92% of Newcastle Clothing Factories Violate Labor Laws, Court Case Reveals
By Nexio News | June 10, 2024
Sweatshop Scandal Rocks South Africa’s Clothing Industry
A shocking affidavit filed in South Africa’s High Court has exposed rampant labor violations in the country’s clothing manufacturing sector. Chantal Naidoo, Secretary General of the National Bargaining Council for the Clothing Manufacturing Industry, accused Drake Clothing of running sweatshops, underpaying workers, and violating wage laws. The case, filed on February 6, seeks the company’s liquidation—a move legal experts call “ambitious.”
The fallout has rippled through the industry, implicating major retailers like Mr Price, Pep, and The Foschini Group, which allegedly sourced garments from Drake’s suppliers. Meanwhile, separate investigations in Newcastle, KwaZulu-Natal’s garment hub, found workers earning R8 per hour in deplorable conditions—well below the legal minimum wage.
Factories Operate Under the Radar
According to Richard Erasmus, the Bargaining Council’s lawyer, 92% of Newcastle’s 300 clothing factories lack compliance certificates. Inspectors during a parliamentary oversight visit uncovered:
- Workers living on-site in unsafe conditions
- Unregistered equipment
- Violations of labor and insurance laws
At least two factory owners were arrested, while Qing Xiu Clothing was immediately shut down. Labor Minister Nomakhosazana Meth also announced R6 million in claims against six textile firms for unpaid worker benefits.
Retailers Under Fire
Patriotic Alliance MP Juliet Basson posted a viral video inside a Chinese-owned factory, revealing Pick n Pay and Jet-branded clothes being made by underpaid workers. Retailers distanced themselves, with Pepkor blacklisting one factory and Pick n Pay cutting ties with an unapproved supplier.
Yet anonymous sources within retail admit most factories in Newcastle operate non-compliantly due to demand for cheap production. “Retailers don’t care where clothes come from, as long as they’re affordable,” said Ferdie Alberts, a former Newcastle economic development director.
Why Newcastle?
Newcastle became a garment hub after post-1997 Chinese investment, fueled by South Africa’s diplomatic ties with China. Low start-up costs led to explosive growth, with factories rising from 20 in the early 2000s to over 200 by 2021—though numbers are now declining due to crackdowns.
Alex Liu, a local factory owner, says rising costs and cutthroat competition force wage suppression. Some factory owners now flee to Eswatini and Lesotho, where wages are lower and imports face no tariffs.
What’s Next?
The Bargaining Council has filed another case against Gemelli (PTY) Ltd, alleging deliberate labor law violations. Yet without systemic change, experts warn the cycle will continue.
“It’s not just about sweatshops,” says Alberts. “It’s about an industry built on exploitation—and who profits.”
— Reported by Nexio News
