Sweeping tariffs imposed by the United States (US) in 2025 sent significant shockwaves through global garment supply chains. History is consistent on what follows: the heaviest costs of such disruptions fall on those least able to bear them: women workers on apparel factory floors, from Bangladesh to Lesotho. The abrupt and far-reaching shifts in buyer purchasing practices that followed the 2025 tariff changes proved no different, with spikes in labour rights abuses documented across key apparel-producing regions. Yet as this research makes clear, these outcomes are not inevitable. In a rapidly shifting global context where trade renegotiation, conflict and instability are growing realities, apparel buyers and brands must commit to responsible purchasing practices when it matters most – not only when conditions are favourable.
Announced on 2 April under the International Emergency Economic Powers Act (IEEPA), the revised US tariff regime introduced a universal 10 percent tariff on imports alongside additional “reciprocal” tariffs of 10 to 50 percent for selected trading partners. Although several tariffs were temporarily paused during negotiations, revised tariffs entered into force in August 2025 and have since been ruled unlawful by the US Supreme Court.
Between April and December 2025, the Business and Human Rights Centre monitored global media coverage, supplier disclosure and direct testimony from unions and worker organisations across garment producing countries to understand how brand and buyer responses to US tariff changes translated into labour impacts across supply chains.
Early evidence from suppliers, unions and industry groups indicates that as buyers moved rapidly to reassess sourcing strategies and production costs, suppliers experienced orders being paused or cancelled, sourcing locations reconsidered and price reductions requested. In some instances, suppliers were also asked to absorb or share tariff-related costs. The result was acute commercial shocks for suppliers, and direct human and labour rights harms for workers.
Key findings
- Tariff announcements triggered rapid shifts in brand purchasing practices, including paused or cancelled orders, while brands sought to avoid financial impacts by relocating supply chains to lower-cost jurisdictions.
- Buyers shifted tariff related costs onto suppliers by demanding price reductions; requesting the absorption of additional costs and; threatening to relocate if suppliers refused lower prices.
- Failures in human rights due diligence and buyer decision-making that appeared to pass all burden to suppliers and workers translated into labour impacts across producing regions, including factory closures, layoffs, reduced working hours, price cuts and delayed payments. Women and migrant workers were particularly exposed due to precarious employment and limited social protections, facing food insecurity, loss of access to life- saving medicine and heightened risks of trafficking and survival sex.
- The sourcing shifts observed during the tariff period reflect a well documented, foreseeable and avoidable pattern in supply chain crises, where abrupt changes in orders and pricing place immediate financial pressure on suppliers and predictably translate into labour harms.
- Despite widespread human rights implications, corporate transparency was absent. None of the 25 apparel buyers contacted by the Business and Human Rights Centre responded to requests for information on how sourcing changes were managed or whether labour impacts were assessed.
These findings suggest human rights risks remain an afterthought to commercial pressures during periods of disruption, a pattern the sector has encountered before. The impacts documented here echo those recorded during the Covid-19 pandemic, and that precedent matters: these risks are not unforeseen. Brands exert decisive influence over order volumes, pricing and production locations across complex international sourcing networks, and when sourcing strategies shift rapidly without regard for labour and human rights consequences, the conditions for abuse multiply.
Sustained commitment to responsible purchasing practices maintained through periods of disruption, not suspended because of them, is therefore essential to protecting the workers who keep global supply chains functioning when it counts most.
Timeline: US tariffs in key sourcing countries
The US announced sweeping reciprocal tariffs on 2 April 2025, kicking off a wave of volatility which sent shockwaves through global supply chains. Explore some of the key dates and shifts – and what workers and unions in some of the countries most affected said about their impacts – in the timeline below.
Purchasing practices under tariff volatility
In supply chains characterised by significant power asymmetries between buyers and suppliers, rapid purchasing practice adjustments place immediate, severe financial pressure on factories operating on narrow margins – with direct implications for workers at the bottom of the supply chain. The 2025 US tariff changes bore this out across four consistent patterns:
- Orders were delayed, paused or cancelled abruptly, leaving suppliers holding finished inventory and workers facing layoffs.
- Sourcing shifted rapidly between countries as buyers redirected orders to lower tariff jurisdictions, exposing workers in both origin and destination countries to instability.
- Buyers demanded price reductions from suppliers rather than absorbing costs or adjusting purchasing terms.
- Suppliers were asked to absorb tariff related costs directly, with those who refused left in commercial limbo.
Delayed, paused and cancelled orders
Hover over hotspots to read how delayed, paused and cancelled orders affected suppliers in the wake of tariff announcements.
The issue, as this research makes clear, is not order reduction alone – it is order reduction unaccompanied by any adjustment to pricing structures, any effort to share the commercial burden, or any consideration of the labour rights consequences for workers in those supply chains.
Corporate transparency and purchasing practices
The immediate and documented consequences for suppliers and workers, driven by rapid shifts in brand purchasing practices, demand transparency and accountability. Despite this, local reporting and labour organisation testimony from Bangladesh, Lesotho and Cambodia consistently highlight that brands provided little transparency about how tariff related sourcing decisions were being managed. When BHRC contacted 25 major apparel buyers in April 2025 – asking whether orders had been paused or cancelled, whether suppliers had been asked to absorb tariff related costs, and whether any measures had been taken to mitigate labour impacts – and again in January 2026, no company responded to either request, leaving suppliers, workers and their representatives with little ability to anticipate, plan for or respond to changes affecting their livelihoods.
"Brands need to be transparent in terms of what they're planning in terms of their commitment to purchasing orders and practices. So far, we have not seen that in place. We need transparency and we need engagement with unions and stakeholders in discussions." – Tharo Khun, CENTRAL
In Sri Lanka, Sugath Rajapaksha of Shramabimani Kendraya and Chamila Thushari of Dabindu Collective reported that engagement with brands was paused for 90 days during the tariff period while brands reviewed sourcing strategies and was not resumed once that review concluded. Worker rights activists in India reported a similar pattern, noting that communication from brands frequently occurred through informal calls rather than written correspondence, deliberately limiting the ability of suppliers and unions to document purchasing decisions and hold buyers to account.
Rapid sourcing shifts
Tariff differentials triggered rapid reallocation of sourcing across supply chains, as brands redirected orders to lower tariff jurisdictions as differentials widened, without regard for existing supplier relationships. By May 2025, apparel imports from China had fallen to their lowest level in 22 years as tariffs peaked at 145% in April before falling to around 50% following a 90-day mutual reduction. Amazon stopped select orders from China, Five Below instructed vendors to suspend shipments, Maersk directed loaded containers to be unpacked and returned, and David's Bridal exited China production entirely, shifting to Vietnam, Myanmar and Sri Lanka.
When India's tariff rose to 50%, buyers that had redirected orders there shifted them again – to Sri Lanka, Bangladesh and in one case, Pakistan. One manufacturer supplying Gap and Kohl's received "midnight panic calls" from buyers demanding they share tariff costs or move production, illustrating how financial risk and operational instability were transferred directly onto suppliers, with workers bearing the consequences at every turn.
Price squeezing
Rather than absorbing tariff related costs, brands across multiple sourcing countries demanded lower prices from suppliers, compressing already narrow margins. In Bangladesh, suppliers reported brands including Levi's demanding reductions. One supplier said: "My US buyer is saying that there is no possibility of raising the price from the end buyer. Therefore, they are asking us to reduce the price." In India, a December 2025 CITI survey found over 82% of respondents reporting order reductions, with almost three quarters (73.9%)% simultaneously compelled to offer discounts – including buyers such as Walmart reportedly seeking cuts of up to 25% on current and future orders. As Lalit Thukral, President of the Noida Apparel Export Cluster, warned: "Buyers are asking us if we can cut prices further. At this rate, we cannot survive." The pressure triggered what exporters called an "order snatching war," with suppliers undercutting one another to secure production.
As US orders stalled, some EU buyers moved quickly to demand lower prices from suppliers seeking alternative markets. One Bangladeshi manufacturer was offered a price USD0.25 to 0.30 lower per unit, with the buyer citing tariff policies as justification. The manufacturer was unable to accept the price and lost the order: “The total value of the order was USD750,000. Losing the deal has made it difficult to keep the factory running."
Tariff cost transfer
Beyond price cuts, brands sought to shift tariff costs directly onto suppliers. In Bangladesh, Gap allegedly instructed suppliers to absorb tariff-related costs, while other buyers attempted to transfer 5-7% of additional tariff costs onto suppliers, leaving those who refused with "contracts hanging in limbo." One managing director captured the shift plainly: "Buyers have made it clear they will now set prices themselves."
In India, buyers sought to transfer 20-30% of additional tariff costs onto suppliers, with one buyer threatening cancellation unless the supplier absorbed the remainder.” The buyer asked me to bear the remaining amount. If I can’t, they want to cancel the order. This is from my major buyer to whom I ship half a million pieces every month.”
Taken together, these patterns reflect a consistent approach during the tariff period: transferring risk and cost down supply chains to suppliers and workers – a foreseeable and documented outcome of supply chain crises that the sector has the tools and the responsibility to prevent.
Worker impacts across garment supply chains
Following major disruptions in purchasing practices, unions in garment producing countries observed significant labour impacts, characterised by consistent reports of layoffs, reduced working hours, lost overtime opportunities and heightened production pressure.
For workers already earning low wages, even short disruptions to income quickly lead to food insecurity, rising debt and increased vulnerability to exploitation. In the most severe cases, some lost access to food and life-saving medicine and were pushed into extreme survival strategies such as sex work or cross-border migration, exposing them to heightened risks of trafficking and exploitation.
Layoffs and factory closures
In Lesotho, several factories closed or suspended operations within three months of the tariff announcement. Precious Garments and its subsidiary Maseru E-Textiles placed approximately 5,000 workers on three months of unpaid leave, prompting protests outside factory gates demanding unpaid wages.
“We don't know how we survive this one. We are going to die.”Aletta Seleso, Precious Garments worker
At TZICC, a factory reportedly producing sportswear for JC Penney, Walmart and Costco, around 1,000 workers were laid off for four months once existing orders were completed and no new orders arrived.
Unionised workers were often among the first dismissed, as reported by workers at Leo Garments, Boming Lai Teng and Precious Garments. For example, Precious Garments reportedly placed union members on unpaid “short term layoffs.”
In India, tariff volatility and declining orders triggered production slowdowns across garment clusters including Tiruppur and Dindigul, where workers reported factory closures, rotational shifts and non-renewal of contracts. Workers further down the supply chain – including fabric cutters, thread trimmers and sewing machine operators in smaller subcontracting units – also lost employment as production slowed.
Layoffs were particularly acute for migrant workers lacking local networks, union representation or language access. According to the Asia Floor Wage Alliance, thousands of migrant workers left Tiruppur as work orders declined.
Workers in Bangladesh and Cambodia reported similar uncertainty. Factory closures, particularly among smaller factories, and suspended production left workers unsure whether they would retain their jobs.
Reduced hours and wage loss
Where factories remained open, declining orders and price pressures coincided with reductions in working hours and overtime, which effectively functioned as wage cuts. Across countries, unions warned that falling incomes forced workers to cut spending on essentials including food, housing and healthcare.
In Sri Lanka, worker organisations reported factories eliminating night shifts and overtime as orders declined.
“Things have always been really bad – existing issues have gotten worse because of the tariffs.”Shramaabimani Kendraya and Dabindu Collective
Reduced hours were particularly difficult for migrant workers who rely on factory-provided meals and must pay rising rents in boarding houses near factories.
In Bangladesh, unions reported reduced overtime directly affecting workers’ ability to meet basic needs.
“Manufacturers and brands have the biggest piece of the pie...workers should not be paying for this.”Kalpona Akter, BCWS
Across countries, unions warned that falling incomes forced workers to cut spending on essentials including food, housing and healthcare.
Intensified production pressure
Even as overall orders declined, order volatility and intensified production pressure when orders finally arrived frequently meant excessive overtime for workers.
In Sri Lanka, Lesotho, India and Cambodia, worker organisations reported factories “frontloading” production, forcing workers to complete orders months ahead of schedule. In Sri Lanka workers reported shifts beginning as early as 4am, with workers leaving home at 2am to reach factories.
Once these orders were finished production slowed sharply, leaving little work for the rest of the year.
Workers also reported worsening health impacts linked to these conditions, including chronic pain and musculoskeletal injuries from the “Dancing Model”, where workers stand bent over sewing machines for long periods.
In India, workers reported being forced into excessive overtime to complete final orders before tariff implementation, only to be dismissed afterwards.
“They made us work day and night to get everything out in time… The brands even had agents come here to supervise and put pressure.”Sanoj Kumar, Tiruppur garment worker
Gendered impacts and exploitation risks
The consequences of tariff-driven disruption have not been gender neutral. As factory jobs disappeared, women workers faced acute and specific risks – including coercion into sex work, exposure to trafficking, and severe food insecurity – that reflect both their precarious position within the garment workforce and the collapse of economic alternatives available to them.
Worker organisations reported some women workers being forced into informal or precarious work as employment opportunities declined. In Sri Lanka and Lesotho , union representatives from UNITE and FTZ-GSEU reported cases where women workers entered sex work after losing factory jobs.
“Women workers were compelled to go into sex work because there was no other employment. The social structure completely collapsed.”Dilakson Suresh, FTZ-GSEU
In Lesotho, economic desperation also increased trafficking risks. According to UNITE, workers attempted to cross the border into South Africa through dangerous routes after being promised employment elsewhere.
Workers also reported severe food insecurity. One laid off worker said she drank water to “trick herself into feeling full” to save food for her family.
Erosion of labour protections
Unions reported employers using tariff pressures to weaken labour protections. In Sri Lanka, factories reportedly forced workers to sign voluntary resignation letters without negotiations with unions.
In Lesotho, unions reported employers denying workers' rights, including unionisation, meal breaks and overtime pay. In one reported case, more than 200 workers were dismissed after complaining about unpaid overtime. Workers were warned:
“There are people more skilled than you, so if you don’t do what we want, we will dismiss you.”
Unions also reported workers being asked to pay bribes to secure permanent jobs amid widespread layoffs.
“We are back to square one.”Solong Senohe, UNITE
In Sri Lanka, workers reported skipping meals as incomes declined. According to FTZ-GSEU, many workers reduced daily food intake to two meals, with breastfeeding mothers struggling to produce enough milk for their children. Worker organisations also reported rising drug use as workers struggled to cope with increasing workplace pressure and financial insecurity.
“People have no way to relieve their stress, and that’s why more people are turning to drugs.”Dabindu Collective
Implications and recommendations for brands and buyers
In supply chains, shocks rarely disappear, they move: purchasing decisions determine where they land and who bears the cost. The pattern of opacity documented above is not incidental – it reflects a broader failure of accountability that runs through the sector's response to the 2025 tariff disruptions. The human rights impacts documented in this research, including layoffs, reduced hours and falling incomes, are reminiscent of those recorded during the Covid- 19 pandemic: they are not exceptional but foreseeable, and the sector's failure to learn from that precedent makes them no less avoidable.
As tariff uncertainty continues, brands and buyers must commit to responsible purchasing practices that prevent commercial pressure on suppliers from translating into human rights harms for workers. This commitment cannot be conditional on stability – rather, it is precisely during periods of disruption that it matters most. At minimum, this means aligning commercial and human rights decisions at every stage of the sourcing process:
- Integrating purchasing practices into human rights due diligence frameworks. Sourcing decisions and their labour impacts must be monitored together, not treated as separate functions. Commercial choices and human rights responsibilities cannot be managed in isolation from one another.
- Ensuring commercial risk is not transferred to suppliers and workers. When crises disrupt global supply chains, companies must avoid shifting costs onto suppliers who operate on narrow margins and will push financial pressure onto workers in the form of wage reductions, layoffs and excessive overtime.
- Honouring existing financial commitments. Goods already produced or in production represent real investments of labour and materials. Cancelling or suspending such orders leaves suppliers and workers carrying unrecoverable costs.
- Protecting workers' wages, benefits and severance. Purchasing decisions must not result in unpaid wages, wage theft or unpaid severance obligations.
- Engaging workers and their representatives. Trade unions and worker organisations play a critical role in identifying labour risks and ensuring workers' rights are protected during periods of disruption. Brands must ensure that sourcing changes affecting workers are communicated clearly, documented and discussed with unions and stakeholders.
Further guidance on responsible purchasing practices is provided in the accompanying recommendations document.
About us
Business and Human Rights Centre is an international NGO which tracks the human rights impacts of over 10,000 companies in over 180 countries, making information available on our 10-language website.
Authors: Anithra Varia and Mayisha Begum
We are grateful to the unions and labour rights organisations who spoke with us and shared the experiences of workers and unions around the world, including: Kalpona Akter and Kouser Alam from Bangladesh Centre for Worker Solidarity (BCWS) and Sunzida Sultana from Karmojibi Nari (KN) in Bangladesh; Tharo Khun from Center for Alliance of Labor and Human Rights (CENTRAL) in Cambodia; Solong Sonohe from United Textiles Employees Union (UNITE) in Lesotho; Dilakson Suresh from Free Trade Zones and General Service Employees Union (FTZ and GSEU), Sugath Rajapaksha from Shramabimani Kendraya and Chamila Thushari from Dabindu Collective in Sri Lanka.
With support from: Áine Clarke, Michael Clements, and the BHRC communications team and regional teams
Quote sources: BBC, 28 July 2025; Washington Post, 17 October 2025
Cover image credit: ILO SME Productivity and Decent Work