A Thread Of Toil Connects Phila. To Clothing Prices The Government Is Fighting The Reemergence Of Sweatshops. Shops In Philadelphia Are Being Watched.

Posted: June 16, 1996

The elevator stops at the top floor of the old loft building on Race Street, above a gentlemen's club two blocks from City Hall.

A bell sounds, signaling that visitors are on the floor. A woman unlocks the solid wood door.

Inside TLD Fashion Inc., about a dozen women sit at high-powered Juki sewing machines, making black cummerbunds, while Chinese music plays over the roar of equipment.

On the sidewalk below, two workers are loading pants into a van.

Ma Chong, the owner, steps out of his office, holding a cordless phone.

Business is slow now, he says.

That is about all he cares to say about business.

TLD paid $2,700 last month in back wages as part of the U.S. Department of Labor's highly public crackdown on illegal apparel production. Chong said it was a bookkeeping mistake. He said TLD is fair to its workers.

Federal inspectors are taking a special interest in the garment industry these days. So are the people who made Kathie Lee Gifford cry on her TV show.

That's because sweatshops have made a comeback.

In nine decades since the deadly Triangle Shirtwaist fire became a rallying cry for unions and reformers, stronger labor laws and postwar prosperity made sweatshops all but disappear from U.S. cities.

Now, nurtured by global economic forces, they have bloomed anew - in New York, Los Angeles, Dallas and Miami.

And Philadelphia.

``There had been a real elimination of sweatshops. You just didn't hear of it . . . but it's clear that since the late 1980s, there has been a reemergence of shops that routinely and regularly violate labor laws,'' said Maria Echaveste, who heads the Labor Department's Wage and Hour Division.

That reemergence has not gone unchallenged.

Labor Secretary Robert Reich, whose parents ran a dress shop in Scranton, has made this his crusade. He has deployed investigators to sweep suspected sweatshops. He has publicized the names of retailers selling illegally made goods on the eve of the Christmas buying binge. His department raided a California factory last year and found Thai immigrants working in slavelike conditions.

The globalization of the garment industry over the last decade has created vast pools of laborers eager to leave rural poverty to make 50 cents an hour or less sewing clothes in the Third World. That has put pressure on U.S. producers to cut costs.

``Many,'' Echaveste said, ``end up taking the low road.''

The Labor Department estimates that there are 22,000 sewing shops in the country and that about half regularly violate the law. Industry officials dispute that figure but agree that the biggest offenders are in New York and California.

There are 200 to 300 garment shops operating in Philadelphia, most of them in Chinatown, say labor organizers and some of the contractors who run shops. They say the shops range in size from 10 to 100 employees. (Federal officials declined to make an estimate.)

Hundreds of other shops also are operating in South Jersey, and near Allentown, Reading or Scranton.

How many are sweatshops?

It's hard to know. Three contractors, including TLD, were ordered to pay back wages last month by the Labor Department. Inspectors listed six area companies as selling apparel made by contractors that violate labor laws.

Labor organizers say that only hints at a wider problem.

``I wouldn't want to say we've cleaned the problem up, because they close and reopen all the time,'' said James Kight, regional administrator for the Wage and Hour Division whose territory includes Philadelphia and New York City. ``But Philadelphia is not as bad.''

* In factory lofts near the Chinatown section of Center City, workers are trying to sew their way into the American middle class.

On the sixth floor of an old factory at 12th and Vine Streets, 25 Asian women are stitching lime-green skirts in silence, their feet pumping the industrial sewing machine treadles at Sun Fashions Inc. It's not on the Labor Department's violator list.

A few are standing by an open fire escape until a loud horn blares, signaling that the break is over. The owner of the shop, Kee Hyun Kim, patrols the aisles.

A block east, workers are filling a van with garment pieces, cut and wrapped in white cloth bundles. A block west, on the ground floor, workers are steam-pressing navy chiffon evening gowns with rhinestone trim.

Some garment work isn't done in shops. Labor investigators say workers are violating state and federal law by sewing commercial garments at home, as well. On Friday night they leave factories with shopping bags of garment pieces and then return Monday with finished goods.

``In some neighborhoods the van drops piece goods off at people's homes,'' said Arnold Delin, the executive director of the Atlantic Apparel Contractors Association, which represents 75 union shops in Pennsylvania and South Jersey. ``Just like a grocery route.''

The hazards go beyond wage-and-hour violations.

In 1989, a Vietnamese immigrant and his three young sons died after a fire in their home in Kensington, where they did sewing. A kerosene heater spilled and ignited bolts of fabric in the living room, causing a swift, intense blaze.

Two years ago, Labor Department investigators and city fire and building safety officials raided Betty's Fashions, a contract shop in West Philadelphia, where about a dozen workers on the ground floor were sewing amid piles of fabric just feet from kerosene heaters.

A day-care center was on the second floor.

``It was scary,'' said George Ference, acting district administrator for the Wage and Hour Division in Philadelphia. ``That was one of those days where you go home and just imagine what could have been.''

The American Apparel Manufacturers Association bitterly disputes the Labor Department's estimate that half the nation's garment factories are sweatshops.

``That is grossly, grossly inflated,'' said Allison Wolf, a spokeswoman for the association, which represents about 70 percent of U.S. garment makers. Manufacturers usually don't make the goods themselves, but contract the work to many contractors.

Wolf said her members are concerned about illegal garment shops because they drive up competition. But she suggested that the Labor Department's publicity campaign was putting undeserved heat on U.S. retailers - who already have their hands full battling cheap imports.

``What are they trying to do?'' Wolf said. ``Push everybody overseas?''

Mike Brennan, regional organizing director for the Union of Needletrades Industrial and Textile Employees (UNITE), who has investigated garment shops in Philadelphia, said most workers in the city are paid by the piece. That opens the system up to violations of wage and overtime laws, he said.

Sometimes a shop just shuts down and disappears, leaving workers unpaid for a week's work or more, Brennan said. That happened in New York last month. One worker went to the union, clutching Kathie Lee Gifford labels.

REPORT FROM INSIDE

Two years ago, three Asian garment workers from New York came to Philadelphia and worked in four contract shops for two months and reported back to UNITE.

``It was summer; it was very hot. There were no windows,'' Jenny Lee, one of the three workers, recalled last week.

Lee said she made $4.25 an hour but was not given overtime pay. She worked making evening gowns from 8 a.m. until 6 or 7 p.m. or later. She did not work Saturdays, but others in the shop did.

In every shop, Brennan said, the workers saw wage-and-hour violations. One woman was paid as little as $2.40 an hour for her work. In three of the shops, workers were paid in cash but were charged a 5 percent check-cashing fee anyway.

``On any given day, they [the shops] were all in violation,'' Brennan said.

The obstacles to regulating garment shops are many. Shops open and close quickly. Most workers speak little English, and those who are in the country illegally are unlikely to complain to authorities.

``When we put pressure on a shop, very often it just closes and the workers don't want to draw attention to themselves and get deported,'' the Labor Department's Kight said. ``So you don't find these people complaining.''

His colleague Ference said that in the last three years, his agency had become more experienced in detecting sweatshops.

Investigators run surveillance, searching for fluorescent lights glowing on upper floors of loft buildings at night and on weekends. They watch for workers coming and going on Saturdays and then check the shop's time cards. They look at production records to see how many garments were made in a given period and calculate whether it was possible to make that many garments in the hours reported by the shop.

RECORDS QUESTIONED

Often, investigators say, contractors keep two sets of records.

But the Labor Department, which has 800 investigators to police 6.5 million U.S. workplaces employing 110 million people, is also applying pressure higher up in the garment food chain, Kight said.

It doesn't matter to the Labor Department that many of the workers are in the country illegally, Echaveste said. They are still protected by labor law.

``Illegal immigrants have broken immigration laws,'' she said, ``but that is not a license for an employer to exploit them.''

Almost half the clothes sold in the United States are still manufactured in this country, by nearly 1 million workers, despite the closing of thousands of apparel companies since the early 1980s, when imports began to surge.

But clothing manufacturers say they are beginning to shift some production from Asia back to the United States. The wages in this country are higher, but unlike garment work done overseas, garment shops here are not subject to political upheavals, tariffs or shipping costs. And the work can be delivered faster to keep up with what styles are selling.

As Jo-Ann Mort of UNITE's New York office explained, the shift away from overseas work is a two-edged sword: ``It's good because it brings jobs back to the U.S. But it also is contributing to the reemergence of sweatshops.''

Kurt Erman, the chief executive of Notations, in Huntingdon Valley, one of the largest U.S. blouse manufacturers, said that 18 months ago, 70 percent of his garments were made in Asia. Now that's down to 30 percent, with the rest made in the Caribbean and United States.

``Maybe it costs me $1 more, but the issue right now is time,'' Erman said. ``You've got to get the items that are selling back into the stores fast.''

Contractors and labor organizers say retail apparel buyers are still looking to buy goods at lower Asian prices. ``My customers, they want the price down, down, down,'' said Kim, the owner of Sun Fashions.

Erman said he uses five to eight U.S. factories to make up to a million garments a month.

Last month, two of those shops in New York City were cited for labor law violations. Erman said his company now screens all contractors before giving them any work.

The apparel manufacturers' association said it gives members a database listing past safety and wage-and-hour violations so that they can check up on their contractors.

Kight said part of the stimulus for sweatshops is pressure from the retail side of the industry to keep prices down. And that, Kight said, makes it hard for the contractors who run the shops to pay the legal wage.

``The garment workers themselves are the number-one abused workers right now,'' he said. ``The number-two abused worker is the garment subcontractor.''

Morrison Cain, spokesman for the International Mass Retail Association, said his trade group, which includes Wal-Mart, resents that claim.

He contends that contractors who don't pay legal wages are pocketing the profits. He said Labor Secretary Reich was picking on retailers unfairly.

``The Labor Department might as well just go the next step and make the customer responsible for the way everything they buy is made,'' Cain said.

In a way, it has.

The department's Echaveste said the publicity campaign was ultimately aimed at consumers. If every shop obeyed labor laws, she said, the price of a $28 shirt would only go up to $29.25.

``Most consumers,'' Echaveste said, ``would be willing to pay a little more.''

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