“HOW THE EXECUTIVE REACT THE FORCED LABOR & HOW TO SOLVE

THOSE PROBLEM IN ZARA SUPPLIER”

Group 2: ZARA

Arranged by:

1. Richel Megapaswati T.
2. Veronica
3. Syakila Azzahra
4. Lysa Rahma Wati
5. M. Thoriq Azyzy
6. Yuni Safitri
 CHAPTER I
INTRODUCTION

A. History of Zara Clothing Brand

Zara is one of the most well-known international fast-fashion companies,
owned by the Spanish fashion group Inditex [CITATION Zar20 \l 1057 ].
Inditex is one of the world's largest fashion retailers, with eight brands
(Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara
Home and Uterqüe) selling in 202 markets through its online platform or
its over 7,000 stores in 96 markets [ CITATION Ind12 \l 1057 ].

Founded in 1975, ZARA has become the leader fashion brand over the last
few years[CITATION Qin08 \l 1057 ]. Zara is the largest division in Inditex,
with more than 75% of Inditex's total sales [ CITATION Fer03 \l 1057 ].

In the year of 1980, the company began to expand internationally through

Porto, Portugal. In 1989 they entered the United States and France on
1990. And until now, Zara has opened stores in 73 countries in the world
Including Indonesia. Zara has several types of clothes, starting from
women (Woman and TRF), Men (Men), children (Zara Kids), Zara Home
to cosmetics. The most Zara stores are in Spain (329 stores), and France
(114 Stores). Meanwhile in Indonesia, Zara only has 13 stores [ CITATION
Mah19 \l 1057 ].
B. Company Structure of Zara

(Source: jadehoang1994.wordpress.com/2015)

Zara organization structure is a hierarchical flow of subordination of

functional department. It is a well- organized structure, by looking at this,
employees know who to report to, and would find easy to communicate
with their colleagues. Thus, it would improve the efficiency of making
work easier as well as productivity of employees. When working for Zara
company, teamwork is a basic skill people need to get to become a good
staff. This culture allows staffs work together and give them chance to
accomplish tasks.

Amancio Ortega Gaona is a Chairman of the company. Pablo is the First

Deputy Chairman and CEO, Carlos is the Second Deputy Chairman.
Antonio is the Secretary. Under the top management of Inditex, there are
some smaller managers such as store managers, regional managers and
country mangers. They manage 70,000 international staffs.
 CHAPTER 2
PROBLEM DESCRIPTION

ZARA:Forced labor estimates that 300.000 people work in slave-like

conditions nationwide.The textile industry is among the top three
industries wuth the highest incidence of slave-like labor,alongside
agribusiness and construction.Most migrant workers in the southeast
region,notably Bolivia.Many often end up in illegal or semi-ilegal
workshops,living and sleeping in or close to their workplace.Each year
reports come to light of the plight of these migrants

In 2011 AHA, the contractor reportedly responsible for 90% of Zara's

Brazilian production was found to have subcontracted work to a factory
employing migrant workers from Bolivia and Peru in sweatshop
conditions in Sao Paulo to make garments for the Spanish company.
Workers were found to be working 16 to 19 hours day with little time off
and in debt to their traffickers. Fourteen of the workers were Bolivians and
one was from Peru. One was 14 years old.

Inditex said in a statement that it could not be held responsible for

"unauthorised outsourcing" but would compensate the workers because
AHA had violated Inditex's code of conduct. At the time CCC stated that:
"It is Zara's responsibility to know who is making their clothes".
"According to the code of conduct that they have signed up to, they are
responsible for everyone involved in the supply chain. It is up to them to
do the monitoring."

Question:
Explain the case further. Does the current excecutive know about the
forced labor? As the new board,how you act on this case to solve the
forced labor in Zara supplier?
 CHAPTER 3
SOLUTIONS

The current executives know about forced labor in Zara Supplier at Brazil.
However, the company must continue to study this case further so that it
can be resolved properly.

As a new board in the company, we must protect the health and safety of
workers so that workers are protected from exposure to health and safety
hazards work that may be at risk of causing permanent injury, illness, or
death. Then we as a new board must also perform Employment contracts
are provided to all workers.

In order not to repeat this bad case, the company needs to use ethical
recruitment practices such as:
 Transparent
 Fair Recruitment practices
 Support Direct Recruitment
 Checked the Workplace (No Slavery Detected)
 Provide Training to Develop their Skills
 Create a Shift-Schedule
All workers are given details of the conditions of work, including at least,
the nature of the work to be performed, the amount of salary and salary
arrangements, hours of work, holidays and other leave, as well as other
work benefits in writing and in a language understood by them. All these
must be arranged in such a way as to avoid misuse.

The company respects the diversity of its workforce. Workers are

protected from any discrimination that would violate their human rights.
Have clear and easy access to remedies. Workers at all levels have access
to legal remedies and access to a credible complaint resolution mechanism
without fear of being accused or dismissed.
All workers, regardless of their position or level of work, have the right to
form or join trade unions of their choice, as well as to bargain collectively.
Although the rights to freedom of association and collective bargaining are
limited by law, the means to freedom of association without coercion and
bargaining are provided to all workers.
Bibliography
Ferdows, K., Lewis, M., & Machuca, J. A. (2003). Zara. Supply Chain Forum: An
International Journal, 4(2) 62-67. doi:10.1080/16258312.2003.11517121

Inditex. (2012). Timeline. Retrieved from Inditex Official Website:

https://www.inditex.com/en/about-us/who-we-are [Accessed March 6
2021 at 23.45 WIB].

Mahadewi, N. P., & Sulistyawati, E. (2019). PERAN POSITIVE EMOTION

DALAM MEMEDIASI PENGARUH.

Zara. (2012). Company. Retrieved from Zara Official Website:

https://www.zara.com/id/en/z-company-corp1391.html?v1=11112
[Accessed March 7 2021 at 00.25 WIB].

Zhang, Q. (2008). What and How Can We Learn from ZARA. Qinghua Zhang.
(2008). Wh2008 IEEE International Conference on Service Operations
and Logistics, and Informatics. doi:10.1109/soli.2008.4682950

References
jadehoang1994.wordpress.com/2015/03/18/organisation-structures-and-cultures/
[Accessed March 7 2021 at 09.41 WIB].