Thousands of garment workers in Bangladesh are facing an uncertain future after Australian fashion retailer Mosaic Brands defaulted on millions of dollars in payments to suppliers.
The collapse of the company has left 23 factories, including Padma Satel Arab Fashions, struggling to pay their workers and suppliers.
Padma Satel Arab Fashions, which employs 3,000 workers, has been waiting for $2.5 million in payments from Mosaic since June. The factory’s director, Jabed Ahmed, says the company has been encouraging them to continue production with promises of future payment.
“Since June, we have been continuously requesting them to pay our overdue payment, but they told us their sales were down and encouraged us to continue our shipments and they would pay soon,” said Padma Satel Arab Fashions director Jabed Ahmed.
Regarding the issue, a garment worker expressed fear that they will be unable to support their families if the factory is forced to close. She and other workers are worried about losing their jobs and being unable to afford necessities like food and medicine.
The suppliers are calling for a thorough investigation into Mosaic’s financial practices and are demanding that the company pay its debts. They argue that Mosaic’s aggressive business practices, including extended payment terms, have contributed to the current crisis.
Mosaic Brands filed for voluntary administration in October, citing financial difficulties. The company is currently undergoing a restructuring process, which could involve asset sales, liquidation, or other measures.
The future of the garment workers and suppliers remains uncertain, as the outcome of Mosaic’s restructuring process is still unknown.
