Maybe you’ve read it in the news lately. H&M’s CEO, Karl-Johan Persson, started to feel bad that he outsources most of his clothing production to countries where workers are hardly paid the money necessary to eat. He flew from Stockholm to Bangladesh, sat down with Bangladesh’s Prime Minister, Sheik Hasina, and kindly asked her to raise the minimum wage. The press is going wild.
What is wrong with this picture? If Persson is really sincere, he has got flawed logic. H&M gets about 25% of its products from Bangladesh. That is a lot of weight to throw around, not just with Bangladesh’s prime minister, but with its producers as well. What does that mean?
A Swedish film crew visited a producer in Hong Kong who said that it is especially hard working for H&M because they can stop placing orders before you can blink your eye. In China this meant that workers were subject to increasingly stressful and unhealthy working conditions. The film crew found children as young as 16 working without safety equipment in factories “dense with chlorine gas.” When they were under pressure to fill and order, they worked 13-14 hours a day, seven days a week.
So you’re trying to tell me that a CEO with that much influence couldn’t have simply asked their producers to raise wages?
But that is really just the tip of the iceberg. In Bangladesh the minimum wage is the lowest in the world, at $36/month. H&M also gets its clothes from Cambodia, where the minimum wage hovers at around $61/month. In September of 2010, Cambodian garment workers at a factory that produced for H&M were fired for striking for $93/month which they consider a “minimal living wage.” H&M also gets its clothes in Indonesia, where the minimum wage is $63/month. Nevertheless in 2003, No Sweat UK reported that at least one factory that produced H&M clothing paid workers as little as $7 a week for up to 60 hours of work. When workers complained, the factory locked them out, and refused to let them back to work. The entire factory went on strike in support of the locked out workers, so the management simply “hired local thugs to intimidate and threaten workers.” The strike ended.
To the best of my knowledge Persson has neither met with the president of Cambodia nor Indonesia about minimum wage policies. Additionally, it would take nearly doubling the minimum wage in Bangladesh to come close to what is being paid in Cambodia and Indonesia. Persson is hardly at risk of losing huge profit margins, should the president decide to listen to him. The icing on the cake is that on September 3, 2012, just weeks after Persson met with the president asking for a minimum wage increase, he announced at a BGMEA press conference that H&M plans to double its purchases from Bangladesh in the next five years. This, apparently, regardless of whether or not the minimum wage is raised.
Finally, it is important to keep in mind that labor rights issues go far beyond wages. H&M is notorious for breaking their code of conduct that set standards for working conditions: unfair treatment of workers, and unsafe factory conditions seem to be common denominators in factories that produce their clothing. Mistreatment of workers, including failure to provide proper safety training and equipment, seems to be an especially grave problem in Bangladesh. In 2006, the National Labor Committee reported that in one factory, producing clothes for H&M (Evitex), employees were routinely forced to work overtime without adequate compensation, and subjected to unsanitary bathrooms, unsafe drinking water, a hot atmosphere, and harsh punishments for not meeting targets. Consequences of such treatment are grave. ILRF’s research shows that in the past twenty years, over 100 factory fires in Bangladesh have killed over 700 people and injured over 2600. In 2010, Garib&Garib, a factory producing cardigans for H&M caught fire, left 21 dead and 50 injured. H&M had apparently audited the factory months earlier and failed to note the absence of proper safety equipment.
Reports of abuse of workers at factories producing for H&M factories have also been documented in Cambodia, Indonesia, the Philippines, India, Thailand, and Madigascar and Mauritus, and the United States. But instead of condemning a history of labor rights abuses, the international press chose to laud H&M for one high-profile conversation. Certainly something to think about just days before Helena Helmersson, Head of Sustainability for H&M, prepares to speak at the BSR conference—towards a just and sustainable Business World— in New York.