Swedish apparel giant H&M will only let go of 349 employees in Spain, out of the more than 1,000 previously announced, a reduction of about 68 percent. The decision follows a series of protests by H&M employees in the country, which included two national, 24-hour strikes.
Several fast fashion chains around Europe, such as H&M and Zara (Inditex), have been laying off employees due to financial losses suffered as a consequence of the pandemic. The employees in question are often on furlough due to the health crisis.
On Tuesday, the H&M management in Spain and trade unions Comisiones Obreras and UGT, signed an agreement after weeks of intense negotiations. Comisiones Obreras and UGT represent the majority of H&M employees in Spain. The agreement stipulates that only 349 employees will be laid off, the two trade unions stated in a joint press release.
In addition, the number of store closures, which was initially set at 30 stores in Spain - 27 H&M stores and 3 Cos stores - will be reduced by three. One additional H&M store can also remain open but will be relocated.
The essence of the agreement is voluntary subscription to the layoff procedure, which is referred to as ERE in Spain, ‘Expediente de Regulación de Empleo’, or collective dismissal. Employees that were initially affected by the procedure take precedence, Comisiones Obreras and UGT noted in the release.
The management of H&M Spain makes one more concession. The terms of employment will be adapted for those who are being dismissed. This includes a reduction of working hours for 170 employees, and compensation by the employer in the form of a severance package. The severance pay will be determined based on the seniority of the employee.
More about this topic: H&M to lay off more than 1,000 employees in Spain