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Burma’s garment sector watchdog is leaving. What does this mean for brands and their workers?

As Burma’s one-year anniversary of the coup passes, now over 130 trade organizations worldwide are calling for the removal of foreign brands from the country. The trade unions span multiple countries and sectors, including All Pakistan Federation of United Trade Unions, American Federation of Labor – Congress of Industrial Organizations, Cambodian Workers Labor Federation Union, Indian National Garment and Leather Workers Federation, International Trade Union Confederation, Bangladesh National Garments Workers Federation, and the Philippines’ Center for Trade Union Rights.

The joint coordinators of the support statement, Jay Kerr of No Sweat and Laura Watson of Global Women’s Strike, both issued calls for brands to go, citing repeated abuse of workers and calling on brands to do their due diligence in executing a responsible exit. 

“Ninety percent of garment workers in Myanmar are women, the primary carers of children and others. Alongside all other sectors they are confronting the sexism, racism, rape, exploitation, torture and murder by this brutal dictatorship,” Watson said. “GWS urges women’s organizations around the world to support the call by women garment workers and their trade unions for international companies to end their criminal collaboration with the deadly Myanmar military regime.”

After months of silence from international brands on the subject of targeted sanctions, Action Living Wage’s ACT agreement, which began developing Freedom of Association (FoA) guidelines with major international brands and Myanmar unions in 2019, recently announced their decision to leave. As the last year has demonstrated the corruption of labor officers and human rights violations of military involvement in workplace disputes, the Dec. 15 statement that ACT would not be continuing their agreement in Myanmar was met with mixed reviews from activists and brands. In fact, ACT cited the Industrial Workers’ Federation of Myanmar’s (IWFM) departure from the agreement, backed by global union affiliate IndustriALL, as leaving them with no option but to commit to a withdrawal. 

ACT involves 20 global brands — including names such as H&M and Zara — to ensure basic workplace freedoms, such as the freedom of association and the right to collective bargaining, are respected and upheld in factories where their clothing is being produced. However, following increasing complaints that workers’ rights are dwindling and citing decreased pay and greater human rights violations within factories, most unions say that the decision to vote for comprehensive economic sanctions on their own industry through the 16-union Myanmar Labor Alliance is the only solution if workers’ safety cannot be guaranteed. 

“This is a consequence of the withdrawal of IndustriALL’s local trade union affiliate IWFM from the ACT operations, because they are no longer able to operate freely under the current circumstances,” the organization said in a December statement. ACT could not be reached for comment, despite multiple attempts. 

While IndustriALL’s August call for comprehensive sanctions on behalf of the Labor Alliance was met with only a muted response from companies (save Danish retailer Bestseller’s pause on orders), the termination of their agreement with unions leaves the question of how disputes will now be handled within factories.

Burma’s courting of international brands was only made possible following the removal, by the Thein Sein administration, of a 50-year prohibition on unions. Alongside new investment flows, this change brought about the start of a new era for Burma’s fledgling labor rights. 

However, activists argue that, despite the progress made over the past decade, the influence of unions has so far failed to stabilize or provide a concrete groundwork for the future of Burma’s workers, with unions only representing a mere 1% of the labor force. Despite brands’ best efforts at protecting the rights of workers, a lack of federal, and now international, oversight, means that due diligence is left to the companies themselves.

Previous ACT member H&M says they will not be taking any immediate action on their long-term presence in Myanmar and plans to collaborate with other former ACT brands to resolve cases with suppliers. In forming new methods of addressing grievances after the dissolution of ACT, they announced their plan to partner with social enterprise Labor Solutions to allow workers to make complaints, anonymously or otherwise, through their platform. 

“The aim is to provide easy-accessible ways for workers to give feedback and voice their concern, anonymously if they wish,” said H&M spokesperson Ulrika Isaksson. “In addition, to better understand and be able to address the root cause of potential problems, we will together with our collaboration partner also conduct worker surveys at factories as well as implement measures to facilitate change.”

Labor Solutions, a Singapore-based technology company operating in 25 countries, uses a digital platform to allow workers to share messages and file grievances anonymously. While messages disappear from workers’ phones after they are sent, they don’t disappear from the case management system, allowing brands to address the complaints. The company has several clients in Myanmar, including H&M. Labor Solutions CEO Elena Fanjul-Debnam says that while their platform is online, half of their job is also advisory services to help stakeholders use it effectively. 

“But building trust in the system — what kinds of messages come into the system, how they are responded to, how the data is acted on, etc. — is all outside the control of our technology and is dependent on the social eco-system in which the technology exists,” she told DVB. 

“First and foremost, while our technology is an important part of the solution, it’s not the whole solution.”

High digital penetration in the country makes anonymous messages, especially those that disappear, an attractive option for workers navigating military checkpoints to and from work, cell phones sometimes demanded for a spot-check. Other brands, such as Irish retailer Primark, plan to continue independently using the grievance systems they had already developed through the guidelines, but hope that they will eventually return to Myanmar.

“While we hope in time ACT can re-establish its presence, our grievance procedures operate independently of ACT and we plan on maintaining an ongoing dialogue with unions regardless,” a Primark spokesperson said.

“In relation to Myanmar, we have said we will be guided by the outcome of the ETI [Ethical Trade Initiative] assessment, and in the interim, remain fully committed to maintaining our due diligence there via our Primark team on the ground and through our work with other labor organizations and social enterprise partners.”

But others are doubtful that any third-party auditing could be successful, given brands’ general awareness of diminishing human rights in factories. Dave Welsh of labor rights group Solidarity Center says that while ACT and similar programs are potentially beneficial, it’s up to brands’ genuine commitment to improving conditions. 

“If they need the public relations benefit of claiming to hire a third-party monitor, waiting for their evaluation, again, that strikes me as being primarily for public relations purposes, not to actually making a difference on the ground or in the industry,” he said, adding that conversations with unions themselves would communicate these issues. 

“What unions are calling for is not necessarily for ACT to pull out of the country, they’re calling for brand divestment. Brands remaining in the country without any mechanism like ACT to at least, to a limited extent, monitor the situation – I won’t say it’s counterproductive, but I’m not sure how effective it is.”

The framework of ACT also has mixed efficacy reviews in the eyes of unions. Although not a member of the agreement, STUM is one of few unions openly speaking against comprehensive sanctions in the garment sector while pushing for better conditions. They feel ACT’s presence in the country came at little actual help to the workers directly under the agreement, due to little motivation from international brands to address grievances on the ground.

“In our country, labor rights have not improved much due to international brands. I have not seen a factory that has changed and improved so much yet as far as I have worked with international brands,” STUM’s Daw Myo Myo Aye said, adding that she had only seen one successful negotiation. 

“They said they give freedom of association but once a labor union was formed, it was fired. The brand factories have formed a sham union that obeys them. Therefore, I could say the laborers in Burma have violated their labor rights.”

Adding to her hesitancy were reports of human rights violations of ACT members in other countries. To her, this demonstrates that left to their own devices, brands will fall short in their oversight of factory conditions. 

But unions have a nuanced view of the effectiveness of such an oversight group– even as they play the long game against the dictatorship. Confederation of Trade Unions Myanmar treasurer and IWFM president Khaing Zar Aung says that while it’s impossible to negotiate under a dictatorship, the fast track dispute mechanism from ACT made it possible to file complaints without SAC intervention. From the early days of the coup, when CTUM announced in a statement that they would not be participating in any negotiations that involved tripart dialogue with the military, including dispute settlement in the workplace, dialogue that didn’t include bribed junta labor officers became essential. 

But even this perceived win means little to IWFM when they feel the industry supports the military as a whole. Between the electricity bills, rent and taxes for factories in state-implemented industrial zones, and the bribes given from factory owners to labor officers and soldiers, the corrupt nature of the industry is what ultimately caused their desire to withdraw. 

After ACT leaves, unions will no longer be able to use the fast track dispute mechanism associated with the agreement, but Khaing Zar Aung says she will continue to file complaints to brands, although for many brands, she never sees a reply. For other factories, she says she believes many brands are aware of on-the-ground disputes of wages, but few choose to address it unless a complaint is filed on workers’ behalf.

“Getting the agreement is easy– easier than implementation. Because when I send complaints, they will happily say inside the agreement, ‘the supplier factory will follow the labor laws and other obligations.’ That’s very easy,” she said. 

“But in the implementation, it doesn’t happen. That’s why negotiations — in signing agreements, working conditions, benefits for the workers — were no longer useful for the workers.”


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