By Elizabeth Segran, Fast Company
We often talk about slavery as if it was a thing of the past–a horror from another era, perpetrated by people who have no resemblance to us. But the truth is that slave labor is still alive and well. And a new report produced by the nonprofit KnowTheChain points out that your closet is likely full of clothes made through forced labor.
Today’s slave labor doesn’t look the way it did a hundred years ago. Instead, it involves poor people in developing countries trying to find work at clothing and shoe factories and finding themselves exploited.
Take the case of one woman in India. KnowTheChain found that she had left her rural village in search of a job in Bangalore, a major city in South India. An agent found her a job at a clothing factory in exchange for a recruitment fee, although the details of how much it would be were murky. The agency then proceeded to take her entire paycheck until she had paid the fee back. Six months into the job, she still hadn’t received a single wage slip. And to make matters worse, the agent had promised her free room and board, but when she arrived, she discovered this was not the case.
Many clothes sold in the United States are made in India. It’s possible that you or I bought a piece of clothing that she made. Yet few of us have any idea about the misery, exploitation, and forced labor that go into the clothes we wear every day.
Why clothing and shoe factories use slave labor
Across the world, an estimated 24.9 million people are victims of forced labor. The lion’s share of them–16 million people–are exploited by companies for a profit, rather than by private individuals, such as in the case of sex trafficking. And according to KnowTheChain’s report, one of the largest sectors that relies on forced labor is the $3 trillion apparel and footwear industry. An estimated 60 million to 75 million people are employed in this global sector. And while most of us realize that these workers are paid very little, the reality is that some are not paid at all.
There are many reasons that the manufacture of clothes and shoes tends to be so tainted by forced labor. One is that people in wealthy, developed countries, like the United States, the United Kingdom, Canada, and France, have gotten addicted to cheap clothing. This is partly because global free trade agreements have made it easy for brands to make their products in places where labor is cheaper, then transport them across the world. This also made it possible for fast fashion to become a trend. Brands like Zara, H&M, and Century21 built their businesses around making off-the-runway looks available at rock bottom prices. As a result, KnowTheChain’s report says that “competition for low prices and quick turnarounds” has led to “globally complex and opaque supply chains.”
KnowTheChain has developed a scoring system to identify how large, global apparel and footwear companies–from Gap to Louis Vuitton to Nike–fare in terms of worker treatment. Shockingly, out of 100, the average score remained low, at 37. In other words, many of the brands that we purchase clothes and shoes from are not paying close enough attention to the treatment of workers in their factories.
Companies that are able to disclose their practices to reduce forced labor, like hiring workers directly rather than going through a recruitment agency, scored well. But many companies either do not have policies or cannot disclose them, because they are not sure what they are. This happens because supply chains can be very complicated: A brand may work with a factory that outsources part of its work to other factories, and so forth. But ultimately, KnowTheChain makes the case that these companies are culpable for their role in the exploitation of workers no matter where it happens in the supply chain.
SLAVERY STARTS AT RECRUITMENT
The scoring system takes into account how these companies address many issues relating to the payment of workers. But one of the most critical areas of focus is recruitment because this is the point in the process when poor workers are most vulnerable to being exploited.
Unethical recruitment agencies often take advantage of poor, desperate people by securing them jobs in exchange for exorbitant recruitment fees, which will come out of the worker’s salary. They may withhold a worker’s passport or other official documents until the fee is paid. And if they compound interest on the fee, a worker may never make enough money to pay it back, rendering them a lifelong slave. One audit KnowTheChain examined found that an apparel company in Taiwan charged migrant workers US$7000 for a job at a fabric mill. Another Taiwanese factory audit found that 82% of workers had their passports withheld.
Migrant workers are particularly vulnerable to being exploited since they do not have strong social support systems–like families and friends–who can protect them. They may also not understand their rights, or how to report grievances. And in some countries, migrant workers make up the bulk of the apparel workforce. In Jordan, 77% of apparel workers are migrants, and in Mauritius, that figure is 44%.
All of this is compounded by issues of gender. Two-thirds of apparel and footwear workers are women, who already face discrimination in many developing countries. These women, who tend to be low-skilled workers from rural areas, are particularly vulnerable to exploitation.
ACTIVEWEAR BRANDS ARE GETTING IT RIGHT
At the very top of the list were two athletic companies: Adidas, which scored 92, and Lululemon, which scored 89. These businesses stand out because they pay close attention to recruitment and migrant worker protections. Adidas, for instance, conducts training on ethical employment practices for 100 suppliers in Vietnam, Indonesia, China, and Taiwan. Lululemon has worked hard to ensure that workers in its supply chains get all of their identification documents, like their passports, returned to them. Both of these companies also eliminate recruitment agencies from their supply chains altogether, requiring factories to hire workers directly. Lululemon also established a hotline for workers to contact the company directly, rather than going through the factory.
Nike and Puma scored 63 and 61 respectively. So, in general, large activewear brands seem to be more aware of labor issues than other industries. Again, this might be in response to consumer pressures. Back in the 1990s, there were many stories about companies like Nike and Adidas relying on sweatshops in Asia, which resulted in protests in the United States at the time. (There are still occasionally protests against these brands, including one that I wrote about last year.) All of this consumer pressure had its desired effect, which was to make these companies rethink their treatment of workers.
Interestingly, fast fashion companies actually fared well, probably because they have been scrutinized by consumers and the fashion press for the last few years, including here at Fast Company. This may have prompted the company’s leadership teams to observe its supply chains more carefully. Gap Inc, the parent company of Gap, Old Navy, and Banana Republic came in third on the list with a score of 75. Primark scored 72, while H&M scored 65. Walmart scored 44, which is a low score, but significantly better than many luxury brands.
Many of these brands fared well because they have policies like training programs that help workers know their rights. H&M and Primark, for instance, both have mandatory “modern slavery” training at the factories they use. Still, there’s a lot of room for these companies to improve. The report suggests that even brands that are doing well can dig deeper into their supply chain, to understand the labor that went into their raw materials. Cotton, for instance, is often linked to slave labor, so companies need to make their entire supply chain traceable.
LUXURY BRANDS ARE FAILING
Many consumers assume that more expensive products are made ethically in high-quality factories. But the rankings revealed that luxury brands had among the lowest scores. Prada received an abysmally low score of 5, for instance, and Salvatore Ferragamo scored 13. The LVMH conglomerate, which includes brands like Fendi, Celine, Rimowa, and Christian Dior, scored 14, while Hermes was not much better at 17. Many of these brands make their products in Europe, but KnowTheChain says that European workers are also vulnerable to exploitation. In Italy, for instance, Chinese laborers are sometimes subjected to forced labor in textile factories, and in Bulgaria, Macedonia, Moldova, Romania, and Turkey, workers have been denied time off, and had to work overtime beyond legal limits for “staggeringly low wages.”
Some luxury brands did better, however. Burberry scored 52, Ralph Lauren scored 58, and Kering, which owns Gucci, Balenciaga, and Saint Laurent, scored 45. But overall, KnowTheChain’s findings suggested that the luxury industry was riddled with labor issues. This might be because consumers assume that the high price they pay for products translates into decent wages for the workers, and as a result, they aren’t applying pressure to these brands to pay more attention to their supply chains.
All of this suggests that we, as consumers, have a role to play in helping to reduce modern slavery. We need to hold companies to task for their lack of oversight. This might mean writing to them or using social media to hold their feet to their fire. And it also means supporting brands that are known to have better practices.