HM Expanding ‘Fair Wage’ Program Throughout Asia

Igor Kossov / Khmer Times No Comments Share:

PHNOM PENH (Khmer Times) – Retail giant H&M wants to raise workers’ pay and improve collective bargaining in its Asian factories, according to a statement by the Swedish clothing retailer. 

H&M has already piloted its “Fair Wage Method” in factories in Cambodia and Bangladesh, it said. The project aims to raise pay, add discretionary income and improve labor relations. 

Now, the retailer wants to roll out the program to 68 strategic suppliers by 2018, including those in Cambodia. The company said it would focus on “well-functioning dialogue” between employer and employee. 

“The implementation of the method will contribute to sustainable pay structures, more regular wage adjustments and enhanced communication and social dialogue between the management and workers’ representatives,” H&M said in a statement. 

The company is also running the Industrial Relations project here with the International Labor Organization, the Swedish International Development Cooperation Agency and Swedish union IF Metall. Participating factories and their unions signed a memorandum of understanding to improve their relations and received training on implementation. 

Wage Talks

Wages are a heated topic in Cambodia now that unions are calling for a minimum wage increase from $128 per month to $177 per month. Some members of the Garment Manufacturers Association in Cambodia are complaining that high wages are making the country unattractive because productivity has not risen in tandem. They say neighbors like Vietnam will soon become more competitive, especially with Vietnam’s pending trade deal with Europe.

H&M disagreed. “We take a positive view of wage increases, and stand behind continued commitment in countries such as Cambodia,” H&M spokeswoman Anna Eriksson said in a prior email. 

Other brands contacted by Khmer Times stopped short of directly supporting a wage increase, but mentioned that they wanted working conditions improved here. 

A delegation from the American Chamber of Commerce of Hong Kong, consisting of major garment brand representatives, visited the Kingdom recently. Its president said that garment buyers’ main concerns are wildcat strikes.

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