H&M’s Supplier Is Using Cancelled Orders As A Cover For Union Busting

22/07/2020 | by Sophie Benson

Image: Protests outside the H&M store in Vienna to support the workers laid off by supplier Gokaldas Exports, Credit: Facebook / Garment and Textile Workers Union

H&M claims to have paid up, and workers’ rights organisations uphold this. So why is its Bangalore supplier still firing employees under the guise of Covid-19? Sophie Benson investigates how garment factories are using the global pandemic to break down trade unions among their workers.

At 5.30pm on the 6^th June, workers at the ECC-2 Unit of Gokaldas Exports, based in Srirangapatna, a town in the Mandya district of the Indian state of Karnataka, were leaving work when they noticed a note stuck to the wall. It stated that all of the approximately 1,300 garment workers were to be laid off. The factory would be closing on the 8th.

Before making any lay-offs, a company with over 100 employees must receive permission from the labour department. However, management from Gokaldas Exports did not seek permission or provide adequate notice, instead they simply began to remove machinery from the factory in preparation for the unsanctioned – and therefore illegal – lay-offs to come.

“I felt like crying,” says garment worker Shobha. “I was hurt. Management doesn’t respect our service. I’ve worked for this company for 8 long years.” Left with no jobs and little other choice, Shobha and her colleagues gathered in protest outside the factory.

The protest continued into the next day, and the next week, and footage of the mass sit-ins began to spread on social media. According to the New Trade Union Initiative(NTUI), ECC-2 was manufacturing solely for fast fashion brand H&M at the time of its closure and, as videos of the protests were widely retweeted, order cancellations due to Covid-19 were announced as the cause for the job losses. H&M quickly became the focus of the discussion and blame.

Supporting this reasoning, the notice from Gokaldas stated that “the order position has dwindled down and become zero” resulting in an “inability to provide employment.” However, when questioned on the matter, H&M stated, “Our orders at this specific supplier are on similar levels during the same period last year. We are fulfilling our payments for the delivered goods in accordance with contracts, on time and at the originally agreed price.”

While order cancellations and refusals to pay have plagued garment factories throughout Covid-19, worker’s rights organisations have broadly upheld H&M’s claims. Instead, they point to a fact missing from the Twitter discourse: Gokaldas Exports has only shut one factory out of the 20 it operates, and ECC-2 is the only one with significant union participation.

“Gokaldas has used the current crisis as pretext to close the only one of its factories where a significant number of workers chose to join a union,” said a representative from Worker Rights Consortium, who have been investigating the lay-offs. “The discriminatory and unlawful closure of ECC-2 represents a serious violation of workers freedom of association.”

At the time of the lay-offs, Gokaldas Exports was being challenged by the union over their low- and non-payment of wages throughout lockdown. The ECC-2 unit reopened in May with a reduced workforce, and while the government had specified that factories must pay full wages, workers report receiving only 50% of their usual rate. Those who could not return to work were paid nothing at all which is, according to NTUI’s statement, in violation of the Ministry of Home Affairs order of 29^th March 2020.

Images: Solidarity from Vienna to Srirangapatna, Credit: Facebook / Garment and Textile Workers Union

An organised workforce makes such wage disparities and non-payments difficult to get away with, ensuring owners and management are held to account. Worryingly, targeting union-members who, thanks to the strength of a collective voice, are willing to speak out and take action against mistreatment has become increasingly common as manufacturers tighten their belts in the aftermath of plummeting sales. 520 union workers were fired in Myanmar in March; a garment worker and union representative from Cambodia was jailed for writing about her fears of dismissal on Facebook in April; and 3,000 workers were fired as part of a reported union-busting exercise in Bangladesh in June. Variations of the same story are quickly repeating throughout the manufacturing sector as bosses seize the opportunity to blame economic reasoning and cancelled orders as a cover.

“All over the world, garment workers are facing the risks that are often connected with organising in the workplace,” the Clean Clothes Campaign explains. “[We’ve seen] a big spike in union busting by factory owners, partly because they think they can get away with it… partly because economic insecurity at the management level spurs on this behaviour.”

The workers from Gokaldas Exports, however, are standing firm. “I am part of the protest since day one. We are still on protest,” says one garment worker who chose to remain anonymous. “Today is the 46^th day,” said Shobha on the 21^st July. “Still we are fighting.”

Despite ongoing protests and increasing international attention, footage has emerged of management from Gokaldas Exports carrying lists of names, visiting workers at their homes in order to pressure them into resigning. IndustriALL Global Union also reportsthat management, who have refused to engage meaningfully to resolve matters, have announced that the factory will not be reopening and that workers must resign in order to get any severance pay.

The lay-off period has now passed the maximum 45 days as set out in the Industrial Disputes act and workers are struggling to survive.

“We are now losing our hopes,” says Shobha. “I am depending only on this job. My family [runs] on my earnings. From April I am getting only half salary, it’s so difficult.” Her colleague is also struggling. “I am finding it very difficult. It’s very uncertain. It’s very difficult to run my family with half wages,” she says.

H&M say they are “in a close dialogue with both parties [Gokaldas Exports and the union] to help them resolve the conflict peacefully and reach an agreement that is acceptable to both parties.” However, many organisations, including the NTUI, believe H&M simply isn’t doing enough. The brand has a Global Framework Agreement with IndustriALL which is meant to uphold and protect the rights of garment workers, allowing them freedom of association, the right to organise, the right to partake in collective bargaining, and other such International Labour Standards.

As one of Gokaldas Export’s major clients, H&M could use it’s position as leverage in order to help support the garment workers and regain their employment but as the stand-off continues and more workers are left with no choice but to resign in order to survive.

“The only credible way for Gokaldas to rectify this is to reopen the factory and return its employees to work, with full backpay,” says Worker Rights Consortium. “The company’s customers not only have the ability but also the obligation, under their own code of conducts, to press Gokaldas to remedy its violations.”

Until H&M and Gokaldas Exports management remedy the illegal lay-offs, the likes of Clean Clothes Campaign are using their platform to keep pressing for a resolution, while Oh So Ethical has created a series of tweet templates which allow consumers to add their voices too.

For now, however, the protests outside Gokaldas Exports continue every day.