Garment Maker in Saipan to Pay Nearly $1 Million in Back Wages
A Saipan garment factory that makes golf clothing and women’s wear for U.S. consumers has agreed to pay nearly $1 million in back wages to hundreds of Chinese immigrant workers under a U.S. Labor Department agreement announced Thursday.
Micronesian Garment Manufacturing Inc., which produces clothing for Cutter & Buck of Seattle and Jones Apparel Group USA Inc. of Bristol, Pa., is fighting an additional $336,000 penalty assessment for “repeated and willful violations” of labor laws. This was the second time in a year that the Labor Department has found violations at the company.
Abuses that led to the settlement are indicative of widespread labor problems in Saipan, part of the U.S. territory of the Northern Mariana Islands, said John Fraser, the department’s acting wage and hour administrator. He says workers there routinely go unpaid for weeks or are forced to work overtime without extra pay.
“The garment industry in the commonwealth started taking off in the mid-’80s and there have been problems with compliance from the very beginning,” said Fraser, noting that the department has four full-time investigators in the Saipan area. “We are very concerned and have been for a long time.”
Apparel manufacturing employs about 15,000 workers in 31 factories in Saipan. Last year, $1 billion worth of garments was shipped duty-free from Saipan to the United States, up from just $400 million in 1995, Fraser said.
Nearly all of those employed in the garment industry are guest workers from China and other developing Asian countries. Many pledge thousands of dollars to job recruiters before being taken to Saipan, and the amount is deducted from their wages for months or years.
In a set of three lawsuits filed in January, labor unions and human rights groups alleged that the practice amounts to indentured servitude. The class-action suits, filed in Los Angeles, San Francisco and Saipan, name some of the nation’s most prominent retailers, including Wal-Mart Corp., J.C. Penney Co. and Gap Inc. If the suit goes to trial, it will be the first courtroom test of the responsibility of retailers for the labor practices of contractors that produce their garments.
In general, U.S. law applies in all U.S. territories. But two exceptions were made in the case of the Northern Mariana Islands, which do not have to comply with minimum wage or immigration laws.
The island territory has set its own minimum wage of $3.05 an hour, which is also in most cases the “maximum wage,” Fraser said. The territory also has a liberal guest worker program, pulling workers from China, the Philippines and elsewhere. Of the territory population of 58,800, more than half--31,400--are guest workers.
“The normal workweek is well in excess of 40 hours a week,” said Fraser, who was involved in a $9-million settlement against a Saipan manufacturer eight years ago. “In that case, the average workweek was 72 hours,” he said. “In these factories, it’s not uncommon for even a daily shift to be 10 to 14 hours.”
