The United States is taking as many measures as it can to decouple American companies from China.
On Monday, the U.S. Department of Commerce added 11 Chinese companies to an export blacklist over allegations of human rights abuses.
One among those companies is a subsidiary of Esquel Group, one of the world’s largest shirt makers, which produces for some of the biggest names in fashion, including Ralph Lauren, Tommy Hilfiger and Hugo Boss.
Esquel’s subsidiary, Changji Esquel Textile Co. Ltd., according to the Commerce Department, has been added to the US Entity List—which restricts export, re-export or transfer of goods to anyone listed—because of an alleged connection with forced labor involving Uyghurs and other Muslim minority groups from the Xinjiang Uyghur Autonomous Region.
In a response Tuesday, Esquel Group called the allegations unfounded.
“Esquel Group is deeply offended by the decision by the U.S. Department of Commerce,” the statement noted. “We absolutely have not, do not, and will never use forced labor anywhere in our company. There is no evidence to support the allegations against us on the use of forced labor in CJE.”
The Hong Kong-headquartered textile manufacturer, which has long prided itself on quality and sustainability, embracing innovation to facilitate both, said it established Changji Esquel Textile Co. (CJE) as a “highly automated spinning mill” in 2009 and has employed skilled technicians it says are paid “at least 2-3 times the minimum wage level.”
“A leading global audit firm who last came to CJE in 2019 confirmed we do not use forced labor, and over the years many international groups and customers have visited the site with positive reports,” Esquel Group said. “We are working with all relevant authorities to resolve the situation, and we remain committed to Xinjiang as we are proud of our contribution in the region over the last 25 years.”
Reports first linked Esquel Group to Xinjiang in 2019 and The Wall Street Journal wrote, citing Esquel CEO John Cheh, that in 2017, officials started “offering” the company Uighurs from southern Xinjiang to employ. While Cheh said at the time that the company did hire 34 of them in the previous two years, he noted that its hiring decisions were made independently, and that Esquel Group was “in no way forced to employ anyone.”
In a statement in April this year, prompted by ongoing connections to forced labor, Cheh said, “In recent months Esquel has been included in a number of reports that accused, without any substantiating evidence, that we use forced labor in Xinjiang. This is completely false and deeply upsetting, given Esquel’s commitment to fair labor practices and our respect for our employees. I therefore wanted to make a clear statement publicly: we do not use forced labor, and we will never use forced labor.”
He said the company’s recruitment process is the same for all candidates globally, and that’s what Esquel follows. Employees are free to leave the workplace at the close of the day or terminate their employment at will, he said, adding that there aren’t pay discrepancies based on race, ethnicity or gender either.
“All our employees, including any minority groups such as Uighurs, were not coerced to join us and they are paid and respected for their work the same as any other Esquel employee. Multiple independent auditors have already validated that we do not use forced labor anywhere in our company,” Cheh said at the time. “In Xinjiang…our employees earn significantly higher than the minimum wage, receive benefits and development opportunities, and enjoy good working conditions. We are proud of our work in Xinjiang.”
Esquel could not be immediately reached for comment on the matter and its response to the Department of Commerce’s blacklisting.