New York — An industrial sewing machine vibrates the musty hallway of this run-down building on Jerome Avenue. Farther up the steep, rickety stairway the unmistakable hum is amplified. Opening any of the doors in this four-story warehouse reveals a scene reminiscent of dickensian England.
But instead of sewing with needle and thread, the women now bend over Singer Merrow machines. Electrical cords are taped to pipes on the ceiling. Bundles of cloth crowd narrow passageways; fire escapes are blocked or nonexistent. The heat is stifling, the work is long and tedious. Wages are barely enough to live on.
The millions of recently arrived immigrants from poor countries, the inadequate enforcement of minimum-wage laws and health and safety standards, and the increasing industry, have resulted in the explosive growth of sweatshops in recent years, according to those familiar with the industry.
Whether in this converted warehouse in the South Bronx, in small garages in northern New Jersey, in Chinatown lofts, or in apartment buildings in Queens, sweatshops are proliferating at a rate alarming to union and government officials.
According to some estimates, as many as 3,000 sweatshops employing up to 50, 000 people now operate in the New York area. "It's New York's fastest-growing industry," state Sen. Franz Leichter says.
International Ladies Garment Workers Union (ILGWU) officials estimate that half of the garments made in the New York area are made in sweatshops. Since approximately 85 percent of ladies' and children's fashion garments are made in the New York area, according to Kurt Barnard, executive director of the Federation of Apparel Manufacturers, a substantial number of garments worn by Americans are therefore made in sweatshops.
National attention has been focused on the sweatshop problem with the creation of the United States Labor Department's sweatshop strike force in March. On April 24, Labor Secretary Raymond J. Donovan led a raid of a five-story Chinatown building in New York. His team uncovered $15,000 in wage violations and three youth violations of the Federal Labor Standards Act. After the raid, Secretary Donovan described the working conditions as a "national disgrace" and vowed continued enforcement of the Labor laws.
Sweatshops were thought to be stamped out decades ago with the tough legislation that followed the Triangle Shirtwaist Company fire in 1911. A total of 146 people, mostly teenaged girls, perished in this Lower Manhattan factory blaze. A Committee on Safety composed of political heavyweights was formed soon after the tragedy. Within a year, the panel had pushed through state legislation that set sanitary standards for factories, mandated fire-prevention measures (including fire drills), and prohibited night work for women and children.
But the contracting system that allows sweatshops to take root, remained. In the contracting system, garments are made in small shops employing 20 to 30 workers, or in individual's homes. The system is unique to large urban centers such as New York, Los Angeles,and Chicago, and contrasts to the factory system which took root in the South and Midwest, in which upward of 500 people work under one roof.
The contracting system can be complex. The process begins with the manufacturers, or "jobbers." They design the clothes and purchase the material. Sometimes they cut the material; sometimes the material is sent to a cutting shop outside the city. The cut material is sent to the sewing shops.
Jobbers are also wholesalers. They have showrooms at midtown where they display the samples of the fashions to retail store buyers.
Between the Seventh Avenue jobbers and the garment shop workers are several middlemen. They include: The owners or managers of the sewing shops, the "contractors"; the truckers who deliver cut material to the shops and return finished goods to the jobbers; and sometimes a "broker," who acts variously as supplier, distributor, business agent, and even translator, for the new contractors. In some instances, the contractor is a legitimate businessman who owns a small shop, employs documented workers, pays above the minimum wage, and meets health and safety regulations. usually the workers in this kind of shop are unionized.
In the sweatshops, the conditions are very different.
"I'm not sure there is any good definition of 'sweatshop,' "Joseph Danahy, assistant regional director of the ILGWU, says. "A sweatshop is a state of mind. . . . It is a place where the dignity of human beings is degraded."
Danahy cites specific characteristics of sweatshops: "People are paid under the federal minimum, not paid proper overtime, child labor is involved, and home work is involved," he says. "Taxes and withholdings are taken out of people's pay and go no further than the employers pocket. There are also health and safety problems in the sweatshops."
Frederick Siems, executive vice-president of the ILGWU, admits that the same abuses occur in some of the unionized shops, which are located mainly in Chinatown. He blames both federal and state Labor departments for reduction in the number of inspectors assigned to the garment
"Government inspectors hardly come in," he charges. "They were understaffed to start out with. Budget cutting has made this worse."
Since the city's financal crisis in 1975-76, enforcing the laws has become increasingly more difficult. According to hugh McDade, assistant supervisor of the New York State Department of Labor, Division of Labor Standards, only 24 inspectors remain of a force that totaled 64 at its peak in 1976. Funds to the department were cut by 45 percent at that time. Before the budget ax fell, the department maintained a regular patrol that initiated its own investigations. now, the reduced staff has its hands full just responding to complaints.
According to a US Labor Department spokesman in Washington, 22 of 180 inspectors will be cut from the New York regional Wage and Hour Division in September due to the Reagan budget slashes.
During A two-year investigation of sweatshops conducted by Senator Leichter, in which over 40 shops were investigated, the average wage of sweatshop workers was found to be no more than $15 for an e ight-hour day. This puts the hourly wage at less than $2, substantially below the $3.35 minimum.
The large number of small shops makes it virtually impossible to check compliance with labor and safety regulations. Most sweatshop contractors don't keep records. And the records that do exist only faintly resemble the actual hours worked, according to Mr. Danahy.
Sweatshop workers are usually recent immigrants, many here illegally. with more and more aliens beckoned by the promise engraved at the base of the Statue of Liberty, the unskilled and illegal work force swells. Sweatshops often offer the only employment possibility, particularly for women with no other means of support.
"There is a tendency to talk in terms of undocumented workers," Mr. Siems says, "but there are plenty of legal workers that are being exploited."
Many of them come from autocratic governments, he explains, where the last place one would turn for help would be the government. Their fear of the US government, especially the immigration authorities, contributes to the secrecy surrounding the entire system and to the diffuculty that Labor Department and union officials have in helping them.
The contractors are often no better off than their employees.
"The contractor, the 'exploiter,' is of the same etchnic group as the workers ," Mr. Siems explains. "How does he put the work force together? His wife, her sister, the woman up the street, a woman they knew from the old country. They get together and you have a sweatshop."
The contractor is the employer and labor organizer.
"The man best fitted to be a contractor is the man who is . . . able to speak the language of several classes of immigrants," labor historian John Commons wrote. "[The labor contractor] can easily persuade his neighbor or their wives and children to work for him, and who in this way can obtain the cheapest help."
Commons wrote this in 1901.
The contractor is often blamed for exploiting the workers. But commons's image of the contractor as the "irresponsible go-between for the manufacturer," was soon put into a different perspective by a contemporary, Theodore Dreiser.
In "The Color of the City," Dreiser wrote, "[The contractor] is no foul oppressor of his fellow man. The great clothing concerns in Broadway and elsewhere are his superiors. What they give, he pays, barring a small profit to himself."
The system operates much the way it did 80 years ago. The contractor goes to the Seventh Avenue manufacturer and a "reverse action" takes place -- the lowest bidder gets the contract. The contractor then returns to his sweatshop and pays his workers a set amount per piece to produce the item.
A Union City, N.J., sweatshop typifies how the contracting system works.
The shop is located in a garage in a residential district. Paper litters the small parking lot next to the shop entrance. A few weeds grow between the cracks in the pavement. It is a dusty, decaying neighborhood .
A maroon van arrives. A man steps out and looks around suspiciously. He then begins to lift bundles of cloth out of the vehicle and hand them through the garage door. He has just returned from the jobber's warehouse in Manhattan.
A cool breeze blows, but inside the garage the temperature is stifling. Electrical wires feed into overload outlets. The doorway only opens halfway because of strewn bundles of cloth and racks of finished clothes. It is the only exit from the cramped shop.
The woman who says she is the shop owner speaks no English and is reluctant to speak to a reporter. She says that the material comes from Armon Fashions in Manhattan. She and her husband pick up the material every Thursday and usually have a week to complete an assigned number of dresses. She claims to pay her employees (14 were working in the room at the time) minimum wages. There is no time clock on the premises.
Al Tambe, ILGWU district manager for northern New Jersey, says that this shop has been operating for only a couple of weeks. A sweatshop under a different owner recently left after occupying the site for a short time.
Repeated efforts to talk to representatives of Armon Fashions at the West 36 th Street office failed. When reached by phone, the office manager said that the company knows who its contractors are. But when asked if Armon is aware that its dresses are being sewn in a New Jersey sweatshop, she said she did not know about this.
A North Bergen, N.J., sweatshop that was making women's summer suits when this reporter visited, gets its material from Grace Fashions, a cutting and distributing firm in West New York, N.J. Grace Fashions, in turn, gets its material and design from Judy Anna/The Boss's Daughter, the jobber, on Broadway.
This jobber's showroom is first class. The plush carpeting of the reception room is separated from the outer hallway by floor-to-ceiling tinted glass. The office manager said that he was to busy to talk. he claimed that he knew "little about the production side" of the industry. He admitted that his firm has done business with Grace fashions, but said he was unaware that the clothes that ended up in his showroom were being sewn in a New Jersey sweatshop.
"If you talk to the jobbers," Mr. Siems explains, "they'll say, 'It's not up to me to go to the shop and see what is happening there. I didn't even know where it was.' And so on. That's a lot of malarkey.
"Nobody's going to give some stranger thousands of dollars' worth of merchandise to make," Mr. Siems continues, "and not know where it is. when his insurance company says, 'Where are the goods th at you've got insured with us?' he can't say, 'I don't know, but I gave it to a very nice man who says he has a place on 180th Street in the Bronx.'"
The contracting system is commonly defended as essential to the manufacture of clothes at the prices the American public has become accustomed to. If the concentration of cheap sweatshop labor here were eliminated, clothing prices throughout the country would skyrocket, it is urged. If clothes aren't being manufactured by sweatshop labor here, the argument continues, they will simply be sent to sweatshops in Asia or Latin America.
"No one can convince me that it's easier to send things overseas," Mr. McDade says. "In order for it [foreign labor] to be profitable, the manufacturers would have to own their own planes and trucks on both sides of the ocean."
Mr. McDade also points to the rising cost of foreign labor. Overseas wages are not as low as they are usually thougt to be, he states.
The strongest argument against the possibility of using overseas labor, according to Adriene Critchlow, an industrial commissioner for the New York State Department of Labor, is that the clothes made in sweatshops need to be manufactured in a relatively short period.
"Why do you think that it is called 'Fashion Avenue'?" asks Ms. Critchlow, referring to Seventh Avenue's nickname. "Goods that are popular now on the East Coast may be in fashion in Idaho in seven weeks. The manufacturer just wouldn't have time to send these items overseas to be made."
The web of organized crime now touches almost every corner of the garment trade, according to those familiar with the industry. Trucking companies, manufacturers, contractors: The list grows longer as more investigations are carried out. Industry observers allege collusion between the ILGWU and the Mafia. They accuse Local 102 of the union of knowing about and even participating in monopolitic practices in controlling truckers' rates and territories. Local 102 is the largest union representing garment carriers, and until recently was the only union.
"There's nothing new about the connection of organized crime to the trucking industry," Senator Leichter declares. "What is new is the extent to which they've gotten into sweatshops, setting them up and so on."
The allegations are well-documented. The Pennsylvania Crime Commission published a hefty volume on the influence of organized crime in a variety of industries, including the garment industry in New York, last fall. Several books, most notably "Vicious Circles, The Mafia in the Marketplace," by Jonathon Kwitny (Norton, 1979), have made similar charges.
Organized crime thrives for three reasons:
1. The existence of an exploitable work force in the illegal immigrants.
2. The lack of restrictions on intracity trucking, allowing the companies to set whatever rates the market will bear.
3. The alleged and proven conspiratorial arrangements between certain trucking companies and unions to control the movement of material and finished clothes in the New York area.
In Leichter's report on the two-year investigation released in March, Stallion Carriers Trucking Corporation, Consolidated Carriers Corporation, Lucky Apparel Carriers, Interstate Dress Carriers, and other trucking firms are accused of using unfair and illegal methods to control a significant sector of the garment industry.
Contractors of both unionized shops and sweatshops are coerced, sometimes by threats of violence, to use a certain trucking company. Transportation rates are often exorbitant.
Unionized contractors tacitly, sometimes resignedly, accept the trucking companies' control over rates and territory. The contractors often have minimal bargaining leverage with the trucking companies due to the growing practice of charging transportation costs directly to the jobber, avoiding the contractor altogether.
With the more established contractors, Senator Leichter says, "the mob doesn't have to resort to strong-arm tactics. Everyone observes the system." If a contractor attempts to use another trucking company, his goods simply won't be picked up or delivered.
"I'm 'married' to my trucker," Peppi Spina states matter-of-factly. He owns a large, air-conditioned sewing shop in West New York, N.J., and has been in the garment business for 18 years. "The trucking company is Mafia-controlled," he asserts. "If I want to change my trucker, I can't." His trucking firm is Alco, on 63rd Street in West New York.
A shop manager in Chinatown, who asked to remain anonymous, claimed that his shop was required to use Remsen Trucking Corporation. To move finished articles from his sewing shop on Allen Street in Lower Manhattan to the manufacturer's warehouses in Midtown, Remsen charges 14 cents per dress, 19 cents per jacket, and 25 to 30 cents for a three- piece suit. The contractor feels certain that the articles could be moved profitably at a lower rate.
A friend of his, who is a manager in a nearby shop, feels the same way. He recently attempted to eliminate the transportation cost altogether by using his own van to move his goods. The windows on the van were smashed while it was parked in the Midtown garment district. The van's owner saw this as no coincidence; he said the windows were broken because he had tried to stop using his trucker.
Stallion Carriers, the main garment carrier for northern Manhattan, according to Leichter's investigation, charges most of its customers 20 cents to move a dress to the Midtown warehouses. The rate includes delivery of precut materials as well as pick-up of the finished product.
But one long-time customer of Stallion is charged only half that rate. he explained to Leichte's aides that he was able to negotiate on his own since he has been in business for more than 20 years.
"If Stallion does in fact find it profitable to move these goods at a 10-cent rate," Leichter says in his report, "a rate of 20 cents constitutes a serious overcharge."
The Allen Street contractor said that his boss owns three other shops in the Canal Street area, and is forced to use a different trucker for each. His efforts to simplify the situation by using the same trucker have been successful.
Sweatshop contractors are often even more dependent on the trucking company than the unionized contractors. The trucker makes work agreements with the Seventh Avenue manufacturers, supplies cut material, and sets up the production schedule. The truckers act as brokers for the uninitiated contractors, doing the work that the more established contractors do for themselves.
According to Leichter, the trucking companies may even finance the operation, lending money to the contractor for the purchase of sewing machines and equipment. This form of complete control of the contracting system prevails in the South Bronx and Washington Heights, in northern Manhattan, where more of the inexperienced immigrant contractors have their shops.
It is difficult to determine how extensive the truckers' control is. Some New Jersey contractors who were willing to talk to this reporter say that they pick up and deliver their goods in their own trucks or vans. Contractors in Manhattan, for the most part, seem to depend on a trucking company for transportation as well as work from the manufacturers.
Matthew Eason, president of the United Warehouse, Industrial, and Affiliate Trades Employees Union, Local 20408, says that small contracters "wouldn't be allowed" to move their own goods.
"It would be unheard-of in this area [Manhattan]," he maintains. Mr. Eason suggests that the small trucks and vans could very well owned by the mob or one of the large trucking companies.
"Even the so-called well-established manufacturers use additional locations -- sub-sub-contractors, If you will -- to do their work," Mr. Eason says. "The trucking companies provide the service of relocating these places. We've had evidence of midnight rides, moving sewing machines and equipment from one plact to another. It would be interesting to note the ownership of these places. It could only be done with the permission of the real estate owners." Those knowledgeable about the trucking industry in New York are reluctant to discuss its alleged connection to organized crime.
Matthew Eason is the exception.
His union's spacious office on Park Place overlooks the financial district of Lower Manhattan. Eason has purposely placed his desk in a windowless, matchbox-size room away from the broad windows at the front of the office. "It's much safer this way," he says, smiling.
Eason is under federal protection for his role in a bribery setup that led to the conspiracy and bribery convictions last year of Athony DiLapi, a Teamster's organizer. Eason was attempting to organize Interstate Dress Carriers (IDC), the largest garment carrier in the Northern US. Eason had issued a complaint that Dilapi and others had threatened him and then offered him bribes.According to Eason, the Teamsters were attempting to "make a deal" with Local 102 of the ILGWU that would have given the two unions complete control over the trucking industry. Local 102 was the only union representing garment industry truckers in New York for over 30 years.
Eason's unionizing efforts have won him few friends.
In 1978 Eason attempted, unsuccessfully, to organize the employees of Consolidated Carriers, cited in the Pannsylvania Crime commission report as owned by Thomas and Joseph T. Gambino, sons of the late Mafia boss, Carlo Gambino. While on the picket line in front of consolidated's West 35th Street office during a strike, Eason was beaten up and struck with a lead pipe.
Eason has been president of Local 20408 since 1971 and knows the trucking industry well.
"The great majority of the trucks are still controlled by the mob," he says. "Prior to our successful organization of the employees of IDC, they controlled all of the trucks in the garment center; if you controlled the trucks you controlled the garment industry."
To operate in the city, Eason explained, the trucking company had to join the truckers' association which was controlled by the "powers that be" -- the mob.
He says that the situation has improved since Local 102's exclusive control of the trucking company employees was broken.
"Now a businessperson can open a trucking company in the garment center," Eason says, "and the employees can choose to join the Local 20408 instead of Local 102. And I doubt very much that the mob would move in. They would have to use outright terror and violence, instead of a conspiracy-type approach where the marchandise won't move."
Local 102 district manager Sidney Gerstein and the union's lawyer, Allen Breslow, refuse to discuss any allegations concerning Local 102 because of pending litigation involving Consolidated Carriers.
Local 102 is chartered by the ILGWU along with approximately 200 other locals. The only formal contact between the various locals is on the general executive board. Some district managers are on the board.Local 102 is not represented. Mr. Siems and other ILGWU officials claim to know little about the day-to-day operation of Local 102. Mr. Siems says he doesn't know how many drivers Local 102 represents or how much the drivers make. "I really know very little about that section of the industry," Siems said. When pressed about Local 102's involvement in organized crime activities, another ILGWU official stared intently at this reporter and said, "I don't deal with them or them kind of guys."
Trucking companies will say even less.The manager at Consolidated's West 35th Street docks would not reveal his surname and said that it was company policy not to talk to reporters. Efforts to reach officials of other companies cited in Leichter's report failed.
The trucking companies are an integral part of the garment industry.They hold the entire network together. From the sticky webs of connections, no one can, or even seems inclined to, break loose. "The whole thing is symbiotic," states Mr. McDade. "It's a situation in which everyone who is willing to sacrifice his rights for a job, to the manufacturer and trucker who reap extraordinary profits , nobody has a compelling reason to complain. Therefore, the system persists.
Cleaning up the industry will be as difficult as removing ink stains from a white summer dress.
Senator Leichter has submitted legislation to the New York State Legislature that would require the trucking companies to register their rates for deliveries within the city in the same that rates for intercity deliveries must be registered with the New York State Department of Transportation and interstate deliveries with the Interstate Commerce Commission. Under the legislation, the trucking companies would have to file scheduled rates. "This would point out the disparities of the rates being charged," Leichter says, "and would give the authorities a handle on both the character and competence of the truckers." Mr. Eason doesn't think the legislation would be effective. "How could you prevent under-the-table payments?" he asks.
What would be most effective in stamping out organized crime, Mr. Eason believes, is for the federal government to establish some type of a lending system so that manufacturers could get small business loans. "this would hurt the mob more than anything else," Eason declares. It would remove the need for contractors, as well as manufacturers, to turn to organized crime for financing. It would also encourage the manufacturers who are caught in the webb of organized crime to disentangle themselves by testifying to federal authorities. "Perhaps, I'm dreaming," Eason says, "but that's what I envision."
Leichter has also proposed legislation that is modeled after a law that will take effect in CAlifornia in July. The CAlifornia "Montoya bill" will require registration of all manufacturers and contractors, who would have to meet health and safety standards and comply with labor laws in order to keep their registration. Penalties under the new law will be harsh. Contractors will have their goods confiscated if found in violation of the registration requirements.
Leighter calls the bill the"ultimate sanction" against sweatshop abuses. "The jobber is not going to take the chance of sending his goods to an unlicensed place and having his confiscated," Leichter says.
The legislation would be self-enforcing. It would essentially make the manufacturer take responsibility for seeing that sewing shops operate legally. At the same time, it would lift the burden from the shoulders of the labor departments and the Occupational Safety and Health Administration, which both lack manpower.
Leichter believes that the bill has a good chance of passing this legislative session, but concedes that the "anti-regulation mood" around the country has hurt. "The emphasis of government is far from protecting poor people these days ," he says.
But even the tough new laws would require policing. An effective enforcement system must be reestablished, according to some government officials. Mr. McDade feels that independent investigations are necessary in controlling the sweatshop problem. "There is no other feasible way to contain it," he emphasizes. "You absolutely need people on the site."
With federal cutbacks, experts throughout the industry are pointing to self-imposed restraints on the part of those mose able to check the growth of sweatshops.
"The large department stores should refuse to buy the merchandise," Mr. Eason asserts. "In my opinion, they know it is coming from the sweatshops.
"the large department stores don't have to get involved is something like that in order to make a profitable return on their money," he declares. "They're not vendors on the street corner."
Some feel that the attitude toward the entire sweatshop system must change. "It ultimately comes back to the welfare of the worker," Mr. McDade says.
"Sweatshop workers are entitled to the same protection under the law.We can't disenfranchise them and then expect to protect everyone else."