H&M rolls out new wage systems in supply chains

Mark Lane | 10th July 2018

STOCKHOLM – H&M has outlined details of new wage management systems aimed at improving career prospects for textile workers in its global supply chains. The company has spotlighted its work with Ekpen Tekstil, one of around 500 textile suppliers implementing the new wage management systems. The factory, which has worked with H&M group’s local team in Turkey for two years to improve wage management systems, has 200 employees located in Denizli in western Turkey and has produced for H&M group for 16 years.

“We want textile factories producing for H&M group to have a positive and motivating workplace environment,” said a note from H&M. “This not only benefits factory employees, but also to the same extent management and buyers such as H&M group. It’s a win-win – and a foundation for fair wages.”

H&M says its new system means employees receive wages based on their skills and experience, where previously all employees received the same basic wage regardless. “This new way of working has also resulted in that many factories now offer their employees skill development, which in turn leads to a happier work environment, and a possibility for motivated employees to earn a higher wage,” said the company.

H&M is rolling out its new systems to ten production countries, these being Turkey, Bangladesh, Cambodia, Indonesia, India, China, Myanmar, Vietnam, Ethiopia and Pakistan. The systems focus on how parameters such as skills, experience and responsibility can be included in wage management systems.

“I believe this system makes the workers aware of their contribution to the company through their work, but also of that they can have a career plan and develop through vocational training. It gives workers more opportunities and increase their trust in the company. It also contributes to a happier work environment as well as improved productivity”, says Ahmet Yavuçehre, owner of Ekpen Tekstil.

Editor’s note: H&M’s press team appear to have been on a charm offensive regarding worker wages ever since the business first came under fire from the Clean Clothes Campaign for – allegedly – reneging on a living wage pledge made in 2013.

While we think the business should be more transparent about what actually happened with its living pledge, the systems outlined here are impressive and suggest this is an issue the business is taking seriously. The systems are also in tune with the continued fine work of Industriall Global Union where the key to better working conditions is seen to be tripartite collaboration between employers, worker representatives and workers themselves.

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