China factory of firm making Ivanka Trump fashion broke rules on overtime and worker benefits, audit finds

Workers endured long hours for low pay at a Chinese factory used by the company making clothes for Ivanka Trump’s fashion line and other brands, Fair Labour Association audit shows

PUBLISHED : Wednesday, 26 April, 2017, 8:03pm
UPDATED : Tuesday, 02 May, 2017, 5:32pm

Workers at a factory in China used by the company that makes clothing for Ivanka Trump’s fashion line and other brands worked nearly 60 hours a week to earn wages equivalent to little more than

US$62 a week, according to a factory audit released this week.

The factory’s 80 workers knit clothes for the contractor, G-III Apparel Group, which has held the exclusive licence to make the Ivanka Trump brand’s US$158 dresses, US$79 blouses and other clothes since 2012. The company also makes clothes for Calvin Klein, Tommy Hilfiger and other brands.

Trump has no leadership role in G-III, and the report did not give the factory’s name or location, or say whether it was working on Ivanka-brand products at the time of the inspection.

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Inspectors with the Fair Labour Association, an industry monitoring group whose members include Apple and Nike, found two dozen violations of international labour standards during a two-day tour of the factory in October, saying in a report that workers faced long hours, high turnover, and pay near or below China’s minimum wage.

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The inspection offers a rare look at the working conditions of the global manufacturing machine that helped make Trump’s fashion brand a multimillion-dollar business.

Its release also comes as the president’s daughter has sought to cast herself as both a champion of workplace issues and a defender of her father’s “buy American, hire American” agenda. Trump, whose book Women Who Work is launched next week, was in Germany on Tuesday for public discussions about global entrepreneurship and empowerment.

“We can add billions to the global economy by creating an enabling environment, increasing women’s labour force participation and business ownership, and improving the productivity of their work,” Trump wrote in a Financial Times essay on Monday.

Trump’s company declined to comment on the factory inspection. Messages left with G-III were not returned.

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Now an official adviser to her father’s White House, Trump stepped down from her management role but retains an ownership interest in her name-brand company. Its assets were moved into a trust that is now overseen by her husband’s siblings. Trump is the sole beneficiary of the trust, which is valued at more than US$50 million.

Chinese factories are by far the dominant suppliers for Ivanka clothes, though G-III also works with manufacturers in Vietnam, Bangladesh and South America. G-III factories overseas have shipped more than 110 tonnes of Ivanka-brand blouses, skirts, dresses and other garments to the United States since October, shipping data shows.

The clothing line licensed by US President Donald Trump’s private business is also almost entirely made in foreign factories. Trump last week signed an executive order that he said would push the government to “aggressively promote and use American-made goods and to ensure that American labour is hired to do the job”.

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Workers at the G-III factory in China were required to work 57 hours a week “on a regular basis” to hit production targets, inspectors found. Though Chinese law sets the limit for overtime at 36 hours per month, workers in all of the factory’s departments exceeded that limit, working up to 82 hours of overtime a month between September 2015 and August 2016.

The factory’s workers made between 1,879 yuan (HK$2,120) and 2,088 yuan a month, which would be below minimum wage in some parts of China. The average manufacturing employee in urban China made twice as much money as the factory’s workers – roughly 4,280 yuan a month – according to national data from 2014.

Fewer than a third of the factory’s workers were offered legally mandated coverage under China’s “social insurance” benefits, including a pension and medical, maternity, unemployment and work-related injury insurance, inspectors found. The factory also did not contribute, as legally required, to a fund designed to help workers afford housing.

Workers earned five days of leave a year, though a small fraction of experienced employees were eligible for more. The factory did not have a union, inspectors said, and the workers’ lone representative was a factory appointee.

Inspectors also cited the factory for a number of workplace safety concerns. It did not train loading workers on safety techniques or provide employees with equipment that could reduce injury, including lifting belts or seats with backrests.

The factory, which began operating in 1992, had also never sought an assessment of occupational disease hazards like those common among workers dealing with repetitive tasks and harsh chemicals.

Two inspectors from SMT-Global, a third-party monitoring group, inspected the factory one month before President Trump’s election victory. The Fair Labour Association then alerted G-III to the problems it had discovered – including 24 violations of standards set by the United Nations’ International Labour Organisation – and asked what steps it would take in response.

The factory pledged to make some progress to improve training, assess hazards, hire more workers and reduce overtime demands. But it did not commit to increasing worker pay and at times pushed back against recommendations that could improve workplace safety. Other G-III factories in China have been cited for similar issues.

Global sales of Trump’s brand have boomed in the months since her father began his pursuit of the White House. Net sales for her clothing collection rose by US$17.9 million in the year to January 31, G-III data shows. An Ivanka company executive said the brand saw some of its “best performance ever” in February, the same month President Trump’s senior adviser Kellyanne Conway told Fox News viewers to “go buy Ivanka’s stuff”.