22 July, 2025After years of negotiations and collective efforts, global garment brands Inditex and Next have so far declined to sign a landmark agreement that would support collective bargaining for better wages and working conditions for Cambodian garment workers, despite having helped develop the initiative and publicly committing to responsible business practices.
The Cambodia Agreements provide a legally binding mechanism for brand support of a standardized Collective Bargaining Agreement (CBA) template developed by Cambodian social partners. This model aims to improve wages, secure better working conditions, and stabilise supply chains. Twelve major global brands have already signed on, and IndustriALL Global Union continues to engage with other companies sourcing from Cambodia.
Developed through years of collaboration between IndustriALL, leading brands, employers, and its affiliated unions in Cambodia, the agreement represents a first-of-its-kind brand-supported CBA in the textile, garment, shoe and leather (TGSL) sector. It offers a viable solution to long-standing challenges in the industry, particularly the persistent difficulty of raising wages without endangering competitiveness.
Despite playing key roles in shaping the agreement, Inditex and Next have not yet committed to signing. IndustriALL has made repeated efforts to re-engage both brands and continues to urge them to support this transformative initiative.
At Next’s Annual General Meeting on 15 May 2025, IndustriALL campaigns director Walton Pantland addressed shareholders, questioning the company’s refusal to sign:
“Low wages remain a systemic challenge in the garment industry, worsened by fierce competition. No single brand or actor can address this alone. A sustainable and effective wage strategy must involve all stakeholders, brands, employers, and workers.”
Next offered no substantive response, stating only that it “couldn’t commit” to the Cambodia agreement. The company’s position was further called into question when, in response to a separate shareholder inquiry about living wages in its UK retail stores, Next’s CEO claimed that its predominantly female workforce 'did not need a living wage' because their husbands supported them.
At Inditex’s AGM, Yot Seang, speaking on behalf of the Coalition of Cambodian Apparel Worker Democratic Union and as a member of the Inditex global trade union committee, raised a similar concern:
“Several investors have expressed interest in the ACT binding agreement and have asked IndustriALL why Inditex refuses to sign. Investors are concerned that Inditex is contributing to increasing inequality in Cambodia. How does Inditex justify its refusal to sign the ACT agreement with its stated commitment to freedom of association, collective bargaining, and fair wages, as well as its Global Framework Agreement (GFA) with IndustriALL?”
Inditex reiterated its general support for collective bargaining and stressed the importance of sectoral agreements, referencing its participation in the ACT initiative and its Global Framework Agreement with IndustriALL. However, the ACT agreement in Cambodia is precisely the tool required to deliver on these commitmen, making the company’s response weak and inconsistent.
In his written intervention, Yot Seang stated:
“As a result of Inditex’s refusal to sign, workers in your supply chain will not receive the benefits of the binding agreement. By not signing, Inditex seems to have consciously decided to deny these workers decent wages and better benefits.”
The Cambodia CBA template goes far beyond wage improvements. It guarantees extended maternity leave, introduces paternity leave, enhances dispute resolution mechanisms, promotes peaceful industrial relations, and supports skills development. These provisions directly benefit Cambodia’s predominantly female garment workforce and contribute tosustainable industry practices.
IndustriALL’s general secretary, Atle Høie added:
“We must hold companies accountable for their commitments, especially those with GFAs. Taking part in lengthy negotiations only to walk away at the end undermines their stated ambitions.
The Cambodia Agreement has the potential to solve one of the major issues in the garment industry: the race to the bottom on wages. Next and Inditex are undermining years of work despite their public statements.
Actions speak louder than words. Investors should look closely at the gap between what these companies say and what they do.”
Despite the refusal of Inditex and Next to step up, many leading brands have signed the Cambodia Agreement. It has already led to the successful unionisation of several factories and the signing of collective agreements for improved wages and conditions.
IndustriALL and its affiliates remain committed to expanding the agreement’s reach and ensuring that garment workers in Cambodia can secure the fair treatment they deserve.
Photo credit: CROYDON, UK - JANUARY 30, 2010: Shoppers enter Centrale shopping centre, North End Croydon, home to Next, Zara and House of Fraser. Its modern glass frontage reflects historic buildings opposite. (Shutterstock: 1605042535)