Oliver Holland, a solicitor at the law firm Leigh Day, sees no small amount of irony in Tesco’s support for mandatory human rights due diligence in the United Kingdom, with Britain’s largest supermarket operator having gone so far as to sign a joint letter last month lobbying the government for legislation to hold corporations accountable for labor exploitation in their supply chains.
Holland is, after all, representing 130 former Burmese migrant workers and one child in a landmark international human rights lawsuit brought in the U.K. High Court against Tesco and auditing firm Intertek Group.
Between 2017 and 2020, the adult claimants worked at V.K. Garment in Mae Sot, Thailand, where they cut, sewed and packaged jeans and jackets for the grocery giant’s F&F clothing line, intended for the domestic Thai market. It was there that they found themselves trapped in what they described as a “cycle of forced labor and debt bondage,” including grueling hours, poverty wages and hazardous conditions that “unjustly enriched” the defendants.
“When I was living in the compound, they deducted fees for my accommodation, rent, social security and passport/work permit renewal,” one worker said. “I had to borrow money for daily living costs, such as house rent, especially when our wages were late, from vendors and colleagues. I was always in debt—it was 20,000 [baht] ($598) in debt, plus the interest rate. My mental health worsened due to my worries about the wages and debt.”
The child claimant, then seven years old, was raped by a factory employee in 2018, according to the complaint, after she was left alone in “unsafe and unsecure” dormitories because her mother, another factory employee, had to work overtime and could not leave. Another worker accidentally sliced his arm while moving a heavy interlocker machine, requiring 13 stitches. Still another had to be hospitalized and rehydrated by drip. A third worker sliced the tip of his finger on a button machine while making F&F jackets.
Workers also said that the pressure to fulfill large F&F orders was so “intense” that they had to toil 99 hours a week, from sunrise to 11 p.m., without breaks to eat, drink or use the bathroom.
“I was employed as a quality controller,” a worker said. “I worked seven days a week. We had to check 100 to 150 shirts per day. Sometimes, we had to check 500 shirts per day if the orders were large. They would force us to work overnight to achieve these targets. During those times, we finished at 5 a.m. and then came back at 12 p.m. to carry on working. We did not get a lunch break; we had one spoon of rice and continued working.”
A resolution has been slow in coming. Although proceedings were first issued in 2022, serving them in Thailand proved more difficult than expected, requiring maneuvering through diplomatic channels. Tesco and Intertek’s audits at the factory, the complaint said, failed to identify, report or adequately remediate the “unlawful activities” that harmed workers both on the production floor and in their housing.
Tesco said it did not learn of the labor abuses until after it sold its Thai subsidiary, Ek-Chai Distribution System Company Limited, in 2020 and that it would have ended its relationship with V.K. Garment immediately had it been made aware. The retailer also argued that it does not manage or operate the day-to-day operations of third-party supplier facilities such as V.K. Garment. Neither was it bound by Thai law or its corporate structure to protect workers or prevent the alleged negligence.
“Protecting the rights of everyone working in our supply chain is crucial to how we operate,” a spokesperson said. “We have robust auditing processes in place across our entire supply chain and the communities where we operate, to ensure our stringent human rights standards are upheld. Any human rights abuses are completely unacceptable, and on the very rare occasions where they are identified, we take great care to ensure they are dealt with appropriately and that workers’ human rights and freedoms are respected.”
A report published this week by the Worker Rights Consortium, however, contends that Tesco and Intertek Group were not only aware of the punishing conditions but also actively thwarted the Burmese workers’ efforts to obtain legal remedies in the Thai court system.
The Washington, D.C.-based labor group said Tesco’s first audit of the factory, conducted by the retailer’s staff in 2017, revealed violations of its supplier labor standards, including withheld worker passports and missing work permits. And although Tesco’s Responsible Sourcing Manual designates such violations as “business critical,” the company proceeded with production at V.K. Garment and advised the supplier to contract with Intertek Group to conduct the Sedex Members Ethical Trade Audit inspections Tesco required, despite prior controversies involving document falsification. Intertek Group did not respond to a request for comment.
The WRC also said that Tesco and Intertek Group failed to disclose evidence of forced labor at V.K. Garment, enabling the auditing firm to give the factory a SMETA report to share with other buyers that omitted “this damning information.” While the SMETA report flagged “non-compliances” related to wages, benefits and working hours, it “downplayed these” as issues with the factory’s recordkeeping, the WRC said.
The report also omitted auditors’ suspicions that managers had coached workers ahead of time to give false testimony. A confidential report for Tesco, by contrast, disclosed evidence that V.K. Garment fabricated pay slips and did not guarantee payment of the legal minimum wage, according to the WRC. When the 130 workers trusted Intertek auditors enough to report the severe abuses in 2020, factory management immediately moved to fire them. Tesco, the WRC said, failed to protect the workers from retaliation despite a public commitment to uphold freedom of association. Instead, the supermarket chain dropped the supplier.
When workers filed a complaint with the Thai Department of Labor Protection and Welfare seeking a minimum of 1.7 million pounds ($2.3 million) in unpaid wages and benefits, the WRC said, Tesco and Intertek undermined their grievances by submitting “misleading and biased” audit summaries that characterized the workers’ testimonies as “unreliable,” leading authorities to dismiss the bulk of their claims and award them only a fraction of the compensation. Tesco did not directly address the WRC’s allegations.
“Retailers like Tesco tell shoppers that they are protecting the rights of the workers who make their apparel,” said Scott Nova, the WRC’s executive director. “Our report shows that Tesco made a mockery of this pledge in Thailand by not only failing to protect workers who reported egregious harms but then withholding information the workers needed to secure recompense.”
Nova said the workers’ lawsuit against Tesco in the United Kingdom is likely their “last hope” of achieving some measure of justice for the abuses they said they suffered while making clothes for the company. And, if nothing else, the case is another indictment of the flawed nature of current social compliance auditing systems.
“Tesco should not compound its due diligence failures in this case by forcing these workers to endure years of litigation in a far-away court, simply to receive wages they should have been paid in the first place for working under such appalling conditions,” he said.
Holland sees a contradiction in Tesco’s public position. Going by the letter Tesco signed, he said, the company believes there should be proper human rights due diligence and, equally important, remediation. “Yet, when faced with a case against them on behalf of people who’ve suffered within its supply chain, it’s not remediating,” he added.
Later this month, a four-day court hearing will begin in London, not to determine the merits of the case but to decide whether there is a sufficient link to the United Kingdom for it to proceed there. Another of Tesco’s arguments is that the legal claims brought against it by the migrant workers do not contain any arguable claims under English law and should not be brought or heard in English courts.
Even with V.K. Garment facing criminal charges in Thailand for fraud, withholding immigration documents and forced overtime, Holland said Tesco’s culpability in the matter is clear.
“This was a Tier 1 approved supplier that was taken on even though Tesco identified serious risks at the factory through its own auditing process,” he said. “Despite that, Tesco continued to obtain products from it. So we say that means Tesco bears ultimate responsibility.”
