Primark has sacked three of it southern Indian factories after they were found to have used unauthorised sub-contracting and child labour to produce its garments.

Primark said in a statement today that the factories failed to meet its “strict” ethical codes and that it would stop sourcing from them.

The factories in question had sub-contracted embroidery and sequin work on a “small number” of designs to sub-contractors that were not approved by Primark. The sub-contracting also involved home working and children working at home. The situation came to the attention of the value fashion brand after an investigation by the BBC.

Primark has been the subject of intense scrutiny over the sourcing practices used to achieve its rock-bottom clothing prices. The retailer said in a statement today that the affected garments represent 0.04 per cent of the retailer’s worldwide sourcing. It said: “Primark is an ethical business that demands the highest standards from its suppliers. It has a strict Supplier Code of Conduct that expressly bans the use of child labour.

“In addition, none of our suppliers is permitted to sub-contract without our specific consent and agreement. None of these suppliers is permitted to use home working. Under no circumstances would Primark ever knowingly permit such activities whether directly through its suppliers or through third-party sub-contractors. Primark does not tolerate serious breaches of its fundamental principles.”

Primark cancelled all new orders with the factories concerned and withdrew the affected garments from sale immediately upon being made aware of the situation.

Today, it announced it would launch the Primark Better Lives Foundation to help fund organisations that improve the working lives of young people in developing nations.

Primark added that it uses reputable third-party audits and has tightened control of its suppliers. It will appoint an as yet undisclosed NGO in southern India to partner with the retailer to ensure its ethical code is upheld.

Primark added that its prices are low because of low mark-ups, big volumes and because they use simple designs and keep overheads and advertising spend low.

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