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...PT Sai Apparel is a supplier to H&M Group with two factories: one in Semarang City and a more recently built factory in Grobogan. The supplier is in the process of relocating the production from the factory in Semarang City to the unit in Grobogan which unfortunately will affect employees in the first factory. We are in a close dialogue with our supplier about their plan and we have made it clear that we expect them to engage in social dialogue throughout this process.

In the end of 2023, the factory management and local trade union reached an agreement to ensure that permanent workers whose jobs will be affected and who do not want to relocate to the new production unit, receive the severance payments that they are entitled to. This agreement is covering almost 1500 employees and its implementation has been supervised by the local labor office.

According to the supplier around 1400 former employees from the factory located in Semarang City are now working in the production unit in Grobogan (please note that we are not able to verify these data).

ILO Better Work assessed the Semarang City factory and in their latest progress report (June 2024),stated that all previously outstanding issues in this regard have been resolved. In addition to these third-party assessments, we continue to monitor the situation closely.

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