UK considers clothing trade adjudicator to tackle labour abuses

The UK government is considering the introduction of a clothing trade adjudicator, who would monitor large retailers’ relationships with their suppliers.

The idea was put forward as one of several possible ways to improve conditions for garment workers by a cross-party group of MPs who have been investigating labour abuses in the domestic and international supply chains of fashion retailers.

A former director of Labour Market Enforcement, Matthew Taylor, has also backed the concept amid fears that voluntary measures have failed to make substantial improvements to pay and working conditions in the fashion industry.

Related: Bangladesh clothing factory safety deal in danger, warn unions

The issue has been highlighted in the past year by revelations about conditions in the Leicester clothing factories supplying the online fashion group Boohoo as well as difficulties for overseas suppliers as orders were cancelled because of the global Covid pandemic.

Responding to the proposal, Kwasi Kwarteng, the business secretary, wrote to MPs saying an adjudicator had worked well in the grocery industry, “ensuring large grocery retailers treat their direct suppliers lawfully and fairly” by enforcing an industry code of conduct.

The grocery adjudicator has the power to fine large retailers up to 1% of UK turnover and has investigated issues at companies including Tesco, the Co-op and Morrisons, instructing them to make changes in working practices. Tesco was forced to pay £1m towards the costs of the watchdog’s investigation that found the supermarket had deliberately delayed payments to suppliers to boost profits.

In the letter to the parliamentary environmental audit committee, published on Thursday, Kwarteng said officials had discussed the proposal for a similar scheme in the garment trade with campaigners. However, he cautioned: “There are significant differences between the groceries sector and the fashion industry, in terms of scale and distribution of market share, so we need to understand whether this model would be as effective in driving compliance in garment manufacturing.”

Kwarteng added that the government was also discussing a potential licensing scheme for clothing manufacturers that could give more assurance to retailers and that he would “bring forward” proposals for a single employment rights enforcement body.

He added that the government had been “encouraging companies to honour existing orders” on clothing bought in countries such as Bangladesh during the pandemic.