SWEATSHOPS FACE NEW STATE EFFORTS
Byline: Eric Wilson / With contributions from Elizabeth Morrow, Albany
NEW YORK — The heat is being turned up on sweatshop operators in this area.
The New York State Attorney General’s office said Thursday it had filed its first civil action against an apparel factory this week in an effort to recover back wages for four employees who were allegedly fired without cause.
And in Albany, a sweeping sweatshop monitoring and enforcement bill passed the State Senate late Wednesday with bi-partisan support and is now headed for the Assembly, where it appears to be unopposed.
Co-sponsored by Sen. Nicholas Spano, a Westchester Republican, and Assemblywoman Catherine Nolan, a Queens Democrat, the bill requires that a photo identification accompany the registration form submitted by manufacturers and contractors in the apparel industry.
The legislation also authorized the commissioner of labor to affix a tag, no more than six inches in length, that reads “unlawfully manufactured” on apparel or components manufactured or assembled by employees of sweatshops.
Attorney General Dennis C. Vacco’s action this week was notable in that it would hold the plaintiff accountable under civil law for unlawful discharge of employees. Vacco has pursued criminal charges against dozens of illegally operated factories in New York for two years, including high-profile cases where factories were making apparel for such labels as Kathie Lee Collection.
In addition to the civil suit, Vacco also charged Jian Wen Liang, general manager of Hua Great Procetech in Brooklyn, with 31 criminal wage violations on Thursday. Criminal charges have been the typical means of recourse for the attorney general when investigators from the Labor Department’s Apparel Industry Task Force identify an alleged sweatshop.
In this case, however, investigators found four former employees of the factory — which once employed 100 workers making junior activewear for Street Beat Sportswear in Manhattan — who were willing to testify that they had been fired after complaining that Liang had made them work shifts of up to 36 hours and had underpaid them.
Liang was arrested Thursday morning and taken to Brooklyn Criminal Court for arraignment on the criminal charges. Of the 31 charges, 16 counts were for violating state minimum wage laws and 15 were for failure to pay wages and allegedly skimming 5 percent of the workers’ pay for himself. The factory, which operated at 641E-F 62nd Street in Brooklyn, closed in May.
Liang was later released and a hearing was set for July 20.
The civil suit, filed Monday in Kings County State Supreme Court, alleges Liang also fired four workers — Kevin Lam, Zhen Xing Liang, Jian Qiang Huang and De Ru Jiang — after they complained to him about labor law violations. The case seeks restitution of back wages plus damages and job reinstatement for the four workers.
The criminal charges relate to a total of $24,000 in unpaid back wages, which is also the amount sought in the civil suit. As for damages sought in the civil case, that amount would be set by the judge who hears the case.
Since the Hua Great Procetech factory has closed, Jennifer Brand, an assistant attorney general in the labor bureau, said the office will seek reinstatement of their positions in any successor factories in the same location or any other one operated by Liang.
Brand said Labor believes Liang opened in the last two weeks within a block of the Hua Great Procetech plant another factory where the majority of the 100 former employees are believed to have taken jobs. Task force investigators are looking into work practices at that factory.
At a press conference announcing the charges and lawsuit Thursday morning at Vacco’s downtown offices here, the attorney general said this case is the first in which his department has pursued civil penalties. The suit alleges the four workers approached Liang on three occasions in late February, complaining they had been underpaid and asking for more reasonable hours.
The following week, the suit alleges, those employees were fired, which Vacco said is a violation of labor law — specifically Labor Law 215, which provides that an employer cannot fire a worker because the worker complained that the employer was violating other labor laws.
Vacco said the workers frequently put in 36-hour shifts and worked up to 137 hours per week without overtime pay. They typically worked seven days each week, getting time off only for occasional holidays, such as the Chinese New Year.
“Workers are often frightened to come forward to complain, which is why unlawful discharge lawsuits are extremely rare,” Vacco said. “This case signifies a new confidence among workers in the garment industry, who, we think, have been bolstered by the increased labor investigators and prosecutions by this office.”
At the press conference, Vacco also handed out charts illustrating the number of apparel industry cases his office has handled and the amount of restitution it had collected on behalf of factory workers. The office is currently pursuing 26 prosecutions on behalf of 250 workers owed some $500,000, he said.
Vacco, a Republican, is running for re-election against State Sen. Catherine Abate, a Manhattan Democrat, who has been critical of the number of investigations carried out by the Labor task force.
While Street Beat Sportswear has not been taken to task by the State Labor Department for the violations at the factory, its owners have acknowledged that they once produced apparel there. Upon learning of possible labor law violations there, however, production was pulled from the plant.
This case first came to light in early May when the Chinese Staff & Workers’ Association, a multitrade grass-roots organization that caters to Chinese workers, took up the cause of employees at several plants operated by Liang. The group has staged protests throughout the city, at Street Beat’s offices and at local department stores. Vacco credited workers from the group for bringing this case to the attention of Labor investigators.
In early May, Chinese Staff also persuaded a nonprofit legal group representing Asian-American workers to file a federal lawsuit against Street Beat Sportswear, charging the manufacturer with labor abuses incurred at factories it had contracted.
That marked one of the first cases where a manufacturer has been taken to court for violations at a contracted factory, and was the first such case filed by the 24-year-old Asian American Legal Defense & Education Fund (AALDEF), which handles four to five apparel-factory related cases each year.
At the time, Albert Papouchado, president and an owner of Street Beat, a $70 million junior sportswear firm that markets under labels such as Street Code, told WWD that violations at three of 30 factories he had contracted in Brooklyn had been brought to his attention by the Federal Department of Labor, and he asserted that he had repeatedly attempted to work out a manner of restitution for unpaid back wages with Labor officials. Two of the cases have been settled, he said.
Street Beat officials did not return calls Thursday. The company has retained Howard Rubenstein Associates, a high-powered public relations firm that handles Kathie Lee Gifford’s press inquiries.
The AALDEF suit charges that the firm knowingly sold apparel made under conditions that broke federal and state labor laws. The suit seeks restitution of $70,000 on behalf of eight workers who said they were subjected to work weeks of up to 137 hours.
Papouchado said in May that he pulled work out of that factory two months earlier but that Labor had ordered the merchandise locked up under the state Hot Goods Law until the situation is settled.
A spokesman at Rubenstein said Thursday that Street Beat has examined how it deals with contractors, “how to best monitor its contractors and how to insure that the letter and spirit of the labor law is being met.” The firm also issued a statement to its remaining contractors alerting them that labor issues associated with offshore manufacturing had hit home.
“This was a wakeup call to Street Beat,” the spokesman said. “They have no intention of going down this road again with another manufacturer.”
Meanwhile, the attorney general, under the proposed legislation, will have the power to restrain shipping, delivery, sale or purchase of apparel found to be made in sweatshops, and gives the office the right to sue for liability for nonpayment of wages. It would also require certain employers, which are not defined in the legislation but would most likely include previous offenders, to deposit a surety bond to guarantee wages.
The measure also states that retailers can request an electronically transmitted assurance by a manufacturer or contractor that merchandise was made legally as a means of removing liability of the retailer.
Ted Potrikus, legislative director for the Retail Council of New York State, said he lobbied for this provision and was “pleased that the legislature has given us the opportunity to point out the concerns of the retail industry.”
Spano said the new legislation is a major victory in the continuing battle for worker rights and will send a significant message that “we won’t tolerate sweatshops.”
“Owners of many of these sweatshops register their operation in someone else’s name in order to avoid the Labor Department,” Spano told WWD. “With the new photo identification of the owner on record, this will no longer be possible.”
One section of the bill that has been ironed out after much debate would make companies liable for damages even if they are in compliance with labor laws but do business with sweatshops.
“To a certain degree, we will make the garment industry police itself by making manufacturers and contractors check with the Department of Labor to insure those they are doing business with follow proper labor practices,” Spano said. “Now, rather than look the other way, these companies will be liable if they contract with sweatshops.”
There are also two sections of the legislation that increase enforcement mechanisms. The first expands the Hot Goods Law, which allows seizure of goods being sold or distributed that were made in violation of labor laws, to allow government confiscation of merchandise being produced. A second provision requires employers to post a bond if they have a history of violating labor laws to make sure workers receive fair pay.