Shein says it found two cases of child labor in its supply chain last year

Shein, the massively popular bargain bin retailer selling clothes, accessories, and home goods, said it uncovered two cases of child labor between Q1 and Q3 of 2023.

In its most recent sustainability report released last week, Shein said the discoveries were made through the company's audits of suppliers working with the brand. Shein says it defines children as anyone under the age of 15; in China, it's illegal to employ children under 16. Shein didn't specify which factories were employing children or how many were discovered.

"Upon discovering these violations, SHEIN suspended orders from the contract manufacturers and undertook investigations," the company writes. Under the policy at the time, manufacturers were given 30 days to resolve the violation by "terminating contracts with underage employees, ensuring the payment of any outstanding wages, arranging medical checkups and facilitating repatriation to parents/legal guardians as needed." As of October 2023, Shein says it's enforced stricter rules around contractors who were discovered to be using child labor - now, those suppliers will be immediately terminated by Shein.

The company says it did not find any cases of child labor in Q4 of 2023.

Shein's dispersed supply chain means that the products for sale on its website aren't all made under one roof or by one company: the brand works with a network of manufacturers, making it harder to keep track of working conditions and potential labor violations. The company also operates a marketplace, hawking products from third-party sellers.

The cheap and fast products sold by Shein (and competitors like Temu) exist alongside an ugly truth: workers making the items are taken advantage of. In 2022, Shein said it would spend $15 million to revamp factories and increase audits after an investigation found that some workers were subject to illegally long working hours. But follow-up reporting found little has changed: a report by human rights advocacy group Public Eye earlier this year found that some China-based workers said they worked 75 hours a week. One worker told the group that they work 8AM to 10:30PM and can only afford to take one day off a month.

Shein exists largely online, where influencers post haul videos to promote the brand, raving about its "affordability." As the company has strengthened its foothold in the US, it has tried to shed some of its negative public image by recruiting influencers to tour factories in China and hosting in-person popup events open to the public. But the Amazon competitor has struggled to fend off sustained scrutiny on its business practices. Some experts say Shein's plans to go public in the US this year are growing more and more unlikely. The company more recently has filed to go public in London, according to The Wall Street Journal. The company was valued at $66 billion last year.