Boohoo's Leicester suppliers underpaid workers, wiping £1bn from its value

In July 2020, The Sunday Times reported that garment factories in Leicester supplying fast-fashion retailer Boohoo were paying workers below the UK minimum wage and operating in unsafe conditions during the pandemic. Boohoo's share price fell by about 42% within days, wiping more than £1 billion off its market value.

Boohoo commissioned an independent review by Alison Levitt QC, published in September 2020. The review concluded that the allegations were substantially true, that poor conditions and underpayment were endemic across Boohoo's Leicester supply chain, and that senior directors knew of serious issues by December 2019 but moved too slowly. It cleared Boohoo of modern slavery crimes but found its monitoring inadequate because of weak corporate governance.

The company cut more than 400 suppliers, added independent directors, created a supply-chain compliance committee, and pledged to publish its supplier list. The scandal became a widely cited example of fast-fashion supply-chain failure and the limits of self-regulation.