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Anyone care to paste pls?
Boohoo executives “knew for a fact” about illegally low pay and unacceptable working conditions within its supply chain at least seven months before professing shock over a Sunday Times investigation at a Leicester factory, according to a review.
Britain’s fastest-growing online fashion retailer acknowledged many failings yesterday and said that it would consolidate its list of approved suppliers in an attempt to reduce concern over its business model.
Alison Levitt, QC, found no evidence that the company had committed any crimes and said she was satisfied that it did not deliberately allow poor conditions or low pay, “nor did it intentionally profit from them”.
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She concluded, however, that allegations surrounding many Leicester factories “are not merely well-founded but substantially true” and that Boohoo had not felt responsible “on anything other than a superficial level”.
Ms Levitt was appointed by Boohoo in July to lead an independent review after The Sunday Times reported that staff within its supply chain were working in unsafe conditions at a site in Leicester that allegedly flouted social distancing rules while the city was in a local lockdown.
In a critical 234-page report, compiled over 11 weeks and published yesterday, Ms Levitt wrote that some Boohoo board members knew there were “serious examples of unacceptable working conditions and poor treatment of workers (including illegally low pay)” by last December at the latest.
Over the summer, when claims came to light about working practices within its supply chain, the company’s board said that it had been “shocked and appalled by the recent allegations”.
The review noted that Boohoo had previously sought to “examine and remedy” issues at factories, but said it had failed to move fast enough “particularly from late December 2019”.
The retailer “capitalised on the commercial opportunities offered by lockdown and believed that it was supporting Leicester factories by not cancelling orders but took no responsibility for the consequences for those who made the clothes they sold”, Ms Levitt found.
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Boohoo’s failure at any point to assess how Leicester’s workforce would cope with increased orders to meet higher demand during the pandemic was inexcusable, she said.
The review received no evidence, however, that its sourcing methods were responsible for the increased rate of Covid-19 infections in Leicester.
Alison Levitt, QC, was satisfied that Boohoo did not deliberately allow poor conditions or low pay
Alison Levitt, QC, was satisfied that Boohoo did no
The review received no evidence, however, that its sourcing methods were responsible for the increased rate of Covid-19 infections in Leicester.
Alison Levitt, QC, was satisfied that Boohoo did not deliberately allow poor conditions or low pay
Alison Levitt, QC, was satisfied that Boohoo did not deliberately allow poor conditions or low pay
The £4.7 billion online retailer, whose brands include Pretty Little Thing, was founded in 2006 by Mahmud Kamani, 56, and Carol Kane, 53. It has grown rapidly by tapping into the appetite for fast fashion and listed on the junior Alternative Investment Market in London in 2014.
Shares in Boohoo rose 50p, or 15.4 per cent, to 374½p after it set out plans to tackle the review’s findings and implement its recommendations in full.
John Lyttle, chief executive, said that the board would significantly increase its scrutiny of suppliers and promised to ensure that the issues would not recur.
“This has identified significant and clearly unacceptable issues in our supply chain and the steps we had taken to address them,” he said. “But it is clear that we need to go further and faster to improve our governance, oversight and compliance.”
Ms Levitt concluded that for too long the priorities of Mr Kamani, the retailer’s executive chairman, had been allowed to dictate company policy.
Checks exposed supply chain failings
Boohoo did “too little, too late” to confront issues within its Leicester supply chain, according to an investigation which the business itself concedes has highlighted “many failings”.
Spot checks led by Verisio — an ethical audit company which has been investigating Boohoo suppliers on the company’s behalf since late last year –— raised a series of red flags. At one visit last month, ten people left through a fire exit as auditors arrived.
Mahmud Kamani and Carol Kane founded Boohoo in 2006
Mahmud Kamani and Carol Kane founded Boohoo in 2006
JERRITT CLARK/GETTY IMAGES
Staff working on the review toured factories themselves this month. They have also spoken to current and former Boohoo employees, campaigners, MPs and journalists. Several dozen witnesses contacted the review online.
Pay
Workers at several sites claimed that they were being paid less than the national minimum wage. Auditors concluded they had “no reason to disbelieve” such allegations, but a lack of documentation prevented verification.
During one check this year, however, a supplier’s managing director admitted employees were receiving less than the minimum wage. He claimed this was because most wanted to claim benefits.
One witness said this issue was “endemic”, estimating that more than 90 per cent of garment manufacturers in one area of Leicester pay illegally low rates.
Hours
Auditors regularly found suppliers’ timekeeping books to be inadequate. The review cited a series of “anomalies”, such as employees shown not to be working on their timecard at one company in 2017, only to be present at a
Article bigger than maximum allowable list so copied and pasted in 3 parts so read my posts in reverse order.
Hours
Auditors regularly found suppliers’ timekeeping books to be inadequate. The review cited a series of “anomalies”, such as employees shown not to be working on their timecard at one company in 2017, only to be present at a fire roll call.
Two suppliers subject to separate spot checks by Verisio this year were found to have “clearly falsified” their books. After one such check, in July, it was noted that “hours that have been recorded for the last three months are believed not to be accurately recorded”.
Conditions
Witnesses described conditions variously as “poor”, “unsanitary” and “horrible” but one — otherwise highly critical of their workplace — called it “clean and safe”.
Visits highlighted a litany of health and safety concerns, including toilets with a lack of paper, buildings in disrepair and locked fire doors. One site was said to be in a “deplorable condition”.
The report highlighted three suppliers checked late last year. At one, there was no “wholesome drinking water”. The managing director of Verisio said another had “the worst working conditions that I have seen in the UK”, concluding it was “not safe for the workers”.
Covid-19 and furlough
Some witnesses described increased staff and more overcrowding, no social distancing and a lack of hand sanitiser and facemasks, but others noted more adequate handling. Auditors found that “on the whole” suppliers had sanitiser and signs about distancing.
One supplier admitted to committing furlough fraud, claiming £50,000 of payments over six weeks despite their site not being operational for two. Another could not explain how it produced orders while staff were furloughed.
Business commentary article part 1
Boohoo has some explaining to do
Alistair Osborne
Saturday September 26 2020, 12.01am, The Times
That’s the thing with fast fashion: too quick to notice the damage left behind. For Boohoo, the report by Alison Levitt, QC, into the Leicester sweatshop affair tugs at countless uncomfortable threads. And they’re not all down to one of her more humdrum lines: that the group’s “extraordinary commercial growth has been so fast that its governance processes have failed to keep pace”.
No, read her 234-page report and it’s hard not to reach this conclusion: that the £4.7 billion online retailer, founded by Mahmud Kamani and Carol Kane in 2006, turned a blind eye for years. Ms Levitt says she is “satisfied that by December 2019 at the latest”, the board “knew for a fact that there were some serious examples of unacceptable working conditions”, including “illegal low pay”. The hint is that the board knew long before that but preferred not to ask. As she puts it: “Boohoo’s monitoring of its Leicester supply chain has been inadequate for many years.”
Laudably, the board has published her damning report in full. And chief executive John Lyttle, brought in from Primark in March 2019, admits that the issues identified are “clearly unacceptable”. He’s pledged to put them right by next February’s financial year end, while beefing up governance with two new non-execs plus a “respected individual” to oversee Boohoo’s “change agenda”. It was enough to lift the shares 15 per cent to 374½p: a decent recovery from the 210p the shares fell to after a Sunday Times investigation left Boohoo looking far more Nasty Gal than Pretty Little Thing
Yes, by last autumn Boohoo had belatedly started looking into a Leicester supply chain that spans 500 factories, with 40 per cent of the togs made in Britain. Yet, even then Ms Levitt spots an “insufficient sense of urgency”. In September 2019, Boohoo put its legal chief, Tom Kershaw, into a new role as “director of sustainability”, responsible for the supply chain.
He hired Verisio, an auditor of working practices. In December, its boss Leon Reed emailed Mr Kershaw, identifying one factory as having “the worst working conditions that I have seen in the UK”. He said it “is not safe for the workers”, with other sites “significant risks to the Boohoo brand”. As Ms Levitt notes, they included “falsified wage records, no signed contracts of employment, buildings in deplorable conditions” and workers unpaid “for seven weeks”.
Business commentary article part2
unpaid “for seven weeks”.
Mr Kershaw forwarded the email to Mr Lyttle, who visited Leicester before Christmas. But, to Ms Levitt’s “surprise”, Mr Lyttle did not tell her of the email or the visit when she “interviewed” him. He says: “She didn’t directly ask me that question,” noting she’d already been given the full picture. But it looks remiss. And why did it take Boohoo so long to act? Verisio’s sample review of factories found that “35 out of 49” had “at least one non-compliance” over paying the minimum wage, while “42 out of 49” had safety breaches, such as locked fire doors.
True, Ms Levitt’s dressing-down isn’t reserved for Boohoo. She also criticises “inaction by the authorities”. Indeed, where were the HMRC, Health & Safety Executive or local council? And, as Boohoo notes, she did not find that it “deliberately” allowed poor conditions or “intentionally” profited from them.
But her conclusion that “in truth Boohoo has not felt any real sense of responsibility for the factory workers in Leicester” because “they are largely invisible to them” says a lot about the business presided over by executive chairman Mr Kamani, owner of a 12.5 per cent stake. And will fixing the problem cost only £10 million? Boohoo calls the report “an agenda for change in UK garment manufacturing”. It’s still got to prove its promises aren’t threadbare.
Thanks @pmoran for posting all that
Scrapping the barrel
Is that really news now ? Just trying to justify their original piece
I don't see ethical II's coming back as I've heard fast fashion is the next target for extinction rebellion
The lefties have spent years banging on about meat, are their more vegans ? yep, has it made a massive difference I don't think so
After reading the Times article and the review it is evident that the Times is targeting the wrong people. Maybe they should be look at benefit fraud as stated people work their as their employers ( Third party factory owners ) pay them a certain amount so they can manipulate the state benefit system. Boohoo only pay these companies no individuals to make garments ie they have Zero responsibility for third party employees! In fact if Boohoo did not produce work then these employees would all be on state benefits. It is laughable that the story has had so much traction as it implies Boohoo advocates slave labour. They are effectively saving the British tax payer a small fortune and it is the third parties employers and employees which need to be investigated further.
Darlomagic that is exactly right but try explaining that to the woke brigade who only read the headline of an article and seem to think boohoo were underpaying staff.