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New Living Wage Report Reveals Labor Violations in Europe

A new report by the Clean Clothes Campaign (CCC), an umbrella group for trade unions and advocacy groups, highlights the breadth of the garment industry’s wage discrepancies. With many companies considering relocation to Europe in the wake of factory tragedies in Bangladesh and Pakistan, CCC chose to focus on garment workers in nine European post-socialist countries, and Turkey.

The report, titled, “Stitched Up: Poverty Wages for Garment Workers in Eastern Europe and Turkey,” shows that dangerous working conditions, poverty level wages and forced overtime are endemic throughout the garment industry–not just Asia where such stories are widely documented.

“We have come to expect that garment workers in Asia are being exploited with low wages and poor working conditions but what this report shows is that there are no good guys,” the report’s co-author Bettina Musiolek said.

In all the countries researched, the study found an immense gap between the legal minimum wage and the estimated minimum living wage. “This gap tends to be even larger in Europe’s cheap labor countries than in Asia,” the report noted. Georgia, Bulgaria, Ukraine, Macedonia, Moldova, Romania and the Eastern Anatolian region of Turkey were the worst offenders, with legal minimum wages 20 percent lower than the estimated minimum living wage.

CCC describes a living wage as one that accounts for common factors including the number of family members to be supported, basic nutritional needs and other necessities including housing, healthcare, education and savings. The campaign argues that without a fair living wage workers suffer from a host of poverty-related problems, but brands continue to focus primarily on a country’s legal minimum wage in search of the most economically advantageous.

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To supplement incomes, the study found that overtime hours occur regularly with some work weeks reaching 60 hours, as reported in Moldova. Overtime is not paid extra or not at a full rate in most of the researched factories. In other instances, workers said it is difficult to refuse overtime or to get days off. In factories based in Bulgaria, Macedonia and Moldova, Romania and Turkey, employees often work beyond legal overtime limits.

With various violations of laws and wage theft practices, including outstanding wage and severance payments when factories close and irregularities in taking leave, the report indicated that labor inspectors are turning a blind eye on conditions in the garment industry. Inspection organizations are said to be understaffed, malfunctioning and often corrupt in most countries researched. In Georgia, a legal workers’ protection system like labor inspection and labor court rarely exist.

In Bulgaria, Romania and Croatia, new union laws were introduced to make it more difficult for unions to be accepted as representatives in a factory, according to the report.

The campaign is calling on brands and retailers to show commitment to fair wages along the whole supply chain, demanding a basic net wage of at least 60 percent of the average national wage. “In cases where the state fails to protect human rights, as in the case of lack of a legal minimum wage that meets a subsistence level (living wage), the business has the obligation to respect human rights nevertheless and to not take advantage of this state failure,” the report noted.

Popular European brands including Hugo Boss, Adidas, Zara, Benetton and H&M all pay wages below the poverty line, the report claimed. Christa Luginbühl, one of the report’s authors, noted that while these brands experience rising profits, working conditions have deteriorated.

In one case study, the report found that two factories in Turkey, known for supplying brands H&M and Zara, pay workers a monthly salary of 196 to 293 euro a month ($265 to $397). For that salary, they must work approximately 10 hours per day, which equates to 30 to 50 overtime hours per month. Additionally, the report claimed that H&M pays just 0.50 euro an hour for embroidering a top.

Adidas said it investigates all complaints it receives and has requested the CCC to disclose details about the factories covered in their investigation.

A spokesperson from Inditex, the Spanish firm behind Zara, told The Guardian it was in touch with CCC so that it could “investigate the claims and take appropriate measures to address them.”

However, the campaign’s call to action is falling on some deaf ears. H&M denied the allegations and in a statement said: “We believe that it is an outdated view that foreign companies should determine what a living wage is. The problem of overtime is not specific to H&M’s suppliers but is one of the most common challenges throughout the textile factories.”