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H&M under fire for ‘low’ Cambodia wages

Swedish clothes giant H&M has been accused of using suppliers in Cambodia that underpay their textile workers. But the company counters the workers have unions and collective agreements.

H&M under fire for 'low' Cambodia wages

TV4 documentary Kalla Fakta (The Cold Facts) claims in a report that Cambodian employees of H&M suppliers are only paid 3 kronor ($0.45) an hour.

When asked about the reported low wages, H&M CEO Karl-Johan Persson argued the situation would have been much worse had the company not been present in the country.

“There are unions in Cambodia and collective agreements that actually work,” Persson told Kalla Fakta.

Deuar Sophon, a mother of three, works some 70 hours a week at a Cambodia textile factory which manufactures clothes for several companies, including Swedish H&M.

On the TV4 programme, which will be broadcast on Wednesday night at 9.30pm, she explained that her monthly salary amounts to around 500 kronor, a sum not sufficient to feed and house her family.

“The constant worry is making me sick, I don’t know where I’ll get money from,“ Sophon said on the show.

According to the TV4 report, many textile workers are also forced to borrow money for food, leading to considerable debts with high interest.

At the factory where Sophon works, 250 workers fainted during two days last year.

In an H&M report, cited by Kalla Fakta, the company says it was overtime and lack of food that caused the workers to collapse.

The show also claimed that the low wages lead to many being forced to take risks with their personal safety by packing themselves onto overfilled trucks in order to get to and from work, sometimes sharing space with some 60 other workers to one truck.

H&M CEO Persson admitted that the situation “could be better”.

“But it is a question of the country’s ability to compete on an international market and the best thing for them is if we continue to buy from the country,” he told Kalla Fakta.

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BUSINESS

Swedish retailer H&M sees profits slump after Russia exit

Swedish fashion retailer H&M reported a sizeable drop in third-quarter profit on Thursday following its decision to leave the Russian market.

Swedish retailer H&M sees profits slump after Russia exit

The world’s number two clothing group is among a slew of Western companies that have exited Russia following Moscow’s invasion of Ukraine.

H&M paused all sales in the country in March and announced in July that it would wind down operations, although it would reopen stores for “a limited period of time” to offload its remaining inventory.

The company said Thursday its net profit fell to 531 million kronor ($47 million) in the third quarter, down 89 percent from the same period last year. “The third quarter has largely been impacted by our decision to pause sales and then wind down the business in Russia,” chief executive Helena Helmersson said in a statement.

The group said in its earnings statement that it would launch cost-cutting measures that would result in savings totalling two billion kronor.

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