What’s in fashion? Fair pay and more U.S. manufacturing
Fri May 13
As more companies outsourced garment manufacturing to produce cheap clothes, wages for U.S. garment workers dropped below minimum wage. But recently, New York Senator Gillibrand has introduced the FABRIC Act, a bill that would ensure fairer wages and simultaneously help companies bring the outsourced jobs back to the U.S.
Under current law, the garment industry has been allowed to effectively pay workers well below minimum wage (averaging $6/hour) through the abuse of a pay practice called “piece rate,” which pays workers by the garment rather than by the hour. This pay structure would theoretically motivate workers, but has instead been abused by larger manufacturers who can set low piece rates. That makes it almost impossible for workers to make minimum wage and allows manufacturers to avoid paying for overtime or unproductive time (e.g. food breaks or sick leave).
To offset the increase in production costs — which could force manufacturers to leave the U.S. altogether — the FABRIC Act includes $5 million in grants to train and equip garment manufacturing workers as well as tax credits of up to 30% on expenses related to moving operations back into the country. And with more “insource” products, we will hopefully have a more manageable supply chain.
Some countries, such as Australia and the U.K., have allowed piece rate pay so long as fair wage requirements are met (USD14.37 in Australia and USD11.90 in the U.K.). The U.S. has similar requirements in place so this bill would be a departure, but it is also limited to the garment industry. Piece-rate laws, as is, would still be valid for other industries such as agriculture and automotive repair.
Below The Fold Bytes
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🎬 Action of the Week
If you want to see more Made in USA with fair wages and working conditions, visit Green Is the New Black to get a script to use when calling your senator as well as some social media shareables.
- Harper's Bazaar: FABRIC Act summary 14 days old | 2 minutes long
- Friedman LLP: FABRIC Act for insourcing 7 days old | 2 minutes long
- Australia Fair Work: Australia’s piece rate laws 1 minute long
- International Labour Organization: Global piece rate wages 7 years old | 3 minutes long
- ClassAction.org: When piece rate is legal 7 years old | 2 minutes long
ASCII-ing About the News
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Art Credit: Ritta Rasimus