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Archived News Release--Caution:
information may be out of date.
For more information call: 202-219-8211
U.S. Secretary of Labor Robert B. Reich today said some of
the nation's largest retailers received goods produced at three garment
factories that have repeatedly violated the nation's minimum wage and overtime
laws.
J. C. Penney, one of the the nation's largest retailers,
was notified for the fourth time in less than a year that it received goods
manufactured in violation of the nation's minimum wage and overtime laws. Five
other retailers named by the department were Talbot's, Macy's East, Specialty
Retailers ( the holding company for Palais Royal and Beall's stores), Charlotte
Russe, and Claire's Boutiques.
"Once again, we find that some of the nation's most
vulnerable workers are cheated of their wages," Reich said. "Everyone in the
industry must be more diligent to protect garment workers' rights and the wages
they earn. The American public wants to do business with stores that don't do
business with sweatshops."
As part of his continuing effort to rid the nation of
sweatshops, Reich announced last year that he would make public the names of
retailers whose goods were produced under conditions that violate wage laws.
However, finding evidence that allows investigators to trace goods to
particular retailers has proved challenging because records that might make
tracing garments possible often do not exist or are incomplete.
Reich said the retailers names were being disclosed today
because all three cases represent either repeat or willful violations on the
part of contractors or manufacturers. The three significant minimum wage and
overtime violation cases involve firms in Boston, Dallas and Los Angeles.
The three companies have paid more than $245,000 in back
wages owed to 294 workers. In addition, the firms will pay more than $42,000 in
fines for willful or repeat violations of minimum wage and overtime laws. The
wage underpayments are significantly larger than those normally obtained in
garment investigations.
"There are too many contractors in the industry who make
skimming the wages of their workers a regular business practice," Reich said.
Two of the three contractors sewing garments for the
prominent retailers have been cited for violations in the past, Reich said. In
the remaining case, a manufacturer and retailer identified by the department
today, were notified of other violations just six months ago.
The department released the following information on the
three cases:
Dallas firm cut wages in producing goods for J.C. Penney
The largest case was brought against Dallas-area contractor Truong Sewing, a
garment contractor producing goods traced to J.C. Penney. The firm agreed to
pay $113,450 in backwages to 132 workers and $30,000 in fines for willful
violations of the nation's minimum wage and overtime laws. The back wages
represent the largest settlement in a garment case this fiscal year and is one
of the largest amounts ever collected in a Dallas region garment case.
Truong Sewing had been contracted to produce the goods for
DeCorp, a Dallas area garment manufacturing firm that is a subsidiary of the
nation's fifth largest garment manufacturing company, Kellwood Industries.
J.C. Penney, Macy's division, others receive goods from
repeat violator in L.A. J.C. Penney, Macy's East, Specialty Retailers Inc. (the
parent company of Palais Royale and Beall's stores), Charlotte Russe and
Claire's Boutiques were all notified by the Wage and Hour Division that they
have received goods from a contractor cited recently for repeat violations of
the nation's minimum wage and overtime laws.
Chums Casual, aka Stephen K. Corporation, of Los Angeles
produced the goods for the retailers under the labels Chums Knitwear, doctor
design and Mega Gear. In addition, the Department has issued a subpoena seeking
records from Chums Casual in an effort to determine whether goods were received
by other retailers.
The Chums investigation revealed that cutters, sewers and
trimmers were being paid $170 a week for working 50 to 55 hours. The hourly
wage averaged as low as $3.10 in some cases. The firm has agreed to pay $80,000
in back wages to 72 workers. In addition, the company will pay $12,240 in fines
for repeat violations of the Fair Labor Standards Act.
Talbot's notified for second time in just six months
National women's wear retailer Talbot's was notified in November and again last
week that it has received merchandise produced in violation of the Fair Labor
Standards Act each time produced by the same manufacturer, David Brooks. Brooks
is also a Kellwood Industries subsidiary.
Brooks was notified that goods it sold under a contract
with Talbot's were made in violation of overtime laws by Boston contractor
Cricket Sportswear. Cricket paid $58,000 in back wages to 58 workers denied
overtime pay despite working up to 50 hours each week.
In a previous case from November 1995, David Brooks and
Talbot's were notified that G.T. Sportswear and Joseph's Cutting, two other
Boston area contractors, produced merchandise for the retailer in violation of
the Fair Labor Standards Act. The two contractors paid $48,000 in back wages to
90 workers also denied overtime despite working many hours more than 40 hours a
week.
In both instances, Talbot's was asked to take steps to
ensure its manufacturers and contractors were abiding by the nation's garment
laws. Manufacturer David Brooks has told the labor department it will implement
a contractor monitoring program.
Kellwood Industries contractors cited often in wage
investigations Reich also noted that Kellwood Industries subsidiaries were
cited in two of these three significant cases. Kellwood has also informed the
labor department that it will begin monitoring the compliance of its
contractors around the country.
"The leaders in the industry must lead by example," said
Maria Echaveste, administrator of the Wage and Hour Division. "I have asked
Kellwood to adopt a monitoring program that will be a model for garment
manufacturers everywhere. The labor department is ready to assist in any way it
can."
Background Shortly after taking office in 1993, Reich
directed the Wage and Hour Division at the department to focus its enforcement
efforts on low wage industries, particularly the garment industry which has a
history of worker abuse. The department has stepped up efforts with a three
pronged approach designed to wipe out sweatshops. The department targets
enforcement on repeat violators of the minimum wage and overtime laws,
recognizes companies that are helping to improve compliance, and is educating
the public about the widespread abuses in the industry.
Reich last year intensified efforts to encourage retailers
and manufacturers to help police the more than 22,000 garment contractors
across the country. The division now has fewer than 800 investigators to police
6.5 million workplaces and is facing new budget cuts that could reduce the
force by up to 20 percent.
"Government simply cannot do it all," Reich said. "Those
in the garment industry that engage in these unlawful practices must end this
abuse. Irresponsible businesses simply cannot prosper at the expense of some of
the most vulnerable workers in the nation.
"This is not a condemnation of the entire industry. There
are many retailers and manufacturers who are working with us to eradicate
sweatshops. And these legitimate operators are forced into an economic
disadvantage by the illegitimate operators."
A survey recently released in Los Angeles indicates the
anti-sweatshop initiative may be having some effect. Investigations of 76
randomly selected in shops in Southern California indicated that more than half
are now being monitored by manufacturers for compliance with labor laws. Labor
law violations in the monitored shops occurred at less than half the rate of
shops not being monitored for compliance.
Archived News Release--Caution:
information may be out of date.
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