Boohoo factory boss’s shock pay confession
Anyone saying all their staff are on minimum wage is a fraud, says £4-an-hour ‘sweatshop’ owner
DISPLAyED on a noticeboard in the foyer of a clothes factory, in the heart of Leicester’s notorious garment district, is a list of the country’s minimum wage requirements.
Staff are informed those aged 25 and over are entitled to £8.72 an hour. If f you’re between 21 and 24, you should d get £8.20 while £6.45 is the rate for 18 to o 20-year-olds. The irony is staggering.
Many of the 30 or so people who work at t this establishment off St Saviours Road, we e discover, are actually taking home as little as £4 an hour. The chasm between this world in the backstreets of the Midlands, and the label which appears on the clothes it churns out, is vast.
The factory supplies Boohoo, the umbrella a fashion company whose corporate stable e includes Coast, Misspap, Nasty Gal, Karen n Millen and Pretty Little Thing. On June 19, , they also snapped up high street brands Warehouse and Oasis from administration.
While there is no evidence that all these labels use the same Leicester sweatshop factories at the centre of the furore over poverty pay, it is nevertheless alarming that its main brands do.
Owned by the Kamani dynasty, Boohoo was worth in excess of £5billion, more than Marks & Spencer and ASOS combined – before our revelations last week of ‘sweatshop slavery’ helped contribute to a shares crash.
Group chairman Mahmud Kamani founded Boohoo.com with his colleague Carol Kane in 2006.
His sons Umar, 34, and Adam, 27, founded Pretty Little Thing in 2012. The online label employs reality stars as ambassadors and their target audience is teenage girls. The fact Umar Kamani, who counts Jennifer Lopez and rapper P Diddy as friends, has been defending the reputation of the brand in the exclusive tax haven of Monaco has also raised eyebrows in the City.
The question raging all week since my last investigation into these Dickensian practices has been: How do we really know that factories like the one visited by the Mail are breaking the law and not paying their employers the minimum wage? Because the boss, a portly man in his fifties, unashamedly admits it.
‘Anyone saying they are paying all their employees the minimum wage in the garment industry is a fraud,’ he declared. ‘ It’s a lie because it’s not possible.’
It’s an astonishing admission.
He is breaking the law but doesn’t see it that way. ‘People who come from India or Bulgaria don’t have money, they don’t speak English but they need money to put food in their bellies,’ he said. ‘The starting point is £4 or £5, then we train them and they get more.
‘We pay the minimum wage but not to everybody. Unless you’re a big company it’s not realistic in this industry where the margins keep getting squeezed.
‘Boohoo is the company that gives us our bread and butter. They are a blessing because without them everyone would go to China and get them made cheaper.’
The businessman, who started as a machinist when he arrived here from India 30 years ago, did not wish to give his name but was happy to show us round.
About 100 boxes, ready to go, are piled high in one corner bearing
Last Saturday’s Mail the label of one of Boohoo’s companies, Nasty Gal, so there can be no doubt about the destination.
The Kamani empire has offices in Manchester, London, Paris, Berlin, Los Angeles, Sydney – and Leicester. The company has been coy about disclosing the extent of its operation in Leicester, saying only that it sources 40 per cent of its clothing from the UK.
The ‘sweatshops’ scandal has resulted in a National Crime Agency investigation in Leicester – where crowded garment workshops are feared to have contributed to a spike in coronavirus in the city, which was put back into lockdown last week.
The Mail told last Saturday how workers dared not go home if they had signs of Covid, fearing they would lose their jobs.
Public bodies and Government officials have also missed repeated warnings about poor conditions.
In 2017, the joint Parliamentary Committee on Human Rights, chaired by Harriet Harman, found between a third and three-quarters of clothes factory workers in Leicester were paid below the minimum wage, worked in unsafe conditions or without employment contracts.
The difficulty in obtaining evidence is that it is common practice for employers to hand out wage slips which understate the number of hours.
Harbhajan Kaur, a mother of three in her fifties, works as a machinist in the vicinity of St Saviours Road. She said she is paid £5 an hour but her payslip says she gets £8.72. She is also listed as a part-time worker but works fulltime, allowing her boss to pay her below the minimum wage.
She said: ‘ We are treated like donkeys because there are a lot of orders to fill. People are buying more online, which means we have to make more clothes.
‘We are put under a lot of pressure to come to work, even if we are not feeling well. The bosses even threaten us with the sack.
‘Even if things are really bad with coronavirus, people will do all they can to come in.’
It is a harrowing picture of life at the coalface of the fast fashion world. While adverts feature pouty models in skyscraper heels, £5 party dresses or £3 bikini tops can be found on every high street.
In this ‘pariah city’, rock-bottom prices equals slave-labour wages.
‘They just want to make an issue out of Leicester,’ insisted the boss who admitted to the Mail that he was paying staff £4 an hour. ‘ We are getting the police here, media. What is that all about?
‘People are desperate and we are providing employment. I’m being asked to produce a garment for 90p. From that I have to pay rates, taxes. It’s just not possible to pay everyone £8.72.’
Boohoo has now said it has launched an independent review into its supply chain, led by Alison Levitt, QC.
The firm said that it was ‘shocked and appalled’ by the allegations and is ‘ doing everything in our power to rebuild the reputation of the textile manufacturing industry in Leicester’.
But isn’t that impossible when you are selling dresses for £5?
‘The starting point is £4 or £5’ ‘Come to work even if we’re not well’