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100% tier-1 Bangladeshi factories achieved democratically elected worker representation

H&M success report on ‘fair living wages strategy’ reveals that 100% of tier-1 factories of Bangladesh achieved democratically elected worker representation in December 2017.

Desk Report

H&M launched a fair living wage strategy in 2013 with the aim to ensure that all its suppliers pay fair living wages to the workers. Recently H&M revealed that it has surpassed its first milestone target of implementing improved wage management systems for all strategic suppliers by the end of 2018.

Fashion giant H&M’s launched a fair living wage strategy in 2013 aiming to ensure that all its suppliers pay fair living wages to the workers
Figure: Fashion giant H&M’s launched a fair living wage strategy in 2013 aiming to ensure that all its suppliers pay fair living wages to the workers. Courtesy: H&M

According to the report, fashion giant H&M’s fair living strategy now reaches 655 factories employing more than 930,000 garment workers, up from three factories in 2013.

Earlier 500 factories which are 67% of total factories spread across 10 countries were successfully implementing improved wage management systems; 594 factories which are 73% of total factories were implementing democratically elected worker representation which involves about 840,000 garment workers; 100 percent tier 1 factories in Bangladesh achieved democratically elected worker representation in December 2017.

H&M Group’s head of sustainability Anna Gedda said, “I’m so proud of the dedicated work hundreds of colleagues around the world have done these past five years. We’re doing something that nobody has ever done before.”

“The results of our work in creating the foundation for fair living wages are exceeding our expectations, reaching close to a million garment workers. Now, the work continues – together with the rest of the industry,” Anna Gedda added.

I’m so proud of the dedicated work hundreds of colleagues around the world have done these past five years. We’re doing something that nobody has ever done before.

Anna Gedda, head of sustainability, H&M Group

“These positive changes start with the fact that more and more workers are electing their own representatives. For example, in Bangladesh, 40% of all worker representatives are now women. This means that issues that concern women are more visible and can be strategically addressed as part of the overall Fair Living Wage Strategy, which in turn has positive effects on quality, worker turnover and productivity,” said Maritha Lorentzon, CoC Global Coordinator, H&M.

“It takes time – one has to be patient. But a focused approach that identifies your salient human rights issues, sets a long-term strategy, and engages both internal and external stakeholders is the only way to systemic change,” Maritha Lorentzon added.

H&M’s Fair Wage Method implementation

Year Number of Factories
At the end of 2016 140 (29% of H&M’s total product volume)
At the end of 2017 228 (40% of H&M’s total product volume)
At the end of 2018 336 (50% of H&M’s total product volume)

According to H&M, systems taking the Fair Wage Method into consideration are being implemented at an increasing number of factories: 140 at the end of 2016 (representing 29% of H&M’s total product volume), 228 at the end of 2017 (representing 40% of H&M’s total product volume), and a total of 336 by the end of 2018, superseding H&M’s goal of 50% of the total product volume by the end of 2018.

H&M fair living wage strategy

Implementation of the Fair Wage Method takes place in Vietnam, China, Cambodia, Bangladesh, Turkey, Myanmar, India, and Indonesia. Approximately 200 factories will also be enrolled in the Wage Management System Program internally developed by H&M.

Implementation of the Wage Management System Program takes place in Bangladesh, Turkey, Ethiopia, Pakistan, India, Indonesia, China, and Cambodia.

To be a buyer H&M’s strategy focuses on the management process of wage standards, rather than imposing specific wage levels for suppliers. The fashion retailer is working with factories to embed fair negotiating processes between governments, employers, worker representatives and the wider labor market.

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