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Report Details Unsavory Secret Behind Shein’s Digital Dominance

Workers who make clothing for Chinese e-tailer Shein face excessive overtime amid dangerous conditions in contravention of numerous local labor laws, a new report claims.

Swiss watchdog group Public Eye, which scoped out 17 of the ultra-fast-fashion purveyor’s 1,000 production sites in Guangzhou, found that several of Shein’s suppliers operate out of small, informal and unregulated workshops. At “Shein Village,” a hub in Nancun that churns out clothing almost “exclusively” for Shein, one researcher spotted barred windows, blocked stairways and no emergency exits. “I don’t want to think about what would happen if a fire broke out there,” she said.

Employees Public Eye spoke to described toiling for 11 to 12 hours every day—or 75 hours per week—with only one day off each month. Such a cadence not only flouts Shein’s own code of conduct, which stipulates “reasonable” working hours, but it also violates Chinese labor laws, which limit workweeks to 44 hours and overtime to 36 hours per month. Workers must also have at least one day off every week.

Public Eye found that most if not all of the workers are “migrants” from other provinces where wages are significantly lower. Many of them want to work these hours, the organization said, because they’re only in Guangzhou for a limited time. Far away from their families, their only responsibility is to earn as much money as possible. “You might find a local in the office of a company, but in the production departments there are only migrant workers,” one researcher said.

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Workers said they were paid piece-rate, that is, by item of clothing. The more complicated the garment, the higher the amount they received. One employee said the pay per item was “considerably lower” than in other places where he had worked, but that the quality expectations were “not particularly high,” either. In a “good month,” he can earn ​​up to 10,000 yuan ($1,566), but only one-third of that in a “bad” one, especially since there is no overtime premium. Like other workers Public Eye interviewed, he did not sign an employment contract, which is required by Chinese law.

Public Eye investigation into Shein
Workers at Shein suppliers described toiling for 11-to-12-hours every day—or 75 hours per week—with only one day off each month. Panos Pictures/Public Eye

Shein’s meteoric rise has caught many people by surprise. Beloved by Gen Z for its $19 dresses and $25 shoes, which are aggressively marketed through social media, TikTok’s buzziest brand commands a 28 percent share of the American fast-fashion market, more than H&M and Zara. Shein’s rapid ascendancy has been attributed to a number of factors, including production turnarounds of as little as one week, compared with Zara’s three to four. It‘s said to pump out thousands of new products every day, lean in on “dark patterns” to entice consumers to keep spending and benefit from “tax perks” that allow it to undercut its rivals. The company has also been accused of nicking designs from designers both large and small.

In an industry that is feeling increasing pressure to be transparent, however, Shein’s opacity has not gone uncriticized. Despite reportedly raking in nearly $10 billion in 2020 alone, America’s most downloaded shopping app has so far failed to make public disclosures about working conditions along its supply chain as legally required by the United Kingdom. Neither does Shein delve into specifics or provide ​​third-party evidence for claims made in a website disclosure required by the California Transparency in Supply Chains Act of 2010. Though Shein notes on its website that it invests “substantial efforts and resources” in its audit system, none of the employees Public Eye spoke to were aware of any audits having taken place.

“Shein’s business model is set up to control as much of the value chain as possible, while taking on as little responsibility as possible,” Public Eye said. ”Through its combination of a cutting-edge online strategy and archaic working hours, the Chinese newcomer is perfecting the fast-fashion industry in a particularly insidious manner. In doing so, it is taking the sector’s tradition of shunning responsibility to another level.”​​

A Shein spokesperson told Sourcing Journal that the company “takes all supply chain matters seriously” and has requested more information from Public Eye.

“In the meanwhile, we have launched our own investigation,” the spokesperson said. “We have a strict supplier code of conduct which includes stringent health and safety policies and is in compliance with local laws. If non-compliance is identified we will take immediate action.”

Public Eye said the only means of tackling responsibility laggards is to mandate a “requirement of transparency” in relation to supply chains, as well as introduce “political guidelines” on corporate responsibility. “It is up to the Swiss Federal Council and industry associations to act to this end,” it added.