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11-12-2013
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it's a scam. they won't say what the "living wage" actually is. washingtonpost:

H&M says it will pay factory workers a ‘fair living wage.’ It doesn’t say what that means.

Posted by Lydia DePillis on November 26, 2013 at 5:01 pm

H&M's "roadmap." (H&M)

On Monday, H&M announced what looked like bold progress towards paying its factory workers something above poverty wages for the hours they spend pumping out flimsy garments. The Swedish company's "four-pronged approach" went into wide media release, and at a time when most other retailers are still dithering over how to help in the wake of the catastrophic building collapse in Bangladesh in April, positioned it as the socially responsible corporation to beat.
But how real are H&M's proposals? They're summarized on a cute one-pager, mostly rendered in the non-committal passive voice, as follows:
  • "H&M will support factory owners to develop pay structures that enable a fair living wage, ensure correct compensation, and overtime within legal limits. This will be explored by implementing the Fair Wage Method in our role model factories, from which we will source 100% of the products during five years."
  • "H&M's strategic suppliers should have pay structures in place to pay a fair living wage by 2018. By then, this will reach around 850,000 textile workers. Our strategic suppliers are currently 750 factory units producing about 60% of our products."
  • Starting in 2014, H&M will "Develop our price method to ensure the true cost of labor. By doing this we secure that we pay a price which enables our suppliers to pay their textile workers a fair living wage and reduce overtime."
  • "H&M will encourage governments to engage in a process to identify a living wage level, set a legal minimum wage accordingly and review wages annually thereafter."
Plus a few things about educating workers, strengthening unions, and strengthening their "social dialogue" project.
What's missing here? An actual number for what it'll pay workers. The closest H&M comes to that is saying it'll use the "Fair Wage Method" developed by Daniel Vaughan-Whitehead, who manages wage policy at the United Nations' International Labour Organization. The Fair Labor Association describes it as a 12-step way of determining whether rates are in fact fair, including factors like productivity and prevailing wages, and providing for annual review. But it's not exactly a formula, and therefore would be difficult to dispute when -- and if -- H&M arrives at a final number.
Those who've been working around these issues for a long time find the lack of specificity exasperating.
"If they want to pay living wages, they should pay living wages. They should give themselves a near-term deadline and give the world a number," said Scott Nova, executive director of the Worker Rights Consortium advocacy group. He was at a meeting in Stockholm a few weeks ago where H&M announced the initiative to stakeholders like labor unions and NGOs, and didn't make much of what it had to offer. "Just staying 'we're for a living wage, in 5 years we're going to pay an undefined amount in a subset or our factories,' that's not credible."
How much would paying a living wage even cost H&M? According to the WRC's calculations, labor comprises about 6 percent of a factory's costs, and only 1 or 2 percent of the final retail price. Bangladesh, where two of H&M's pilot factories are located, is proposing to double its minimum wage to about 31 cents an hour. The WRC estimates that a living wage would be more like $1.50 an hour. That would increase the price of a tank top, but not by much.
Meanwhile, H&M is already a member of the Fair Labor Association, which has a code of conduct that addresses adequate wages (the FLA certifies H&M's work only in China). Even so, it still pays the same rock-bottom prices as Wal-Mart and Nike.
"We've been down the road many times. This has all the hallmarks of fluff," Nova says. "Where H&M has the power to make it happen now is in the factories now. If they are willing to take the steps necessary, they can achieve it. Why are they not doing that, is the question."

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11-12-2013
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^ But it would be a different number in each and every country where they'd have factory workers, right?

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Quote:
Originally Posted by fashionista-ta View Post
^ But it would be a different number in each and every country where they'd have factory workers, right?
that depends on how the trans pacific partnership treaty goes. a draft of the treaty was leaked recently which listed that companies could export items from (vietnam for example) into the US (and other countries where H&M have markets and are included in the treaty) duty free (versus made in china which has an import tax)

if this happens than H&M will likely pull out of countries that require the duty entirely.

it's a race to the bottom to find the lowest cheapest wage possible with no duty or taxes.

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H&M Plans to Pay Garment Workers Fair Wages. Here's Why That's Probably BS.


—By Dana Liebelson
|


Terry Chay/Flickr
I recently wrote about the Indian sumangali scheme, wherein girls from poor, rural families are recruited to work in clothing factories, on the promise that they will earn enough money for a dowry. Instead, many toil in exploitive conditions, earning far less than recruiters told them they would. Many of these factories sell to American companies. H&M has been accused by the Centre for Research on Multinational Corporations of using sumangali labor in the past, but the company is trying to rid its factories of the scheme by 2014. Shortly before Black Friday, H&M announced that it also plans to start paying 850,000 workers at 750 factories—out of its some 1,800 total factories around the world—a fair wage by 2018.
Fair-trade experts say that the announcement is a step in the right direction, but some point out that the plan has major holes. Most notably, the factories that will be covered under the fair-wage program produce just 60 percent of H&M's products, and the company did not say whether it would eventually extend the plan to its other factories, as well. Here are a few other red flags:
H&M won't say how much it will pay workers in each country. Anna Eriksson, a spokesperson for H&M, told me that that the company does not believe US buyers should dictate a minimum wage to its factories; instead, it expects factory employees and factory owners to work together to come up with a fair wage. Wages will depend on the country and the factory, and must meet the Fair Wage Method, which was developed by Daniel Vaughan-Whitehead, who oversees wage policy at the United Nations' International Labour Organization. This standard is based on a number of factors—such as promoting "acceptable living standards" and being "comparable to wages in similar enterprises in the same sector." H&M also plans to support unions that empower workers to negotiate for wages, and encourage governments to identify a living wage level.
But Scott Nova, executive director of the Worker Rights Consortium, criticizes the company's plan to rely on governments and factories to set wages. Nova told the Washington Post, "Just saying 'we're for a living wage, in 5 years we're going to pay an undefined amount in a subset or our factories,' that's not credible." Jefferson Cowie, the chair of the Department of Labor Relations, Law, & History at Cornell University, echoed those concerns. "It is hard to see governments taking a strong role in boosting wages in the short run," he told me. Fair wages can also be hard to enforce. I saw this firsthand while reporting my sumangali story: In India, the government does have a minimum wage for textile workers—but many of the female workers I spoke with were not being paid that wage, and didn't have access to a union.
H&M claims that increasing wages somehow won't raise prices consumers pay for its clothing. Eriksson says that the company will keep its clothing prices steady for Western consumers by using in-house designers, buying clothing in large volumes, and finding other efficiencies. But Elizabeth Cline, the author of the 2012 book Overdressed: The Shockingly High Cost of Cheap Fashion, says that she doesn't believe that H&M can pay garment workers a living wage without raising retail prices. "How can that be true?" she says. "It makes me think that the company is just riding on unsustainable expansion [and] will just continue to sell more and more low-quality clothes to make up for this increased cost." However, Joel Paul, a law professor and expert in trade policy at the University of California-Hastings, speculates that the claim could, in fact, be true: Because foreign garment factory labor accounts for a tiny percentage of a shirt's total cost, he says, increasing workers' hourly wages from 15 cents to a $1.50—an estimated living wage in Bangladesh—wouldn't substantially undercut profits.
The wage increase won't affect any of H&M's spinning mills. H&M's fair-wage promise does not extend to all of its subcontractors, which include the factories that spin the cotton into thread (also known as spinning mills). In India, most sumangali schemes take place in spinning mills. That the plan doesn't include subcontractors could be a big problem: If some factories in the supply chain are not required to pay a fair wage, garment factories can simply outsource more of their labor to those cheaper operations. When I asked H&M how the company plans to address the challenge of factories outsourcing labor to subcontractors with potentially exploitive conditions, spokesman Håcan Andersson said, "We are not able to assist you further in this matter."
Despite the plan's significant problems, Cornell's Cowie says he believes that H&M deserves some credit for taking baby steps toward fixing a notoriously exploitive industry. "Do they have the perfect solution?" he says. "Absolutely not. If they wanted to pay the highest wages, they wouldn't be shopping for labor in Cambodia and Bangladesh in the first place. But making an open commitment to workers matters—as long as it does not end up being just a cover for their old practices." (motherjones)

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