Update on Massive Minimum Wage Violation in Karnataka, India

To:WRC Affiliate Universities and Colleges
From:Scott Nova and Ben Hensler
Date:December 2, 2021
Re:Update on Massive Minimum Wage Violation in Karnataka, India

This is an update on the massive wage theft that the WRC has identified in India by factories supplying at least one significant university licensee—Columbia Sportswear—and many other leading apparel brands. As we wrote to you in mid-October, the WRC has been engaging with Columbia and these other brands to seek corrective action, and we want to update affiliate universities on the situation, including new commitments the WRC has secured from brands to direct suppliers to pay workers what they are owed. Here is the latest:

  • More than 1,000 garment factories in Bangalore and across the Indian state of Karnataka are continuing to violate minimum wage laws by refusing to pay workers a cost-of-living increase (known as the “dearness allowance”) that has been legally required since April 2020 (20 months ago).
  • More than 400,000 workers are affected, and the arrears owed to them, which grow every month that the increase goes unpaid, now total more than $50 million. This is one of the most sweeping minimum wage violations we have ever seen and has resulted in a reduction, in real terms, in workers’ already precarious incomes.
  • Almost none of the implicated brands, which includes licensees Columbia Sportswear (for collegiate apparel), adidas and American Eagle (Tailgate) (for non-collegiate), as well as top non-licensee brands like H&M, Levi’s, Target, VF, and Walmart, had taken any steps to address the violations prior to being contacted by the WRC.
  • When we wrote to you in October, we reported that Columbia had just advised us that it would direct suppliers to pay workers what they are owed, and that we expected several other major brands would follow suit.
  • We can now report that 10 other major brands have agreed to tell their suppliers to pay workers the arrears and implement the increase, including adidas, American Eagle (Tailgate), ASOS, Gap, H&M, Levi’s, Next, Primark, PVH, and VF.
  • The question now is will these brands, including Columbia, take firm action to ensure their suppliers actually pay workers what they are owed, and will other brands, which have so far failed to meaningfully address this situation at all, join them?

We will continue keep you posted on the WRC’s efforts to achieve full implementation of the lawful wage increase and back pay for all 400,000 affected workers.

Please let us know if you have any questions.