Fashion brands bring US$10bn in pandemic profits as thousands of their garment workers face wage theft
- More than 9,800 garment workers not paid in full for work at eight factories supplying 16 fashion brands including H&M, Nike & Levi’s
- Combined, these brands have recorded profits of at least US$10 billion in the second half of 2020 alone.
- In seven of the eight cases, workers have still not been paid what they are owed. This in spite of policy commitments from all fashion brands to ensure workers are paid for making their clothes.
- Cases include 1,200 garment workers protesting over unpaid wages and benefits at the Violet Apparel Factory in Cambodia. Nike claims it does not have a relationship with the supplier, however order forms and photographs taken by workers suggest otherwise.
- Our research found the minimum wage in 12 major apparel exporting countries is, on average, over four times less than the wage workers need to live on.
London, UK: A year into the pandemic, fashion industry profits are booming again while almost three quarters of garment workers face hunger. Business & Human Rights Resource Centre (BHRRC) investigated eight factories supplying 16 major fashion brands and found nearly 10,000 workers fighting for wages and benefits legally owed. In the last six months of 2020 alone, the brands they produced for brought at least US$10 billion in profits combined.
At the start of the pandemic, fashion brands cancelled their orders with supplier factories and demanded discounts of up to 90% on clothes already made, to protect their bottom line. This had a direct impact on suppliers’ ability to pay their workers even for work already completed. A year on, and the destitution faced by workers who have lost their jobs is worsened by not being paid what they are owed. In many cases workers – the vast majority women – have been owed wages for several months and are left struggling to support themselves and their families.
Factories were located in Cambodia, Myanmar, the Philippines, Bangladesh and Ethiopia, and supplied: Carter’s Inc., Hanesbrands, H&M, Levi Strauss & Co., Lidl, L Brands (Victoria’s Secret), Matalan, Mark’s Work Wearhouse, Next, New Look, Nike, PVH (Calvin Klein, Tommy Hilfiger), River Island, Sainsbury’s, s.Oliver and The Children’s Place.
Thulsi Narayanasamy, Senior Labour Rights Lead at BHRRC, said: “Our research exposes an unfair industry rigged to favour brands at the expense of women workers who make our clothes. A year into the pandemic, with growing profits, and after witnessing the utter destitution of workers, brands don’t have an excuse for failing to protect the basic rights of garment workers. It’s not optional to ensure legal wages and benefits are paid in your supply chain.
“The crisis now facing garment workers stems from years of precarious work and poverty wages. Our research shows that the normal wages workers receive are on average, over four times less than the wage they need to live on. Yet even that poverty wage hasn’t been paid to women workers. Destitution could and should have been avoided – if only they had been paid a fair, living wage.
The business model of fashion brands and the structure of global garment supply chains is built on an extreme inequality of power that creates and sustains poverty wages for garment workers. To then have so many cases of not even paying workers during such a vulnerable time is excruciating.
“We can’t talk about a just recovery from the pandemic for garment workers without guaranteeing that a living wage will finally be paid to workers across the fashion supply chain. A wage that you can live on is a fundamental human right. After decades of failed initiatives, it’s time to make it happen.
“Payment of living wages as an industry standard would level the playing field for fashion brands and be transformative for workers – not only for a just recovery from the pandemic, but also to prevent the scale of crisis from repeating again.”
Priyanka Mogul, Media Officer, Business & Human Rights Resource Centre, [email protected]
Thulsi Narayanasamy, Senior Labour Rights Lead, Business & Human Rights Resource Centre, [email protected]
Notes to editor:
Read the full report: Wage theft and pandemic profits: the right to a living wage for garment workers
BHRRC released research in August 2020 on attacks on unions and freedom of association on garment workers during the pandemic: Union busting and unfair dismissals
For more about how fashion brands are responding to the pandemic visit the BHRRC COVID-19 Apparel Tracker.