Sunday, February 16 1997; Page A01,
The Washington Post
© Copyright 1997 The Washington Post Company
Reaping Abuse for What They Sew
Sweatshops Once Again Commonplace in U.S. Garment Industry
By William Branigin
NEW YORK -- After an arduous trek across the border from her native Mexico, Aurora Blancas made her way to New York City and took the first job she could find: sweeping floors and packaging clothes sewn by other illegal immigrants at a sweatshop in the garment district.
No experience -- or documents -- necessary.
"I started working the same day I asked for the job," she said. "The boss asked me my name and how old I was. Nothing more."
But unlike her fellow workers, Blancas, 28, did not accept quietly the exploitation and abuse that followed when she was hired last summer to work in the dilapidated Eighth Avenue building.
Although her willingness to speak out makes Blancas unusual, the place that employed her and the conditions she found there are not.
Despite a ledger of laws against them and periodic pledges by government and business leaders to crack down, sweatshops have made a remarkable comeback in America, evolving from a relative anomaly into a commonplace, even indispensable, part of the U.S. garment industry.
They have also evolved almost entirely into a phenomenon of immigrants. According to federal investigators and union officials, most such factories are owned by newcomers from Asia, who often exploit other immigrants, many of them illegal, either from Asia or Latin America. Typically, both the workers and the employers see themselves as victims of a system dominated by increasingly powerful major retailers.
In Blancas's case, the owner of the 14th-floor shop in which she worked is a South Korean immigrant whose clothes were sold to suppliers of such stores as Wal-Mart and Kmart. According to Blancas and another former worker, he refused to pay the minimum wage or overtime to his three dozen, mostly female employees. The workers typically toiled at their sewing machines and presses for up to 60 hours a week in a room with wires hanging from the ceiling, three small fans that served as the only source of ventilation and no fire exits. Wages, usually paid in cash to avoid taxes, often were arbitrarily cut or delayed if the owner ran short of funds. Employees who missed a day would be illegally "fined" $30, on top of losing a day's pay.
When workers made mistakes, the owner's wife would scream at them, throw garments in their faces and sometimes pull their hair or hit them. One newly arrived young woman was summarily fired for yawning on the job.
Last July, after Blancas demanded higher wages and brought the sweatshop to the attention of a garment workers union, she was fired.
Whether operating openly in decrepit buildings in New York or Los Angeles or hidden away illegally in people's homes in Dallas, sweatshops violate labor and tax laws amid cutthroat competition for orders that filter down from the retailers.
Underground Economy
The return of the kind of sweatshops that flourished early this century -- and were thought to have been largely eliminated -- reflects fundamental changes in the garment industry and, more broadly, in American society. The shops have become part of a vast underground economy, shielded by an overlay of laissez-faire practices and tacit accommodations.
Clothing designers and retailers depend on the sweatshops for fast delivery and big profit margins. Unions, hopeful of eventually organizing these workers, appear to be more interested in preserving manufacturing jobs than driving them out of business. Large pools of illegal immigrants are so anxious for work that they accept the shops' meager wages and are often too fearful to complain. Consumers keep gravitating toward the lowest prices they can find. And government agencies do not field enough investigators or cooperate sufficiently with each other to pursue the shops effectively and enforce the laws that would eradicate them.
Helping sweatshops to thrive have been technological advances that allow retailers to determine instantly what is selling and to order more of it. This allows stores to limit inventory and avoid getting stuck with large volumes of unpopular apparel. But it also requires quick turnaround, which favors domestic manufacturers. The pressures on these manufacturers to produce garments quickly and still compete with cheap foreign imports have tended to drive down wages and working conditions among the sewing shops that lie at the bottom of the industry.
Yet, there is no shortage of workers for these jobs because of a broader change in American society: increasing waves of legal and illegal immigration since the 1970s and growing concentrations of immigrants in cities such as Los Angeles and New York.
The sweatshops' revival also reflects a weakening of unions in the garment industry in recent years, in part because of their difficulties in trying to organize workers who are here illegally in the first place. For them, even a sub-minimum wage in the United States generally beats what they could earn in their homelands.
Although the clandestine nature of much of the industry has made it hard to track, recent federal studies point to a rise in the number of U.S. sweatshops and a worsening of their conditions.
Union and Labor Department officials estimate that minimum wage and overtime violations, two of the basic parameters that define a sweatshop, prevail in more than half the 22,000 U.S. sewing businesses. Many also pay their workers "off the books" to avoid various local, state and federal taxes.
The sweatshop conditions described by Blancas are "typical of the bottom of the industry," said Jeff Hermanson, director of the Garment Workers' Justice Center, a branch of the Union of Needletrades, Industrial and Textile Employees.
"Physical abuse is unfortunately quite common, and there's always the yelling," he said. The long hours, low wages and lack of benefits often found in Korean-owned sweatshops are also routine in shops run by Chinese and Latino owners, he said.
In New York, a garment center where much of the industry's changing dynamics play out, Koreans own up to 40 percent of the city's roughly 4,000 contract sewing shops. Chinese immigrants own almost all the rest. Yet, the Korean-owned shops have attracted relatively more attention from labor investigators, mostly because they tend to hire Latino workers, who are less reluctant to complain than Asian employees.
Intimidation
Chinese-owned shops tend to hire only other Chinese, said Maria Echaveste, administrator of the Labor Department's wage and hour division. In some cases, she said, workers have expressed fear for their lives if they reveal labor violations. Many Chinese sweatshop workers are believed to be indentured servants toiling under a form of debt bondage to pay off the heavy cost of being smuggled into the United States.
"The workers lie to us," one investigator said. "In Chinese shops, the falsification of records is absolutely down to a science. It's almost impossible to break unless the shop goes out of business. It's only then that workers tell you those were not the hours and rates they worked."
In the Korean-owned shops, poor working conditions are often exacerbated by the lack of a common language between the Koreans and their mostly young, female Latino employees.
"They [the Korean owners] think they can make themselves understood by yelling," said Hermanson of the Garment Workers' Justice Center, which tries to organize workers and defends them in disputes with shop owners. The result, especially when owners hit their workers, is an "atmosphere of terror and intimidation," he said.
The Korean Apparel Manufacturers Association says it has been trying to get its 400 member companies in New York to pay at least the minimum wage. Most now do so, the group says. But these owners are themselves victims of punishing market forces, the group argues.
"The problem for the sewing companies is that the minimum wage goes higher and higher, and the price from manufacturers stays the same or goes down," said a spokeswoman for the association who gave her name only as Hung.
She acknowledged that some owners treat their workers harshly but said most do not. As for the illegal aliens among them, she conceded, "That's a problem."
For Blancas, trouble started almost immediately after she was hired by a shop called New Young Fashions. The owner, Kim Young Han, paid her less than the $160 a week she said she was promised. She worked six days a week, starting at 7:30 a.m. and finishing at 6 p.m. each weekday. Her pay averaged $2.54 an hour, according to figures compiled by the workers' center.
When she found out what the minimum wage was and told her co-workers they should be getting at least $4.25 an hour, "they were astonished," but refused to back her in a confrontation with the owner and his Korean wife, Blancas said.
"They were robbing us," she said. "I was very angry. . . . I said, `Talk, compan~eros, talk,' but they were terrified. The [owner's wife] told me to shut up and leave, and the others just kept quiet."
Her co-workers, most of them fellow Mexicans and Ecuadorans, feared being deported as illegal aliens if they complained, Blancas said.
Interviewed at his factory, Kim said he had resolved all of his employees' complaints and that he is now complying with labor laws.
After Blancas was fired from New Young Fashions, the workers' center helped her recover some of her back wages. She later found work in another garment shop that pays more, though still not the minimum wage. She took a second job in a store.
Blancas said she left her home in Mexico City to seek work in the United States because her husband had died in a car accident a year earlier and she needed to support her young son. She crossed the border with an uncle, who also works in a sweatshop, and trekked all night over hills to reach a road that would set them on their way to New York.
Bertha Morales, a 25-year-old Ecuadoran who worked in another Korean-owned sweatshop, said she was sent by her boss to help out at New Young Fashions one day and was shocked by what she saw. At one point, she said in an interview, the owner's wife struck a worker on the back for sewing buttons incorrectly. Other workers described similar punishment, and one told of an incident in which the boss grabbed her hair and pulled on it.
One new employee, a 19-year-old woman from Nicaragua, was summarily fired by the owner's wife for yawning and left the shop in tears, Morales said.
The Food Chain
Sweatshops such as Kim's lie at the bottom of what the Labor Department describes as a garment industry "food chain" beneath layers of suppliers, designers and middlemen, who compete fiercely for orders from the big retailers at the top.
It is a system that regulators and union officials say effectively insulates the big-name stores and fashion labels, allowing them to profess shock and ignorance of sweatshop conditions in which their clothes were sewn.
Major retailers, such as J.C. Penney, Sears and Wal-Mart, have quality-control inspectors who regularly visit work sites, and they know how much it costs to produce a garment at the minimum wage, a Labor Department official said. But under a 60-year-old law, the retailers can be held liable only if they had "direct knowledge" of labor violations involved in producing their goods.
The system also adds markups far in excess of the actual cost of the labor and material that went into the garments.
Retailers say too many variables go into the final price of a garment to generalize about any of them, but Labor Department and union officials estimate that labor typically accounts for less than 3 percent of the U.S. retail price of clothing made in domestic sweatshops and as little as one-half of 1 percent for garments sewn abroad.
Because of the pressures weighing on those at the low end of the industry, shop owners such as Kim Young Han believe that they, too, are victims of the system.
Sitting at his worn desk in a corner of the shop floor, Kim blamed his problems on creditors, saying he was owed thousands of dollars by garment manufacturers who had subcontracted several large jobs to him. He produced letters to them demanding payment and threatening "legal action." All were written in longhand; he does not have a typewriter.
Wearing jeans and a denim shirt, the lean, craggy-faced Kim, 61, said he had been a lecturer at a junior college in Seoul before coming to the United States years ago to study for a doctoral degree in linguistics under Noam Chomsky. Although that alone makes him a rarity among sweatshop owners, union officials said his violations of labor laws were all too familiar.
Asked about the specific allegations against him by the garment workers union, Kim became visibly upset and pleaded for understanding.
"Help me, please," he begged. "I'm in trouble."
Seemingly on the verge of tears, Kim complained of having to compete with cheap imports and denied making any windfall profits. "I want to close my factory," he lamented over the din of sewing machines and a radio blaring Spanish songs. "The market's no good. . . . No hope at my age."
The National Retail Federation, which represents 2,000 major U.S. retailers, in turn blames sweatshop conditions on subcontractors such as Kim.
"The retailers don't employ these workers," said Pamela Rucker, a spokeswoman for the federation. "The retailers many times are at least two or three steps removed from the problem." She asserted, "It's not the retailers who are reaping the benefits from these criminal activities. It's the greedy subcontractors."
Enforcement
Shops at the bottom of the industry often go out of business, relocate andopen under new names. Some fail altogether, never to reappear. But despite decades of lawmaking against them -- and a public campaign by the Clinton administration following the 1995 exposure of a virtual slave-labor garment factory in Los Angeles -- the system designed to eradicate the sweatshops has largely failed, union activists say.
Local, state and federal agencies charged with enforcing labor, immigration and tax laws have often failed to work together, allowing shop owners and workers to slip through the cracks of the system. Under a directive renewed by Mayor Rudolph W. Giuliani, a strong supporter of immigration, New York authorities are prohibited from sharing information with the Immigration and Naturalization Service.
At the direction of the administration and Congress, the INS has thrown the bulk of its resources at the southwestern border to prevent illegal immigrants from crossing into the United States from Mexico. Nationwide, only about 1,700 INS investigators are assigned to the interior of the country, and they spend less than 20 percent of their time enforcing immigration law at work sites of all kinds, according to the agency.
In a special effort in New York last year, INS agents arrested 1,824 illegal aliens during inspections of 150 work sites, most of them garment shops. However, because of a lack of detention space, almost all were released on their own recognizance and told to return for court hearings.
"The percentage that shows up is minute," said Russ Bergeron, an INS spokesman. Most simply find another job in the underground economy, and many return to work at the same shops where they were arrested.
Ironically, labor groups such as the Garment Workers' Justice Center also play a part in keeping the sweatshops in business. Among the literature the center distributes, for example, are fliers in English, Spanish and Korean that advise shop owners how to fend off searches by INS and Labor Department agents.
The fliers encourage employers to challenge inspections on grounds of discrimination and use legal stalling tactics that the INS says often enable them to fabricate employment eligibility records. Fliers in Spanish urge workers to "remain silent" when asked about their nationality, birthplace or entry into the United States.
The union says its main aim is to protect workers and preserve their jobs, regardless of their immigration status. When faced with labor violations, the justice center usually tries to work out a solution with the employer without government involvement.
Critics call the policy misguided. "If you're trying to defend a living standard, the minimum wage and Social Security and deal with legitimate companies," one independent labor activist argued, "helping these sweatshops exist would seem to be counterproductive."
Retribution
For some garment workers, the punishment for exposing sweatshop conditions comes from their employers. After complaining about what she saw at New Young Fashions while filling in there last year, Bertha Morales was fired by her own Korean boss, who was a friend of Kim's.
Others, including two illegal immigrant sisters from Mexico, said workers do not tell authorities about labor violations and physical abuse out of fear that their shops will then be raided by immigration agents.
In the case of another outspoken worker, the consequences of going public -- or at least the perception of those effects -- became evident after she appeared at a forum on sweatshops in Arlington last summer. The worker, Nancy Penaloza, 29, said she has labored in Korean-owned sweatshops in New York for nine years, working up to 66 hours a week in filthy conditions. In her current job, she said, she sews high-quality women's suits, earning $6 apiece for garments that usually sell for $120 or more at stores such as J.C. Penney and Ann Taylor.
"I get paid off the books," Penaloza told the forum. "Even though I am working legally, my boss doesn't pay any taxes or Social Security. . . . I never get a vacation. I never even get a whole weekend off." She said she works in constant fear, not only of her temperamental boss but of the "big rats and mice" that continually crawl over her feet.
A day after she spoke, INS agents raided her factory and arrested most of her co-workers, who were illegal immigrants, Penaloza said. Three days after that, a Labor Department wage inspector showed up. Although she is sure the INS raid was a coincidence, because she did not name her employer at the forum, her co-workers blamed it on her.
A former secretary in Mexico, she said she originally crossed the border as an illegal alien herself, then "became legal" a couple of years ago.
She said her Korean boss routinely smacks his workers in the head when they make mistakes. He also orders them to tell the Labor Department that they are receiving their proper wages and overtime, she said, and that is what they did during the latest inspection.
"The workers are afraid," Penaloza said. "They don't want to lose their jobs."
And so, she said, "they lied to the inspector," thus perpetuating a cycle that helps the industry to survive.
HOW THE INDUSTRY WORKS
Long before a blouse ever reaches the sales rack, it passes through several layers. At the bottom are workers in sewing shops, many of whom toil in sweatshops working 60 hours a week for low pay in unsafe, abusive conditions. Here is the path garments take in this country to get from the assembler to the store.
Retailers
Sell to the public garments received from manufacturers. As fewer retailers control a larger share of the market, they have more power to demand low prices and fast delivery from their suppliers.Manufacturers
The 1,000 U.S. manufacturers design garments, sometimes marketed under their own labels, and sell them to the retailers. They generally use contractors to make the garments.
Contractors and subcontractors
There are about 22,000 such contracting shops, whose workers cut and sew materials. Many shops employ illegal aliens, and half violate minimum wage and overtime laws, according to one government estimate. They are often transient -- closing, moving or reopening under new names.
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