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Brands Urged Not to ‘Disengage Abruptly’ from Sri Lanka

Organizations representing many of the world’s biggest brands and retailers have expressed their solidarity with Sri Lanka’s garment industry, which is girding its loins for a drop in orders amid the island nation’s worst financial and political crisis in decades.

In a letter dated Tuesday, American Apparel & Footwear Association president and CEO Steve Lamar applauded the Joint Apparel Association Forum (JAAF)’s “relentless efforts” to keep workers “employed, safe and healthy” during an unprecedented time.

“Your continued work has kept the industry moving forward, preserved jobs in Sri Lanka’s garment industry and supported the Sri Lankan economy through these extremely difficult times,” he said.

Lamar said that the AAFA, which represents more than a thousand major companies, including Adidas, Gap Inc., and J.Crew, promises to be “cognizant and mindful” of any sourcing decisions that could trickle down to the South Asian country’s 350,000 garment workers.

The trade group pledged to maintain “regular communications” with its Sri Lankan suppliers to ensure that all payments are disbursed in a timely manner and workers are treated in accordance with labor laws. The AAFA also said it is monitoring humanitarian conditions closely and “actively” reviewing opportunities to assist workers, their families and their communities “during this difficult time.”

“We recognize that any significant changes in sourcing during this time could have a major impact on Sri Lanka’s garment industry, the hundreds of thousands of workers the industry employs, their families and the Sri Lankan economy,” Lamar said.

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Garment workers in the embattled nation, many of whom earn persistently low wages and lack savings, say they are running out of money to afford food for themselves and their families. The prices of fuel, medicine and other necessities have likewise skyrocketed as the Sri Lankan economy continues to melt down over a debt disaster that has emptied out foreign coffers and sent inflation rates into freefall.

But they also blame their increased vulnerability on the global companies that have built their profits on exploitative purchasing practices. This was thrown into particular relief when the novel coronavirus gripped the globe.

“Workers…feel that the unwillingness of global fashion brands to ensure living wages and social security for their supply chain workers or even contribute to emergency efforts like the AFWA supply-chain-relief contribution during the Covid-19 pandemic have contributed to their inability to meet this economic crisis,” Vishmee Warnachapa, Sri Lanka country coordinator at the Asia Floor Wage Alliance (AFWA), a worker-rights nonprofit, said earlier this month.

One thing brands and retailers shouldn’t do right now is cut and run, the Ethical Trading Initiative, Fair Wear Foundation, the Fair Labor Association and the British Retail Consortium said in a joint call to action on Tuesday. With Sri Lanka a key sourcing destination for many fashion firms, they have a responsibility to support workers through business continuity, they said.

“Sri Lanka is facing challenging times,” said Margreet Vrieling, associate director at Fair Wear. “We expect our member brands to not disengage abruptly, but rather stay in communication with their Sri Lankan suppliers, have a dialogue on challenges faced and see how they can contribute to more predictable planning and finances with their purchasing practices.”

The organizations, whose collective rosters include nameplates such as H&M Group, Uniqlo parent Fast Retailing and Zara owner Inditex, urged companies sourcing from Sri Lanka to take “specific steps” to support a sector that contributes more than 50 percent of the country’s exports.

Brands and retailers, the organizations said, need to ensure that there is a “clear understanding” of the risk to workers in the current situation, avoid order cancelations and ensure timely payments. Companies should include the inflation-induced rise in energy costs, other raw materials and labor in future price negotiations. They must also make sure that all pending wages and severance payments are paid out to employees, engage with unions and suppliers to explore “innovative remedial solutions” to bolster workers and work collaboratively to investigate ways they can improve respect for human rights in the context of the current catastrophe.

“As workers in Sri Lanka seek to ensure their livelihoods during this economic crisis, brands must take additional due diligence steps,” said Sharon Waxman, president and CEO of Fair Labor Association. “Companies sourcing from Sri Lanka should work even more closely with their suppliers to ensure stability and safety for the people who work in their supply chain.”

The JAAF said it welcomes both the AAFA’s sentiments and the call to action.

“The livelihoods and welfare of workers remain a top priority of the industry,” Yohan Lawrence, the apparel body’s secretary-general, told Sourcing Journal. “JAAF welcomes this collective support as it will enhance and complement worker welfare measures already taken by the industry during these unprecedented times. Support of the brands is crucial at this time and we appreciate the commitment of the ETI and AAFA in this regard.”

The JAAF previously said that it expects a 20 percent decline in orders as a result of the chaos. Workers that the AFWA recently spoke to reported reducing working hours, increasing layoffs and deteriorating quality of aid, though Lawrence has denied this. Its members, he said, are hyper-aware of their employees’ despair and suffering, and they’re doing what they can to alleviate their burden.

“Welfare schemes by some factories have been in operation for the distribution of dry rations, with certain factories providing additional meals to employees to take home to feed their families,” Lawrence said. “Provision of schoolbooks for children, free medical facilities, and special food packages for pregnant mothers have also been made available for employees in the SME sector.”

“This crisis affects all of us: the JAAF membership is acutely conscious of this fact,” he added. “We would not be the force we are in the global apparel supply chain if companies neglected to take care of their workers. Even if one is skeptical about humanitarian intent, taking care of workers is in the business interest of factory owners and businesses.”

Labor campaigners have already been beating the drum for aid. If orders plummet and operating hours fall, they say, so will the wages garment workers receive.

In an open letter last month, the Clean Clothes Campaign, Labour Behind the Label, Maquila Solidarity Network, War on Want and Workers United asked national governments, international financial institutions, brands and other stakeholders to underwrite a program of emergency relief and mid- and long-term financial support, along with a “democratic political solution to the crisis,” because a loss of buyers’ confidence in the sector poses a “real risk.”

“This is the result of a crisis driven by international debt that has been unfolding for decades and mismanagement by the previous Sri Lanka government,” they wrote. “This has caused catastrophic inflation and the loss of purchasing power; failure of public services including health services, education and public transport; disruption of economic activity; and scarcity of fuel, cooking gas and oil and many basic commodities. Importantly, it has caused great hardship for the 300,000, mostly female, garment workers and their families.”