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Wage Theft

Photo of workers protesting

Garment workers, who already receive subsistence wages, are often paid even less than they are owed when their employers fail to obey minimum wage, overtime, and severance laws. By targeting areas where violations are particularly widespread, and by responding to worker complaints at individual factories, we have successfully pressed many employers around the world to start obeying wage laws, and we have helped workers win over $25 million of legally-owed back pay—worth $74 million in purchasing power in workers’ home countries.

Case Study: Haiti

Before the WRC intervened in 2012, almost all Haitian garment factories failed to pay workers the minimum wage. In fact, many were paying workers 32 percent less than the legal minimum. Most factories also cheated workers of overtime pay. This theft of workers’ already poverty-level wages left 75 percent of workers in some areas unable to afford three meals a day for their families.

The WRC’s research and advocacy led to three major apparel brands committing to both end their supplier factories’ violations and to secure $250,000 in back pay for over 2,000 workers. Since we began this work in 2012, more than 10,000 workers across Haiti have seen their wages increase by 50 percent. The WRC continues to work toward the goal of all Haitian garment workers receiving their legally-earned wages.

Severance Pay

Workers are also often cheated out of their legally-owed severance pay, typically when owners shutter factories and abscond overnight. Because many countries where garments are made lack unemployment insurance, workers and their families depend on receiving severance pay when factories close.

Since 2010, the WRC and our allies have successfully pressed major brands like Nike, adidas, Gap, H&M, Disney, and Walmart to provide over $10 million in legally-owed severance to more than 6,000 former employees of shuttered factories around the world.

Recent Cases in which Violations Were Fully Resolved

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Recent Cases in which Violations Remain Unresolved

LD El Salvador

LD El Salvador, a garment factory located in El Salvador, unexpectedly closed down operations in March 2018 and failed to pay its 824 employees approximately $2.3 million dollars in compensation that they were legally entitled to receive for terminal benefits. The factory was owned by a Korean businessman, Young Ryul Kim, and was a key…

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Konffetty S.A. de C.V.

The WRC uncovered extensive wage theft and related violations of university labor codes at Konffetty S.A. de C.V., a garment producer in El Salvador that is the sole disclosed supplier to university licensee Vive La Fete.

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PT Jaba Garmindo

Read More: WRC Assessment PT Jaba Garmindo (Indonesia) – December 18, 2015

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All Related Factory Investigations

League Central America

The WRC conducted an assessment of compliance with labor rights standards at League Central America (LCA), a garment factory located El Salvador that is owned and operated by the U.S. apparel brand known as League Collegiate Wear, Inc.  The assessment found violations of Salvadoran law in the following areas: Wages and Hours of Work. The WRC…

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PT Kahoindah Citragarment Tambun-Bekasi

The WRC conducted an investigation of the PT Kahoindah Citragarment Tambun-Bekasi factory, which was owned and operated by Hojeon Ltd. (Hojeon), a South Korea-based factory conglomerate.  The investigation was undertaken in response to complaints from workers received by the WRC after the factory announced its intention to close on July 2, 2018. From 2009 until…

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SMC

The WRC’s assessment at SMC found violations in the areas of wages and hours, statutory paid time off, maternity benefits and occupational health and safety.

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Direct Ship Americas

In January 2019, the university licensee Fanatics, the WRC, and other stakeholders worked together to ensure compliance with university codes of conduct following the closure of Direct Ship Americas (DSA), a factory located in Choloma, Honduras. Fanatics informed the WRC about the closure before it occurred and reported that the factory, which owed its 240…

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LD El Salvador

LD El Salvador, a garment factory located in El Salvador, unexpectedly closed down operations in March 2018 and failed to pay its 824 employees approximately $2.3 million dollars in compensation that they were legally entitled to receive for terminal benefits. The factory was owned by a Korean businessman, Young Ryul Kim, and was a key…

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Konffetty S.A. de C.V.

The WRC uncovered extensive wage theft and related violations of university labor codes at Konffetty S.A. de C.V., a garment producer in El Salvador that is the sole disclosed supplier to university licensee Vive La Fete.

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Pure Cotton

The WRC investigated violations of university codes of conduct by Pure Cotton, a company located in Los Angeles, California, that supplied collegiate apparel to the licensee, Hype & Vice, LLC (Hype & Vice). In September 2018, California state inspectors cited Pure Cotton, and a small subcontract factory operating at the same address, Union Supply, for…

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Hansae Vietnam

The Hansae Vietnam factory has been the subject of in-depth investigation and reporting concerning labor rights issues and engagement with Nike and Hansae on their remediation, by both the WRC and the FLA, for the past two years.

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Cambo Yon Xing

The WRC has issued a report on the successful remediation of labor rights violations at Cambo Yon Xing Garment Co., Ltd., an apparel factory located in Phnom Penh, Cambodia, that closed on February 7, 2016. The resolution of these violations secured the payment, in August 2016, of nearly $91,000 in legally mandated compensation to 75 employees — an average of eight months’ wages per worker.

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Rio Garment

In August 2016, Rio Garment, a collegiate supplier factory, unexpectedly closed its operations. The WRC’s investigation found that, at the time of the closure, the factory owed its workers $1.3 million in compensation.

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