The Factories Paying for Fashion’s Audit Fatigue

A Lahore fabric mill sat in social audits for 220 days last year, while workers at eight Pakistan factories still reported wages below the legal floor. Brands now treat those visits as proof, even as EU rules start to demand evidence they can take to a regulator.

The people who actually sit through the inspections, and the sewers whose pay never makes the file, are carrying a testing and certification trade that Labour Behind the Label puts at 6.3 billion USD for apparel, footwear and leather. When a site fails, the brand can still walk.

A Lahore Mill Spent 220 Days in Audit

Saqib Shahzad, a general manager at Sapphire Group, told an OECD garment forum in February 2026 that Diamond Fabrics Limited in Lahore had been in audit for 220 days out of the last 365. Many large suppliers now keep dedicated teams whose job is to host inspectors. Smaller workshops cannot copy that cost, and they still have to pass if they want orders.

Labour Behind the Label published Silenced on 23 July 2026 after interviewing 255 workers across eight factories that supply 15 international brands, including Levi’s, Next, H&M, Gap, Carrefour and Primark. The garment and textile trade accounts for about 60% of Pakistan’s exports and employs 15 million people across the national chain. The group also recorded 11.7% inflation in 2026 eating into pay packets that were already thin.

THE PAKISTAN FILE

• Audit calendar: Diamond Fabrics Limited in Lahore was in audit for 220 days out of the last 365, Shahzad said in February 2026.
• Worker sample: 255 people across eight supplier factories serving 15 brands.
• Legal pay: 65% earned less than the legal minimum once skill level and overtime were counted.
• The industry around them: Labour Behind the Label cites a 6.3 billion USD apparel, footwear and leather testing, inspection and certification market.

Gabriel Amouyal, audit services director at the compliance firm Qima, has spent about 20 years walking mills and sewing floors in China, India, Bangladesh and South Korea. He still defends the visit itself, because an auditor who gets through the gate can speak to people on site. The problem, he and other practitioners now say, is that brands keep sending that visit to the same first-tier rooms instead of to the riskier rooms further down the chain.

The Proof Brussels Now Demands

Fashion houses talk about a wave of European due diligence. The law that actually landed first is a consumer one. The European Commission says the Empowering Consumers for the Green Transition Directive, which tightens greenwashing rules in force since 27 September 2026, is now applicable, with no general transition period. Vague “eco” and “sustainable” claims, and carbon-neutral boasts built on offsets, are the kind of language the new rules target.

That change does not wait for a factory in Lahore to finish its next SMETA week. It hits hangtags, websites and shop floors in the EU now. The easiest answer a brand still has is another certificate, another shared report, another announced visit.

THE DATES THAT REACH THE FACTORY GATE

1. 19 July 2026: The Ecodesign ban on destroying unsold apparel, accessories and footwear starts applying to large firms.
2. 20 July 2026: The EU Digital Product Passport Registry goes live as a central store of unique product identifiers.
3. 27 September 2026: The greenwashing amendments enter into application across the Union.
4. 14 December 2027: The Forced Labour Regulation starts to apply, with power to keep goods off the EU market.
5. 26 July 2029: In-scope companies must meet the rewritten Corporate Sustainability Due Diligence Directive after the Omnibus I delay.

Global Fashion Agenda’s October 2026 tracker records the Commission’s Forced Labour Regulation from 14 December 2027, and notes that non-binding implementation guidelines were published on 3 September 2026. CSDDD guidelines are expected in the first quarter of 2027. The Omnibus I Directive, in force since 18 March 2026, narrowed that due-diligence law and set a single company application date of 26 July 2029, so the near-term squeeze is the live claims rule, digital product data, and a 2027 import ban, not the delayed human-rights statute.

Naurin Muzaffar, founder of the US auditing firm Innovatus, says the industry already spends too long hunting for problems and too little time fixing them. Digital product passports will add another data ask on the same exhausted offices. Unless buyers send money, orders and engineers back down the chain, the forms will keep moving and the floor will not.

Wage Theft That Paperwork Cannot Catch

A social audit is a structured look at a site on a given day, or over two or three days. Ellias Mussa, a former auditor for the retailer I Saw It First who now works with the Fashion Workers Advice Bureau Leicester, describes the usual rhythm. If a visit is booked 10 days out, managers can keep the floor clean and tidy until the inspector arrives. Muzaffar prefers unannounced visits for that reason, so the system runs as it does on an ordinary shift.

Labour Behind the Label’s Pakistan work shows why a tidy day is not the same as a legal wage. Six percent of the 255 workers took home less than the unskilled minimum of 37,000 Pakistani rupees. Forty-four percent were below the minimum for their skill level. Once overtime was counted, 65% were below the legal floor. Seventy-one percent said their pay did not cover basic household needs. Only three of 255 earned anywhere near a living wage. Two-thirds said they were pressed into overtime, and 62% of those people said they were not paid the legally required double rate.

Anna Bryher, policy lead at Labour Behind the Label, argues that worker voices are systematically under-recorded because findings have to be backed by documents. Audits collapse into a file check. One auditor told the researchers their hands were tied and they had to give a documentary trail. Another said suppliers know how to play the game, and that the factory is often so smart it outsmarts the visitor.

HOW A PASS STILL HIDES THE PAY

• Advance notice: A booked date lets a factory stage the floor, the files and the people the auditor will meet.
• Document rule: Worker testimony of wage theft often cannot be logged unless paperwork agrees, and the paperwork is the factory’s.
• Closing meeting: Sites must sign off on findings, which blocks testimonial evidence that management will not accept.
• Firm shopping: Auditors described coaching, temporary workers being sent home, and factories picking firms they expect to be kind.

Fear does the rest. A worker at Artistic Milliners in Karachi, which supplies Inditex’s Zara, told researchers what happens if someone complains.

We all know, if you file a complaint, you will be terminated.

Garment worker, Artistic Milliners, Karachi, Labour Behind the Label interviews

About 50 workers were dismissed in January 2026 after raising unpaid bonuses at Combined Fabrics in Lahore, which produces for Levi’s. In some plants, complaint boxes sat under cameras. Internal hotlines stood in full view of managers. One worker said abuse, including touching, was the price of having piecework counted. Khalid Mahmood, director of Labour Education Foundation Pakistan, said brands will keep hearing what factories want them to hear until workers have a real union voice.

Cotton, Wool and Italy’s Label Still Failed

The same snapshot logic sits on fibre labels and on “Made in Italy” tags. Certified and audited chains have still been hit by investigations that the original visit did not catch, or did not treat as in scope.

THREE CERTIFIED STORIES, THREE GAPS

Better Cotton hired the agriculture inspector Peterson after Earthsight’s report. Chief executive Alan McClay said the three farms licensed at the relevant time were not in breach. Earthsight answered that the check left out other farms in the same groups, including land at the centre of a Bahia prosecutor’s case. A later whistleblower account, which Better Cotton declined to discuss as anonymous, alleged data manipulation inside the scheme.

On wool, PETA president Tracy Reiman said every investigation her group has run, including this Nativa-certified South Africa farm, has shown sheep beaten and cut no matter the label. Textile Exchange, which governs the Responsible Wool Standard, said the practices described would fall far short of RWS rules if verified, and that suspension or withdrawal is available when non-compliance is confirmed. H&M said all of its virgin wool is meant to come from RWS-certified farms and that it had raised the findings with Textile Exchange.

In Italy the issue was not a far-off mill. It was workshops in the production hinterland of Milan. Loro Piana was placed under court monitoring after prosecutors described workers in subcontract shops putting in as many as 90 hours a week. Prosecutor Paolo Storari’s inquiry later named further houses. The first wave of judicial administrations closed once courts were satisfied that controls had changed. The fine against Armani was for public ethics claims that sat beside subcontractors with poor safety, hygiene and off-the-books work.

One Shared Report for Many Buyers

The industry already built a way to stop 220-day calendars. Sedex, the Supplier Ethical Data Exchange, hosts SMETA, which it calls the world’s most widely used social audit. The method launched in 2004 so UK retailers could stop sending separate, clashing inspections. A supplier commissions one visit from an approved affiliate auditor, uploads the report, and chooses which member buyers can see it. SMETA is not a certificate and has no pass or fail mark. It produces findings and a corrective action plan against the Ethical Trading Initiative Base Code, ILO conventions and local law.

Sedex says the platform held 67,000 SMETA audits in 2023, that auditors visited 120,000 sites in 2024, and that 250,000 non-compliances were closed that year. About 70% of visits now use the four-pillar scope, adding environment and business ethics to labour and health and safety. Amfori BSCI, the other big shared scheme, grades 81 questions across 13 performance areas from A to E and lets member brands read one another’s results. ICS, the Initiative for Compliance and Sustainability, works on a similar share-the-visit logic.

Amouyal wants brands to reuse those reports where risk is low and spend the saved days further down the chain. First-tier cut-and-sew plants are audited the most. Dyehouses, spinning mills, farms and the informal workshops that luxury prosecutors keep finding in Italy are not. Factory groups in producing countries have been asking buyers to align standards for years, because a second code is another week of managers in a meeting room instead of on the line. Diamond Fabrics’ 220 days show that sharing on paper has not yet thinned the queue on the ground.

Mussa thinks in-house auditors who stay with a factory can fix what they find, because they do not vanish after the closing meeting. Muzaffar warns that a brand marking its own homework can look away, and wants both an internal team and an outside check. Most houses do not have the staff to visit every site themselves. If they all tried, the same mill would drown again.

Brands Still Walk When a Factory Falls Short

Audits work, Amouyal says, when a supplier feels safe enough to show the whole truth. That only happens if the buyer will not simply move the order next door. Child labour, in his example, needs a long plan that goes beyond a 90-day corrective action, and it often needs other brands and local groups in the same room. A one-off fail-and-exit teaches every manager to hide the next problem.

Bryher wants the centre of gravity shifted from compliance to remedy, with unions and community monitors sitting beside the clipboard. Lidl and Carrefour, after seeing the Pakistan findings, commissioned a third party to assess them. Other brands, Labour Behind the Label said, did the minimum the local law required and kept using a system they know does not match the floor.

Fashion is facing a credibility crisis. For far too long, international brands have relied on tick-box compliance and superficial audit systems that fail to capture the realities experienced by workers in Pakistan.

Anna Bryher, Policy Lead, Labour Behind the Label

Muzaffar puts the same gap on the environmental side. Brands ask mills for carbon, water and chemical data through portals, then send little help back. Suppliers keep filling the forms. Nothing returns. Direct relationships, she says, change how a manufacturer talks, because a third-party inspector is not the person who writes the next purchase order.

Amouyal’s last point is the one the 220-day calendar makes brutally plain. A visit is one tool. It is not going to resolve the industry’s issues by itself. Other tools have to be used, and they cost more than another booked date: staying with a failing site, paying for the fix, and listening to people who will be fired if they speak on the record.

Who Pays When the Snapshot Looks Clean

The hidden ledger is already visible in Lahore. A mill spends 220 days hosting inspectors. Workers still describe half-pay, unpaid overtime and cameras over the complaint box. Certified cotton and wool still attract investigators. Italian luxury still finds illegal workshops a short drive from the showroom. Brussels now wants hangtag claims that can survive a consumer-law complaint, and from 14 December 2027 it will be able to keep forced-labour goods off the market.

The people who will be asked for that proof are the same offices that already know how to make a file look clean, and the same workers who already know what happens if they talk. Shared reports, unannounced days and union monitors only change that if the order stays when the truth comes out. Otherwise the next auditor will get the tidy floor, the signed closing meeting, and another pass.