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News Release

Garment Manufacturer Sells ‘Hot Goods’ to Charlotte Russe That Prompts Restraining Order Following U.S. Department of Labor Investigation

LOS ANGELES, CA – Following a U.S. Department of Labor investigation that found overtime and minimum wage violations, prompting the Department to invoke a “hot goods” legal action, the U.S. District Court for the Central District of California has issued a temporary restraining order to prevent a Los Angeles garment manufacturer from shipping clothes to retailer Charlotte Russe.

Division investigators notified garment manufacturer RK Apparel Inc. that they found widespread violations of the Fair Labor Standards Act (FLSA), which rendered the garments manufactured and assembled by those workers hot goods unfit for shipment or sale through interstate commerce. The company advised the Department that it would not ship the hot goods, but then proceeded to ship a batch of the hot goods clothing to Charlotte Ruse.

Division investigators found that RK Apparel’s contractor HDK Ave. Inc. paid its employees well below the federal minimum wage of $7.25 per hour, with some receiving pay as low as $4 per hour. The employer required employees to work up to 58 hours per week but paid them only a piece rate, earning a flat amount per garment produced, and did not pay overtime when they worked more than 40 hours in a work week, as required by federal law.

“Whenever goods are produced in violation of the FLSA’s minimum wage, overtime, or child labor provisions, the U.S. Department of Labor can restrain those goods from being shipped in interstate commerce. This action is commonly referred to as invoking the ‘hot goods’ provision,” said Janet Herold, Regional Solicitor in Los Angeles. “Today’s action demonstrates that we will use all of the tools provided by law to ensure that employees receive the pay they have legally earned and that law-abiding employers are not undercut by unfair competition.”

Employees and employers with questions about the Fair Labor Standards Act or any of the federal wage laws administered by the Division should call the agency’s toll-free helpline at 866-4US-WAGE (487-9243). All calls are confidential.

Agency
Wage and Hour Division
Date
April 13, 2018
Release Number
18-0401-SAN
Contact: Leo Kay
Phone Number
Contact: Jose Carnevali