What Happens After a Brand Is Called Out for Worker Exploitation?
By Flawless Magazine
Fashion’s labor abuses are no longer just whispers behind the seams—they are broadcast in headlines, exposed in watchdog reports, and increasingly, confronted by the public. But when a major brand is accused of worker exploitation, what really happens next? Does change follow the outrage, or does it all fade after the next trend?
In 2024, non-profit watchdog Transparentem released evidence of serious labor abuses in the Taiwanese supply chains of several global fashion brands. These included forced overtime, illegal recruitment fees, withheld wages, and exploitative conditions among migrant workers. The report drew immediate attention—but the aftermath revealed stark differences in how brands respond when the veil is lifted.
From Crisis PR to Long-Term Remediation
While most brands launched internal investigations or issued public statements of concern, one company—American Eagle Outfitters (AEO)—took a rare path: long-term, worker-centered remediation. Rather than defaulting to the industry norm of terminating contracts or reshuffling supply chains, AEO leaned into the mess.
Partnering directly with Transparentem and a local NGO, AEO worked to repay recruitment fees, improve housing conditions, ensure back pay, and offer support services to affected workers. This took months—not days—and included engaging suppliers in behavioral reform rather than simply replacing them.
Why This Response Matters
“Most brands still treat supply chain risks as PR crises to manage, rather than systemic issues to solve,” says Arvind Ganesan, labor rights advocate and former director at Human Rights Watch. “AEO’s approach stood out because it prioritized the people harmed, not just the brand’s image.”
The apparel industry is notorious for subcontracting through opaque tiers of suppliers, often several steps removed from the final brand. This distance allows brands to claim plausible deniability—and absolve themselves of liability—when abuse is exposed. But that legal distance doesn’t change the ethical responsibility.
The Hidden Incentives to Walk Away
In many cases, terminating a contract with a supplier implicated in abuse does more harm than good. Workers are often left unemployed, with no recourse for stolen wages or restitution. Worse, brands move on to new suppliers with no incentive to fix the structural issues that led to exploitation in the first place.
This cycle—identify abuse, cut ties, move on—is a reputational strategy masquerading as due diligence. It’s cost-effective, clean, and widely accepted. But it rarely changes outcomes for workers.
A Model for Accountability
Transparentem’s approach advocates for “worker-centric remediation,” a model that sees workers not just as victims but as stakeholders. This means including them in the solutions: from restitution agreements to supplier reform and grievance mechanisms. It also means putting in the time, resources, and patience to undo years of systemic neglect.
The success of this model relies on brands being willing to stay, not flee. As seen with AEO, this can rebuild trust with consumers, regulators, and advocacy groups—but more importantly, it creates a rare ripple of real impact on the factory floor.
What the Industry Can Learn
If one brand can demonstrate ethical persistence, why aren’t others following? The truth is, the fashion industry is built on speed, scale, and disposability—not just of products, but of problems. Structural incentives prioritize cost control, not justice. And while ESG standards are gaining ground, many remain toothless when applied to labor rights.
However, pressure is mounting. Legislative efforts like the Fashioning Accountability and Building Real Transparency (FABRIC) Act in the U.S., and mandatory human rights due diligence laws in the EU, are making it harder for brands to look the other way.
At the same time, consumer consciousness is evolving. Gen Z and millennial shoppers are demanding more than lip service to ethics—they want receipts, literally and figuratively. Public calls for accountability are increasingly backed by data, technology, and organized activism.
A Future Rooted in Responsibility
What happens after a brand is called out should no longer be unpredictable. It should follow a clear path of transparency, repair, and reform. The industry needs a new playbook—one that rewards responsibility over evasion, and systemic change over superficial fixes.
As Transparentem’s founder Ben Skinner puts it, “The goal isn’t to shame brands into action, but to make accountability the default.”
Real progress happens when companies stay at the table after the headlines fade. When workers aren’t just protected, but empowered. When remediation isn’t a footnote—but the story.
Because true sustainability in fashion doesn’t start with fabric. It starts with people.
