Shein said it identified two cases of child labor in its supply chain last year

Shein, the hugely popular bargain retailer of clothing, accessories and home goods, said it uncovered two cases of child labor between the first and third quarters of 2023.

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

“After discovering these violations, SHEIN suspended the contract manufacturers' orders and launched investigations,” the company writes. According to the policy at the time, manufacturers had 30 days to remedy the violation by “terminating contracts with underage employees, ensuring payment of all outstanding wages, arranging medical examinations, and facilitating repatriation to parents/guardians if necessary.” From October 2023, Shein says, stricter rules will apply to contractors found to be using child labor – now these suppliers will be terminated by Shein immediately.

The company says it did not identify any cases of child labor in the fourth quarter of 2023.

Shein's scattered supply chain means that the products for sale on the site are not all made under one roof or by a single company: The brand works with a network of manufacturers, making it harder to keep an eye on working conditions and potential labor rights violations. The company also operates a marketplace that offers products from third-party sellers.

The cheap and fast products that Shein (and competitors like Temu) sell sit alongside an ugly truth: the workers who make those products are being exploited. In 2022, Shein announced it would invest $15 million in upgrading factories and increasing audits after an investigation found some workers were subjected to illegally long hours. But follow-up reports showed little has changed: A report from human rights group Public Eye earlier this year found that some China-based workers reported working 75 hours a week. One worker told the group he worked from 8 a.m. to 10:30 p.m. and could only afford one day off a month.

Shein exists largely online, where influencers post haul videos to promote the brand and rave about its “affordability.” As the company strengthened its position in the U.S., it tried to shed some of its negative public image by recruiting influencers for factory tours in China and hosting in-person pop-up events open to the public. But the Amazon competitor has struggled to resist sustained scrutiny of its business practices. Some experts say Shein’s plans to go public in the U.S. this year are looking increasingly unlikely. The company has announced plans to go public in the U.S. this year, according to the Wall Street Journal. Last year the company was valued at $66 billion.