Governor Gavin Newsom signed the Garment Protection Act (SB62) into California law this Monday. As a worker-led piece of legislation, it will allow more than 45,000 workers to receive a minimum wage of $14 dollars an hour, which is the current minimum wage in the state. One of the key points of the legislation is that fashion brands will now be responsible for wage theft violations at Californian factories, a point of difference to most laws governing brands and supply chains that typically self-govern. It also includes the implementation of a Garment Special Account that will be managed by the labor commissioner and dispensed if wages or benefits are not paid.
According to the Garment Workers Center, a key driver of the Act, Los Angeles has the highest concentration of garment industry workers in the United States, with some 2,000 manufacturers employing more than 40,000 workers. In a statement, the Governor said, “California is holding corporations accountable and recognizing the dignity and humanity of our workers, who have helped build the fifth-largest economy in the world.” The bill had support from over 140 business industry members, from fashion brands including Reformation, Doen, Mara Hoffman, Eileen Fisher and For Days. Vanessa Barboni Hallik, founder and CEO of sustainable luxury brand Another Tomorrow and supporter of the bill said, “At the outset, I would say the signing is a wake up, one of many globally, that deeper change and greater accountability is coming for the industry. We also have to remember that it’s also really still a starting point: SB62 gets us to minimum wage in California when a living wage should be a basic right for everyone in fashion’s supply chain. Creating legal accountability is a lot easier to do in a domestic context and given the global and fragmented nature of supply chains we really need cross-border accountability mechanisms, similar to what has been under discussion in Europe. ”
Although more than 97% of apparel sold in the U.S. is made overseas, according to the American Apparel & Footwear Association, there is growing interest in American fashion production as a result of the human rights concerns in places like China. The legislation in California could become the blueprint for fashion production in the United States. The Garment Worker Protection bill was also sponsored by state Sen. María Elena Durazo (D), a former vice president of the labor union Unite Here. Durazo said in a statement that the legislation will “level the playing field for ethical manufacturers that are doing the right thing. For too long, bad-actor manufacturers have exploited garment workers toiling in unsanitary conditions for as little as $5 an hour,” Durazo said.
The garment worker rights issue has been growing in other parts of the world, as well. The fashion industry employs 40 million to 60 million people worldwide, with 60% of that number living in the Asia-Pacific region, according to the International Labour Organisation (ILO). These areas are still yet to change their pay-per-piece model that has been shown to have a negative impact on garment worker health. In Germany, a similar proposal to the one set forward in SB62 in California was shut down last year by the Federal Ministry for Economic Affairs and Energy. It reached an agreement in February 2021. It will go into effect in 2023, impacting around 600 companies that employ 3,000 or more employees. In 2024, it will apply to 2,900 additional companies that have more than 1,000 employees. The law states that fines will be given, starting at several hundred Euros, if subcontractors are found to breach human or environmental rules, including workers’ rights. The fines go up to 2% of annual revenues if they exceed €400 million, marking large companies as prime targets.
These moves forward toward regulating pay within fashion supply chains show that the industry is starting to change the regulations that have been in place for over 50 years, even as production has shifted to a more globalized model. Considering the response needed for a bigger shift, Barboni Hallik says that, “consumers and investors also need to start to demand the change and shift the bar. That’s arguably more challenging to accomplish relative to talking about recycled materials or circular business models, as it very directly impacts your cost base. However, if we actually care about human dignity we have to get there – culture is a big part of that and we’re currently running at very low levels of awareness of these issues so there is much to be done in education and activism.”