H&M has met with the Ministry of Labor in Myanmar and expressed our expectations about set minimum wage levels and annual review mechanisms to ensure that workers receive a fair wage. Together with Gap Inc and N Brown Group plc, we have sent a joint letter, urging the Government to set a negotiated minimum wage level that is uniform across all industries as well as annual reviews of the minimum wage.

Our role as a brand and buyer is not to set or recommend the level of wages. Our approach is that wages should be negotiated between the parties on the labour market. We require our suppliers to pay their employees the wages and overtime remuneration to which they are legally entitled, and check that they do so.  We are well aware that the opportunities for employees to negotiate are limited in many countries, including Myanmar. That is why we are developing projects and programs which have the aim of strengthening employees’ rights and their ability to negotiate on their own behalf on their terms and conditions through trade unions or other elected employee representatives.

On 17 July, H&M published on its website a "Statement on Wages and Industrial Relations in Myanmar"

We welcome the efforts of the Myanmar Government to enact the Minimum Wage Law; however, we are concerned that it has not been implemented in the past two years since its enactment. In setting a minimum wage level, we advise that the Government set a uniform level across all industries in compliance with the ILO C.131 Minimum Wage Fixing Convention. If the garment industry wage levels are lower than other industries, it will not be able to attract and retain a skilled labor force, which it needs to develop and grow into a thriving economic driver.

The minimum wage should be reconsidered through an annual review mechanism, which is inclusive of key stakeholders, and is aimed at laying the foundation for a vibrant tripartite industrial relations and wage level negotiations process based on transparency, inclusiveness and peaceful negotiation.

We attach high importance to freedom of association – according to ILO Convention C087 Freedom of Association and peaceful resolution of conflict.  Ideally this should lead to social dialogue between employers and worker representatives in which issues can be constructively resolved and in which more broadly – according to ILO Convention C. 98 – Right to Organize and Collective Bargaining can ensue.

Occasionally–whenever issues cannot be resolved–workers may choose to go on strike or protest. We attach great importance to the peaceful resolution of worker protests. When violence is used by public or private sector security forces to curtail workers’ peaceful protests, this is likely to be more of a deterrent to companies considering sourcing from Myanmar than the strikes themselves, and will have a significant negative impact on Myanmar’s reputation.  Similarly, where workers representatives are detained or dismissed for striking, this will also have a negative impact on Myanmar’s reputation and will be a factor which investors consider.

This lack of clarity in the regulatory environment can cause business uncertainty and we encourage the Minimum Wage Law’s urgent implementation, uniform across all industries.