#ShareYourProfits Campaign Highlights the Transfer of Wealth From Workers to Brands During the Pandemic

Like many industries, the fashion sector has been devastated by the COVID-19 pandemic, with factory workers bearing the significant burden of financial hardship and health risk. Citing low sales, many brands refused to pay factories for cancelled orders, with $16 billion dollars worth of unpaid orders remaining globally. Among the brands that still owe factories money are hugely profitable companies like boohoo, Fashion Nova, Forever 21, TJMaxx, and Walmart.

In addition to unpaid orders, the pandemic has revealed how a core part of brands’ profitability is achieved by consistently underpaying suppliers and garment workers. Despite the financial downturn caused in the wake of Covid-19, many brands have turned a profit since the pandemic. With companies accruing millions (and sometimes billions) in net profit this quarter, the PayUp Fashion campaign is calling on profitable brands to fund the unpaid workers forgotten within the supply chain. In stark contrast to companies that have survived the pandemic and returned to earnings, a majority of garment workers’ have experienced a staggering loss of income during the same time period.

Surveys in 15 countries reveal:

• Garment workers have suffered a 21% drop in their already poverty wages, from an average of $187 per month down to $147 per month.
  
• Workers are globally reporting hunger and food insecurity. In fact, 77% of workers in nine countries say they or a member of their family has gone hungry since the start of the pandemic.
  
• One in four laid off workers have not received legally mandated severance pay and have no safety nets to fall back upon.
  
• The Clean Clothes Campaign estimates that workers were not paid at least $3 billion in legally-owed wages and severance just for the three months ending May 2020.

That’s why we’ve launched a new phase of the PayUp Fashion platform, called #Shareyourprofits, which calls on profitable fashion brands to both provide direct relieve and a safety net to workers who’ve lost income and wages during the crisis.

Action 2 in the PayUp Fashion movement calls on any brand that has made a profit and already committed to #PayUp to now commit the following:

A) Pay #TenCentsMore to the Severance Guarantee Fund: In alignment with the Clean Clothes Campaign network, PayUp Fashion calls on brands to protect laid-off garment workers by paying into a social safety net fund, called the Severance Guarantee Fund for Textile, Garment, Shoe and Leather Workers. The Fund, which is legally binding and negotiated with unions, requires that brands pitch in #tencentsmore per unit of apparel to ensure that all garment workers who’ve lost their jobs during the pandemic receive legally mandated wages and, in the case of layoffs, severance. #10centsmore

B) Help Provide Direct Relief to Garment Workers: Brands should also provide and push for direct financial relief to garment workers for income lost during the pandemic. This can be done either through brands’ own channels and foundations, through International Financial Institutions, or through international relief efforts such as the ILO Call to Action and the USAID Memorandum of Understanding. The ILO Call to Action and USAID MOU have moved less than $200 million to just four countries (as of December 2020) thus far, while the need is estimated in the billions of dollars. Brands must contribute or work through relief efforts and foundations to release an amount equivalent to 1% of their 2020 net revenue. Meeting this part of the demand is not a replacement for contributing to the Severance Guarantee Fund.

C) Protect Freedom of Association: Brands’ purchasing practices are often instrumental in squashing union activities and/or brands often look the other way while state violence is committed against organizers. The pandemic should not be used as a cover to roll back worker rights. Brands should intervene in their factories to support workers’ rights to freedom of association and collective bargaining, in accordance with international guidelines. Any brand found limiting the freedom of association of their garment workers or failing to support collective bargaining rights in their factories will automatically be ineligible for movement on Action 2 of the PayUp Fashion Brand Tracker.

How can you participate and support the campaign? By tagging any of the brands below on social media and telling them to “#ShareYourProfits and provide a pandemic safety net for fashion’s essential workers.”