Tesco is being hit with a landmark lawsuit in the UK from workers at a Thai factory that produced F&F clothing for the retailer, over alleged labour exploitation claims.
Employees at the VK Garment Factory in Mae Sot, Thailand, are suing the supermarket for alleged negligence and unjust enrichment.
The 130 Burmese workers have reported being trapped in “effective forced labour”, according to their representative law firm Leigh Day, including working 99-hour weeks for illegally low pay under alleged dire conditions.
They made F&F clothes for the Thai branch of Tesco’s fashion business from 2017 to 2020.
Allegations of unlawful working conditions at the VGK factory, which is based near the Myanmar border and relies on Burmese migrants for its labour force, were first reported by The Guardian.
Employees described working 13-hour days while being paid as little as £3 a day, with just one day off a month – well below Thai minimum wage laws at the time of £7 a day for an eight-hour shift, the newspaper reported.
They also claimed having to work 24-hour shifts at least once a month to fulfil large F&F orders. Some reported serious injuries, physical and verbal assault, and debt bondage.
One of the lawsuit’s claimants is a young girl claiming to have been raped in insecure accommodation at a factory while her mother worked a late-night shift sewing jeans for the fashion brand.
The lawsuit is also being brought against Tesco’s Thai branch of the business: at the time Ek-Chai Distribution System Company Limited, and auditing companies Intertek Group and Intertek Testing Services (Thailand) Limited.
Tesco sold its businesses in Thailand and Malaysia in 2020 for $10.6bn and was reportedly not involved in the day-to-day running of the factory.
But the lawsuit argues that the British retailer should have known this particular area in Thailand was notorious for labour exploitation and should have conducted a more thorough audit of the local supply chain.
Leigh Day’s suit is accusing Tesco of negligence “for permitting, facilitating and/or failing to prevent the unlawful working and housing conditions which caused the workers injuries and losses”, as well as of being “unjustly enriched” at the expense of the workers as sales from the Thai business went into the company’s UK profits.
Auditing firm Intertek is being accused of negligence “for failing to identify and/or report the unlawful working and housing conditions, causing injury to the workers”.
A Tesco spokesperson said: “The allegations highlighted in this report are incredibly serious, and had we identified issues like this at the time they took place, we would have ended our relationship with this supplier immediately.
“Any risk of human rights abuses is completely unacceptable, but on the very rare occasions where they are identified, we take great care to ensure they are dealt with appropriately, and that workers have their human rights and freedoms respected.”
The law firm representing the Burmese workers has said that if Tesco and Intertek failed to settle the claim, it would consider taking the case to the High Court.
Anna Fletcher, employment director at law firm Gowling WLG, said: “The news of litigation against Tesco is a salient reminder of the importance of auditing within the international supply chain.
“It’s not enough to accept labour practices are what they should be or what the end user is being told they are.
“The audit process needs be thorough in every respect, responses considered with a level of scepticism and above all rigorous to ensure that poor working practices, low pay and exploitation are rooted out.”
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