Even in normal times, the global fashion industry makes it hard for workers in the poor countries who make the clothes people in the rich countries wear to survive on the poverty wage they are paid. The global garment and textile industry rides on the backs of millions of workers, predominantly women, engaged through flexible contracts and poor working conditions to make the huge profits they make. With the global garment trade coming to a standstill, companies have done the expected: made labour bear the risks that capital claims profits for.
Cheap clothes demands cheaper production centres and cheapest labour
In April 2020, fast-fashion MNC H&M (Hennes & Mauritz) made a public commitment to honour all orders placed before the pandemic, including garments produced as well as those in production. The sequence of events at Gokuldas Exports (GE) ECC-2 factory at Srirangapatna, Karnataka belies the public commitment that H&M made. On Saturday, 30 May, the company started moving out machinery at 9.30 pm – much after the factory closed at 5.30 pm for the weekend. The following morning, workers came to know and more than 350 of them gathered around the factory. The police and civil administration were present when the GE management gave an assurance that the factory would not be shut down.
900 of the 1200 workers are members of NTUI’s affiliate – the Garment and Textile Workers Union (GATWU). 1100 of the 1200 workers are women and are paid only the minimum wage of Rs. 8866 per month or Rs. 341 per day. The workers have been at this factory since 2010 and have manufactured for H&M continuously since 2014. H&M made a profit of US$1.8 billion last year alone, while GE booked a profit of Rs. 383 million.
On 1 June, GATWU wrote a letter to the Deputy Labour Commissioner (DLC), Government of Karnataka and also informed H&M, while simultaneously writing to GE seeking a meeting. Subsequently, the company began to systematically empty the finished products and materials from the factory store. On 4 June, the production department was not assigned any work, with the finishing department assigned work only till the end of the day. On 5 June, even that ceased.
On 5 June, GATWU again wrote to the DLC, police and civil administration about an imminent closure. It also called upon the DLC to recognise that an industrial dispute existed and to admit the matter into conciliation. The government did not act. Gokaldas Export announced an indefinite layoff at 5.40 pm on 6 June.
A thin fabric spun from disregard for laws, human rights, and ethics
Despite its rapid growth in volume and complexity over the past decade, the global garment industry continues to seek the cheapest labour among and within developing countries. Having found that, capital continues to exploit labour, this time using the pandemic as a front. GE has not paid lockdown wages for all workers. The workers, who could join, were paid only 50% wage, while those who could not join work owing to lack of public or company provided transport have not been paid at all. Workers came to complete old orders when the factory opened post-lockdown. Non-payment of wages is in violation of the Ministry of Home Affairs order of 29 March 2020.
H&M did not commit to the order status even after being informed by GATWU on 1 June. Even as GATWU sought a meeting with the management, H&M allowed the management to proceed with the factory closure while asking the union to meet with the management. During the meeting, the management informed GATWU that payments of old orders were still due. H&M is the only MNC for which ECC-2 has been manufacturing in 2020. In 2019, ECC-2 manufactured almost 90% production for H&M. Therefore, H&M was clearly aware that they were reducing orders leading to the shutting down of the factory.
The Labour Department was informed of the situation from the day the management removed the machinery on 30 May. The local administration and police were present when workers assembled at the factory gates on 31 May. Yet, none of them acted despite GATWU seeking intervention under the Industrial Disputes Act, 1947 (IDA). The Government of Karnataka has grossly failed to implement labour laws and has allowed the factory to illegally lay off over a thousand workers without following due process under section 25M of the IDA.
Time for labour to stop picking up the tab for capital
While global capital blazes through production sites with dexterity and impunity, workers has been left to bear the price to families and communities in its wake. Using third-party factories like GE to produce products allows companies like H&M to take a public stand against labour abuses but avoid any financial or legal responsibility. Sweden, where H&M is registered, has announced several crisis containing measures to reduce costs, strengthen liquidity and improve access to financing to support viable companies during the crisis and reduce the number of jobs lost. However, none of these social and financial security benefits transfer to the workers that MNCs engage through their supply chains across the world, and certainly not in the poorer countries.
NTUI demands the following immediate actions:
- The Government of Karnataka immediately intervene and take legal action to keep the factory functional
- H&M must disclose the status of orders and payments made to GE, and place orders at ECC 2 to ensure smooth operations of the factory and prevent layoffs
- Gokaldas Exports (GE) stop illegal action against workers and immediately resume operations at ECC-2 and pay all outstanding wages