Has the ‘sweatshop’ returned to the UK fashion industry?

The apparel industry has dominated Leicester since the 19th century; its thriving city factories once claimed to ‘clothe the world’. Poor conditions faced by framework knitters were highlighted by a Royal Commission of 1844, but legislation improving work hours and introducing paid holidays, pensions etc. slowly improved the garment-worker’s lot. By 1936 it was the second richest city in Europe thanks to this booming industry.
With overseas suppliers offering more competitive prices, UK garment manufacture has since declined, but with shoppers increasingly concerned about the lack of transparency inherent in complex global supply-chains, retailers are looking again to domestic potential. While London and Manchester are also centres of textile and garment manufacture, Leicester still has the largest concentration of factories in the UK, currently employing around 10,000 people in almost 1,500 businesses. It can offer UK buyers a local supply chain, from design and fabric production through to garment manufacture, providing better speed-to-market and in smaller batches.
Unfortunately, concerns about wages in Leicester were raised as long ago as 2001 by the Government’s Low Pay Commission. A recent Leicester and Leicestershire Enterprise Partnership report suggests the industry as a whole still offers relatively low wages, with Leicester textile workers generally receiving just three-quarters of the average UK manufacturing wage, while clothes-makers fare even worse. A 2010 Channel 4 Dispatches programme showed workers paid £2-an-hour. The UK legal minimum wage is currently £8.21 for anyone over 25. An HMRC letter to the current commons Environmental Audit Committee’s enquiry into fashion sustainability reports that since 2012, HMRC has investigated 93 UK textile companies, finding 24 cases of criminal underpayment, six in Leicester.
With today’s record employment levels, it’s at first hard to see why UK workers would accept this. But British labour is now so cheap that businesses may chose to hire more staff rather than upgrading their machinery. 60% of those officially defined as poor now live in working households. The unions are weak and these workers have little bargaining power. In January 2017, another Dispatches showed an undercover reporter paid £3-an-hour in Leicester to pack garments for River Island. A 2015 Leicester University study for the Ethical Trading Initiative (ETI) reported ‘widespread and severe violations of work and employment laws’, also including a lack of employment contracts and poor health and safety and regulatory compliance. Workers reported health problems, dangerous workplaces and bullying.
To meet the expectations of a growing ethically-aware client base, many older clothing factories have had to actively work to improve their standards. Jenny Holloway, of ethical London factory Fashion-Enter, is working both to help retail buyers spot the signs of poor supplier ethics, and to encourage them to support good manufacturers by providing a consistent flow of orders. At the same time she advocates better use of automation technology as a means of cutting costs.
But a disturbing counter-trend has also emerged. An unnamed industry insider told the Leicester Mercury that shops and websites demanding fast fashion at low prices were leading some smaller manufacturers to cut corners and pay staff less. A report by the Sunday Mirror suggests that at some factories more than half the workforce may consist of undocumented workers, often hidden on the night shift. Some ‘dark’ factories choose to close down and re-establish themselves elsewhere the next day (or ‘phoenix’) rather than to tackle any issues raised about their employment practices. Dr Nik Hammer, an Employment Studies lecturer at Leicester University, blames ‘the considerable market power of global brands’ who often base their purchasing decisions primarily on price. Saeed Khilji, chairman of the Textile Manufacturer Association of Leicestershire, said: “None of the retailers are giving us an ethical price. An extra £2 or £2.50 on a garment would sort everything out. Instead they squeeze us for pennies.”
Members of the ETI have responded by creating a new initiative called ‘Fast Forward’ which involves a deep investigation into suppliers’ HMRC and Companies House documentation, with a view to identifying any hints of ‘phoenixing’ prior to audits by the same team. Some factories experience this scrutiny as an extra burden. One told the Sunday Mirror: “They want us to give contracts to our workers but they won’t give us contracts. When they are not busy, the factories can’t survive.”
The ETI’s Martin Buttle admits it may as yet have been more successful in reducing it’s member brands’ exposure to criticism than in improving the lot of garment workers. But Sue Tilley, of the LLEP, is optimistic that highlighting of these issues has motivated manufacturers to engage more enthusiastically with offers to help them improve.
A 2017 report by PwC suggested that in the next decade, the return of garment production could increase the UK’s annual output by GBP1-2bn. Let’s hope the industry seizes the opportunity to become a global ethical powerhouse rather than a byword for worker oppression.