Los Angeles-based YN Apparel, one of the main suppliers of clothing to Ross Stores, has been ordered to pay hundreds of thousands of dollars in back wages for minimum wage and overtime violations, the U.S. Department of Labor (DOL) said Wednesday.
The judgement, handed down in Central California district court earlier this week, found 13 contractors culpable of violating the Fair Labor Standards Act (FLSA) while sewing clothes for YN, the latest in a multi-year enforcement crackdown against garment manufacturers in the state.
The supplier is now required to pay $212,000 in back wages to 270 workers employed by these sewing shops and has to hire an independent, third-party monitor to ensure all of its domestic subcontractors comply with federal standards of overtime, minimum wage and recording keeping provisions.
According to the FLSA, covered, nonexempt workers must be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus one-and-one-half times their regular wages for hours worked beyond 40 per week. Employers must also maintain accurate time and payroll records.
The DOL said that evidence supporting the division’s findings in this case included detailed analysis conducted by investigators to determine whether prices YN paid to its subcontractors for their goods were sufficient to support legally-required wages, when all overhead costs were taken into account.
“This analysis showed that to pay their workers in compliance with the FLSA, the prices the contractors received from YN for their garments would have needed to be up to three times the prices they were actually paid,” a release said. “The analysis further showed that for YN to have paid these contractors amounts sufficient to pay their workers properly, YN would have needed to receive double the price it was paid by its retailer, Ross Stores.”
To that end, the judgement said that YN must renegotiate the contract if the price it’s paid by the retailer is not enough to support legally required wages for workers.
“We are using all means necessary to bring justice for LA’s garment workers, whether that means enforcement, outreach and education or going up the supply chain to engage the retailers selling these clothes,” said David Weil, administrator for the DOL’s wage and hour division, who first highlighted the widespread violations in the Southern California garment industry in November 2014. “We should not continue to see 19th century sweatshop conditions in 21st century Los Angeles.”
In the last five years, wage and hour officials have concluded more than 1,000 investigations in the garment industry, resulting in more than $11.7 million in back wages.