ZYZ Apparel

• In January 2024, it was reported that a worker at ZYZ Apparel factory was fired after arriving late to work, and faced a reduction in his owed wages.

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● In May 2024, it was reported that workers at ZYZ Apparel are facing a series of violations, including mandatory overtime without pay, denial of social security benefits, denial of leave, verbal abuse and unfair dismissal.

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Hengrun Myanmar

● In April 2024, it was reported that workers at Hengrun Myanmar are facing a series of violations, including one third of workers being hired as day labourers, who are denied permanent employment contracts and are denied benefits incl. medical leave, wage cuts if workers take leave, excessive production targets, workers being charged for medicine and cleaning equipment, verbal abuse for not finishing targets, workers dismissed if managers don't like them, and workers not having enough time to go to the toilet during the work day.

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Next Response 17.09.24:

ZYZ Apparel:

...The factory named in your correspondence is an active factory for Next and has had regular unannounced audits every 8 weeks by our Code of Practice team.

In relation to the worker who was dismissed in January 2024, we were initially alerted to this case through our relationship with SMART Myanmar. We immediately initiated an investigation with our contracted supplier and subsequently provided a full report to our contact at SMART Myanmar. Our understanding was that the worker in question had received 3 warning letters in relation to performance concerns which then resulted in dismissal in accordance with the factory’s internal procedures and local law.

Regarding the May 2024 allegations at ZYZ of mandatory overtime without pay, denial of social security benefits, denial of leave, verbal abuse and unfair dismissal, our local team has audited this factory on an unannounced basis 5 times since January 2024 and we have not identified the issues highlighted. This has been verified through a review of relevant documentation and conversations with workers at the factory. If BHRRC has any further specific details to share, we would be happy to carry out further investigation.

Hengrun Myanmar:

...The factory named in your correspondence is an active site for Next and has regular unannounced audits every 8 weeks by our Code of Practice team.

Our local team has audited this factory on an unannounced basis 5 times since January 2024. During the most recent audit carried out on 12th September 2024, only 4% of the total workforce are temporary. We have checked documentation for temporary workers and can confirm that all relevant benefits, including social security, have been paid in line with local legislative requirements. In addition, we found no evidence and received no reports from workers of verbal abuse taking place at Hengrun. We acknowledge that the industry in Myanmar is currently in its peak production period which can lead to the recruitment of a temporary workforce in order to meet production needs. Our team monitors such recruitment processes closely to ensure that the Next standards are met.

Worker engagement conversations form part of the audit process and the workers at Hengrun have confirmed to our team that no fees were charged for medicines and/or cleaning equipment. We have seen evidence that the factory paid for these items and not the workers. Should BHRRC have any evidence to the contrary, we would be happy to investigate further.

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[The full response is attached]