British fashion giant Next has abruptly closed one of its three factories in Sri Lanka, leading to the immediate redundancy of approximately 1,400 workers and triggering protests on Wednesday.
The factory, located in the Katunayake Free Trade Zone near Colombo, announced its closure on Tuesday, promising severance packages to the 1,416 employees laid off overnight.
David Reay, Next’s director of manufacturing, stated the decision was unavoidable due to the plant’s unprofitability for several years, citing “increasingly high operating costs.”
Next will continue to operate its two other factories on the island.
A powerful trade union, the Free Trade Zones and General Services Employees Union, whose general secretary, Anton Marcus, confirmed over 800 members were affected, rejected the claim of unviability and vowed to pursue legal action to secure their members’ jobs.
Marcus argued the closure without consultation violated a collective agreement.
This abrupt shutdown comes after Sri Lanka’s apparel industry warned last month that threatened US tariffs could severely disrupt the island’s largest export sector and endanger thousands of jobs.
While a 44 per cent US tariff on Sri Lankan exports has been on hold, a new 10 per cent baseline tariff is currently being applied.
Sri Lanka’s garment exports reached $4.76 billion last year, supporting approximately 350,000 workers and serving as a vital source of foreign exchange.
