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Brands’ ‘Made in Europe’ Labels Could be Hiding Labor Violations

When consumers see a ‘Made in Europe’ label, they may think their products are ethically made. But that isn’t always the case.

On Thursday, the Clean Clothes Campaign published a report titled, “Europe’s Sweatshops,” which documents regional poverty wages and unethical working conditions among garment and footwear workers in Eastern and South-Eastern Europe. The report found that while some brands tout the ‘Made in Europe’ label and suggest they comply with labor regulations, many of the 1.7 million garment workers in the region don’t earn a living wage and are forced to work in dangerous environments. What’s more, the gap between actual wages and the cost of living is a “drastic” one.

‘Made in Europe’ doesn’t mean fair wages

Eastern and South-Eastern Europe nations are a boon for hiring cheap and experienced workers, and Clean Clothes Campaign said many factories—including those producing for global fast fashion brands like Benetton, Esprit, GEOX, Triumph and Vera Moda—are paying their predominately-female workforce unfairly. The report pointed out that some workers’ monthly wages just met legal minimum monthly wages—which varied between $103 per month in the Ukraine to $435 in Slovakia.

A gendered division of labor in these nations could be contributing to unfair pay. According to the report, in all countries, the garment sector paid workers the worst—with the manufacturing industry gender pay gap varying between 18 percent and 27 percent. This could place much strain on the region’s female garment workers—who are often responsible for providing food, living arrangements and care to their families.

The report also found that legal minimum wages in the region were below the subsistence levels and respective official poverty lines for these nations. For example, if a Ukrainian female garment worker needed to provide enough food, shelter and other necessities for her family—her actual living wage would need to be about four times higher.

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To illustrate the differences, in Serbia, Clean Clothes Campaign said the legal minimum net salary is 189 euro ($220) and the estimated living wage is closer to 652 euro ($759). In Ukraine, the minimum wage is 89 euro ($104) and the living wage estimate is a much higher 477 euro ($555). For Hungary, the difference is even more stark, with minimum wages set around 243 euro ($283) and living wages estimates closer to 1,119 euro ($1,303).

Clean Clothes Campaign interviewed 110 workers from garment and shoe factories in Hungary, Serbia and the Ukraine, who said they are often forced to work overtime to reach their production targets, yet some don’t make more than the legal minimum wage.

In addition to unfair wages, some workers reported unsafe working conditions—including exposure to heat and chemicals and abusive treatment by management. What’s more, some of these countries, including Georgia, lack a workers’ protection system that involves both local and government authorities. Without this legislation, workers don’t have any legal labor protections against unfair wages and treatment.

[Read more on labor violations: Zara Factory Workers Give Voice to Turkey’s Supply Chain Problems]

What brands and governments can do

Clean Clothes Campaign provided recommendations for brands and governments to improve the lives of workers in Eastern and South-Eastern Europe.

It stars with paying a living wage. Clean Clothing Campaign suggests that brands pay workers the legal minimum wage within regular working hours (40 per week), so workers don’t have to clock in overtime hours just to survive. Brands could also take each nation’s legal net minimum wage into consideration and if it falls below the monthly living wage estimate, pay the difference to get workers to a better standard of living. Brands were also encouraged to work with their suppliers to enforce ethical pay regulations in their factories.

For governments, the effort should be an even simpler one. If they can set a minimum wage that meets what a fair living wage would be, then paying a living wage wouldn’t be left to each brand and retailer’s discretion, and workers would be more likely earn decent pay.