- The National Bargaining Council for the Clothing Manufacturing Industry is seeking to liquidate Drake Clothing, alleging it contracts with unregistered sweatshops.
- Drake Clothing, which supplies Pep, Mr Price and Foschini, has accused the council of making “unsubstantiated, highly defamatory allegations”.
- Managing director Roger Drake says the company cannot be held responsible for independent manufacturers’ internal employment practices.
- Drake also says liquidation would not address any alleged workplace violations, and the council should use its enforcement powers over the manufacturers.
Drake Clothing, a supplier to major retailers, has accused the National Bargaining Council for the Clothing Manufacturing Industry of acting in bad faith after the council accused it of contracting with unregistered manufacturing sweatshops.
Last month, the council filed an application in the Pietermaritzburg High Court seeking the liquidation of Drake Clothing, which supplies retailers including Pep, Mr Price and Foschini.
“The application makes unsubstantiated, highly defamatory allegations based on inadmissible hearsay evidence and unfounded speculation,” stated Drake’s managing director, Roger Drake.
In its application, the council alleged that the company contracts with “sham co-operatives” where labour laws are flouted, and employees are subjected to appalling working conditions to maximise profits.
In an opposing affidavit, Roger Drake said his company cannot be held responsible for the internal employment practices of “independent manufacturers”. Of the 11 manufacturers identified in the council’s papers, Drake only had a contractual relationship with one of them when the application was launched.
He also questioned why the bargaining council was targeting Drake, “despite the industry operating through a number of design houses, using similar production models”.
Drake said cut, make and trim (CMT) manufacturers, which his company contracted, signed annual declarations confirming compliance with labour laws and also submitted to audits. Where the CMT manufacturers outsourced to “co-operatives”, they were also required to confirm that these subcontractors complied with the law.
He maintained, however, that these manufacturers were independent contractors over whom Drake had no operational control.
According to Drake, the bargaining council has enforcement powers over the manufacturers alleged to be non-compliant, and liquidation of Drake would not address any of the alleged workplace violations.
Drake described the language in the council’s application as “emotive” and said it was intended to embarrass and exert pressure on the retailers that sourced from the company.
He said the retailers had been cited in the court papers with an “ulterior purpose” – to put pressure on them by exposing them to reputational harm.
By contrast, he noted, the CMT manufacturers and co-operatives named in the papers had not been joined to the application, despite their names being “dragged through the mud”.
“Drake has lost some orders as a result of this litigation and will, in due course, be seeking damages against those responsible. Unfairly and falsely targeting the [company] appears key to the campaign,” he said.
Drake questioned why the bargaining council had not instead enforced compliance orders against the manufacturers and co-operatives it alleged were in breach of the law.
He denied that the company had relationships with most of the manufacturers the council had identified.
He said the presence of Drake-branded boxes found during inspections at certain premises was due to recycling.
“Our boxes, like those of other design houses, tend to be re-used and redistributed among CMT operators. I personally went to take a photograph at a premises where we have never had any dealings. Amongst the piles of boxes stored for re-use were a whole pile of second hand boxes from various design houses,” Drake said.
He said Drake also sometimes sold fabric overruns and cancelled orders to the CMT manufacturers, securing these parcels with branded tape, which would explain why these were found during the raids on some of the factories.
Drake said there was no factual or legal basis to liquidate what he described as a solvent company.
“Winding up is an extraordinary and discretionary remedy. It is neither necessary nor appropriate where alternative enforcement mechanisms exist, where material disputes of fact arise and where the relief sought would not remedy the alleged regulatory concerns,” Drake said.
He asked that the application be dismissed with punitive costs.
The bargaining council is expected to file a further affidavit this month.
Although no relief has been sought against the retailers, they may elect to file affidavits in the matter.
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