WASHINGTON — Hanesbrands Inc. is severing ties with the Harvest Rich factory in Bangladesh after discovering the facility’s managers intentionally concealed excessive and sometimes forced overtime, as well as slow payment for the extra hours worked.
The decision was made after an investigation by the firm that included discussions with the factory’s owners, managers and workers. About 200 to 300 of the several thousand employees at the factory worked on lines that produced underwear and T-shirts, as well as other products, for the company.
Hanesbrands said it verified that all employees received the compensation due to them before pulling its business.
In October, the National Labor Committee issued a report that accused the factory of beatings and employing underage workers, though Hanesbrands said its investigations found no child labor. At that time, Wal-Mart said it had found excessive overtime and unpaid benefits at the factory. There also were media reports in the U.K. about abuses at the facility.
This caused Hanesbrands to take a closer look. The company found while the average work day went from 8 a.m. to 7 p.m. with a lunch break, some were working until as late as 2 a.m.
“We had audits that did not catch some of the excessive working hours, did not catch some of the double books,” said a Hanesbrands spokesman, referring to the fake logs of workers’ hours shown to auditors. “Our first clue to the double books issue was making a midnight visit to the plant and finding about 50 employees who were still working.”
Hanesbrands will be beefing up its monitoring program and will do independent audits to double-check the work of third parties.
“A lot of the very inadequate or even horrifyingly ineffective corporate monitoring has been revealed,” said Charles Kernaghan, director of the NLC. “Hanes really did do a thorough investigation. It’s enormously significant that they do come out now and confirm these serious violations.”
Kernaghan said he asked Hanesbrands not to pull out of the factory but said the move might help put pressure on management and other brands that use the facility to take a closer look at labor practices. He also maintained that Harvest Rich uses child labor, but that the children and their families have been pressured to lie about their ages since the issue surfaced in October.
This story first appeared in the December 7, 2006 issue of WWD. Subscribe Today.