BEIS mulling fashion adjudicator to tackle human rights abuses
MPs have proposed the creation of a clothing sector adjudicator, in a bid to hold fashion firms accountable for labour abuses and environmental issues in their supply chains.
The proposal has been backed by MPs representing all major political parties, as well as former Labour Market Enforcement director Matthew Taylor. If created, the new body would be similar to the grocery adjudicator, which has the power to fine large firms up to 1% of their UK turnover if its investigations uncover violations. This body has previously fined firms including Tesco and Morrisons.
Business, Energy and Industrial Strategy (BEIS) Secretary Kwasi Kwarteng has signaled his support for the potential move. In a letter penned late last week, he promised to “bring forwards” proposals for a single enforcement body for the fashion sector, building on previous works through voluntary schemes and through bodies like the Gangmasters and Labour Abuse Authority.
However, he said that the Department would need more clarity about the potential body’s size, shape and remit before preparing for implementation.
“There are significant differences between the groceries sector and the fashion industry, in terms of scale and distribution of market share, so we need to understand whether this model would be as effective in driving compliance in garment manufacturing,” Kwarteng’s letter stated. An alternative to an adjudicator, he outlined, could be a licensing scheme for manufacturers.
The letter came as Fashion Revolution Week 2021 came to a close. Marked annually and coordinated by Fashion Revolution, the event remembers garment workers who lost their lives in the Rana Plaza disaster in Bangladesh, while pushing fashion brands to go further on supply chain transparency and support to prevent such tragedies in the future.
A home-grown scandal
Many big-name fashion brands have, historically, faced criticisms for their inability to ensure transparency and prevent human rights abuses across multinational supply chains. The Clean Clothes Campaign (CCC) – an alliance of labour unions and NGOs aimed at championing ethical garment production – has accused H&M paying its factory workers across Bulgaria, Turkey, India and Cambodia wages below the poverty line, for example. More broadly, Know The Chain’s 2018 apparel and footwear benchmark showed that just two of 43 major fashion brands could provide evidence that workers below the first tier of their supply chains had used their grievance mechanisms. Poor scorers in this benchmark include Foot Locker and Sketchers.
The Covid-19 pandemic highlighted just how fragile multinational garment supply chains can be. Several big-name brands did not pay for completed or in-process orders until the PayUp Fashion campaign, showing hesitancy to pay due to store closures. Some brands have still not paid, including Topshop and Urban Outfitters.
But there are also believed to be widespread issues in the UK’s own fashion value chain. The Environmental Audit Committee’s 2019 ‘Fixing Fashion’ inquiry heard that some garment workers in Leicester factories receive £3.50 an hour – less than half of the national minimum wage for those aged 21 and over.
BooHoo Group has been heavily implicated in these accusations and has since commissioned an independent review of supply chain practices since 2019. As well as its namesake brand, BooHoo Group owns the likes of Pretty Little Thing, Nasty Gal, Karen Millen, Warehouse and Oasis. Some 40% of the Group's overall UK product portfolio is made in Leicester.