Below you will find more information on the topics highlighted in report.
In 2013, H&M was one of the first and largest fashion companies in the world to make its supplier factory list public. The list includes all factories that are approved for production for any brand within the H&M Group. In 2014, we expanded the scope of the list even further to include so called processing factories that in certain cases can be subcontracted by our suppliers to perform specific outsourced tasks such as printing or washing. By publishing the list, we want to contribute to a more transparent and ultimately more sustainable fashion industry
We are well aware that the opportunities for employees to negotiate and to stand up for their rights are limited in many countries. That is why we are involved in projects and programs which have the aim of strengthening our suppliers’ employees’ rights and their ability to negotiate on their own behalf on their terms and conditions through trade unions or other elected employee representatives.
In partnership with SIDA, the ILO and Swedish trade union IF Metall, we have launched a programme in Cambodia aimed at strengthening industrial relations in the textile industry and increasing the number of collective bargaining agreements. The customised training programmes were launched 2014 to a pilot group of 7 factories and will be extended to several more factories during 2015.
Training consists of workplace cooperation, labour law and dispute resolution, effective communication and negotiation skills aiming for collective bargaining and collective agreements negotiated in good faith.
An undeclared unit is a serious breach to our Code of Conduct and can lead to termination of the supplier. When we do find an undeclared unit we require the suppliers to presents an action plan which shall include a management system with a clear policy, well documented and fully implemented and communicated routines, designated responsible staff, and a control and follow up mechanism to prevent repeated violation. If the supplier fails to present a sustainable action plan or is not willing to do so it can lead to termination of the business relation. In such circumstances a phase out plan is worked out in order not to jeopardize the well-being of the workforce.
Undeclared factories can have serious violations of labour rights, health and safety standards and environmental requirements as they do not go through the same process of audit assessments that H&M and other brands in the industry require as a prerequisite to start a business relationship.
In May 2013 H&M held a workshop on undeclared production units for all of our Cambodian suppliers. At that time, H&M gave suppliers a two-week grace period to reveal any undeclared production units they had used the previous year.
H&M has distributed a translated copy of its suppliers’ list to local unions and labor rights groups to encourage whistle-blowing on undeclared units.
Fixed Duration Contracts
We recognize that the frequent use of short term, fixed duration contracts, in the Cambodian garment industry constitutes an illegal breach of workers’ rights, which needs to be addressed by us and other buyers. Starting from early this year we will have stricter requirements towards our suppliers. We will revise our contract requirements, as a first step towards achieving a change towards un-fixed duration contracts. Suppliers that employ workers over two years on fixed duration contracts will be seen as being in violation of our code of conduct requirements. All suppliers with this violation will be required to create a remediation plan for how to transfer workers from fixed to un-fixed duration contracts. Our factory auditors will then follow up on the implementation of these plans.
To ensure that this transition takes place in a sustainable way we will work closely with other actors in the industry. Primarily we will work closely with international and national unions and employer associations to anchor this shift with the workers themselves, so that this change is understood and seen as beneficial. To that end a legal clarification on contracts will be part of our engagement with the Cambodian government. We will work with industrial associations and provide technical support to our suppliers as this will have a significant impact on their current employment practices. Collaboration with other buyers in Cambodia will also be important as the issue of un-fixed duration contracts is industry-wide, and a successful approach to change this practice will likewise have to be industry-wide.
Excessive overtime is one of the most common challenges throughout the textile industry. H&M have strict regulations that overtime should be within legal limits, be voluntary and be correctly remunerated and is one of the points that we verify through our audits. This is something we are very happy to see in the results of our first evaluation from the role model factory in Cambodia. In this particular role model factory overtime has been reduced from 14 hours to 8 hours a week, which is under the legal limit of 12 hours a week
As part of our new Fair living wage roadmap, we are evaluating and further improving our purchasing practices to ensure it enables our suppliers to pay a fair living wage and reduce overtime. Our purchasing practices should enable our suppliers to pay a Fair Living Wage. During 2014 we have started to further improve our purchasing plans to reduce our suppliers’ production peaks and enable them to better prepare the right capacity in their factories. This means, among other things, that the supplier can have the factory running during low season and secure employment for the workers.
The challenges we face in the countries where our products are manufactured are complex, and often difficult to address as an individual company. That’s why we collaborate with other brands in different initiatives on a local as well as global level. Since 2005, H&M has supported the ILO’s Better Factories Cambodia project, which aims to improve working conditions in the textile industry in Cambodia – one of the countries where H&M's clothes are made. The project has expanded to countries including Bangladesh, Vietnam and Indonesia under the Better Work Programme. H&M supports the ten principles of the UN’s Global Compact on human rights, working conditions, the environment and anti-corruption (www.unglobalcompact.org).