Sweatshops, retailers
settle suit

The Gap, Target and 5 other retailers
join the settlement to end
3 years of litigation

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By Debra Barayuga
dbarayuga@starbulletin.com

It is believed to be the largest known settlement of a sweatshop case in the world, according to a lead attorney in the case.

Seven U.S. retailers and 23 Saipan manufacturers have agreed to pay $11.25 million to settle a federal class-action lawsuit that alleged Saipan's garment industry violated U.S. labor and human rights laws.

Abercrombie & Fitch, Target, Gap Inc., J.C. Penney Co., Lane Bryant Inc., The Limited Inc. and Talbots Inc. joined 19 other retailers yesterday who previously settled, bringing the total settlement fund to $20 million.

"When you go to Ala Moana or any of the retailers' own stores there, you as an American consumer want assurance that when there's a 'Made in USA' label, that those garments are made in full compliance with American law," said Michael Rubin, a lead attorney for the workers with the law firm Altshuler Berzon Nussbaum Rubin & Demain in San Francisco.

"The result is a victory for American consumers and for the workers themselves."

The settlement, if approved by the federal court in the U.S. Commonwealth of the Northern Mariana Islands, brings to an end nearly three years of litigation. There is no admission of wrongdoing by the defendants.

The lawsuit was filed on behalf of immigrant workers -- mostly young women -- from China, the Philippines, Bangladesh and Thailand who claimed they were lured to Saipan with promises of high pay.

They were brought to Saipan for fees of up to $10,000 and agreed to pay it off with their wages.

When they arrived, however, they were forced to work long hours for low pay and under intolerable working conditions. The garment factories in Saipan produce more than a billion dollars' worth of clothing that are sold annually in the United States.

At least $6 million of the $20 million settlement will go toward compensating more than 30,000 to 40,000 former and current garment workers. There are about 12,000 currently working in the Saipan factories today.

More significant, the defendants have agreed to adopt a code of conduct and an independent monitoring of Saipan factories "which will set the standard for factory monitoring for years to come," Rubin said.

The code of conduct requires employers to comply with all applicable laws of the United States and Commonwealth of the Northern Mariana Islands.

Manufacturers have also agreed to comply with strict employment standards, including guarantees of extra pay for overtime work, safe food and drinking water.

The code also prohibits so-called "shadow contracts" which threaten the workers with arrest and imprisonment if they get pregnant, go to church, join a labor union or complain about workplace conditions, Rubin said.

Companies that settled earlier were Calvin Klein Inc.; Jones Apparel Group; Liz Claiborne Inc.; The May Department Stores Co.; Oshkosh B'Gosh Inc.; Sears, Roebuck and Co.; Tommy Hilfiger USA Inc.; Warnaco Inc.; Nordstrom Inc.; J. Crew Group Inc.; Cutter & Buck Inc.; Gymboree Corp.; Ralph Lauren; Phillips-Van Heusen; Bryland LP; Donna Karan International; The Dress Barn Inc.; Brooks Brothers; and Woolrich.

One remaining defendant, Levi Strauss & Co., did not join the settlement but stopped purchasing garments from Saipan after the lawsuit was filed.

Rubin said the plaintiffs expect to pursue the claims against Levi Strauss. No trial date has been set.