Child Labour & Low Wages: The Real Cost of Producing Fashion in Myanmar

London - As Myanmar continues to invest in becoming one of the leading garment-producing and exporting countries, a new report shines a light on the growing number of issues emerging in its fashion sector - which includes children as young as 14 working for as little as 13 pence an hour to produce apparel for high street retailers.

Fast-fashion retailers such as H&M, New Look, and Sports Direct’s Lonsdale label were all found to have worked with factories which employed 14 year old children in Myanmar, according to the new report “The Myanmar Dilemma” from the Amsterdam-based organisation the Centre for Research on Multinational Corporations (also known as Somo). Together with the Observer and local NGOs Action Labor Rights and Labour Rights Defenders and Promoters, Some interviewed over 400 workers in 12 factories which supplied garments for international fashion brands and found workers were being paid half of the full legal minimum wage, in addition to a number of children workers as young as 14 working over-time.

Garment factories in Myanmar which supply H&M and New Look found to employ workers as young as 14

Over the recent years Myanmar has become a popular destination for the fashion industry, for Western brands in particular, as its offers low wages and favourable import and export tariffs. Myanmar is currently seen as a cheaper production hub to neighbour countries such as Thailand, Cambodia, China and Indonesia, which has led to a number Asian apparel suppliers moving their production hubs to the country. At the moment nearly half of the garment factories in Myanmar are owned by foreigners, or joint ventured between Myanmar and overseas companies. There are currently over 400 garment factories in Myanmar, which employ approximately 350,000 workers - 90 percent of which are women.

The legal minimum wage in Myanmar is 3,600 kyat per an eight hour working day (2.12 pounds), which is equal to 26 pence per hour. However, researchers also found garment workers were paid as little as 13 pence an hour at factories in Myanmar supplying clothing to Sports Direct, H&M, New Look and Muji, earning a total of 1.06 pounds a day. According to the report, these factories paid newer workers a reduced rate, which is permitted by Myanmar’s labour laws, but sees workers struggling to live a normal life on such low wages and working up to 11 hours a day, 6 days a week. In addition, workers in factories suppling New Look, Sports Direct, Karrimor, Henri Lloyd and New Look were also found to work more than 60 hours a week, which breached Myanmar’s factories act that workers should not be work more than 60 hours a week including overtime.

The report also found workers under the age of 18 were employed in all 12 investigated factories. At half of the factories, researchers found strong indications that current workers were younger than 15 years old when they first started working. Although it is legal for children as young as 14 to work for up to 4 hours a day in Myanmar, many workers lie about their age in order to work and earn more. However, they are still expected to do the same work as their adult counter-parts which is in violation of both Myanmar legislation and international labour standards, added the report. Close to half of the workers interviewed also did not have a signed contract at their factory of employment, which meant they lacked rights to bonuses and benefits.

This ‘race to the bottom’ led by fashion retailers forever in search for the lowest production hub causes unhealthy competition between garment producing countries in the region, argues Some in the report. “The rule of law in Myanmar is not adequately upheld. The army still has a lot of influence. Civil society organisations and trade unions have only been allowed to operate since 2012,” said Martje Theuws, researched at Somo. “The garment industry’s operations go largely unchecked. The question is justified if the time is ripe for foreign companies to invest in Myanmar. Garment brands should think twice before they start production in Myanmar. The risk of labour rights violations is very high. Companies should make a thorough analysis of all potential problems. They must ensure that they, together with their suppliers, identify and tackle these risks before placing any orders. Our research shows that companies are not doing this adequately.”

In response to the report, H&M issued a statement its Group website, noting the report raised “industry-wide challenges” which they have been addressing for many years. “It is of utmost importance to us that all our products are made under good working conditions and with consideration to environment, health and safety. We want people to be treated with respect and that our suppliers offer all their workers good, fair and safe working conditions,” added the Swedish fashion company. “A collaborative approach is key to achieve long-lasting improvements and that is why we work close to other brands, organizations, trade unions and workers representatives.”

It in not the first time H&M has been accused of working with factories that employ workers as young as 14 in Myanmar. Last August saw the publication of the book 'Modeslavar' by Moa Kärnstrand and Tobias Andersson Akerblom, who stress factories in the region regularly hire young workers. FashionUnited reached out to New Look for their response to the Somo report and a spokeperson said: “We recognise the issues highlighted in this report. We are working with our suppliers and local partners in Myanmar to address the findings and to support the development of an ethical garment industry in the area.”

Photo Credit: SOMO