Almost one million garment workers covered by H&M’s ‘fair living wage’ strategy

H&M has revealed that more than 930,000 garment workers located in its supply chain are now covered by a "fair living wage" approach, with 84% of the company's product volume now produced in factories that are improving wage standards and human rights approaches.

H&M launched its fair living wage strategy in 2013, aiming to ensure that all supply chain workers received a wage that was enough to support a family and be earned during legal working hour limits.

The company has this week revealed that it has surpassed its first milestone target of implementing improved wage management systems for all strategic suppliers by the end of 2018. Since 2013, the number of factories supplying to H&M covered by the strategy has increased from three to 655. More than 930,000 workers are located in these factories, which account for 84% of product volume.

“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,” H&M Group’s head of sustainability Anna Gedda said.

“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.”

As 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 labour market.

H&M does have a time-specific target to ensure that worker representatives cover 100% of factories that H&M works with across Bangladesh. The company revealed that all tier 1 factories in Bangladesh had these representatives in place by December 2017. Globally, 73% of H&M’s product volume is located in factories that have democratically elected worker representation – covering 840,000 workers.

More than two-thirds of H&M’s product volume is sourced from factories that are implementing improved wage management systems – covering 635,000 workers.

Chain reaction

H&M is encouraging other brands to improve worker options in the garment supply chain. Working with the IndustriALL Global Union through the ACT platform, retailers are revamping approaches to bargaining agreements and responsible purchasing practices.

The Ethical Trading Initiative (ETI) will conduct an independent evaluation of H&M’s strategy later in the year, outlining the next steps to reach the overarching target.

H&M has previously been stung by findings that have emerged as the company improves the traceability of its supply chain. Last year, the company vowed to implement new supply chain management approaches, after a report linked some of the world’s largest fashion brands with highly polluting facilities that are producing man-made viscose fibres.

H&M has since switched its supplier approach and is now partly based on the Higg Index facility module used by the Sustainable Apparel Coalition, which measures environmental, social and labour impacts of production and identifies areas for improvement.

At an industry level, retailers and brands have had to overhaul enforcement practices towards human rights neglection in the supply chain. The Rana Plaza collapse and a BBC investigation into Syrian child workers have led to a heightened focus on worker rights in factories.

Matt Mace

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