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WRC Factory Investigation

Shahi Exports Pvt. Ltd.

Factory: Shahi Exports Pvt. Ltd.

Key Buyers: Columbia Sportswear

Year: 2018

Case Summary

An investigation by the WRC found that the management of Shahi Exports Pvt. Ltd.’s (Shahi) Unit 8 factory (Bangalore, India) carried out a campaign of vicious repression and retaliation against workers’ exercise of fundamental labor rights. This retaliation occurred in response to workers organizing with the Karnataka Garment Workers Union (KOOGU) and petitioning for better working conditions. The factory makes university logo apparel for Columbia Sportswear and apparel for Benetton, H&M, and Abercrombie & Fitch.

Shahi is India’s largest garment manufacturer and is owned by the Ahuja family. In early 2018, the company successfully lobbied the government of the state of Karnataka to cancel a scheduled increased in the minimum wage for workers in the garment industry. The WRC’s investigation of the factory, conducted in late April and early 2018, involved interviews with over 30 Shahi workers. The WRC found Shahi to be in violation of Indian law, international labor standards, and university and brand codes of conduct. These violations included physical beatings, death threats, gender, caste, and religion-based abuse, and threats of mass termination; and the expulsion from the factory of 15 worker activists.

The WRC shared findings and recommendations with Shahi, Columbia Sportswear, and other brands and pressed for action, including the reinstatement of the fired leaders, the dismissal of managers directly implicated in acts of violence, and immediate recognition of the union. Shahi initially agreed to reinstate the Unit 8 workers, but did not agree to take the basic steps necessary to ensure that workers are able to return safely to the factory to ensure their fundamental right of freedom of association. In light of Shahi’s failure to produce meaningful corrective action, the WRC made their investigation public, securing substantial media coverage to put pressure on Shahi and the brands, while bringing university pressure to bear to motivate the collegiate licensee, Columbia.

Under pressure from the publication of the WRC’s report, Shahi met on June 25 with the workers’ union and signed a memorandum of understanding (MOU), the key elements of which were implemented successfully by the end of June. The 15 workers who had been brutally beaten, subjected to death threats, and were suspended from the Shahi Unit 8 factory, returned to their jobs at the factory, without incident or harassment, and received their back wages. The workers’ return was observed inside the factory by representatives of the WRC and buyers. Shahi also recognized the union, agreed to regular negotiations, and proceeded to terminate most of the managers and supervisors responsible for the violence.

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