Zara, Next, H&M, Primark… Major international clothing brands have been accused of unfair practices towards their suppliers in Bangladesh, such as order cancellations, defaults or late payments, according to a study published on Wednesday.
This Transform Trade Association study, conducted alongside the University of Aberdeen and the Center for Global Development, examined 1,000 garment factories or producers in Bangladesh and found “unfair” practices that began during the COVID-19 pandemic, but were continued thereafter.
The manufacturers surveyed “reported that brands and retailers had canceled orders, refused payment or requested discounts on orders already in production or shipped,” despite rising production costs since economies reopened after lockdowns and rising inflation.
Among the big brands that produce in Bangladesh, Inditex (parent company of Zara), Next, Primark and H&M have canceled around 30% of their orders and also asked for price reductions or delays in payment. Gap, Walmart, C&A too, but in a smaller proportion, among many other examples.
“Such unfair practices impact suppliers’ employment practices, leading to (…) job losses and declining wages,” the report said.
“One in five factories in particular said they had difficulty paying the minimum wage since the end of lockdown in Bangladesh,” he adds, calling for the creation of a garment sector regulator in developed countries to put an end to these abusive purchasing practices.
The clothing industry is regularly accused of abusive wage or labor practices, including in developed countries like the UK.