ten years after the Bangladesh factory collapse, we are no closer to fixing modern slavery

Retailers now have to disclose how they are tackling modern slavery in their supply chains. I Wei Wang^[11]

Many wealthier jurisdictions including the UK^[12], France^[13], Germany^[14], the EU^[15] and Australia^[16] have enacted legislation to tackle forced labour. This requires companies within those countries to produce things like annual modern slavery statements or due diligence reports to show they are managing their supply chains properly and ensuring workers are treated fairly.

Much of this legislation is disappointing. The UK Modern Slavery Act 2015 only applies^[17] to companies with upwards of £36 million annual turnover. Companies have to disclose what steps they are taking to deal with slavery risks in their supply chains, but don’t have to specify which abuses have taken place. There is also no penalty for failing to make the necessary disclosures.

On the other hand, Germany has made it mandatory^[18] for companies to enforce standards within their supply chains to make sure their suppliers are ethical employers and providing safe working conditions, as opposed to the UK approach of simply requiring a disclosure. Germany also imposes fines of up to €8 million (£7 million) or 2% of annual turnover, whichever is higher. It only applies to companies with turnover in excess of €400 million, however. There are also proposals^[19] for a mandatory due diligence directive across the EU, though it’s not yet clear whether this will go ahead.

Our findings

Numerous^[20] studies have shown^[21] that – despite all the social audits, ethical codes, corporate social responsibility disclosures and moral narratives global fashion retailers use – workers’ human rights have not improved. Indeed, the situation was aggravated by COVID 19.

When some colleagues and I^[22] interviewed Bangladeshi garment workers and people in trade unions and NGOs, we found that the pandemic had led to job losses and increased people’s financial burdens. This made it harder for women workers to support themselves and their families.

Garment workers particularly struggled during COVID. SOPA Images Limited^[23]

In December 2021^[24] we then surveyed 1,000 garment factories and found that more than half during the pandemic had endured retailers suddenly cancelling orders, delaying payments, reducing what they were willing to pay or refusing to pay for completed goods. Retailers on the list included (but were not limited to) Aldi, Asda, Asos, Bestseller, Costco, H&M, Kik, Lidl, New Look, Nike, Next, Pep&Co, Primark and Zara.

Yet no suppliers took customers to court for cancellations or refusing to pay for goods. Three-quarters of factories were still selling to brands at the same prices as in March 2020. Nearly one in five factories also struggled to pay the Bangladeshi minimum wage.

The situation today

Since the pandemic, suppliers continue to struggle^[25] amid high inflation. In Bangladesh^[26], unions are demanding that the legal minimum wage for garment workers be almost tripled, but so far with no success. Garment exports have increased^[27] more than 35% since the start of the pandemic yet wages and employee numbers have stayed the same.

The collapse of British online retailer Misguided in 2022 gave more insight into the unfairness of the supply chain when it was revealed that^[28] clothing producers in Pakistan were shipping consignments and not getting paid until later. When Misguided went under, this meant not getting paid at all, leading to hundreds of workers being made redundant.

Meanwhile, International Labour Organization-led^[29] estimates suggest that the number of people in forced labour around the world rose from 24.9 million to 27.6 million between 2016 and 2021. Many workers in poor conditions in the retail supply chain would not be categorised as forced labour, but this rise is certainly not encouraging. Overall, these are various signs during and since the pandemic that suggest the modern slavery legislation is not having the desired effect.

A decade after Rana Plaza collapsed, forced labour is still rising. Tansh/Alamy^[30]

So what can be done? Instead of more transparency regulations, we need a watchdog^[31] to investigate unfair practices around the world and punish companies that are found guilty. As well as investigating forced labour allegations, it would penalise companies for doing cut-price deals that prevent workers from receiving a living wage. It would also prevent companies from delaying payments for long periods or refusing to pay for completed goods.

A bill was tabled^[32] in the UK parliament to establish such an adjudicator last July. It has been publicly supported^[33] by more than 50 MPs and is expected to be put back before the House of Commons in the near future. For the longer term, to harmonise practices between different countries, it would also make sense to establish an international fashion watchdog.

It is unavoidable that COVID and high inflation have adversely affected supply chain workers, and no one is denying that exploitation by suppliers is part of the problem. But an international watchdog that puts more pressure on retailers to treat their supply chains fairly is an essential part of the puzzle. Until a regime is in place with genuine teeth to ensure retailers toe the line, the modern slavery behind high-street fashions will only continue.

Read more https://theconversation.com/rana-plaza-ten-years-after-the-bangladesh-factory-collapse-we-are-no-closer-to-fixing-modern-slavery-203774

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