More than 1,000 garment workers who were sacked after their lingerie factory closed down last year will receive a total of US$8.3 million (about 282 million baht) in compensation.
"This is a huge victory for the workers and a testament to the courage of their union and the strength of the international solidarity campaign that supported them," said David Welsh, Thailand country director of the Solidarity Center, a US-based workers rights' advocacy group.
A total of 1,250 workers employed by Brilliant Alliance Thai Global factory, which produced lingerie for Victoria's Secret, were told to leave in March last year without being given legally-mandated severance pay.
The workers lost their job after their factory in Samut Prakan's Bang Sao Thong district went bankrupt that month.
The government ordered the factory owner, Hong Kong-based Clover Group, to pay the workers within 30 days, but the group refused, telling the sacked workers that it had no money and they should agree to wait 10 years to be paid in full.
With the Solidarity Center's support and advocacy, the Triumph International Union launched a campaign demanding their severance pay.
The Worker Rights Consortium (WRC) and Solidarity Center engaged Victoria's Secret and Sycamore, the parent company of Lane Bryant and Torrid, pressing them to ensure the workers were paid.
"This was the largest theft -- and now the most back pay -- we've ever seen at an individual garment factory," Scott Nova, Executive Director of the WRC, noting the incident took place amid the Covid-19 pandemic.
The $8.3 million settlement, financed by Victoria's Secret in a loan agreement with the owner of the Brilliant Alliance Thai Global factory, could set a precedent for global brands to better protect the rights of workers, said Mr Nova.
"The severance these workers earned was effectively their life's savings," Mr Nova said, adding the money was stolen from them when they were fired and now restored.
"Victoria's Secret should be proud of what it has done here," he noted. "The people who run Sycamore Partners should hang their heads in shame."
It was initially unclear how much of the settlement Victoria's Secret would cover.
In an emailed statement to Reuters, the company said the factory's owner was not "in a position to conclude this matter on their own".
Emily Lau, an executive of Clover and a board member of the bankrupt factory, said on Friday that the payment will be made with "the personal resources of owners, Angie and Emily Lau" but did not mention the loan from Victoria's Secret.
