Archived News Release — Caution: Information may be out of date.

U.S. DEPARTMENT OF LABOR

ESA Press Release: Most Bay Area Garment Shops Pay Required Wages; Monitored and Established Businesses Do Best [05/18/1999]

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Nearly three-fourths of garment sewing shops and manufacturers in San Francisco and Oakland obey federal wage and hour regulations--about the same level as in 1997- according to a U.S. Department of Labor survey released today.

Although the overall level of compliance remains stable, the survey indicated some notable changes in the past two years. The amount of back wages found by the department owed to underpaid workers is down dramatically from similar surveys in 1995 and 1997. Sewing contractors monitored by the manufacturers they supply are less likely to violate the law, and the more closely monitored the better their compliance. Firms which have been in business two years or more are also more likely to be in compliance than newer businesses.

"The insights provided by this survey will be instrumental in fine-tuning our efforts to use enforcement, education and partnerships to continue to improve compliance in this industry," Labor Secretary Alexis M. Herman said. "The survey clearly demonstrates that shops effectively monitored by manufacturers are more likely to obey labor laws."

According to the survey--conducted by the department's Wage and Hour Division--74 percent of Bay Area garment businesses comply with the minimum wage, overtime pay and other requirements of the Fair Labor Standards Act, not a significant change from a similar 1997 survey, and up dramatically from 57 percent in 1995.

The survey includes data for the first time for the San Francisco Bay area showing that garment shops monitored periodically by manufacturers had much higher compliance levels and smaller amounts of back wages for underpaid employees. A garment shop is considered "monitored" when a manufacturer conducts one or more of the following during the year: record review; time card review; employee interviews; distribution of compliance materials; notifying shop owners of common violations and recommending corrective action; or making an unannounced monitoring visit. A shop is considered "effectively monitored" if six or more of the above elements occur. The compliance level for effectively monitored contractors was 90 percent, compared to 76 percent for contractors subject to some monitoring, and 57 percent for shops not monitored at all.

The average back wage amount owed by effectively monitored shops was $186, about 10 percent of the $1,841 average owed by firms which were not monitored.

The survey also found that among Bay Area sewing shops, compliance is greater among established firms. The average compliance level of companies in business more than two years is 76 percent, compared to 64 percent of firms less than two years old.

The survey also found a high rate of current compliance (86 percent) by those contractors that had been previously investigated and found in violation. It found no instances of the illegal employment of minors.

The results of the survey were announced at a Garment Stakeholders Forum in San Francisco today. The Labor Department hosted the meeting which was open to representatives from all parts of the industry -- sewing contractors, manufacturers, retailers, worker advocacy groups, academia and other interested parties.

The survey of 57 firms is considered a statistically valid sampling of the Bay Area garment industry. In total, some 400 garment sewing shops employ approximately 10,000 workers on both sides of the Bay. The department conducts periodic surveys in major garment centers to measure compliance with the wage and hour laws and to direct resources to improve compliance. In 1993 the Department launched the "No Sweat" campaign--a multi-pronged nationwide strategy of enforcement, partnership and education--to eliminate sweatshops in the U.S.

Since the "No Sweat" initiative was launched, the department has recovered more than $17.7 million in back wages for 54,000 garment workers across the country.

Archived News Release — Caution: Information may be out of date.