Joel Preston, from labour rights group Central, said the company, and a sister factory, had suffered a drop in orders after clothing giant H&M stopped sourcing from their parent firm China Key.
He said there had been three Arbitration Council rulings ordering the factory to pay at least $50,000 in withheld suspension pay to workers.
“It seems like there is a lot owed to workers. It would not surprise me if they close to avoid liability,” Preston said.
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