The WRC is pleased to report that Lucky Brand has made a humanitarian contribution of $500,000 to assist garment workers at the Industrial Hana factory in Guatemala, which was, prior to its closure, a subcontractor for one of Lucky Brand’s direct apparel suppliers. As the WRC has previously reported, the Industrial Hana factory closed in October 2023, without paying approximately $1.5 million in legally due severance to its 246 former employees.
Prior to obtaining Lucky Brand’s commitment of funds to assist the Guatemalan workers, the WRC secured and distributed contributions to the factory’s former employees totaling $1,000,000, from two other brands whose apparel was also made at the factory, American Eagle Outfitters (AEO) and Puma. The impact on workers of the factory’s failure to pay their legally due severance, and the facility’s subcontracted production for Lucky Brand—which is now part of Catalyst Brands, a company whose owners include Authentic Brands Group and Shein—were also reported by the US NGO Partners for Dignity & Rights on multiple episodes of the podcast, Art of Citizenry.
The funds contributed by Lucky Brand will be distributed to the Industrial Hana workers next month. Workers have reported to the WRC that they will use these much-needed funds to pay off debts they have accumulated since the factory’s closure because they were not paid their severance. They will also use the funds for medical care they’ve been deferring and pending school fees for their children. Some of the workers also said they intend to use the funds to start small businesses.
One worker told the WRC: “The money we’re receiving that we were owed for our years working at Industrial Hana will help pay my son’s school fees. I also will be able to buy him a school uniform and supplies for his classes. And now I can also pay for medicine for my mother, for whom I’m the sole caregiver and source of support. I am so thankful that we will receive this money that we are owed.”
There is increasing recognition on the part of major apparel brands of their responsibility to ensure workers who made their products are paid legally due severance when supplier factories close. However, the closure of Industrial Hana presented a particular challenge given that the factory had operated primarily as a subcontractor to other factories in Guatemala, that were Tier One (i.e., direct) suppliers to major brands like Lucky Brand, Puma, and AEO. None of these brands had a direct business relationship with Industrial Hana and, in some cases, production of their apparel may have been subcontracted to the factory without the brands’ knowledge. Despite this, and to their credit, all three brands ultimately contributed the funds needed to ensure that the workers of this subcontracted factory will receive the full legally due severance they had earned making these brands’ apparel.

