clients, who have no idea their new senior account manager has less than 2 years’ experience in the industry. Of course, the agency is billing them out as a Senior Account Manager on the retainer and pocketing 80% of the income, while the newbie is learning a valuable lesson in why the advertising industry has such a high employee churn rate.

The supply-chain

Finally, we get to a procurement favourite: the off-shore supply-chain. Be it for design and production or digital and tech development, increasingly agencies are either building or partnering with suppliers in lower-cost markets such in Eastern Europe, the Subcontinent or Asia. The benefit for the client is lower cost and speed to market, with many more employees working on the project at once.

But with these offshore production facilities, how can the agency be assured that those working there are doing so of their own free will and under employment-conditions acceptable to a local standard? There is huge competitive pressure on agencies to drive down cost but providing low-cost workers from overseas markets can be a risk.

How many times have we heard of outsourcing in the fashion industry and technology sector resulting in scandals and issues for local companies, wanting to enjoy the financial benefits of the low-cost workforce, but unwilling or unable to ensure that low-cost workforce is enjoying a standard of employment equivalent to their employees at home?

Working to a sustainable world

When we talk with procurement about the Modern Slavery Act, there is general consensus that most businesses think of slavery in a more historic or dramatic context. But for most developed economies, the interpretation of this UN Sustainable Development Goal is about ensuring that people are not exploited in the workplace.

To embrace these initiatives means not just complying with the legal interpretations of the acts, but also looking to the broader context of modern slavery and as an industry working toward ensuring that no-one is being exploited through their employment situation.

This article was first published in The Drum on March 2, 2021

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