Victoria’s Secret is set to fund a US$8.3 million worth of compensation to Thai workers who were laid off last year without their legally mandated severance, according to the Solidarity Center and the Worker Rights Consortium (WRC).
The compensation, to be paid via a loan arrangement with the workers’ former employer, will go to more than 1250 workers, who sewed bras for Victoria’s Secret, Lane Bryant, and Torrid. However, the parent of Lane Bryant and Torrid – Sycamore Partners – did not contribute.
Last year, Brilliant Alliance factory’s owner, Clover Group was ordered to pay severance to its workers within 30 days by the Thai government after closing its facilities in the country. The company then refused and said the workers should agree to wait 10 years to be paid in full.
Last week, all workers received their severance, plus more than $1 million dollars in interest, per Thai law thanks to Victoria’s Secret’s commitment.
“We also hope this represents a model for the type of domestic, governmental, international and brand engagement to resolve future cases where garment workers are left in similarly desperate straits,” said David Welsh, country director of the Solidarity Center Thailand.
“It’s a historic case given the amount of the settlement and again, hopefully, a model for the global garment industry going forward in terms of direct brand involvement.”
Executive director of the WRC, Scott Nova, said the organisation has gathered hundreds of cases of wage theft in the apparel supply chain.
“The $8.3 million provided by Victoria’s Secret is also the most any brand has ever contributed to help resolve a wage theft case,” he said. “Victoria’s Secret should be very proud of what it has done here. The people who run Sycamore Partners should hang their heads in shame.”
According to Solidarity Center, all of Clover’s factories were included in the new company after it formed a partnership with Brandix, except Brilliant Alliance, allowing the two companies to profit from Clover’s assets and its ongoing brand relationships, while the Brilliant Alliance workers went unpaid.