Vietnam

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A recent boom in garment production puts Vietnam front and centre in the fight for a living wage

Vietnam’s garment industry at a glance

Vietnam is becoming an increasingly important country in garment exports. The country currently ranks as one of the top five global garment-exporting countries, with the vast majority of its products going to the United States, the European Union and Japan. The textile and garment industry is one of the largest indus- tries in Vietnam and a key contributor to the country’s economic growth. The industry directly employs approximately 2.7 million people (75% of whom are women) and indirectly supports millions of others in the form of remittances sent to the families of workers around the country. 

Labour issues in Vietnam’s garment industry

The Vietnamese garment industry faces a number of labour challenges, including wildcat strikes, high employee turnover, gender- based discrimination, excessive overtime and low wages. There have been numerous attempts by the government of Vietnam, the Vietnam General Confederation of Labour (the national trade union), non-governmental organisations and international organisations to address these labour issues. For example, Vietnam is in the process of revising the current labour law to include provisions promoting collective bargaining and social dialogue. In a commitment to the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA), Vietnam ratified International Labour Organization (ILO) Convention 98, which protects the right to organise and collective bargaining, and ILO Convention 105, which abolishes forced labour. With their ratification in 2020, Vietnam has adopted seven of the eight fundamental ILO Conventions. Vietnam plans to ratify ILO Convention 87 on freedom of association by 2023. These major changes in legislation are expected to significantly influence labour relations in the garment industry. Although these changes show substantial progress towards improved labour conditions, there is still a need for increased independent monitoring and effective guidance in implementing the new legislation. Moreover, the pressure on Vietnam to demonstrate political reform and to sign the free trade agreement with the EU creates a complex political climate for addressing sensitive topics such as freedom of association and violence and harassment in the workplace.

What Fair Wear is doing

Fair Wear has been active in Vietnam since 2006. There are currently 32 member brands sourcing from 190 factories throughout the country.

As interest from European garment brands continues to grow, Vietnam has expanded significantly in importance to Fair Wear members. In 2020, thirty-two Fair Wear members were sourcing from approximately 190 factories located across 30 provinces and cities in Vietnam.

The Workplace Education Programme Basic training module has been active in Vietnam since 2014, with around 20–25 factories joining the programme each year. This module introduces Fair Wear’s Code of Labour Practices and its complaints helpline. It is designed to help brands and factories take their first steps towards workplace awareness on labour rights. Management, supervisors and workers are trained in separate two-hour sessions that cover workers’ rights, their individual and collective responsibilities and the resources available to them.

Another important aspect of our work in the country lies in building relationships with local labour organisations. Fair Wear has established strong relationships with the Ministry of Labour, Invalids and Social Affairs (MOLISA), the Vietnam Chamber of Commerce and Industry (VCCI), the Vietnam Textile and Apparel Association (VITAS), the Vietnam General Confederation of Labour (VGCL), ILO Better Work Vietnam and a number of grassroots labour NGOs in Hanoi and Ho Chi Minh City.

Interested in calculating labour minute value and product costing for this country? Check out our country calculators here.

Resources

Regulatory Framework on Responsible Business Practices in Vietnam

The Preliminary Assessment of the Regulatory Framework on Responsible Business Practice in Viet Nam is undertaken as part of the Responsib…

Vietnam: Sustainability re-defined in the pandemic? (ENG)

Disruption, resilience and adjustment in the apparel and footwear industries of Vietnam.

Brands sourcing from Vietnam