H&M probes alleged Myanmar manufacturing unit abuses as tension intensifies

LONDON, Aug 16 (Reuters) – H&M (HMb.ST) is investigating 20 alleged situations of labour abuse at Myanmar garment factories that supply the world’s next-greatest manner retailer, it advised Reuters, just months soon after best rival Zara-operator Inditex (ITX.MC) stated it was phasing out buys from the Southeast Asian state.

A British-based mostly human rights advocacy group tracked 156 cases of alleged employee abuse in Myanmar garment factories from February 2022 to February 2023, up from 56 in the prior calendar year, indicating a deterioration of workers’ legal rights given that a military services coup in February 2021.

Wage reduction and wage theft ended up the most routinely noted allegations, adopted by unfair dismissal, inhumane do the job prices, and forced additional time, according to a report by the non-governmental organisation, the Business enterprise and Human Rights Useful resource Centre (BHRRC).

“All the scenarios elevated in the report by BHRRC are remaining adopted up and the place essential remediated by means of our area staff on the floor and in near cooperation with applicable stakeholders,” H&M said in a statement.

“We are deeply worried by the newest developments in Myanmar, and we see improved troubles to perform our functions in accordance to our requirements and needs,” the Swedish retailer stated.

The BHRRC has tracked allegations of workers’ legal rights abuses in Myanmar garment factories considering the fact that the military junta took energy, plunging the nation into political and humanitarian crisis. The tracker consists of abuse scenarios at 124 independent factories.

The BHRRC reported it tracks circumstances of alleged abuses through resources which include union leaders, intercontinental media, and neighborhood media these kinds of as Myanmar Labour News, and seeks to verify reports by examining with brand names and interviewing employees. Reuters has not independently verified its conclusions.

There have been 21 conditions of alleged abuses linked to Inditex suppliers about the two-calendar year time period, and 20 linked to H&M suppliers, according to the report. Inditex declined to remark on the report.

A spokesperson for Myanmar’s military services government did not reply to a request for comment on the findings. The Myanmar Garment Production Association did not reply to a request for comment.

Built IN MYANMAR

The decision by Inditex to minimize ties with Myanmar suppliers arrived following Primark (ABF.L) and Marks & Spencer (MKS.L) announced designs to exit very last yr, in a pattern that some say could in the long run depart garment personnel even worse off.

Spanish fashion retailer Tendam also options to quit sourcing from Myanmar, it said in its response to a BHRRC study of brand names released together with the report.

“We do have a strategy to depart the place but [it] has not been announced however,” Tendam wrote, without detailing its reasons. Tendam did not promptly reply to a ask for for remark.

Primark instructed Reuters it expects its final orders from Myanmar suppliers to ship in advance of the conclusion of this calendar year, but has also enhanced its existence on the floor.

“As we get the job done to our exit, we’ve doubled the dimension of our Ethical Trade staff on the ground, enabling us to much more routinely visit the factories we even now get the job done with and giving us better visibility,” Primark claimed in an electronic mail on Wednesday.

Some brand names continuing to resource from Myanmar have also ramped up monitoring of suppliers.

Danish fashion company Bestseller greater its number of personnel in its Myanmar workplace from a few to 11 because the coup, it explained in its survey response.

H&M, Bestseller, and Tendam are between 18 models forming aspect of the European Union-funded Manufactured job aimed at improving labour circumstances in Myanmar’s garment factories.

The EU’s stance is that providers must continue on sourcing from Myanmar, wherever the garment business is a key employer, with more than 500 factories generating garments and sneakers for massive models.

“By participating as a organization in discussions with local labour legal rights teams and trade unions on wages and labour situations you can have leverage,” said Karina Ufert, CEO at the European Chamber of Commerce in Myanmar. “By leaving the state, it is challenging to see how you can have an affect on local ailments.”

Vicky Bowman, previous British ambassador to Myanmar and director of the Myanmar Centre for Responsible Company, explained the worldwide brands under force to stop getting from Myanmar were also the most probable to give secure employment and get additional measures to guard versus legal rights abuses.

“If they leave, both the positions disappear completely, or factories scrabble to get orders from footloose buying agents who treatment only about cheap labour and do not fret about factory disorders,” Bowman instructed Reuters.

In the BHRRC study, some of the world’s largest apparel brands detailed their solution to the predicament.

In its response, sportswear big Adidas (ADSGn.DE) wrote: “Despite the human rights and labor legal rights hazards which have been recognized, we feel that by way of improved human rights owing diligence steps, we can keep on to do enterprise in Myanmar in a dependable manner and in alignment with main ILO (Intercontinental Labour Business) conventions, the UN Guiding Rules, and the OECD Pointers.”

Britain’s Future (NXT.L) wrote that it had regarded withdrawing from Myanmar, but “even though it can ship a distinct signal to the local authorities that its policies and techniques are unacceptable, it can do massive destruction to community communities and employees, depriving them of desperately wanted financial investment and wages.”

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