# The Dindigul Agreement: Success in Worker Protection Faces Corporate Resistance Binding labor contracts reduced violence in Indian factories, yet major global brands remain hesitant. - **Source:** [Financial Post - Top Stories](https://financialpost.com/) - **Published:** 2026-09-03 - **Topic:** [Business](https://brifing.si/c/business) - **Original article:** - **On Brifing:** https://brifing.si/s/bf21ad7b-e8b4-4f22-b7ce-7f1b89c6e973 ## The Dindigul Agreement Framework The 2022 Dindigul Agreement emerged following the 2021 death of a garment worker in India. This legally binding contract involved manufacturers, unions, and major international brands. It established a formal grievance process, worker-elected shop floor monitors, and mandatory training to combat gender-based violence and harassment within the factory production environment. ## Measurable Improvements in Safety Research by Simon Fraser University and Lead at Krea University confirms the model's efficacy. Surveying nearly 1,100 workers, findings show 80 percent reported increased workplace respect. Additionally, 87 percent of workers experienced wage growth. The agreement successfully reduced harassment cases and improved treatment from male colleagues and factory management significantly. ## Corporate Reluctance to Renew Despite proven success, major brands are distancing themselves from Dindigul-style agreements. Since the initial term expired in October 2025, interest from global retailers has waned. Factory executives report that signing such binding contracts often leads to a loss of business, as brands prefer less restrictive, non-binding supply chain initiatives. ## Canadian Brands and Transparency Canadian retailers like Lululemon and Aritzia were not signatories to the original Dindigul deal. Investigations reveal that only 10 of 25 reviewed Canadian brands publicly disclose their sourcing factories. This lack of transparency obscures the extent to which these companies support or reject worker protections within their global supply chains. ## The Cost of Compliance Eastman Exports, the factory behind the Dindigul Agreement, struggled to retain clients after implementing the model. Despite achieving a gold standard in facility conditions, the company saw brands exit their supplier lists. Executives suggest that brands actively avoid factories with binding union agreements to maintain lower costs and avoid accountability. ## Industry-Wide Accountability Gaps Global brands often rely on internal codes of conduct rather than enforceable union contracts. Companies like H&M, Disney, and Victoria’s Secret emphasize their commitment to human rights in statements but stop short of signing binding agreements. Critics argue this maintains a fiction that brands hold no employer responsibility for their suppliers. ## Preventable Tragedies in Supply Chains The necessity for such agreements remains critical, as evidenced by the death of Paramasivam Pushpalatha at a Sri Lankan factory in 2025. While Brandix denied negligence, union advocates argue the incident was preventable. Victoria’s Secret, a major buyer from that facility, has not engaged directly with the local union regarding the incident. ## The Business Case for Ethics Experts suggest that for the $2.5 trillion global apparel industry, the cost of implementing worker protections is relatively small. However, brands prioritize financial margins over the power of unions. By avoiding binding agreements, companies minimize their liability, even when such initiatives are proven to reduce violence and improve worker safety. ## Global Replication of the Model The Dindigul model is gaining traction as a blueprint for other regions. In 2024, two factories in Central Java, Indonesia, adopted similar agreements following reports of widespread abuse. These initiatives demonstrate that worker-led, legally binding frameworks can function effectively across different cultural and geographic contexts to ensure basic human rights. ## The Future of Labor Standards The expiration of the Dindigul Agreement highlights a critical crossroads for the fashion industry. While the model proves that gender-based violence can be mitigated through collective action, corporate participation remains the primary barrier. Future progress depends on whether brands shift their priorities from cost-cutting to genuine, enforceable accountability for workers. ## Sources covering this story - https://financialpost.com/news/economy/this-deal-has-cut-violence-against-women-on-factory-floors-but-some-clothing-brands-still-wont-sign-on — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._