BRITAIN’S BOOHOO BEGINS INQUIRY INTO SUPPLY CHAIN
▶ Budget retailer cuts ties with factories in Leicester over accusations of low wages and unsafe conditions
Cut-price fashion retailer Boohoo ordered an independent review of its supply chain after accusations that workers at the factories of its suppliers were being exploited.
The company said it cut ties with two suppliers after revelations of illegally low pay and poor practices in Leicester, where the UK government imposed new lockdown measures last month because of a sharp increase in Covid-19 cases in the English town.
The value of the UK-listed retailer halved to £2.7 billion (Dh12.5bn) since trading closed last Friday and a newspaper detailed sweatshop conditions in one of about 1,500 garment workshops in Leicester that supplied Boohoo.
Amazon temporarily suspended sales of Boohoo products after the report was published.
Boohoo commissioned a lawyer to review its supply chain over concerns it faces a formal investigation under the UK’s Modern Slavery Act.
The company said it would invest a further £10 million to tackle malpractice in its supply chain.
Campaigners claimed that some workers in Leicester were paid £3.50 an hour – less than half the UK’s £8.72 minimum wage for employees over the age of 25.
Staff in factories that supplied Boohoo said they were forced to work despite suffering Covid-19 symptoms and with few measures to ensure social distancing, according to a report last month by campaign group Labour Behind the Label.
Worker abuse in the sector has been reported for years and campaigners say the UK government has done little to tackle the problem.
Last week, Home Secretary Priti Patel ordered a police investigation into modern slavery in Leicester because of concerns about working practices.
“As a board we are deeply shocked by the recent allegations about the Leicester garment industry,” Boohoo chief executive John Lyttle said.
“We wish to reiterate how seriously we are taking these matters and we will not hesitate to terminate any relationships where non-compliance with our code of conduct is found.”
Charities gave a warning that labour exploitation could increase if diplomatic and trade disputes with China forced cutprice fashion retailers to source more clothing in the UK.
The Covid-19 pandemic and worsening relations with Russia and China created “challenging conditions” for cut-price retailers in Britain, Neil Wain, international programme manager for anti-slavery charity Hope for Justice, said.
The charity is working with Boohoo.
“It could well be that they draw back into UK manufacturing because of those difficulties in international relations and supply chains,” Mr Wain said.
“Maybe this is a wake-up call. This is an opportunity to have a good look at the situation.”
The industry in Leicester employs about 10,000 people and continues to operate during the pandemic.
Last Sunday, British Health Secretary Matt Hancock said he was worried about employment practices in some factories in the city.
One factory worker said he sat close to colleagues who did not wear gloves or face masks and that a single garment could be touched by up to 40 people.
“I carried on working because I have three children, a wife and parents to support back in Afghanistan,” he said.
Police visited nine factories last week with immigration and health officials but none of the sites was ordered to close.
Boohoo, which makes 40 per cent of its products in the UK, said it severed links with a supplier and subcontractor that sent products to be made in Morocco.
The company told British MPs investigating industry practices that its discount prices were not to blame for unlawfully low wages in Leicester’s garment factories.
In 2018, it told MPs its £5 dresses were a “marketing tool” to attract customers and were sold at a loss.
Leicester was identified as a human-trafficking hot spot and has a high proportion of ethnic minority residents.
The garment industry abuses cheap labour, campaign group Stop the Traffik said.
Complaints about how some factories operated during the height of the lockdown in April are already being investigated, the city’s council said.
Leicester’s deputy mayor, Adam Clarke, said officials found “no evidence to suggest the rise in coronavirus cases in the city was linked to the textile industry”.
The latest lockdown in the city was imposed last Saturday after infection rates hit 135 cases for every 100,000 people.
On Tuesday, Mr Hancock said the rate was down to 117 per 100,000 people, but it was not clear when the restrictions would be lifted.
Company’s value halved to £2.7bn after a report detailed sweatshop conditions in a garment factory in the UK city