As Ethiopia pushes to improve its economy through manufacturing, companies are taking advantage of their lack of minimum wage and supply of labor.
PVH Corp., the U.S. clothing company that owns Tommy Hilfiger and Calvin Klein, has announced plans to probe reports of Ethiopian employees facing verbal abuse, discrimination and inadequate wages.
According to the Workers Rights Consortium, employees in PVH factories in Ethiopia are often obligated to work overtime without pay, despite receiving an hourly wage of about 12 cents and basic human function, such as drinking water at workstations can cause employees to lose pay.
Reports stated that one factory's hiring managers would touch the stomachs of applicants to ensure that they were not pregnant.
PVH responded to the WRC report and committed to "conduct an immediate and thorough investigation and take appropriate action if any violations are found," a spokesperson said Monday.
While PVH insists that they "take allegations raised in the WRC report very seriously," they did not go without noting that "some of the interviews are two years old and the [Hawassa Industrial] Park and its practices have evolved since then."
Hawassa is one of a dozen parks that house manufacturing hubs, which PVH helped finance. With the increasing prices of labor, raw materials and taxes in Asian countries that are typically targeted by retail manufacturers, brands, such as the Gap and H&M, have switched their sights over to Ethiopia.
#Ethiopia-n delegation in Hong Kong met GLOBA BRANDS: H&M, VF, GAP, L&F, Target, Academy, Ralpha Lauren, New Balance, Under Armor. PVH VP shared Hawassa IP’s experience. The brands showed interest to join as #Africa is the last&best frontier for Apparel if developed #sustainably. pic.twitter.com/wDuaA1fVeI— Fitsum Arega (@fitsumaregaa) December 11, 2018
As Ethiopia pushes to improve its economy through manufacturing, companies are taking advantage of the lack of minimum wage and supply of labor. Despite the country's lack of minimum wage, the code of conduct for employers prohibits abuse.
According to a PVH spokesperson, sourcing clothes from the African country benefits their economy and job market. Other factors that attract major brands to Ethiopia include preferential access to Western markets, competitive tax incentives and a large influx of primarily Chinese investment.
According to a survey of 1,000 garment factory workers, conducted by the WageIndicator Foundation, the majority of workers do not earn a living wage, which is about US$144 a month.
“Unfortunately for the country’s garment workers, there is a yawning gap between the brands’ ethical pretentions and the workplace reality for the people sewing their clothes,” a WRC researcher, Penelope Kyritsis, explained.
Regardless, PVH has consistently claimed a high standard of ethics at its Ethiopian operations. The current investigation will shed light on whether or not PVH has maintained its pledge to "show the world there is no conflict between companies doing well and companies doing right by the people, the community and the environment they operate within."