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Implementing a Living Wage Strategy in Apparel Factories

In 2013, Hennes & Mauritz AB (H&M) established its Fair Living Wage Strategy to achieve significant improvements in living wage standards across its supply chain by 2018. H&M is one of the world’s largest apparel manufacturers and retailers, with a global supply chain employing roughly 1.5 million people. As such, the business recognizes its opportunity to significantly influence living wage standards. Specifically, by implementing the Wage Management System and democratically elected worker representatives, H&M has seen particular success in improving wage levels in its supplier factories. The Wage Management System provides workers with greater transparency on wage grids that highlight the skills and responsibilities compensated at each wage tier. The implementation of democratically elected worker representatives has the primary objective of supporting fair negotiations. As of 2018, factories producing 67% of the company’s product volume have implemented an improved Wage Management System and 73% of product volume is produced by factories with democratically elected worker representatives.