article: SECTION 1. SHORT TITLE AND REFERENCE. (a) Short Title.--This Act may be cited as the ``Stop Sweatshops Act''. (b) Reference.--Whenever in this Act an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Fair Labor Standards Act of 1938. SEC. 2. FINDINGS. The Congress makes the following findings: (1) The production of garments in violation of minimum labor standards burdens commerce and the free flow of goods in commerce by spreading and perpetuating labor conditions that undermine minimum living standards and by providing an unfair means of competition to the detriment of employers who comply with the law. (2) The existence of working conditions detrimental to fair competition and the maintenance of minimum standards of living necessary for health, efficiency, and general well-being of workers are a continuing and growing problem in the domestic garment industry. (3) The Congress concurs in the findings of the Comptroller General that most sweatshop employers violate the recordkeeping requirements of the Fair Labor Standards Act of 1938 and that the failure of such employers to maintain adequate records has and continues to adversely affect the ability of the Department of Labor to collect wages due to workers. (4) The amendment of the Fair Labor Standards Act of 1938 to provide for legal responsibility on the part of manufacturers for compliance with such Act's wage and hour, child labor, and industrial homework provisions by contractors in the garment industry and to provide civil penalties for violations of that Act's recordkeeping requirements is necessary to promote fair competition and working conditions that are not detrimental to the maintenance of health, efficiency, and general well-being of workers in the garment industry. SEC. 3. LEGAL RESPONSIBILITY FOR COMPLIANCE WITH WAGE AND HOUR PROVISIONS IN THE GARMENT INDUSTRY. (a) Amendment.--The Fair Labor Standards Act of 1938 is amended by adding after section 14 the following: ``legal responsibility for compliance in the garment industry with sections 6 and 7 ``Sec. 14A. (a) Every manufacturer engaged in the garment industry who contracts to have garment manufacturing operations performed by another person as a contractor-- ``(1) shall be civilly liable, with respect to those garment manufacturing operations, to the same extent as the contractor for any violation by the contractor of section 6 (except for violations of subsection (d)) or 7, for any violation by the contractor of the provisions of section 11 regulating, restricting, or prohibiting industrial homework, and for violation by the contractor of section 12; and ``(2) shall be subject to the same civil penalties assessed against the contractor for violations of such sections. ``(b) For purposes of this section: ``(1) The term `garment industry' means the designing, cutting, sewing, dyeing, washing, finishing, assembling, pressing, or otherwise producing men's, women's, children's, or infants' apparel, including clothing, knit goods, hats, gloves, handbags, hosiery, ties, scarves, and belts, or a section or component of apparel, except for pre-manufactured items such as buttons, zippers, snaps, and studs, designed or intended to be worn by any individual which is to be sold or offered for sale. ``(2) The term `manufacturer' means any person who (A) contracts, directly or indirectly through an intermediary or otherwise, with a contractor to perform the cutting, sewing, dyeing, washing, finishing, assembling, pressing, or otherwise producing any men's, women's, children's, or infants' apparel, including clothing, knit goods, hats, gloves, handbags, hosiery, ties, scarves, and belts, or a section or component of apparel, except for pre-manufactured items such as buttons, zippers, snaps, and studs, designed or intended to be worn by any individual which is to be sold or offered for sale, including a retailer engaged in such activities, or (B) designs, cuts, sews, dyes, washes, finishes, assembles, presses, or otherwise produces or is responsible for the production of any men's, women's, children's, or infants' apparel, including clothing, knit goods, hats, gloves, handbags, hosiery, ties, scarves, and belts, or a section or component of apparel, except for pre-manufactured items such as buttons, zippers, snaps, and studs, designed or intended to be worn by any individual which is to be sold or offered for sale. ``(3) The term `contractor' means any person who contracts, directly or indirectly through an intermediary or otherwise, with a manufacturer to perform the cutting, sewing, dyeing, washing, finishing, assembling, pressing, or otherwise producing any men's, women's, children's, or infants' apparel, including clothing, knit goods, hats, gloves, handbags, hosiery, ties, scarves, and belts, or a section or component of apparel, except for pre-manufactured items such as buttons, zippers, snaps, and studs, designed or intended to be worn by any individual which is to be sold or offered for sale. ``(4) The term `retailer' means any person engaged in the sale of apparel to the ultimate consumer for personal use.''. (b) Liability to Employees.--Section 16 (29 U.S.C. 216) is amended-- (1) in subsection (b), by adding after the first sentence the following: ``A manufacturer in the garment industry (as defined in section 14A(b)(2)) shall also be jointly and severally liable to such an employee to the same extent as the contractor in the garment industry (as defined in section 14A(b)(3)) who employed such employee if the contractor violated section 6 (other than subsection (d)) or 7 in the production of apparel or components of apparel for such manufacturer.''; (2) in subsection (b), by inserting in the last sentence ``or by a manufacturer in the garment industry'' after ``by an employer''; and (3) in subsection (c)-- (A) by striking ``first sentence'' and inserting ``first or second sentences''; and (B) by inserting ``or by a manufacturer in the garment industry'' after ``liable''. SEC. 4. RECORDKEEPING. Section 16(e) (29 U.S.C. 216(e)) is amended by adding after the first sentence the following: ``Any person who fails to establish, maintain, and preserve payroll records as required under section 11(c) shall be subject to a civil penalty of not to exceed $1000 for each employee who was the subject of such a violation. The Secretary may, in the Secretary's discretion, compute civil penalties under this subsection for each pay period for willful violations. Any person who submits fraudulent payroll records to the agencies enforcing this Act in any of its investigations or hearings or as evidence in a court action, which records conceal the actual hours of labor worked by employees or the violation of section 6, 7, 11(d), or 12 shall be subject to a civil penalty of $10,000 per act of fraud and $15,000 per act of fraud for a second offense. SEC. 5. EFFECTIVE DATE. The amendments made by this Act shall take effect upon the expiration of 30 days from the date of its enactment.
summary: Stop Sweatshops Act - Amends the Fair Labor Standards Act of 1938 to make garment industry manufacturers civilly liable for sweatshop conditions maintained by their contractors. Sets forth civil penalties for violation of recordkeeping and payroll accounting requirements.