30 years after establishing, 1,416 employees lost their jobs when the UK-based fashion retailer NEXT announced the immediate closure of its Katunayake production plant on the 19th of May 2025. Citing unsustainable operating costs as the primary reason, the factory’s trade union was not informed about the closure, leading to a heart-aching loss for workers, especially those who have worked in the factory since its establishment.
Workers stated that no one was informed about the closure, and that those on the second shift on the 19th of May were asked to stop work and leave the factory immediately, before their shift ended. The company announced its compensation package in accordance with the Termination of Employment of Workmen (Special Provisions) Act (TEWA) on the day itself.
The abrupt and secretive nature of the closure prompts crucial questions: Was the Labour Commissioner’s approval granted before closure was announced as per TEWA? Why was the BOI not informed? Why was the Collective bargaining agreement not honoured in this event?
Meanwhile, the Company has threatened workers against requesting an inquiry and support from the Commissioner of Labour, citing that their additional payments under the compensation package will be withheld. This is a blatant violation of the workers’ right to legal redress.
This is not an isolated case. It emphasises the broader crisis Sri Lanka’s apparel industry faces. Growing instability in the global supply chain created by wealthier powers of the Global North pushes local factories to scale down at the cost of workers’ lives and rights.
We condemn the process of the NEXT Factory closure, and demand that workers, especially those with decades of experience working in the factory, receive just compensation.
We urge the labour commissioner to probe into this matter swiftly and justly, to protect workers.
We urge the protection of the Trade Union and honouring of the Collective Bargaining Agreement placed in the NEXT Factory.