CONTRACTOR FOR MAJOR CLOTHING LINES CITED FOR MORE THAN $5 MILLION IN UNPAID WAGES
Factory Swindled Over 100 Workers and Provided Them with Cheat Sheets in an Attempt to Deceive Investigators
Albany, NY (July 23, 2008) - New York State Labor Commissioner M. Patricia Smith announced today that the Department of Labor found extensive labor law violations committed by Jin Shun Incorporated, a garment contractor located at 47-51 33 rd Street in Long Island City, on the outskirts of Manhattan, and its owners, Jikai Lin and Zhang Yun Chen. The factory took extraordinary steps to conceal its violations, even providing its employees with mock question-and-answer sheets to memorize and use in response to investigators’ questions. Jin Shun, a producer of women’s garments for retailers such as Macy’s, Gap, Banana Republic, Express, Victoria’s Secret, Limited and Coldwater Creek, has underpaid more than 100 workers out of nearly $3 million in minimum and overtime wages since 2005. Prior to 2005, the factory operated under the name Venture 47, when it allegedly cheated an even greater workforce out of nearly $2.5 million in minimum and overtime wages.
This morning, the Department “tagged” over ten thousand items of clothing made by the factory, affixing to the garments a label stating that the garments were unlawfully manufactured. Investigators found employees working on these garments off the clock over the weekend, so that the hours worked would not appear on time cards presented to investigators. Under the “hot goods law,” it is a misdemeanor for anyone other than the Department or the consumer to remove such labels. Within hours of the tagging, the manufacturer, Urban Apparel, paid $60,000 in underpayments to have the tags removed, the amount of money attributable to the unlawful manufacture of the tagged garments. The Department also tagged garments at several other factories this morning.
Jin Shun has been cited for violating the state’s minimum wage and overtime laws, falsifying employee time records, not paying overtime wages, and coaching employees to lie to Labor Department investigators. The factory also changed names repeatedly when faced with Department of Labor Investigations and is now operating under the name Garlee NY Inc.
“This factory paid sweatshop wages, kept fake records, and coached employees to lie, even though it had signed retailer codes of conduct to comply with the law. The Department of Labor will use all legal tools to stop this mistreatment of workers,” said Commissioner Smith. Commissioner Smith noted that the Department is referring the case to the Queens District Attorney’s office for review for possible criminal charges.
An investigation by the Department of Labor’s Apparel Industry/Fair Wages Task Force revealed that employees of the factory worked twelve-hour days, six to seven days a week, and were paid on a piece-rate basis. The employer falsified time records by making workers punch one time card for their hours on Monday through Wednesday, and a second time card for the latter part of the week, so that each time card would show 30 – 40 hours, and not the actual full weekly amount worked. The employer would provide only one set of time cards to labor investigators, presenting them as the employees’ true hours of work. Based on reasonable estimates of production time, the department’s investigators calculated that a worker would have had to finish an entire piece of clothing in less than one minute if the time cards presented by the employer were accurate.
“Our message to retailers and manufacturers is that cursory inspection in monitoring factories is not enough. We in government are getting more aggressive in ensuring that suppliers abide by the law. While you may require your suppliers to abide by strict codes of conduct, these codes do workers no good if they are not aggressively enforced,” Commissioner Smith continued. “By doing your part and with the State Labor Department continuing to enforce the laws, we can curb these unlawful practices.”
While New York State had significant success in recent years in enforcing wage and hour laws – with an increase of 37 percent in minimum wage underpayments in 2007 compared to prior years – this success stands in contrast to the federal government’s enforcement. Last week, the U.S. Government Accountability Office released a highly critical report of current enforcement practices at the federal level. According to the report, enforcement actions have decreased by 37 percent over the past 10 years, while the number of workers and the companies who employ them have actually increased. The report also states that the federal government is not focusing enough attention on low-wage industries, where labor law infractions are most likely to occur.
Recognizing the need for more aggressive enforcement, the Department of Labor’s field investigative staff, about half of whom are bilingual, have recently adopted new investigative techniques. These methods include conducting more surveillance on weeknights and weekends, interviewing employees off-site, and obtaining evidence directly from the employer and from third party witnesses.
New York State’s minimum wage is $7.15 per hour, and employers are required to pay overtime for weekly hours past 40 at 1½ times the employee’s regular pay rate. The State Labor Department encourages employers and workers to contact the department about wage and hour issues. Investigators will answer any questions regarding New York’s labor laws. Information is also available on the department’s web site – www.labor.ny.gov; or by phone at 1-800-447-3992.
This investigation was handled by Investigator Haing Bo Kim of the Apparel Industry/Fair Wages Task Force with the assistance of Investigators Yong-Soon Hwang and Young Cho, under the supervision of Lorelei Boylan, the Task Force’s Director of Strategic Enforcement in the Division of Labor Standards.