In a landmark settlement honoring labor rights, global lingerie brand Victoria's Secret paid $8.3 million to compensate over 1200 sacked Thai garment workers who made bras at a factory.
Brilliant Alliance Thai closed down its Samut Prakan factory in March 2021 after going bankrupt. But the 1250 laid-off workers – many of whom had worked at the factory for over a decade – did not receive severance payouts mandated under the Thai law.
The factory also produced underwear for plus-size American brands Lane Bryant and Torrid, owned by Sycamore Partners –- but only Victoria's Secret contributed to the settlement via a loan arrangement with the factory's owners.
Victoria's Secret confirmed in a statement that an agreement had been reached, but did not mention the amount involved.
"Over several months we had been in active communication with the factory owners to facilitate a resolution," the company said.
"We regret they were not ultimately in a position to conclude this matter on their own so to ensure the workers received their full severance amounts owed, Victoria's Secret agreed to advance the severance funds to the factory owners," it added.
Former worker Jitnawatcharee Panad had clocked up 25 years at the factory and said over a third of the sacked workers were women aged 45 and older.
"If we hadn't fought for fair compensation, we wouldn't have received anything," Jitnawatcharee, who is also president of Triumph International Workers' Union of Thailand, told Agence France-Presse (AFP).
"The doors of the Labor Ministry were locked when we went there to seek help and the minister didn't seem to want to listen to our problem."
The agreement is the largest-ever wage theft settlement at an individual garment factory, the international workers rights group Solidarity Centre said.
"I think it's extremely unprecedented and represents a new model – the scale of severance and interest paid on it ... as well as direct engagement by the brand," Solidarity Center Thailand country director David Welsh told the AFP.
For the past year, sacked workers and Thai union representatives have protested outside the Government House in Bangkok, calling for their pay.
Confederation of Industrial Labour of Thailand president Prasit Prasopsuk said some protesting workers had been charged with criminal offenses, including violating public gathering rules during the pandemic. "This case serves as a lesson in the future for the government ... to ensure that foreign companies doing business in Thailand allocate some portion of the monthly profit for fair compensation when these companies cease domestic operations," he said.
A Worker Rights Consortium report from April last year said it had documented similar wage theft cases at 31 garment factories in nine countries. The group's executive director Scott Nova said those cases were just the "tip of the iceberg" and that the issue of wage theft in the garment industry had exploded during the pandemic as clothing orders declined.
He estimated garment workers worldwide were owed $500 million as a result of factory closures and unpaid severance.
Some workers at the Samut Prakan factory had received the equivalent of more than four years' wages last week, he said.
"It's like the equivalent of a worker's life savings ... and it's simply stolen. What it means to lose that and get it back is difficult to capture in words," Nova added.
