Questions to the board of Boohoo Group PLC
AGM date: 17th June 2022
Venue: 301 Thurmaston Lane, Leicester, LE4 9UX
Question 1 on repayment of wages to Leicester workers
My name is Dominique Muller, I’m from Labour Behind the Label, and my question today is about the historic wage debt owed to workers by Boohoo group. As you are aware, Boohoo has been at the centre of investigations surrounding illegal pay for many years, with media exposes from 2018 and 2020 causing the company to initiate investigations. Allison Levitt QC found allegations of illegally low rates of pay to be substantiated, and that directors knew of the seriousness of the issues but failed to act. £3.50 / £4 per hour rates were paid to workers making Boohoo clothing – this is not a disputed fact. Many worked in suppliers selling only to Boohoo. The issue of whose responsibility it is to repay the debt owed to workers who received these wages however remains unresolved. In 2015 ETI estimated that Leicester garment workers were underpaid around £1 million per week while in 2020, the British retail Consortium estimated that workers were owed around £27 million underpaid wages in three months alone. A conservative total then is around £50 million underpaid to Leicester garment workers each year – given that Boohoo bought 50-80 % of Leicester’s garment production in the last decade, workers who supported Boohoo’s profit margins could be owed around £125 million for the past five years.
If Boohoo is committed to ensuring its supply chain operates legally in the UK, will it ensure workers are paid back, in full, for the underpayment of the minimum wage that has been the basis of much of its margin for a number of years? Will it be creating a fund to pay back workers for the illegal wages?
Regardless of whether or not illegal wages are still being paid at Boohoo suppliers in Leicester, , the ongoing impact of Boohoo’s historic purchasing practices in Leicester suppliers should also be acknowledged. There remains an entrenched way of working where Leicester suppliers pay illegal wages and cut corners on HR and safety to compete for the low prices that buyers assume can be met in factories in this city. What is Boohoo doing to ensure it changes this, and sets an example of transparent pricing that encourages payment of a living wage, compliance and business growth?
Question 2 on prices paid to suppliers prohibiting sustainable practices
My name is Kaenat Issufo, I’m from Labour Behind the Label and work as the Leicester garment worker engagement lead. My work involves supporting local workers and I’m in contact with a lot of local suppliers who face continued low prices and precarious contracts. My question today is about Boohoo’s impact on business in Leicester, the prices it pays and what it is doing to support the long-term improvement of factories.
Boohoo plays a huge role in influencing how prices are set in factories here, as at least 40% of the products sourced from Leicester are for Boohoo, and many of the other brands who do business here are its price competitors. The prices that Boohoo pays to suppliers – like many other brands – are very low and over the years prices have stayed low because Boohoo keeps them there.
Boohoo stated that it has developed a series of responsible purchasing practices including paying a ‘fair price’ to suppliers. However there are no clear details for these practices and no clear benchmarks for what exactly is a fair price. I want to ask, what exactly is Boohoo doing to make sure that its prices will enable the payment of a living wage to workers in the UK? Are prices enough to allow suppliers to operate legally, turn a profit and invest in their factories in order to create a sustainable industry?
Boohoo have also pulled out of lots of Leicester suppliers in the past year leaving factories with no business. What is Boohoo doing to make sure it supports suppliers in the long run to build their businesses, work with suppliers to improve wages and support the growth of a sustainable garment industry in Leicester?