H&M Group navigates European labour disputes and restructuring

Swedish fashion retailer H&M Group is facing mounting labour tensions across Europe as the planned closure of its Ghlin distribution centre in Belgium and an ongoing restructuring process in Spain continue to disrupt operations and negotiations with unions.

Belgium distribution center closure sparks protests

Belgian media outlet Retail Detail reported that H&M’s European distribution centre in Ghlin, Belgium, is set to close permanently in autumn 2026, resulting in the loss of 440 jobs. The closure has triggered employee protests and a blockade at the logistics site, raising concerns about supply shortages across Southern Europe during the critical summer sales season.

Anger has been escalating among workers since H&M announced the closure in March 2026. According to the CSC union, “Bertrand Merlevede, regional officer at CSC Transcom, questions why Belgium was chosen for this drastic cut rather than the other two major depots in Southern Europe.”

The Ghlin logistics hub currently supplies H&M stores in Belgium, Germany and the Netherlands. Retail Detail reported that management recently issued an exceptional request for the urgent dispatch of 720,000 pieces from the site’s 1.2 million-item inventory within just a few days. By comparison, a typical large shipment ranges from 50,000 to 60,000 pieces.

The unusually large order has fuelled speculation that stock levels at H&M stores in Italy and Spain are rapidly declining, partly due to the impact of a previous strike in April. Industry observers are closely monitoring the situation as the summer collections period approaches.

Restructuring process in Spain

Negotiations between management and unions over the collective redundancy plan, which began on May 18, have stalled. Philippe Dumortier, a representative of the FGTB union, told Belga news agency: “A meeting was scheduled for Wednesday, but it was postponed and, since then, social dialogue has broken down.” Union representatives are now calling for direct intervention from H&M’s Swedish management and the appointment of a new negotiator.

At the same time, H&M has reached an agreement with Spain’s CCOO and UGT trade unions as part of a separate restructuring process affecting its offices in Madrid and Barcelona. The agreement confirms the redundancy of 349 employees for organisational reasons — 717 fewer than the 1,066 layoffs initially proposed by the company.

According to the unions, the reduction in planned redundancies by 32.74 percent was a decisive factor in securing agreement on the collective dismissal plan. UGT stated that the agreement “was made possible by achieving our primary objective, which was a significant reduction in the number of people directly affected by termination”.

The union added that “the priority criteria have been voluntary participation and favourable severance conditions for those affected by this plan, thereby avoiding traumatic departures”.

H&M reaches agreement with Spanish unions

Under the agreement, affected employees will receive severance pay equivalent to the maximum allowed under Spain’s Workers’ Statute Law — 45 days’ pay per year of service up to February 2012 and 33 days per year thereafter, capped at 24 months’ gross salary. Additional seniority bonuses ranging from 2,000 euros to 8,000 euros will also be paid depending on years of service, while employees over the age of 50 will receive an extra 4,000 euros.

A voluntary redundancy phase will remain open until June 3, prioritising employees initially included in the dismissal process. However, staff whose departure would leave critical vacancies unfilled will be excluded. H&M is also considering job swaps between affected and unaffected employees.

As part of efforts to minimise redundancies, H&M will launch a national and international redeployment programme offering 401 vacancies. Employees who accept roles with reduced working hours will receive compensation for lost hours at the same rate as redundancy payments. This measure will also extend to an additional 170 employees, with working-hour reductions capped at 20 percent for an initial period of 24 months.

The restructuring agreement affects H&M employees managing operations across Spain, Portugal, Italy, France, Belgium and Luxembourg. It also includes an external outplacement programme with specialist firm Lee Hecht Harrison and measures aimed at protecting vulnerable workers, including employees from single-parent households, large families, pregnant women, disabled employees and long-serving staff.

Additionally, H&M and the unions agreed to keep stores in Orense, Loranca and near Barcelona’s L'Illa Diagonal shopping centre open. Employees at the Vigo store will remain on temporary furlough, receiving 80 percent of their salary without losing bonuses or holiday benefits until the store relocates and reopens.