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Indonesian garment workers are asking 5.5 million US dollars from Uniqlo and s.Oliver

By Simone Preuss

Apr 22, 2022

Business

Bild: Clean Clothes Campaign

Fashion companies Uniqlo and s.Oliver were recently called upon in an open letter from Indonesian workers to pay the compensation to which they are entitled.

Exactly seven years ago, on April 22, 2015, the Indonesian garment factory Jaba Garmindo closed its doors, putting more than 2,000 workers out on the street. Since then, they have kept their heads above water with various odd jobs such as cleaning clams for fishermen or as street food sellers in the informal sector.

However, money is lacking everywhere and many workers have had to take their children out of school because they can no longer afford school fees, uniforms and books. Providing three meals a day has also become a challenge. The problem is 5.5 million US dollars (about 5.05 million euros/4.26 million pounds) in compensation payments, which are still outstanding.

In the open letter, the workers address Fast Retailing chairman and largest shareholder Tadashi Yanai and s.Oliver CEO Claus-Dietrich Lahrs directly. They point to Yanai's personal wealth of 26.4 billion US dollars (about 24.23 billion euros/20.44 billion pounds) and Lahrs' experience with luxury fashion brands.

“What has happened to us is no secret from you, there has even been a documentary made about our case, and you are well aware of the Fair Labor Association report which recommends that both your brands pay a meaningful amount into a relief fund for us. But still you won't. You claim you owe us nothing, but it’s your products we made. What would it take for you to pay up? How desperate do you want us to be, before you do the right thing?,” reads the open letter, which has been published on the Clean Clothes Campaign website.

S.Oliver recognises “general responsibility”

The companies have not made any payments to date. However, when speaking to FashionUnited, s.Oliver confirmed that it had taken all allegations seriously over the years and was currently in ongoing discussions to meet a moral obligation. Legally, the German brand was not found to have any obligation in an investigation by the Fair Labor Association (FLA); after all, s.Oliver had paid all its bills. In addition, the brand was not a “dominant buyer” and thus not involved in the factory's bankruptcy - which is attributed to financial mismanagement.

“The s.Oliver Group recognises a general responsibility towards everyone working in its value chain, including in this particular case. Therefore, the company has been in close contact with FLA and the Fair Wear Foundation to discuss the process and engagement with the former workers of the Jaba Garmindo factory to contribute to a relief fund for them,” says s.Oliver in a statement of 20th April 2022.

Fast Retailing states termination of business relations

Fast Retailing confirmed in a statement released in 2018 that it had contracted Jaba Garmindo to produce clothing for its Uniqlo brand from October 2012 to October 2014, but then discontinued business relations due to quality issues and delivery problems, and paid for all orders up to that point.

“Fast Retailing has no legal obligation pertaining to this matter, including the responsibility to financially compensate former PT Jaba Garmindo employees,” said the company in a statement dated 18th January 2018.

“Although Fast Retailing has no legal obligation, it empathises with those affected by the PT Jaba Garmindo situation. Accordingly, the company has offered to work with the relevant parties to facilitate re-employment for any workers who remain unemployed. In addition, Fast Retailing is currently leading talks with stakeholders across its industry about methods that might protect apparel industry workers from similar scenarios in the future,” it added.

Compassion is the best advertising

As the situation in the aftermath of the Covid pandemic has shown, a development in this direction did not happen and factories and thus workers had to wait a long time for their due payments. FashionUnited has contacted Fast Retailing for a more up-to-date statement and will amend this report accordingly should one be received.

The sum claimed comes to a per capita amount of 2,750 US dollars (around 2,500 euros/2130 pounds) and even the total of 5.5 million US dollars is a small amount compared to the average advertising budget of a clothing company. However, those in charge do not seem to have realised that a compassionate gesture is the best advertisement and proof of a company's integrity.

Indonesia
S.Oliver
UNIQLO