Question to the board of ASOS
AGM date: 11th January 2023
Venue: Greater London House, Hampstead Road, London NW1 7FB
Time: 12.00

Question on living wages and long-term security for workers

In 2021, ASOS announced the launch of its 2030 Programme for Fashion with Integrity, which included commitments to net zero, circularity diversity and transparency. We understand that progress towards these goals will be measured by a series of KPIs linked to the CEO performance and committee renumeration packages. We also note that ASOS has committed to developing a human rights saliency assessment this year in order to detail its concrete plans. While these commitments are welcomed, LBL is clear that paper commitments are meaningless without positive impacts in the real world,  and indeed decades of such paper commitments have not resulted in real progress towards decent work and decent wages for garment workers globally.

Can you provide clear details of how this assessment will measure short, medium and long-term progress towards freedom of association in ASOS suppliers, the actual payment of a living wage by ASOS suppliers and the improvement of working conditions?

In particular, considering the statement by the new CEO that ASOS is focusing on a shorter buying cycle, a test and react sourcing model and optimising costs, can you outline how this will not in practice negatively impact ASOS’ commitment to long term relationships with suppliers, longer lead terms, improved forecasting and prices which clearly ringfence or cover wage costs which act as ‘key enablers’ ensuring progress towards a living wage?

 For reference: https://www.asosplc.com/fashion-with-integrity/people/modern-slavery-and-human-rights/

Press release for immediate use: 9 December, 2022

Representatives from the human rights campaign group Labour Behind the Label will today raise concerns that Primark is not doing enough to protect workers during the global economic downturn.

The garment industry is facing a crunch point as the global economic downturn sends shockwaves through all economies. Garment suppliers, both in the UK and overseas have reported a drop in orders from brands which is further squeezing supplier factories still reeling from pandemic-related financial loss.

These financial losses are ultimately passed on to workers themselves. The Clean Clothes Campaign estimates that garment workers are owed $11 billion in unpaid wages from the first 12 months of the pandemic alone [1]. Reductions in orders during the Covid-19 crisis resulted in a wave of factory closures, resulting in thousands of workers who were not paid their legally owed severance [2].

Factory closures are set to continue in the current economic downturn, and losses will continue to be passed on to workers, with short-term contracts not renewed, wages and compensation unpaid.

Labour Behind the Label will ask what Primark is doing to ensure its due diligence is met with respect to ensuring workers receive their pay and severance when factories do close, and specifically whether it will meet requests from unions to join a binding severance guarantee fund to protect workers from bearing the cost of factory closures.

“I have to pay debt, water, and electricity bills monthly, but my wages are not enough. I don’t want to see high production targets with a decreasing number of workers to meet them. We don’t have enough income to pay for our basic living costs.”

Worker producing for Primark in Cambodia [3]

“Primark has continued to profit after the pandemic. For them, the crisis may be over, but the workers making their clothes are still impacted by pandemic-related wage theft and live under the constant threat of job loss due to reducing orders. Primark must ensure that the most vulnerable in their supply chain do not pay the biggest price during the economic crisis. They must commit to a binding severance guarantee to provide a safety net for the workers who make their clothes.”

Meg Lewis, Campaigns Lead – Labour Behind the Label

“Primark has continued to profit after the pandemic. For them the crisis may be over, but the workers making their clothes are still impacted by pandemic-related wage theft and live under the threat of job loss due to reducing orders. Primark must ensure that the most vulnerable in their supply chain do not pay the biggest price during the economic crisis. They must commit to a binding severance guarantee to provide a safety net for the workers who make their clothes.”

The full text of the question being put to the Primark board is available here.

ENDS

Notes to editors:

• Labour Behind the Label is a campaign that works to improve conditions and empower workers in the global garment industry.
• The Primark Annual General Meeting will be held at Congress Centre, 28 Great Russell Street on Friday, 9 December 2022 at 11 am.

[1] Clean Clothes Campaign (2021)  Still Underpaid: How the garment industry has failed to pay its garment workers during the pandemic

[2] Workers Rights Consortium (2021) Fired, then robbed: Fashion brands’ complicity in wage theft during Covid-19.

[3] Clean Clothes Campaign (2021) Breaking point: Wage theft, violence and excessive workloads are pushing garment workers to breaking point during the pandemic.

Question on factory closures and compensation for workers

My name is Meg, and I’m here today from Labour Behind the Label. My question today is about Primark’s approach to factory closures and compensation for workers in production countries following supply chain disruption, past and future. The garment industry is facing a crunch point as the global economic downturn sends shockwaves through all economies, and the lowest paid in supply chains feel the impact. Garment suppliers both here in the UK and overseas have reported a drop in orders from brands, which is further squeezing businesses still reeling from pandemic-related financial loss. This in turn results in factory closures. Losses are passed on to workers, as short term contracts are not renewed, and compensation and wages are not paid. A Business and Human Rights Resource Centre report shows that unionised workers have been unfairly targeted due to union membership and organising. Social protection and freedom of association should be the nets in place to ensure workers are protected from these kind of economic shocks, but we all know that social protection globally is lacking for the majority of workers who make clothing.

In the AB Foods Responsibility Report 2022, you state that “The erosion of workers’ rights, and the ongoing effects of COVID-19 pose a significant threat to [workers’] quality of life” as well as risk to business supply chains, and also note that the UN Guiding Principles require businesses to have a systematic approach to human rights due diligence.

Given this background, my question relates to what Primark is doing to ensure its due diligence is met with respect to ensuring workers receive their pay and severance when factories do close. Specifically,

• Does Primark ensure supplier reserves are enough to make wage payments and severance payouts in the event of closure as part of its responsible exit policy?
• What is Primark’s response to requests from unions to join a binding severance guarantee fund to protect workers from bearing the cost of factory closures?

Finally, can the board speak to the concrete measures Primark has put in place to protect the right of workers to organise and bargain collectively?

Questions to the board of Boohoo Group PLC
AGM date: 17th June 2022
Venue: 301 Thurmaston Lane, Leicester, LE4 9UX
Time: 14.00

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?