Global Exchange class-action suit against Gap, Inc.
Jan 13, 1999, S.F. Global Exchange, et al., filed their class-action suit against Gap, Inc., et al., for human rights abuses on Saipan. We had wanted coalition with Global Exchange and Labor from the start of the Gap Boycott Campaign. The IWW East Bay & SF General Membership Branches endorsed the Gap Boycott, but filed the class-action suit. They encouraged and helped us from the sidelines until then.

Sweatshop Conditions Alleged on U.S. Island
Retailers sued for selling `Made in USA' garments
William Carlsen, Chronicle Staff Writer
Thursday, January 14, 1999
©2000 San Francisco Chronicle


Thousands of Asian women are forced to work under slavery-like conditions on the U.S. commonwealth island of Saipan making clothing that top garment retailers are selling for huge profits, according to a sweeping lawsuit filed yesterday in San Francisco.

In a series of suits filed in state and federal court, human rights groups claim that foreign clothing firms are passing off the apparel as ``Made in the USA.'' Because of Saipan's commonwealth status, retailers have avoided more than $200 million in tariffs.

Lawyers filing the suits yesterday described inhumane working and living conditions on the island, including long hours of work at sub- minimum wages, poor ventilation in hotbox factories, physical abuse -- including forced abortions -- and concentration-camp rat-infested living conditions, complete with guarded barb-wire compounds.

The three suits, filed in San Francisco, Los Angeles and Saipan, name as defendants the Gap, Nordstrom, Tommy Hilfiger, May Co., Sears, Wal-Mart and most of the big names in clothing and retail, as well as a number of apparel manufacturers and contractors.

The class-action suits, which seek $1 billion in lost wages and damages, were brought on behalf of 25,000 so-called ``guest workers,'' mostly Asian women, and they allege violations of labor, racketeering, human rights and business laws.

``To allow such squalid conditions to persist on American soil is both patently unlawful and morally reprehensible,'' said Al Meyerhoff, one of the lead attorneys.

Apparel companies and retailers contacted yesterday denied that their subcontractors violate any laws. They said they have conducted inspections and would stop doing business with vendors they believed were in violation of the law.

Nordstrom, for example, said it inspected two facilities in Saipan in October and did not find violations.

``There was no cause for concern at that time,'' said Brooke White, a spokeswoman for the company. ``We make announced and unannounced inspections and look at working conditions, wages, the ages and numbers of workers and the safety of the facilities and operations.''

``We realize that this is in conflict with the allegations in the lawsuits, and we are eager to get a copy of the suits so we can continue our investigation.''

Rhonda West, a spokeswoman for the May Department Store Co., said the company takes the allegations ``very seriously, and we'll investigate fully to ascertain the facts.'' But, she added, the company insists that its suppliers and vendors fully comply with applicable wage and labor laws.

The Gap, which is based in San Francisco, issued a statement saying the company was ``deeply concerned about the allegations.''

``Gap Inc. does not tolerate this type of conduct in the factories where we do business,'' the company said, noting that it monitors ``conditions to ensure that workers are treated with dignity and respect.''

Saipan, one of a chain of western Pacific islands known as the Northern Marianas, came under U.S. control after World War II. In 1975, the islands gained U.S. commonwealth status.

Yesterday's legal action stems from exemptions from minimum wage and immigration laws that the islands negotiated with the United States at the time.

In recent years, aware of lax laws and regulations, Asian-based companies have flocked to Saipan, the commonwealth's main island, to set up dozens of apparel factories.

Because of their commonwealth status, the islands enjoy favorable U.S. tariff and duty protections.

This has permitted companies in Saipan to ship their products to the mainland without paying duties, according to yesterday's suits, and allows them to label the goods ``Made in the USA,'' or ``Made in the Northern Mariana Islands, USA.''

Lawyers representing the island's garment workers called Saipan ``America's worst sweatshop'' yesterday.

They said thousands of the workers, mostly women brought from China, the Philippines, Bangladesh and Thailand, work and live like indentured slaves.

Lured with the promise of high wages and U.S. working conditions, they are instead often forced to work seven-day weeks, 12 hours a day, with no overtime, sometimes without pay or at pay below the U.S. minimum wage, the attorneys said.

``Many live in a room with up to seven other people in inward-pointing barbed wire-enclosed barracks, their movements strictly supervised by guards and subject to lockdowns or curfews,'' said a statement released with the lawsuits.

Many fear deportation and cannot return home because they must first repay ``recruitment fees'' of up to $7,000, the suits allege.

``Unfortunately, indentured servitude is alive and well in many parts of the world, including the United States,'' said William Lerach, another lead attorney. ``Companies like the Gap and Wal-Mart have reaped millions in profits from this scheme. Now they will be held accountable.''

The suits were brought by the Union of Needletrades Industrial and Textile Employees, AFL-CIO (UNITE), and three local nonprofits, Global Exchange and the Asian Law Caucus, both in San Francisco, and Sweatshop Watch of Oakland.

©2000 San Francisco Chronicle

Saipan Workers Describe Slavery of Sweatshops
They say American Dream turned into nightmare
Robert Collier, Chronicle Staff Writer
Friday, January 22, 1999
©2000 San Francisco Chronicle


Saipan, Northern Mariana Islands -- The Chinese garment worker sat stiffly in her lawyer's office, staring at the floor. Her carefully manicured hands were clenched in her lap, red nails digging deeply into calloused palms.

She was in America and in a protected place. But she was scared stiff.

The woman is one of dozens of anonymous plaintiffs in a class-action lawsuit against some of the world's biggest clothing labels and their local contract manufacturers. The suit, filed last week in Saipan, California and federal courts, accuses the firms of exploiting her and thousands of other indentured foreign workers in sweatshop conditions on U.S. soil.

When the garment worker came to Saipan in 1997 from her home province of Jilin, in northern China, she expected life in America to be different.

But in the Northern Mariana Islands, a U.S. commonwealth in the western Pacific, she in many ways found less freedom than she had back home.

She was forced to work long hours of unpaid overtime in order to meet production quotas. Her supervisor yelled constantly and beat the workers ``whenever he felt like it,'' she said. He also forced her and others to ``lend'' him money that was never repaid.

In the company dormitory where 120 workers lived, eight to a room, conditions were primitive: Food was unsanitary, and there were a total of three working toilets and five showers.

``They didn't respect us, and they made me feel like I wasn't a human being,'' the woman said.


As she worked 12- to 16-hour days stitching clothes for The Gap and other major clothing labels, she was trapped in an insidious system that gives the islands' employers near-total control over their 40,000 foreign contract workers. If they are fired for any reason, they are almost immediately deported to their home countries, where most face heavy debts to the corrupt government officials who gave them the jobs.

Late last year, the woman rebelled and filed a complaint with the islands' labor office.

``My supervisor came to me and said, `You have a choice: Either you withdraw the complaint, or you get sent back to China.' I didn't know what to do, so he fired me,'' she recalled.

Now she wanders Saipan's 10- mile-long urban and industrial zone, looking for another job in the booming garment industry. But she worries that if the manufacturers find out that she is a plaintiff in last week's lawsuit, she will be blacklisted -- or deported immediately to China, where she still owes $5,000.

``What will I tell my family?'' the woman asked, gazing reproachingly at her lawyer. ``What will happen to us?''

Her fingernails dug deeper into her hands as she spoke.

None of the plaintiffs who have given depositions in the case will reveal their names or those of their employers, because some are still working and others are looking for work.

When a visiting reporter asked the woman whether she would recommend to her younger sisters that they come to Saipan, she was silent for a long moment, her hands twisting violently.

``I'd tell them, `Stay where you are, don't, don't ever --' ''

Her voice caught, and she stopped. Her body seemed to collapse upon itself. She jumped up and rushed from the room, sobbing.

The Northern Marianas' mix of tough working conditions, control and fear has engendered a struggle in Congress, where the Republican leadership is blocking attempts by Democratic lawmakers and the Clinton administration to eliminate the islands' longtime exemption from federal immigration, customs and minimum-wage laws.

The controversy illustrates how multinational corporations have spurred -- and become dependent on -- the large-scale flow of migrant labor across international borders. With this flow increasingly dominated by organized crime and corrupt governments, corporations sometimes find themselves complicit in a complicated web of abuses committed by their subcontractors, human-rights groups say.

In the Northern Marianas, local government officials and clothing industry officials insist that they are not responsible for those abuses.

``I don't know about the payments in China or what goes on there,'' said Richard Pierce, executive director of the Saipan Garment Manufacturers Association. ``All we know is that while there may have been some problems here in the past, we've worked very hard to clean them up, and any federal takeover would simply make matters worse.''

Amid the growing controversy, the industry has tried to put its best foot forward.

This week, Saipan's largest garment manufacturer, Tan Holdings Corp., showed reporters around its factories and employee bunkhouses. Conditions were clean and orderly -- although some facilities appeared to have been scrubbed especially for the occasion. The company, still nervous about publicity, did not allow photographs.

Three subsidiaries owned by the company's owner, Hong Kong- based shipping and gambling tycoon Willie Tan, are defendants in last week's lawsuit.

Some impartial observers dispute whether conditions are as bad as the plaintiffs allege. These observers say that in the past year, the garment industry has reacted to the accusations by fixing the worst problems.


But the U.S. Labor Department said Wednesday that it had been forced to intercede last year after five island employers had refused to pay more than $2.1 million in overtime pay owed to 1,315 workers.

In a statement, Labor Secretary Alexis Herman said: ``We must stop the exploitation of workers on these islands. We will continue to hold employers accountable and will work to get U.S. minimum wage standards . . . extended to the Northern Marianas.'' (The commonwealth's minimum wage is $3.05 an hour.)

``The real issue is not whether the factories are total sweatshops or just partially so,'' said one U.S. official who took part this week in talks with the island's government over the controversy.

``In fact, they've probably improved some. What's more important is that none of these abuses are permitted under U.S. law, and the Northern Marianas shouldn't be able to pick and choose between the laws of the land just to benefit a few people.''

The legal arguments, however, pale beside the overwhelming daily reality of an economy totally dependent on an imported proletariat.

Of the Northern Marianas' 27,000 U.S. citizens, most active workers are government employees, while the private sector is dominated by 40,000 workers from China, the Philippines, Thailand, Bangladesh and other Asian nations.

The islands' press reflects the same social division.

The two daily newspapers -- one of which is owned by Tan -- are staffed exclusively by Filipinos on one-year, renewable contracts. Like the garment workers, hotel workers, housekeepers and myriad other foreigners, these imported journalists must practice self-censorship for fear of being deported.

An estimated 10,000 foreigners are in Saipan illegally after overstaying their work permits. Among them are hundreds of Bangladeshis who have been marooned after being cheated by labor contractors.

A typical example is M.A.H. Durbar, who came in 1997 with 21 others who each paid $5,000 for jobs as security guards in Saipan -- a huge amount of money in Bangladesh, where the annual per-capita income is about $250.

Durbar, 26, was told by the labor contractor that he was going to Saipan U.S.A., America, the land of the free -- located only a train ride away from Los Angeles.

A fiasco awaited the newcomers.

Although the Northern Marianas government granted him a work permit, the jobs turned out to be nonexistent -- a collaborative scam mounted by the Bangladeshi contractors and an unscrupulous Saipan security firm, Benavente Security.

Although a Northern Marianas court last July ordered Benavente to pay the Bangladeshis $104,684, the local government has been unable -- or unwilling, or perhaps too incompetent -- to collect.


``I sold my house and I borrowed to get this opportunity to come to America,'' Durbar said as he sat cross-legged on the floor of the small house he shares with 16 other destitute Bangladeshis.

``Now I must go door to door, begging for work. I can't send money home to my family. They think I'm a liar, that because I'm in America, I must be making good money and spending it all at nightclubs, doing things with girls, rather than helping them pay what we owe.''

``Now I know that the American flag doesn't mean much,'' he added. ``In World War II, thousands of American soldiers died to put the flag in these islands. But I ask, what for? Where is justice? It's now the responsibility of the Americans to restore the dignity of that flag.''

©2000 San Francisco Chronicle

Stalemate in Talks On Saipan Workers
Tuf-of-war between local officials, federal government on sweatshop law
Robert Collier, Chronicle Staff Writer
Wednesday, January 20, 1999
©2000 San Francisco Chronicle


Saipan, Northern Mariana Islands -- On this tiny, tropical piece of American soil in the western Pacific, local officials backed by key Republican figures in Congress are waging an increasingly bitter tug-of-war with the Clinton administration and human rights activists.

Caught in the middle is a foreign workforce laboring in conditions of sweatshop-style exploitation that are perfectly legal in the Commonwealth of the Northern Mariana Islands but banned throughout the rest of the United States.

The dispute worsened yesterday when local Republican leaders told a visiting team of Clinton administration officials that they will not give up the islands' exemption from federal immigration, customs and labor laws. Human rights groups and U.S. officials say this has allowed indentured servitude, dire working conditions and poverty wages to flourish on Saipan.

The Northern Marianas' commonwealth status also allows U.S. apparel corporations doing business in the islands to avoid tariffs and to claim that products manufactured there are ``Made in the USA.''

Since they were enacted two decades ago, the loopholes have transformed the Northern Marianas from a forgotten backwater into a billion-dollar player in the global economy.

But the visitors from Washington say the exemptions must be withdrawn voluntarily -- or Congress will do it for the islanders.

Although attempts to remove the loopholes have been blocked by congressional Republicans, support for their elimination is growing on Capitol Hill. Representative George Miller, D-Martinez, and Senator Frank Murkowski, R-Alaska, are each sponsoring similar legislation to that effect.

The pressure for reform was brought to American public attention last week by a sweeping series of class-action lawsuits filed in California and federal courts. Human rights groups and a labor union accused such well-known apparel firms as San Francisco's The Gap, Nordstrom, J. Crew, Tommy Hilfiger and Burlingame's Gymboree of tolerating a wide variety of labor abuses by subcontractors on Saipan. They seek $1 billion in lost wages and damages for 25,000 workers, most of whom are Chinese.

In the charged atmosphere leading up to yesterday's start of talks on Saipan, both sides engaged in a bout of name-calling.

``Why should the United States suffer a continuing financial loss of $200 million a year in tariffs -- for the dubious privilege of explaining to the rest of the world why it tolerates the Northern Marianas' human rights record?'' asked Allen Stayman, who as director of the Interior Department's Office of Insular Affairs is the top federal official for U.S. territories in the Pacific.

``Are alien workers human beings, or are they simply inputs in a production process?'' he said.

The islands' legislature fired back, unanimously approving a resolution accusing the federal government of ``embarking on a vicious campaign to destroy the garment industry'' and ``insinuating arrogantly that the third-class U.S. citizens of the Northern Marianas should not and cannot improve their economic status at the expense of secured jobs for the first-class U.S. citizens in the United States.''

This week's negotiations are scheduled to continue until Friday, an exercise both sides admit is mainly for Washington consumption. Federal officials said today that talks had virtually broken down, with each side refusing to budge.

At issue, both sides agree, is a key component of the role the United States plays in the global economy -- whether corporations must obey American labor and human rights standards wherever they do business, as the Clinton administration wants, or whether free trade and local autonomy will prevail over all else, as Republican leaders like House Majority Whip Tom DeLay advocate.

It is hard to imagine a more incongruous place for such a battle.

The 13-mile-long island of Saipan is lush but has a ragged feel. Along Beach Road, which fronts the azure though polluted waters of the Philippine Sea, large five-star hotels are crowded together with sleek duty- free shops, honky-tonk bars, American fast-food restaurants and the corrugated metal shells of garment factories.

Yet, the Northern Marianas standoff also has elements of the mainland civil rights battles of the 1960s -- angry federal officials saying that morality and the law are on their side, glaring down local officials who claim the right to do things their way and who complain about Washington's arrogance.

Largely missing, however, is a protest movement by the workers themselves.

In the Northern Marianas, the estimated 40,000 foreign laborers are seen and not heard. They form almost the entire private-sector workforce -- including 15,000 in the booming garment industry, where factories owned largely by Chinese and Korean businessmen produce $2 billion worth of clothes annually for American firms.

The foreign workers also staff the tourist industry, which draws hundreds of thousands of Japanese each year to the islands' beaches, barrier reefs and World War II battlegrounds.

Unlike elsewhere in the United States, the foreigners are allowed in only on one-year work permits, which can be renewed solely at the request of an employer. Almost all workers were forced to pay a fee ranging from $2,000 to $8,000 to labor recruiters in their home countries to obtain the jobs, and many borrowed heavily from hometown loan sharks to pay the fee.

If a worker is laid off for any reason, including protesting working conditions or union organizing, he or she must find another job within 90 days or be deported. Since the minimum wage is $3.05 per hour, anyone fired from a job is likely to be shipped home without enough money to pay off their debts -- a dangerous situation.

The net result, labor advocates say, is that employers have near-total power over their workers, who live in fear of being sent home summarily.

Last week's lawsuits hit like a bomb in the islands, prompting a near-unanimous outcry from local politicians and residents, who form a privileged economic class far above the imported workers.

The Northern Marianas have only 27,000 U.S. citizens, most of whom belong to the Chamorro indigenous group and work for the patronage-ridden local government. Average incomes are more than four times higher than the wages earned by the average foreign worker.

Nearly 40 percent of local households have full-time domestic servants -- a rate that puts the islands on a par with the wealthiest communities in the United States.

The Saipan Tribune, a daily newspaper owned by Willy Tan, a Hong Kong tycoon who owns Tan Holdings Corp., the Northern Marianas' largest garment manufacturing firm, thundered that the lawsuit was ``a dastardly trick.''

Steven Pixley, spokesman for Tan Holdings, called the move ``a political maneuver by the Clinton administration, Democrats and labor unions to destroy the Northern Marianas.''

At Saipan's public beach parks, where Chamorros traditionally gather on weekends to picnic on barbecued pig, sentiment was the same.

``We've got a good thing here,'' said Manny Camacho, a 30-something local resident as he cradled a beer can. ``If someone wants to come work for me for pennies, why shouldn't they be able to? I mean, why stop them?''

The legislation pushed by Miller and Murkowski faces tough opposition on Capitol Hill. A similar bill was blocked in committee last year by DeLay, R-Texas, who fiercely defended the Northern Marianas' exemptions, claiming that the islands' garment industry is a sign of ``free- market success.''

``Liberals in Washington and the Clinton bureaucrats are intentionally trying to kill economic freedom and return the Northern Marianas to the days of welfare dependency,'' DeLay said during a visit to Saipan.

He suggested that the U.S. mainland adopt a Mexican guest-worker program like the Northern Marianas' with ``whatever wage the market will bear.''


Saipan, the largest of the Northern Marianas, is home to the Chamorro indigenous people, who remain a privileged class today. The island was claimed for Spain by Ferdinand Magellan in 1521 but was virtually depopulated during 350 years of Spanish rule. It was governed by Germany from 1899 to 1914, then conquered by Japan in World War I. During the subsequent years, the Japanese heavily developed fishing and sugarcane industries.

In June 1944, nearly 40,000 Japanese troops and several thousand Japanese civilians died defending Saipan and neighboring Tinian against invading U.S. Marines. In the final days, the Japanese troops ran out of ammunition yet nearly overran U.S. lines with suicidal bayonet charges. Thousands more jumped off cliffs to their deaths.

More than 5,000 U.S. soldiers were killed in the fighting.

In 1945, the Tinian airstrip was the world's busiest airport, serving as the launching pad for the intensive American bombing of Japanese cities. The planes that dropped the atomic bombs on Hiroshima and Nagasaki took off from Tinian.

After the war, the Northern Marianas were administered by the United States under U.N. authority as a trust territory. The islands slumped into somnolence and obscurity, and fishing and farming were abandoned. From 1953 to 1962, Saipan was closed to the U.S. public and was used by the CIA as a training center for Chinese anti-Communist guerrillas. In 1978, the islands became a self-governing U.S. commonwealth, and in 1986, residents were granted U.S. citizenship, although they cannot vote in federal elections. Tourism and clothes manufacturing started in the mid-1980s, and grew rapidly with heavy Asian investment.

The Northern Marianas' economy is rigidly balkanized, and local attitudes rely on stereotypes that would be considered shockingly racist on the U.S. mainland.

Foreign workers make up 91 per cent of the private workforce, in which occupation is largely determined by national origin. Most hotel workers are Filipino, while most garment workers are Chinese. Chinese are given garment production work because they are viewed as hard-working, obedient and unlikely to protest. (In China, unions are part of the oppressive government structure, and independent, American-style unions are unheard of.)

Federal officials say the Northern Marianas system promotes a parasitic relationship in which the indigenous islanders live off the fruit of sweatshop labor by an indentured foreign workforce while ceding overall control to Asian tycoons.

Another unsavory aspect of Saipan is the growth of prostitution. Internet ads tout the island as a sex destination, and it ranks with Bangkok and Manila as a regional sex-industry haven. Federal law-enforcement officials say Japanese and Chinese organized-crime syndicates have taken control of Saipan's sex trade and are now using it as a beachhead to expand into drug trafficking and other businesses.

©2000 San Francisco Chronicle

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