The NGO monitored global media reports, supplier disclosures, and first-hand testimony from unions and worker organisations across major garment-producing nations between April and December 2025.
The research examined how brand and buyer responses to US tariff changes impacted labour conditions throughout supply chains.
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Following the announcement of a universal 10% tariff on imports and additional “reciprocal” tariffs ranging from 10 to 50% for certain trading partners under the International Emergency Economic Powers Act, the study revealed that brands and buyers responded with abrupt changes to purchasing practices.
Suppliers reported orders being paused or cancelled, demands for price reductions, and requests to absorb or split tariff-related costs. Buyers in some cases threatened to shift orders elsewhere if suppliers did not comply with lower price demands, generating commercial shocks along the supply chain.
The study found that these commercial actions led to layoffs, factory closures, reduced working hours and delayed wage payments for workers.
Unions and industry organisations observed that brands rapidly changed sourcing away from jurisdictions with higher tariffs, including a reduction in apparel imports from China to a 22-year low by May 2025 and shifts to countries such as Vietnam, Myanmar and Sri Lanka.
When tariffs increased in India, some buyers moved orders again, creating persistent instability for workers.
Among 25 apparel buyers contacted, none responded to requests for information on how they managed sourcing changes or monitored labour impacts during this period.
Echoes of Covid-19 pandemic
The Centre’s report stated that the practice of transferring financial risk and cost to suppliers and their workers mirrored patterns recorded during previous supply chain crises, including the Covid-19 pandemic.
Price reduction pressure was widely reported, with brands and retailers demanding discounts of up to 25% on new and ongoing orders.
“The 2025 US tariffs didn’t just reshape trade, they reshaped livelihoods as well. When a crisis hits global supply chains, more often than not the costs are pushed down onto suppliers, with disastrous consequences for workers,” commented Anithra Varia, interim project manager for labour rights at the Business and Human Rights Centre.
“As brands made calculated commercial decisions, garment workers were left facing layoffs, rising precarity, the erosion of labour rights, and in many cases hunger and marginalisation. The response to the tariff crisis reveals a systemic failure by brands who continue to treat human rights as optional when commercial pressures arise.”
Factory closures and unpaid wages
One Bangladeshi supplier said: “My US buyer is saying that there is no possibility of raising the price from the end buyer. Therefore, they are asking us to reduce the price.” Competition between suppliers to secure orders further reduced profit margins.
The Centre documented buyers in Bangladesh and India seeking to push additional tariff costs onto suppliers, in some cases suspending or cancelling contracts where suppliers refused.
One supplier in India was quoted as saying: “The buyer asked me to bear the remaining amount. If I can’t, they want to cancel the order. This is from my major buyer to whom I ship half a million pieces every month.”
Workforce impacts included layoffs and factory closures, such as in Lesotho, where around 5,000 workers were placed on three months’ unpaid leave following factory shutdowns, leading to protests over unpaid wages.
In factories that remained operational, reductions in working hours and pay occurred, increasing financial insecurity among employees. Some unions reported that food and medical insecurity, as well as risks of exploitation and trafficking, increased for some workers.
The report found women and migrant workers were particularly exposed due to insecure employment and limited protections.
According to union accounts, employers used tariff pressures to request workers sign voluntary resignation letters without negotiation.
Better purchasing practices
“How brands respond to disruption matters. In supply chains characterised by significant power asymmetries between buyers and suppliers, adjustments to purchasing practices can place immediate financial pressure on suppliers operating on narrow margins,” Varia added.
“When commercial pressure is pushed down supply chains, workers pay the price. Better practice means maintaining agreed prices and payment terms, honouring existing orders, and working with suppliers and worker representatives to protect wages, benefits and severance when disruption hits.
“Brands and buyers have the power to determine where shocks land across supply chains. As tariff uncertainty continues, these actors must urgently adopt responsible purchasing practices to prevent financial pressure on suppliers translating into human rights harms for workers.”
