A Leicester MP has openly attacked management of the Boohoo fashion chain after allegations of poor conditions in factories supplying it.
The £1.2bn turnover business, which is based in Manchester, has been at the centre of allegations over working conditions – even bringing in a QC to oversee an independent review of work practices in its supply chain.
Leicester West Labour MP Liz Kendall has launched a stinging attack against its bosses over how it has responded to the allegations.
Ms Kendall hit out at the company during a parliamentary debate over long-standing concerns about how some of the 1,000 or so textile firms in the city have been run.
She honed in on the issues that have arisen at some apparently making clothes destined for Boohoo.
She said: “I want my constituents and people across Leicester to have the highest standards of employment.
“I want them to be paid well, trained well and to work in a safe and welcoming environment.
“I want our local businesses to be the very best they can and to have the support they need to expand and thrive.”
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She said that was why she was so concerned about poor and exploitative conditions in some parts of the textile industry in Leicester.
She said Boohoo was a major part of the problem in the city.
The firm’s shareholders, she said, had failed to fulfil their responsibilities.
Ms Kendall also said the Government needed to properly resource enforcement against the companies responsible.
A spokesman for Boohoo declined to comment on the latest criticism but the business has promised to act.
The Boohoo-commissioned review by a top lawyer was published in September and Ms Kendall said its findings were ‘utterly damning’.
It found repeated allegations of unacceptable working conditions and Illegal underpayment of workers were ‘substantially true’.
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The MP said Boohoo had denied and downplayed this for years.
There were examples of sub-contractors not paying staff the minimum wage and serious health and safety violations.
Ms Kendall said employees’ rights had been ignored and neglected on a wide scale.
She read from the review findings highlighting the conclusions that Boohoo put profit and growth were prioritised in a way 'that made substantial areas of risk all but invisible at the most senior level.’
Ms Kendall highlighted that this summer when Boohoo was aware of endemic problems in its Leicester supply chain it still proposed multi-million pound bonuses to top executives.
She said an under-reported part of Alison Levitt QC’s review focused on the behaviour of chief executive John Lyttle and executive chairman and co-founder Mahmud Khamani.
Ms Levitt said Mr Lyttle, on three occasions, failed to tell her about an email highlighting serious health and safety concerns in the Leicester supply chain.
Ms Kendall said Ms Levitt found Mr Kamani had a lack of knowledge and interest in the problems in Leicester.
She said other board members had not stood up to him and allowed him to dictate company policy.
Ms Kendall added: “It beggars belief that the very people who denied and brushed aside this appalling exploitation are still in place and far from suffering any penalties, as a result of their failures, have instead given themselves a huge pay cheque.”
She said: “Boohoo is still failing to take sufficient action and fob people off with warm words.”
The MP said the company had promised to implement the findings of the review but had declined to send her its documents about its emergency plans in the event of a second national lockdown.
She also said she had written to all of the company’s major shareholders to ask what action they had taken as a result of the scandal.
She said the people who had turned a blind eye to problems over many years were not the right people to take the company forward and added: “To be clear the executive chairman and chief executive officer should be removed.”
Ms Kendall said the response to her letter had been disappointing and with one exception, none had changed any of their investment decisions making a mockery, she said, of their claims to champion responsible investment.
Only Standard Life Aberdeen, she said, has sold all its Boohoo shares explaining it had been concerned about the direction of the firm.
Ms Kendall went on to say that over a decade agencies such as the Health and Safety Executive, which carries out factory inspections, and HMRC, which is responsible for making sure firms pay minimum wage, had suffered considerable budget cuts.
She said union representation should be increased in the industry because “too many people are too scared to speak out about what is happening.”
Business, Energy and Industrial Strategy Minister Paul Scully said: “We are committed to ensuring that workers receive their employment rights, and that employers act responsibly.
“It is important to realise that some workers are particularly vulnerable. That is where our enforcement bodies have a role.
“The allegations of abuse in textiles manufacturing in Leicester that are the subject of today’s debate are not new.”
He added: “In response to the most recent allegations, as we have heard, a multi-agency taskforce led by the Gangmasters and Labour Abuse Authority has been set up in Leicester.
“It works closely with Leicester City Council. Partners include HMRC, the Employment Agency Standards Inspectorate, Leicestershire Police, the National Crime Agency, Leicestershire City Council and the Department for Work and Pensions."