The Natural Denims Ltd. Sommilito Sramik Union has signed a two year collective agreement with the company for the first time.
The union is part of IndustriALL Global Union affiliate the Sommilito Garments Sramik Federation (SGSF). The agreement was signed on 29 January by representatives of the company, union and federation, after a period of negotiation lasting six weeks.
Natural Denims Ltd employs about 3,500 people, two thirds of them women, at a plant in the Ashulia garment district of Dhaka. The company produces denim for H&M, Inditex (Zara) and a number of other brands, including Pull & Bear, K-Mart, Mango and Debenhams.
IndustriALL has global framework agreements with H&M and Inditex, which include a provision for encouraging collective bargaining. The SGSF was able to use this provision to establish the union at the factory, and to negotiate the agreement.
The comprehensive agreement includes a 7 per cent annual wage increase, and two festival bonuses equal to one month’s salary each for workers who have been employed for a year or more. Workers with a shorter period of service receive the bonus pro rata.
The agreement also includes provisions for time off, maternity leave and medical care.
It includes check off for union dues, which helps ensure the financial sustainability of the union, time off for union activity, including training for members, and an explicit grievance resolution mechanism.
Wages remain low across the ready-made garment sector in Bangladesh, and agreements like this are not common.
Jenny Holdcroft, IndustriALL assistant general secretary, said:
“The collective agreement at Natural Denims stands in stark contrast to the arrest and persecution of trade unionists at other factories. This is excellent news and shows the effectiveness of our global framework agreements with major brands. We have created the space for unions to organize and bargain. This agreement, and the one at Donglian Fashion last month, shows the effectiveness of our approach."
Inditex's Sustainability Department said:
“The GFA between Inditex and IndustriALL provides the best framework and environment between workers and factory management for the development of this type of enterprise. Inditex encourages all their suppliers to make all possible efforts to promote better conditions for their workers through the social dialogue with the legitimate representatives of the workers at the factories.”
Gustaf Asp, Country Manager for H&M in Bangladesh, said:
"We wish to continue the journey towards improved industrial relations, where the freedom of association is respected, where workers’ representatives have a voice and where trade unions can negotiate collectively."