“Fabric Act” is the big federal effort to relocate fashion – WWD
NEW YORK — At a press conference Friday, New York Senator Kirsten Gillibrand introduced a crowd of hopefuls to the pro-worker federal Fashioning Accountability and Building Real Institutional Change Act, or the Fabric Act.
In one fell swoop, the bill attacks tax incentives for relocation, the piece rate system, joint liability, and so on.
The press conference was held at Ferrara Manufacturing in the Garment District of New York with many supporters in attendance. Labor and advocacy groups such as Workers United, Remake, Garment Worker Center (GWC), The Model Alliance, Custom Collaborative, Sustainable Brooklyn, Fashion Revolution, The Slow Factory and New Standard Institute have publicly supported the law, along with brands like Mara Hoffman and Another Tomorrow and many Garment District manufacturers.
“No brand can make these changes alone, and if you’re a brand, you always wonder where you stand. I ask you, without the garment workers, would you still be standing? “, questioned Mara Hoffman, during the press conference.
“The perception is that the fashion industry is glamorous, but the reality is often very different,” Sara Ziff, founding director of the Model Alliance, told WWD in a previous interview, on barriers to adoption. of legislation. Ziff is behind the Fashion Workers Act, which passed a milestone in the New York State Senate earlier this week and aims to establish greater labor protections for models and creatives in the fashion capital.
The Fabric Law not only follows the Fashion Workers Law, but also the “Fashion Law” in recent regulatory efforts to shape fashion. Many factors have led to the industry’s current state of affairs, as anyone with a passing interest in fashion or the economy can recount the decline of domestic garment manufacturing.
Before the offshoring trend, some 1.4 million domestic garment manufacturing workers were employed at the top of the industry in 1973. But that number is now – according to Bureau of Labor Statistics data for May 2022 – 116 220 sewing machine operators across the United States. a small portion of the approximately 40 million garment workers worldwide, according to International Labor Organization statistics, the majority of whom are women in the Asia-Pacific region.
Tissue law: what is it?
First, the bill would provide basic protections to thousands of garment workers.
Among in-store features, the bill would create a $40 million domestic apparel manufacturing support program with incentives like a 30% apparel manufacturing relocation tax credit as well as a nice grant program included in the package.
“Now is the time for factories and co-workers on both sides of the aisle to support this timely bill that heeds the demand for relocation to benefit American workers,” commented Remake’s chief executive, Ayesha Barenblat, applauding the prompts.
The bill would extend protections under the Fair Labor Standards Act of 1938 to prohibit employers from paying employees in the garment industry on a piece-work basis (guaranteeing the minimum wage as a floor to strengthen incentives) – a loophole that the Governor Gavin Newsom shut down California by signing the Garment Worker Protection Act, or SB 62, into effect last year after a GWC crusade.
“The introduction of the Fabric Act is a step towards a responsible fashion industry in the United States. It is a step towards closing the wage gap for thousands of women who currently earn less than minimum wage in their tailoring work. This is a quantum leap towards the overall health of the fashion industry – the industry we are proud to be a part of and committed to improving,” said Ngozi Okaro, Executive Director of Custom Collaborative Custom Collaborative, as with flagship organizations like Sustainable Brooklyn, participated in the legislation for several months and fought for the bill to include access to grant funding for nonprofits ( instead of just manufacturers) to train people.
Under its current draft, manufacturers and contractors in the garment industry would also be required to register with the Labor Department. The Department of Labor registration fee will help spur the revitalization of the nation’s manufacturing landscape. In the meantime, the information collected on manufacturers will facilitate record keeping and transparency measures.
In a major attempt to reduce fashion’s power imbalances and instill a sense of alignment – amid instances of continued late payment within fashion – the drafters of the bill included a clause on the joint liability. Thus, brands (including licensors) as well as contractors will share joint liability for any breach, including reimbursement of lost wages and additional damages, if any.
If adopted, the amendments will enter into force six months after their promulgation. The application and maintenance of records would be carried out by the Secretary of Labor, acting through an Under Secretary appointed by the garment industry, or the Under Secretary of Labor for the garment industry. Individual offenders could face fines of up to $50 million, depending on the seriousness of the situation.
Let’s talk incentives
Any registered manufacturer or non-profit entity providing workforce development opportunities within the industry is eligible for a grant of up to $5 million, as included in the broader package, applying to the secretary at work. Applicants with priority status will be at the top of the pile. For example, this includes businesses owned by minorities, veterans, or women, workplaces with collective bargaining units, or businesses with tenures longer than five years (because the average lifespan of a store of clothes is only 13 months).
Eligible grant projects can cover improved tools and equipment for manufacturers that improve safety, as well as training and education for garment workers.
For nearby relocation tax credits, the 30% tax credit can be claimed in the first full tax year following the guidelines for relocating or increasing domestic employment to full-time. For clarity, the Commonwealth of Puerto Rico and the Commonwealth of the Northern Mariana Islands are included in the exchangeable relocation centers for the United States.
What it is not
While a pro-labour bill, the legislation has bipartisan elements Gillibrand says both sides can support (job creation and tax breaks, for starters). “The bill is quite simple. It just requires a fair work environment and fair treatment of workers, and it allows certain resources to do that,” Gillibrand told WWD. “The combination of this investment and the fact that it demands broader and better treatment of workers [is] a combination that has appeal, so we’ll be asking for a vote by the end of the year.
Sole operators of a garment business without employees, such as a tailor or seamstress, do not fall under the definition of a “clothing manufacturer” and are therefore omitted from the wording of the bill.
Although the bill alludes to a process for “resolving disputes over non-payment of wages,” it does not clarify timelines, procedures, or refer to existing fair business practices, as similar regulations do. such as the Unfair Commercial Practices Directive in the European Union, which exists for food and agriculture and limits payment terms to 30 or 60 days.