Following a recent conference in Berlin, H&M announced that it is planning to pay its factory workers more than just poverty wages for their hours worked by 2018. Of course, the mainstream media took the bait and are praising the retailer for its initiative. However, like a diligent source of journalism, the Washington Post, is asking some questions; namely, "How real are H&M's proposals?" The publication cited a "a cute one-pager" of the Swedish fast fashion retailer's promises in promoting fair living wages for its factory workers, which the Washington Post says are "mostly rendered in the non-committal passive voice." The highlights from H&M's "roadmap towards a fair living wage in the textile industry" are 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."
To this, the Washington Post, asks: "What's missing here?" Apparently, an actual number for what H&M will pay workers is what is missing. While the retailer sets out a "Fair Wage Method" developed by Daniel Vaughan-Whitehead, who manages wage policy at the United Nations' International Labour Organization, the Post is not satisfied. Its writer, Lydia DePillis says: "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."
Who else is dissatisfied? Well, Scott Nova, for one. The executive director of the Worker Rights Consortium (WRC) advocacy group says: "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. Just staying 'we're for a living wage' ... that's not credible."
The numbers that we do have are quite shocking. 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." In Bangladesh, where two of H&M's pilot factories are located, the minimum wage is less than 31 cents an hour. According to a recent piece by the New York Times, "Factories in Bangladesh, the world’s second-leading apparel exporter after China, keep costs down by paying garment workers the lowest wages in the world — the current minimum is about $38 a month."
Now, please be aware that we commend H&M for opening up a dialogue about wage improvements (even though the repeated labor tragedies are really the reason, I think). Hopefully H&M and its fellow fast fashion retailers will act swiftly and in a respectable manner to ensure that its laborers are working in safer facilities and are being paid appropriate wages. These retailers have the power to ensure that these initiatives are achieved!