Forever 21, Ross Dress for Less and TJ Max mimic low wages inside U.S.


Forever 21 is one of the largest retailers in the U.S. Founded in the 80’s, in its corporate website indicates that the  goal is to become an $8 billion company by 2017 and open 600 stores in the next three years. However, as Natalie Kitroeff from Los Angeles Times points out,  U.S. Labor Department investigators have determined that the brand is being supplied by companies in California violating the state minimum wage.

“You can’t buy anything you need. Between rent and food, everything is gone, no money is left,” said Montiel, who lives with two roommates in Boyle Heights. The department said that from April to July, it investigated 77 local garment companies that were supplying some of the biggest clothing stores in the nation. Investigators uncovered labor violations in 85% of the cases, the department said, and found that the companies cheated workers out of $1.1 million. The retailers with ties to companies that had the most offenses were Ross Dress for Less, Forever 21 and TJ Maxx.

Workers were paid as little as $4 an hour, and they got $7 an hour on average — $3 less than the state minimum wage, according to the Labor Department. The department said it has penalized the garment companies and some manufacturers that act as intermediaries between the factories and the retailers. Those companies were ordered to pay $1.3 million in lost wages and damages to workers .  But the retailers will avoid any repercussions for hiring factories that violate labor laws.  The Labor Department can only penalize companies that directly employ workers. Retailers keep their distance from the factory floors by working with several layers of suppliers, lawyers for the government and worker advocates said.

This is an example of how some companies try to elude responsability in the supply chain. They must control and supervise suppliers, because they get high profits from the “fast fashion – low wages” system.

See the original news here.