The US$8.3 million compensation settlement by American lingerie giant Victoria's Secret for 1,388 Thai workers who were fired in 2021 without their legally mandated severance has been a landmark victory in the campaign against wage theft.
This was the largest wage theft reportedly seen at an individual garment factory, and the US$8.3 million provided by Victoria’s Secret is also the most any brand has ever contributed to help resolve a wage theft case.
The backdrop to this case was typical of the hundreds of wage theft cases that have been documented since the start of the COVID-19 pandemic. In this instance, 1,388 workers were fired without notice in March 2021 at the Brilliant Alliance Thai Global (BAT) factory, which supplied lingerie brands Victoria’s Secret, Torrid and Lane Bryant, suddenly closed shop, using the pandemic and a lack of orders as ostensible reasons.
The Thai labour inspector ordered the company to pay THB 242million (US$7.4 million) for violating the country’s labour laws. Hong Kong-based Clover Group International, which owns Brilliant Alliance, offered to pay workers in instalments over a 10-year period. When this was rejected by the Triumph International Thailand Labour Union (TITLU), the company went into liquidation.
As pressure mounted on both Clover and Victoria's Secret, the latter finally gave in and agreed to pay off the entire amount. Technically, Clover agreed to pay the workers and Victoria’s Secret committed to finance the payments, via a loan to Clover. Sycamore Partners, the parent company of Lane Bryant and Torrid, did not contribute to the compensation package. David Welsh, Thailand country director of the Solidarity Center summed up best: “Victoria’s Secret should be very proud of what it has done here. The people who run Sycamore Partners should hang their heads in shame.”
“Our organisation has documented hundreds of cases of wage theft in the apparel supply chain,” said Scott Nova, Executive Director of the Worker Rights Consortium (WRC). “This was the largest theft—and now the most back pay—we’ve ever seen at an individual garment factory. The $8.3 million provided by Victoria’s Secret is also the most any brand has ever contributed to help resolve a wage theft case.”