8 COMPANIES SETTLE SAIPAN WORKER SUITS
Byline: Leonard McCants
NEW YORK — Eight large vendors and retailers — Calvin Klein, Warnaco, Tommy Hilfiger USA, Sears and May Department Stores among them — agreed Tuesday to a multimillion-dollar settlement of two class-action lawsuits filed on behalf of Saipan garment factory workers.
Under the terms of the agreement, which requires court approval, the companies — which also include Jones Apparel Group, Liz Claiborne Inc. and Oshkosh B’Gosh Inc. — will make a combined $6.5 million payment towards the settlement and agree to adhere to a system of independent monitoring of their Saipan contractors. The settlement also stipulates that no company admits any wrongdoing.
The amount each company will pay, while unspecified, depends on how early each agreed to settle and how much business is performed in Saipan, said Michael Rubin, one of the plaintiffs’ attorneys.
“This is great news for the workers,” Rubin said. “It means that their working and living conditions will increase dramatically in the short term.”
In statements, several of the defendant companies said the suit lacked merit, but the length and cost of litigation combined with the establishment of the independent monitoring agency made the settlement worthwhile.
“We are pleased that the settlement will fund independent monitoring in Saipan,” Roberta Karp, vice president, corporate affairs and general counsel for Liz Claiborne, said in a statement. “We believe independent monitoring in Saipan will separate the reputable factories from the irresponsible.”
Last August, four other companies named in the suit — Nordstrom, J. Crew, Cutter & Buck and Gymboree — as well as Donna Karan and Polo Ralph Lauren, who were not named, agreed to the same terms. With Tuesday’s additions, the total settlement amount has risen to $8 million.
Of that amount, $1.5 million will be set aside to finance the independent monitoring, $3 million will go to cash payments and public education for the plaintiffs, and the remainder will pay attorneys’ fees and administration costs.
In addition, the settlement prohibits those factories from using recruitment fees when hiring workers from other countries like China and the Philippines, which the suit charged was an unfair labor practice.
The deal codifies certain codes of conduct for Saipan factories involved with American retailers and vendors. The affected factories identified in a statement from the tort firm handling the case, Milberg Weiss Bershad Hunes & Lerach, were Global Manufacturing Inc., Diovra Saipan, Concorde Garment Manufacturing Corp. and Jin Apparel Inc.
None of the factories, in addition to four other U.S. retailers — Gap, J.C. Penney, Target and Lane Bryant — have agreed to the settlement.
The two lawsuits were filed on Jan. 13, 1999, in Los Angeles and San Francisco. The Los Angeles case seeks class-action status in federal court, while the San Francisco case is an unfair-business- practices case filed in superior court on behalf of apparel union UNITE and human rights groups, including Global Exchange.
Members on both sides believe the suit will not jeopardize jobs in Saipan. Indeed, Tommy Hilfiger officials said in a statement, that once the settlement is approved it may resume some production in Saipan, which is part of the U.S. Commonwealth of the Northern Mariana Islands.