The FABRIC Act

The FABRIC Act aims to address wage theft in the U.S. garment industry. Specifically, the FABRIC Act would prohibit “piece rate” payment to employees of garment manufacturers or garment contractors. Instead, garment manufacturers and garment contractors would be required to pay garment workers in the U.S. an hourly rate that is compliant with the U.S. minimum wage.

• The FABRIC Act would apply to all garment manufacturers and garment contractors in the U.S.

• The FABRIC Act would apply to garment manufacturers and garment contractors own operations.

The FABRIC Act would apply to garment manufacturers and garment contractors as well as their subcontractors who also engage in garment manufacturing. The Act would also apply to brands which contract with these manufacturers and contractors

The FABRIC Act would only to grant manufacturers, regardless of where in the supply chain they are. However, it would not apply to other types of suppliers involved in the garment sector supply chain.

Garment manufacturers and garment contractors would be required to register with the department of labor on an annual basis. Garment manufacturers and contractors would not be permitted to practice in the garment industry if they have not registered for that year.

Failure to register with the Department of labor would result in a civil money penalty of not more than $50,000,000.

In the event that a garment manufacturer or contractor pays their employees in piece rate, in violation of this law, garment manufacturers, garment contractors, and the brand guarantors that contract them would be held jointly and severally liable for employees lost wages.