Fashion retailer H&M boss calls for annual Bangladeshi minimum wage revision following Rana Plaza collapse

The Bangladesh government said at the weekend that it would increase the minimum wage – currently the lowest in the world – for the first time since 2010 as it looked to limit the fallout from the collapse of building, which housed five garment factories, and left more than 1,100 people dead.

However, Karl-Johan Persson, chief executive of H&M, which is the biggest buyer of clothes in Bangladesh, told the Financial Times that its government should revise its minimum wage for its four million garment workers every year.

Bangladesh almost doubled its minimum wage to $38 a month in 2010 after violent protests from workers angry at the erosion of their wages by double-digit inflation. Workers have once again taken to the streets protesting for higher wages and around 200 factories were forced to shut this week.

“It’s always a balance between people, planet and profit. To focus only on profits will be long-term bad for profits . . . It’s not good for Bangladesh, or H&M, to see the unrest,” said Persson.

The H&M boss said it could not act unilaterally to raise wages as it would cause unrest in other factories. Persson said: “I would be very happy if we could find a model where all the companies could come together and find a new way of working with wages. I would happily sit around a table and talk to all the other big buyers from Bangladesh.”

H&M is among a raft of major international retailers, including Primark, Topshop-owner Arcadia and Tesco, which signed up to an accord to improve fire and building safety in Bangladeshi factories last week to help prevent tragedies such as Rana Plaza from reoccurring.