Clothes are not the only merchandise at H&M shops tainted by workers’ poverty

The “Turn Around, H&M!” campaign focused on the specific commitment made to the workers who make H&M clothes. However, H&M does not only sell clothes, and garment workers are not the only ones who live in poverty while H&M rakes in profits. Viet Labor Movement researchers spoke to seven workers at a factory in Vietnam that supplies bowls, soap trays and soap dispensers bearing H&M’s name.

The interviewees worked at the Cuong Phat company that is listed on H&M’s public supplier list.

At the time of the interviews (in February 2018) their monthly wages ranged from the equivalent of USD 200 to 250. Back in 2015, Asia Floor Wage estimate of what would constitute a living wage in Vietnam was USD 385.

Apart from being paid poverty wages workers reported that this H&M supplier is also stingy when it comes to the so-called allowances. For example, workers’ daily meal allowance was about half of the usual amount in other companies in this province.

This allowance is part of a widespread industrial practice in Vietnam: for employers to split the cost of labour into several components. These include, among others: the basic wage, the meal allowance, the punctuality allowance, the bus allowance, the seniority allowance, the Tet (New Year) “bonus”.

Because this is standard practice, and workers effectively do not have collective voice, they have no choice but to work under these arrangements – even though these “allowances” and “bonuses” essentially just give employers the power to withhold or delay parts of workers’ income.

At the time of the interviews, the company had not announced how much the Tet “bonus” would be. The interviewed workers expected that this announcement would be made only once workers leave for Tet, which left the interviewees feeling quite anxious.

One interview took place with a group of three women. They had worked at the same company for five, 12 and eight years, respectively. Everyone in the group said that given the cost of living in the province, their earnings make it very difficult to make a living or to save.

One worker said that she got paid about the equivalent of USD 220 per month (VND 4.9 million) if she worked 10 hours a day five days a week, with two hours a day counting as overtime. She paid VND 1.1 million for her rented accommodation. School fees for her two children added up to 1.9 million a month. The family spent 3.5 million on food. By economizing on every step they could save about up to 1 million a month.

The other two workers in this group said their wages were very similar.

Another interviewee, a 28-year-old, worked lifting and carrying dirt bags used in the manufacturing process. These bags can weigh up to 70kg. His monthly wage amounted to VND 5.7 million. His rental accommodation cost 1.4 million, and he spent about 3.5 millon on food. His one ‘luxury’ were the occasional cigarettes. He said he was not able to save anything at all.

The interviewed 34-year-old mother of a young child had worked at Cuong Phat for three years. Her monthly wage was 4.5 million. Her mother lived with her to look after her child because she could not shoulder commercial childcare costs. She was unable to save any money. She said that the best she could do was to economize so that she could cover the basic cost with her income and not fall into debt.

Researchers spoke to two more women who shared their accommodation, so they were each paying 450,000 per month.

One worker said she was glad that her family was not far away. She would otherwise not be able to visit them because she could not save any money from her wages, which amounted to 4.7 million .

Her co-worker and roommate is married to a bricklayer. At the time of the interview their youngest child was nine years old, and the two older children assisted her husband in his bricklaying work.

Her monthly wage was 4.5 million. After all expenses, including education costs for her nine-year-old daughter, the couple was able to save about 3 million per month, which they needed for rainy days, such as someone in the family falling ill.