WRC Update: $9.4 Million in Back Wages Paid by Collegiate Supplier in India

July 8, 2022

Dear Colleagues,
 
This is a progress report on the WRC’s efforts to secure back wages for 400,000 garment workers in India’s Karnataka state, including the 80,000 workers employed by the collegiate supplier Shahi Exports. (Click here and here for background.)
 
Here are the key updates:

• Collegiate supplier Shahi Exports has now paid $9.4 million in legally owed back wages, covering all current employees.
• In total, across 180 factories operated by Karnataka’s 21 largest garment suppliers, the WRC has confirmed $23 million in payments, covering 97 percent of workers currently employed by these suppliers.
• To address the challenge of getting payments to workers who are owed money and are no longer employed by these suppliers, the WRC worked with two brands to develop a distribution protocol that has now been shared across the industry, and Shahi Exports and other suppliers have begun the process of distributing funds to their former employees.
• We are confident that the collegiate supplier, Shahi Exports, will complete payments to all former employees, which will fully resolve the violations of university labor standards we originally uncovered.
• Every major supplier, including Shahi, has committed to pay the proper minimum wage going forward.

We are continuing to monitor the back pay process and to promote broad compliance, including hundreds of small factories that produce for less well-known brands. While we will not be able to directly confirm payments by these smaller non-collegiate facilities, there is good reason to expect that the majority will comply. This means, at the end of the day, that most of the $56 million originally owed to workers across the region will be paid.

Back pay, plus the higher wages they are now receiving, mean better circumstances for hundreds of thousands of workers and their families, including improved nutrition.

Best,

Scott