Boohoo, the British fast-fashion retailer known for dressing the stars of Love Island and Keeping Up With The Kardashians alike, was the subject of an undercover investigation published in the U.K.’s Sunday Times last week. The article stated that Jaswal Fashions factory in Leicester, England, where Boohoo-brand clothing was being produced, was paying its workers £3.50 (or $4.40) an hour, despite the minimum wage for anyone over the age of 25 in Leicester being £8.72 (or $10.97). The investigation also claims that the factory in question was not taking proper precautions against COVID-19.
On Wednesday morning, Boohoo Group responded to the claims. “We are deeply shocked by the recent allegations about the Leicester garment industry,” John Lyttle, Boohoo Group chief executive officer, said in a statement provided to Refinery29. “We wish to reiterate how seriously we are taking these matters, and we will not hesitate to terminate any relationships where non-compliance with our code of conduct is found.” Later in the statement, the board states, “The actions of a few do not continue to undermine the excellent work of many suppliers in the area, who succeed in providing good jobs and good working conditions.”
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The company also announced an immediate independent review of its supply chain, which will investigate supplier compliance with “minimum wage regulations, COVID-19 regulations, working hours and record keeping, and right to work documentation and contracts of employment,” according to the statement. Another independent review will be conducted by Verisio and Bureau Veritas, specialists in ethical audits and compliance. In the meantime, Boohoo Group is committing £10 million (roughly $12.6 million) to “eradicate supply-chain malpractice.”
The company’s statement also includes findings from its own investigation into the claims. In it, the board states that they found some “inaccuracies” with the Sunday Times report, one of which being that no evidence of suppliers paying workers £3.50 per hour was found. “However we have found other evidence of non-compliance with our Code of Conduct and the Group has taken the decision to immediately terminate its relationship with both suppliers,” the statement reads. The two suppliers are Revolution Clothing Co. Limited and Morefray Limited, companies that, according to Boohoo, sent the garments to be repackaged in Leicester.
The Secretary of State for the Home Department Priti Patel called for an immediate investigation by the National Crime Agency into the claims. “Let this be a warning to those who are exploiting people in sweatshops like these for their own commercial gain,” Patel says to the Sunday Times. “This is just the start. What you are doing is illegal, it will not be tolerated and we are coming after you.”
In light of the news, Boohoo, which was founded by Mahmud Kamani and Carol Kane in 2006, saw its market value plunge by around $1.89 billion in two days, as per The Guardian. Retailers including Zalando, ASOS, and Amazon are now pulling Boohoo clothing — as well as clothing from Boohoo-owned brands like Nasty Gal, PrettyLittleThing, and BoohooMAN — from their virtual shelves.