Missguided has been a member of ETI since 2017 and has worked with them to develop standards in their supply chain to improve respect for human rights in the workplace.

In a blog post, ETI said it was made aware of Missguided’s business difficulties over the past year and its subsequent fall into the hands of administrators.

“We understand that this is the result of considerable debts to suppliers. Debts of this nature put garment workers, who already live on low wages, at increased risk of unpaid work,” the blog states. “We have contacted the company without success and will be suspending their ETI membership. The decision to terminate an ETI member rests with the ETI Board of Directors which meets in June.

“Unfortunately, this case raises well-known issues, namely that risks and costs within the fashion industry are too often passed on to suppliers, with long payment terms and unfair purchasing practices that ultimately cost workers dearly. When a brand goes into receivership, suppliers usually have little or no chance of payment, and certainly not their full value. This results in significant financial losses, wages unpaid bills for workers and often job loss.This is not a fair share of the risks of doing business.

Online pureplay was acquired last week by Frasers Group, owners of Sports Direct.

ETI says it recommends any responsible business acquire an out-of-government business:

• Adheres to international labor standards, such as those embodied in the ETI Base Code, and strives to ensure unrestricted access to human and labor rights. Acts in accordance with the United Nations Guiding Principles on Business and Human Rights (UNGP).
• Engages with suppliers to ensure they are paid for work performed, enabling workers to be paid for past work.
• Ensures that future operations avoid payables to suppliers and establishes measures to mitigate any existing debt and address its negative impacts on workers to date.
• Works with suppliers to ensure that business practices and working conditions meet international labor standards and/or ETI Base Code requirements.
• Collaborates with trade unions and/or workers’ representatives when they are present and makes joint decisions whenever possible.
• Conduct enhanced human rights due diligence, in accordance with the UNGPs, to assess immediate adverse human rights impacts on workers and place their safety, well-being and needs at the heart of the business decision making.
• Collaborates with local and international NGOs working on identified issues within the acquired supply chain, to improve outcomes for workers in the future.

Frasers Group and Missguided did not return Just Style’s request for comment.