US labor dept seeks enforcement of Forever 21's subpoena

A recent investigation by the department's Wage and Hour Division, conducted under a multiyear enforcement initiative in Southern California's garment industry, revealed evidence of significant violations of the Fair Labor Standards Act's minimum wage, overtime and record-keeping provisions by vendors supplying goods to Forever 21.

"We are disappointed that Forever 21 has refused to cooperate with the subpoena, particularly given the significant problems we have found among its suppliers. Since 2008, our investigators have identified dozens of manufacturers producing goods for Forever 21 under sweatshop-like conditions," said Ruben Rosalez, regional administrator for the division in the West.

"When companies like Forever 21 refuse to comply with subpoenas, they demonstrate a clear disregard for the law, and the Labor Department will use all enforcement tools available to recover workers' wages and hold employers accountable."

The FLSA authorizes the secretary of labor to investigate and gather data regarding wages, hours, and other conditions and practices of employment. The Labor Department has the legal authority to issue subpoenas for the production of relevant documents and information relating to any matter under investigation.

Forever 21 has refused to provide the documents requested by the secretary in the subpoena. As a result, the department's Regional Office of the Solicitor in Los Angeles has filed this action to compel compliance with the subpoena.

The Wage and Hour Division historically has found repeated and widespread violations of the FLSA's minimum wage, overtime and record-keeping provisions in Southern California's garment industry.

The division's enforcement initiative is concentrating on employers in Los Angeles and Orange counties, as well as those operating out of large garment buildings in Los Angeles' Fashion District.

In the past five years alone, the division's Los Angeles, San Diego and West Covina offices have conducted more than 1,500 investigations under the initiative. Ninety-three percent of these investigations uncovered violations, and the division found more than $11 million in back wages due to approximately 11,000 workers.

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular rates, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week.

In general, "hours worked" includes all time an employee must be on duty, or on the employer's premises or at any other prescribed place of work, from the beginning of the first principal work activity to the end of the last principal activity of the workday.

Employees in the garment industry are typically paid a fixed amount for each garment they produce, an amount that is often so low workers' wages fall below the federal minimum wage and do not meet overtime compensation requirements.

Additionally, the law requires that accurate records of employees' wages, hours and other conditions of employment be maintained, and prohibits employers from retaliating against employees who exercise their rights under the law.

U.S. Department of Labor