San Francisco, Gap Inc. is pulling 50% of its orders placed with a vendor whose subcontracting led to children sewing some of the retailer's clothes in squalid conditions in India, according to the Associated Press.
The penalties disclosed Wednesday wrapped up the company's investigation into an episode that attracted headlines around the world and renewed concerns about abusive labor practices in overseas factories.
To help address the problem, Gap said it would make a $200,000 grant aimed at improving the working conditions in India and would try to recruit retailers from around the world to participate in a forum next year to address child-labor issues.
Gap said it would also partner with the Global March Against Child Labour and other organizations to provide independent monitoring of hand embroidery and beadwork that is typically done in informal settings, not factories. Grants would help establish community centers in India where such work could be performed under better-monitored conditions.