NEW YORK — The U.S. Department of Labor reached a settlement agreement Friday with a Northern Marianas Islands garment manufacturer a week after filing a lawsuit against the firm and its principal owner.

The DOL said Marianas Garment Manufacturing Inc. and its lead principal, Nicholas Fong, agreed to to pay its employees $1.6 million in back wages for overtime worked over a two-year period to settle the suit brought on Sept. 27. The company agreed to pay its 764 workers for unpaid hours worked during the period from April 7, 1997 to April 7, 1999.

The $1.6 million includes a $5,000 civil monetary penalty. The workers, on average, will receive $2,087.70 each in back wages plus interest in two installments on Nov. 1 and July 15.

Marianas Garment Manufacturing officials and Fong could not be reached for comment.

U.S. District Court Judge Alex R. Munson signed a consent judgment approving the settlement, by which the company also agreed to keep accurate records of its employees’ hours.

Labor practices in the U.S. commonwealth have been the subject of intense scrutiny for the last few years. As reported, last month seven major U.S. retailers and 23 factories on the island of Saipan agreed to settle three 1999 class-action suits brought on behalf of the archipelago’s garment workers for $11.3 million in back pay. They joined 19 other U.S. retailers and manufacturers who had already settled the suit, which has brought in a total settlement fund of more than $20 million.

The class-action suits contend that Saipan factories held Chinese and other workers in a form of indentured servitude while they paid back "recruitment fees" of up to $7,000 by working 12-hour days. The only U.S. company named in the suit not to have settled is Levi Strauss & Co.

Those suits were separate legislation from the DOL suit settled Friday. DOL officials monitor working conditions in factories in Saipan and elsewhere in the Marianas Islands.

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