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Volume X, Number 221

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August 06, 2020

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Big Changes to California’s Garment Industry Possible

On June 25, 2020, the Garment Worker Protection Act, SB 1399, passed the California Senate in a 25-11 vote. The bill was introduced by State Sen. Maria Elena Durazo, the former secretary-treasurer of the Los Angeles County Federation of Labor, who said that it is meant to address long-standing issues for garment workers, “who, when paid by the piece, earn on average $5.15 per hour.” 

Currently, many workers engaged in garment manufacturing are paid on a piece-rate basis, meaning that they are paid per each item they make, regardless of how long it takes to make the item. SB 1399 would prohibit piece-rate pay for California garment workers. Consequently, if the bill passes, garment manufacturers will need to change their pay structures to ensure that workers are paid on an hourly basis.  

The California bill also seeks to close a loophole in an earlier law, AB 633, which sought to prevent wage theft against garment manufacturers by mandating that businesses that contracted to have garments manufactured were liable as guarantors for unpaid wages and overtime of garment workers. Supporters of SB 1399 argue that manufacturers have attempted to avoid liability under AB 633 by adding layers of contracting between themselves and the employees making the garments. SB 1399 therefore clarifies that a business contracting to have garments made is liable for unpaid minimum wages and overtime of workers regardless of how many layers of contracting exist. 

The bill defines a “brand guarantor” as a person contracting for the performance of garment manufacturing, regardless of whether the person with whom they contract performs manufacturing operations or hires a contractor or subcontractor to perform the operations. The bill specifies that a person who is engaged in garment manufacturing and contracts with another person for the performance of garment manufacturing shares joint and several liability with a contractor and a brand guarantor for all civil legal responsibility and liability for all workers employed by the contractor. 

The bill also requires those parties to guarantee the payment of unpaid minimum wages, overtime pay, break premiums, and other damages and penalties, and to guarantee failure to secure workers’ compensation coverage. 

Further, the bill expands the definition of garment manufacturing to include dying, altering a garment’s design, and affixing a label to a garment. It also requires garment manufacturers to maintain additional records for three years, including all contracts, invoices, purchase orders, work orders, style or cut sheets, and any other documentation pursuant to which work was performed. 

There is strong opposition to the bill among many in the apparel industry, however, it is not clear whether that will be enough to stop the bill from being approved by the California State Assembly and becoming law.

© 2020 BARNES & THORNBURG LLPNational Law Review, Volume X, Number 191

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Scott Witlin Employment lawyer Barnes Thornburg
Partner

Scott J. Witlin is a partner and the administrator of the Labor & Employment Department in the firm's Los Angeles office. He is Co-Chair of the firm's Wage and Hour Practice Group and a member of the firm's Entertainment, Media and Sports Practice Group.

Scott assists companies in dealing with the challenges of employing workers in California and throughout the U.S. Scott's practice includes both traditional labor and employment law matters, including wage and hour class actions, arbitrations, collective bargaining negotiations, compliance with various guild and union agreements...

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Associate

Caroline represents employers in a range of actions involving harassment, retaliation, discrimination, wrongful termination, and wage and hour claims, including class actions.

Beyond litigation and agency representation, Caroline counsels senior management on day-to-day human resources and employee relations issues, including wage and hour compliance, disciplinary and performance counseling, reasonable accommodation, termination decisions, internal complaints and investigations, and employee classifications. She also assists with reviews and updates to company handbooks, policies and procedures.

Caroline is skilled at working directly with clients, having been third-chair at trial and conferring with clients and with experts and witnesses. She leads investigations and takes and defends depositions, including PMK depositions. She also drafts and responds to various pleadings and motions. Caroline also negotiates settlement agreements and has been first-chair in several mediations.

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David M. Spooner, Barnes Thornburg Law Firm, Washington DC, Corporate and Finance Law Attorney
Partner

David M. Spooner is a partner in the Corporate Department and Co-Chair of the International Trade Practice Group. Mr. Spooner represents governments, trade associations, and corporate clients on international trade matters, including trade remedies, trade policy and customs issues. He uses his past experience as a high-level political appointee in the Executive Branch and on Capitol Hill to assist clients with their advocacy efforts before both branches of government, as well as before foreign governments.

Prior to entering private practice, Mr...

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