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A landmark bill to protect American garment workers, introduced to the US senate last week, could be transformative for the country’s apparel sector by eliminating piece-rate pay, holding brands accountable for wages in their supply chain and encouraging them to reshore manufacturing. The bill’s targeted focus could also raise the bar for legislation in other countries.
Senate Bill 62 has passed in California, guaranteeing a minimum wage for garment workers and holding brands accountable, even for violations with third-party partners.
“The strength of this act is in its specificity, because this is not only sector-specific to the fashion industry, it’s also clear about exactly what kind of labour abuses it’s trying to curtail,” says Thulsi Narayanasamy, director of international advocacy at the Worker Rights Consortium. “That’s really important, and very different from other corporate accountability legislation we’re seeing in other jurisdictions, like mandatory human rights due diligence legislation in the EU.”
The Fashioning Accountability and Building Real Institutional Change Act, known as the Fabric Act, introduced by New York senator Kirsten Gillibrand, would increase garment workers’ wages and hold brands accountable if they work with factories, both contractors and subcontractors, that pay less than the federal minimum wage. These are all groundbreaking provisions on a national level and similar to a widely celebrated bill, SB62, adopted by California last year. The bill would also establish incentives for companies to do more manufacturing within the US, including a 30 per cent tax credit as well as a fund, administered by a federal agency, to support manufacturers in updating or improving their facilities. And it’s not just labour advocates supporting the measure. A number of brands and manufacturers also want to see their industry better regulated, saying it’s the only way to level the playing field — currently, they say, adopting rigorous environmental and labour standards on a voluntary basis puts them at a competitive disadvantage.
“Labour cuts straight to the bottom line. I think it's exactly why the ‘s’ in ESG is, in many cases, so much more silent,” says Vanessa Barboni Hallik, co-founder of Another Tomorrow. “I think it's a real pain point for large brands, but this is the direction of travel.”
The New York-based brand is among a handful of companies also backing the Fabric Act, including Argent, Botanical Colors, Mi Jong Lee and Mara Hoffman. Tom Ford and Coach parent Tapestry, both based in New York, declined to discuss the bill, and Ralph Lauren, Tory Burch and Versace owner Capri Holdings did not respond to requests for comment.
“It puts brand accountability squarely at the centre, which I think is really critically important,” says Barboni Hallik. Another Tomorrow manufactures its clothes in Europe because they could not find a reliable way to do so ethically within the US, a process that prompted the brand to support efforts on legislation. “As a young brand, there was very little that we could do to actually change things in New York. We felt pretty strongly that legislative action was going to be required,” she says. “Voluntary actions by companies and individuals are certainly not enough to create lasting change.”
What’s crucial to the act is the joint liability. “It was significant when it happened with SB62, but scaling something up to a federal level — the importance of that just can’t be overstated,” says Narayanasamy. “It’s not just about addressing loopholes in US labour laws, but also understanding how to address a fundamental power imbalance within the apparel industry between suppliers and brands.”
Next steps for the coalition will be to build bipartisan support (a task they are optimistic about given the bill’s inclusion of both incentives and regulations), pick up more co-sponsors and educate other congressional representatives on the bill. At a press conference on Friday in Manhattan’s garment district, Senator Gillibrand said it could be brought to a vote by the end of the year — but that’s far from certain, especially considering how full the congressional agenda already is with global affairs.
“As we saw with SB62, whether it will move to a vote and how fast will also come down to organising and the passion and time that the coalition behind the Fabric Act is preparing to put into this,” says Elizabeth Cline, director of advocacy and policy at Remake, which collaborated with Senator Gillibrand's staff, Workers United and the Garment Worker Center in developing the worker rights portions of the bill and ensured garment workers were also involved in the process. “Our first challenge will be getting the Fabric Act — a bill that supports women, immigrants, and workers of colour in an industry that is so often overlooked — onto the priority list of lawmakers.”
Supporting the American industry
With a combination of penalties for wage violations and incentives for domestic production, the bill takes a carrot-and-stick approach, intended to mitigate both the problem of substandard wages in the supply chain and the circumstances that make them so common. The bill would make US apparel manufacturing “more equitable and sustainable”, Senator Gillibrand said at the press conference. “As we make these changes, we also need to support the expansion of the industry here in America.”
The wage protection and brand liability provisions of the Fabric Act replicate California’s rules under SB62. They also align with a growing global push to replace voluntary measures with mandatory regulations. A number of European countries have implemented mandatory due diligence laws, and in 2021, the International Accord for Health and Safety in the Garment and Textile Industry replaced the expired Bangladesh Accord. The legally-binding agreement holds signatory brands accountable for factory safety.
Researchers and activists welcome these moves, saying the industry has largely escaped regulation and over-relied on voluntary commitments that have not materially benefitted factory workers and have failed to address the underlying factors that allow poor working conditions or substandard wages to occur. A fundamental problem with both industry-led coalitions and brands’ internal commitments is they lack oversight of both their initial planning and their progress on implementation — it’s very difficult for outsiders to analyse whether commitments are being met.
The Fabric Act would amend the Fair Labor Standards Act of 1938 to prohibit piece-rate compensation and hold brands responsible for the labour practices of their manufacturing partners. The goal is to compel brands and retailers to become allies in combating workplace violations.
The bill would establish a nationwide garment industry registry, through the US Department of Labor, to ensure that all garment manufacturers and contractors comply with the new labour standards. The registry would aim to “promote supply chain transparency” for brands looking for compliant producers and “identify bad actors in the industry with a demonstrated pattern of labour violations”. In addition, the bill would create a new Undersecretary of Labor of the Garment Industry to oversee enforcement.
While the bill is significant, it is also a reminder of how far the industry still needs to go. “This is groundbreaking legislation because it’s closing a loophole and because it brings joint liability between brands and retailers. But, the rights it’s ensuring for workers are not groundbreaking,” says Narayanasamy of the Worker Rights Consortium, explaining that minimum wage should be a given — a baseline to improve on, not an end goal. “It’s closing a loophole that should never have existed for as long as it did. We shouldn’t be wondering whether workers, whether it’s in the US or Bangladesh or Cambodia, are being paid their legal minimum wage.”
Some experts also have concerns that reshoring production could result in job losses in regions where brands currently manufacture, but it’s too early to judge if that would come to fruition if the Fabric Act passes. (The question also extends far beyond fashion, with other industries having to navigate similar tensions as interest in localising or regionalising production grows.) On the incentives side, besides the tax credit, the bill would create a $40 million Domestic Garment Manufacturing Support Program, administered by the Department of Labor. This would provide manufacturers with grants to support efforts addressing facilities and equipment costs, safety improvements, and training and workforce development initiatives for garment workers.
Those incentives make for “promising and forward-thinking policy”, says Marissa Nuncio, director of the Garment Workers Center, a Los Angeles non-profit involved in creating and passing SB62 last year. SB62 has already improved pay for some workers in California, she says, and a federal bill would have that much more impact. “Workers around the country will see better, more dignified wages, and less cutting and running by their factories,” she says. “California garment workers have demonstrated that systemic change is possible, and that there is a broader political will for labour protections in the garment industry — from fashion designers and brands to our legislators. The Fabric Act would take their vision of multilateral accountability in the supply chain, including by the fashion brands, and a fair wage system to the federal level, codifying those rights as basic labour principles.”
The bill has been widely applauded by a range of groups and interests, with backing from advocacy and labour organisations including Garment Workers Center, Bet Tzedek Legal Services, Fashion Revolution, The Model Alliance, National Employment Law Project and Workers United.
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