Sweatshops Expanding Into Orange County : Garment trade: L.A. no longer has a monopoly on low wages and Third World conditions for immigrants.

They have survived war, prison, famine, terrifying voyages across pirate-infested seas and long stints in refugee camps. Now, in the land of their dreams, thousands of Vietnamese immigrants spend long days hunched over sewing machines in sweatshops in suburban Orange County.

Some earn as little as $1 an hour. Most are glad to get it.

Beside them toil Latino immigrants who have fled impoverished homelands for prosperous Southern California, only to land Third World-style jobs here.

At least 400 sewing shops have sprung up in and around Orange County’s Little Saigon, employing upward of 5,000 immigrants. In fact, the majority of the shop owners are themselves former boat people who have been in this country less than five years.

These suburban sweatshops are tucked into clean new industrial buildings, just out of sight of their affluent neighbors, and out of mind of the consumers who buy their products in some of the nation’s priciest department stores. Seeing “Made in USA” labels, most shoppers are utterly unaware that some of these garments have been made by immigrants and refugees--sometimes children--working long hours for a fraction of the minimum wage.

It’s not just money but a certain resignation to hardship that keeps these immigrants at their sewing machines. Ngoc Pha Nguyen, 46, has worked at several sewing shops that cheated and underpaid her. Now she earns $4.25 an hour, the California minimum wage. She is deeply grateful.

It took Nguyen four attempts to escape from Vietnam. Two of her daughters and 14 other family members didn’t make it. “I’m very sad, so when I get to work, I forget about it for a while,” she said through an interpreter. “If I stay home, I look at the family shrine and cry.”

Nguyen bends over to stitch the flounces on party dresses--a tedious task performed over and over under hot lights in a crowded, airless garage. The truth is, she hates to sew. But, she says, she can’t find a better job.

The shop where Nguyen works is paid $6.75 for each dress she stitches. Identical dresses with the same labels were selling at a South Coast Plaza department store for $64 each.

“The people who are really making the big money are the retailers and the financiers of the retailers, and some of the manufacturers,” said Edna Bonacich, a UC Riverside sociology professor studying Asians in the California garment industry. “The workers are totally exploited.”

Once a backwater in the $6-billion-a-year Los Angeles-area garment industry, Orange County now produces everything from junior knits to inexpensive evening wear. But it is a transformation that comes with a price tag of its own.

Authorities warn that these new suburban sweatshop workers--particularly in Orange County but also in immigrant strongholds throughout Southern California--are becoming the latest victims of an industry that has been nourished by cheap immigrant labor for nearly a century.

Far from the downtown Los Angeles garment district, where enforcement officials know the turf, offenders are hard to catch. And federal and state labor officials say that when they do find them, enforcement is often stymied by the same dynamics that have kept sweatshops in business for more than a century. Owners insist they’ll go bankrupt if they pay the minimum wage. Workers won’t complain no matter how bad their treatment because they are undocumented aliens, are receiving public assistance or are simply afraid. And manufacturers have few incentives to investigate the conditions under which their products are made.

Suburban Sweatshops

From the outside, Orange County sweatshops bear little resemblance to the ones found in dilapidated buildings in teeming garment districts in downtown Los Angeles, San Francisco and New York.

Most are in brand-new complexes of light-industrial buildings that tend to be located just behind the restaurants and mini-malls that line the thoroughfares connecting Garden Grove, Westminster and Santa Ana, where about 100,000 Vietnamese-Americans have settled since 1975.

“Sweatshops flourish wherever you have pockets of immigrants,” said Allen J. Scott, professor of urban and economic geography at UCLA. “It’s not just happening in Orange County, it’s happening in the San Fernando Valley and in Long Beach. . . . And there’s a big new Korean community growing up around Van Nuys.

“What has been happening recently is a decentralization in all directions out from the garment district, not only to tap . . immigrant populations but also to take advantage of the cheaper land,” Scott said.

In 1983, Scott studied garment subcontractors and found that nearly all were located in downtown Los Angeles. He found only two in Orange County. Last spring, Bonacich analyzed the ethnic makeup of the state’s 4,589 registered garment contractors and found 172 in Orange County.

The owners of 102 of them were Vietnamese. One was Chinese, 11 Latino and 10 Korean; 24 were owned by other Asians whose national origin was unclear, and the rest were unknown.

Including the 20% to 30% of shops that are unregistered and the scores of mini-sweatshops hidden inside single-family homes and garages, Bonacich estimates Orange County now has at least 400 sewing shops.

“We haven’t run into a single Vietnamese who’s been in business here for more than two years, so this seems like a brand-new business for Orange County,” said Rolene Otero, director of enforcement for the U.S. Department of Labor’s Wage and Hour Division in Santa Ana. “In the last two years, it’s just exploded.”

But while wages and working conditions in Los Angeles have on the whole improved thanks to heavy enforcement, officials said, labor abuses in Orange County are widespread.

A recent crackdown spearheaded by Otero found 18 Orange County sweatshops that had been violating minimum wage, overtime and child labor laws--including the shop that employed Ngoc Pha Nguyen, according to documents obtained by the Los Angeles Times under the Freedom of Information Act. So far, the shops have been ordered to repay more than $180,000 to at least 220 workers, and some cases are still pending, Otero said.

“The extremely low wages across the board in Orange County are not the case in Los Angeles,” Otero said. “In L.A. you will find $10-an-hour employees. In Orange County, we have yet to find a single employee paid any more than the minimum wage.”

The suburbanization of sweatshops is an outgrowth of the changes that are reshaping the garment industry, scholars and officials said. First, foreign competition has driven down prices in the domestic sewing industry. But at the same time, manufacturers need flexible production capability because rush orders for more of a hot-selling item cannot be filled fast enough overseas.

The solution--especially in inexpensive clothing, women’s and junior wear, where fashions change overnight and quality is often second to price and timing--is to subcontract the sewing. This enables manufacturers quickly to shift their designs and output to ride out the treacherous market tides--while largely escaping legal responsibility for any labor abuses committed by the companies that sew for them, officials and garment-industry sources said.

“They’ve created a Third World labor force here to match the Third World labor force with which they’re competing abroad,” Bonacich said.

“We all need work, and we take anything we can get,” said one Vietnamese shop owner, who said she cannot possibly pay her workers the minimum wage because the price she gets for finished garments is so low.

Labor Police

Some argue that labor police have never succeeded in crushing sweatshops in the past and are unlikely to do so now because the market demands them.

“If you really tried to enforce immigration and other laws about working conditions, in both the garment industry and the electronics industry in Southern California, the effect on the economy would be disastrous,” Scott said. “So the enforcement is symbolic more than it is systematic.”

In a typical suburban sweatshop, fluorescent lights beat down on rows of sewing machines. Heaps of pre-cut fabric spill out of plastic bags onto cement floors littered with scraps of cloth, threads and cigarette butts. Remnants of meals linger in odd corners, and the air smells sour.

In many shops owned by Asians, the office decor includes a red-and-gold lacquered shrine with an incense holder and a porcelain statue of Than Tai, the Vietnamese god of money. Perhaps no less symbolic are the time clocks and posters nearby that detail, in English, the California minimum wage and overtime laws. They pacify the authorities, but few of the workers can read, write or speak English. And the time cards are rarely used to determine wages, because most workers are paid by the piece.

Labor abuses exist in part because both shop owners and the workers themselves are participants in a vast underground economy. Authorities say the sweatshops prey on two particularly vulnerable groups: illegal Latino aliens and Southeast Asian refugees who work illegally and collect welfare at the same time.

“My former boss used to pay us 10 cents a piece for ironing,” said Maria del Pilar Solano, 23, a sweatshop worker who has since applied for immigration amnesty and is not receiving public assistance. “We would work from 7 a.m. to 8 p.m. We got $8 or $9 a day, sometimes $4 or $5. At the end of the week we would add it up and we would get only $50 a week. The owner used to say it was a lot of money.”

And to Solano, it was a lot of money. In Mexico, where she worked as a knitter, she earned $12 every two weeks.

Federal inspectors raided the shop where Solano worked and found that it had been paying less than the minimum wage and had illegally employed 12 home workers, federal documents show. The garments Solano and her colleagues made were sold to Macy’s and Bloomingdale’s department stores, documents show. Solano said the shop has since changed hands and is now paying $4.25 an hour. Even some of the immigrants who have working papers accept between $1 and $3 an hour because they have no skills, speak no English and are often desperate to earn money to send home, authorities and Vietnamese community leaders said.

“In Vietnam for $10, one person can live for a month,” said Ly (Louis) Cao of Vietnamese Community of Orange County Inc. in Santa Ana, which provides retraining for scores of refugees who are in the garment industry but want better jobs. “Ninety-nine percent send money home.”

Some also are willing to stay in the sweatshops or stitch at home in secret for a fraction of the minimum wage because they are collecting welfare, housing subsidies or food stamps, authorities said.

In the world of sweatshops, where wages are paid in cash, and records, where they exist, are sketchy, it is tricky to identify the true victims, authorities say.

The proprietor of one floundering shop in the Euclid Business Center in Garden Grove, $3,000 behind on his rent, stunned his landlord by coming in to pay the entire sum in $5 bills. And state welfare fraud inspectors tell of refugees who, by putting every family member to work, continuing to collect benefits, living three families to a house, and scrimping for years, have managed to buy $200,000 homes or businesses of their own--again, all purchased in cash.

Beds and Bassinets

Even deeper in the shadows are the uncounted workers who assemble garments illegally in their homes.

Officials will not even guess at how many there are, but the practice of home sewing both by families and by sweatshop workers who take work home with them after hours is certainly widespread. Nine of the 18 sweatshops cited by Otero were employing such illegal home workers.

Danny Lam, who runs a sewing machine shop in Garden Grove, estimates that he sells about 20 industrial machines a month to Vietnamese, Cambodian, Laotian, Korean and Mexican families who tell him they plan to sew at home. And Lam has three competitors in Orange County alone.

The first authorities to notice the burgeoning home sewing industry were Orange County welfare fraud inspectors sent to check out tips that some of the county’s 22,000 refugees who receive public assistance were working on the sly.

“When we go to (their) houses to do welfare fraud investigations, 70% to 80% of the time we find sewing machines,” said Van Nguyen, a welfare fraud investigator for the Orange County district attorney’s office.

State Deputy Labor Commissioner Craig Cubberly began accompanying Nguyen and her partner on their monthly rounds to search out labor violations. From June, 1987, through September, 1989, they raided 66 businesses and 21 homes where welfare violations were suspected. Cubberly issued 85 labor citations assessing nearly $45,000 in fines--including 13 child labor violations involving children ages 13 to 17.

At one home in Westminster, they confiscated 757 knit cardigan sweaters, in various stages of completion--enough to fill six large plastic trash bags, Nguyen said. The homeowner, who was collecting welfare, “says he’s the only one working, making $120 a month,” she said.

Altogether, state officials seized 5,022 garments, which were donated to charity, Cubberly said.

Men and women who sew in such homes--and their children--risk inhaling dust and fibers from the heaps of cut fabric in poorly ventilated spaces.

“Eventually, we’re going to see tuberculosis, respiratory problems,” Otero said.

Some of the garments seized in homes or found in factories paying less than the minimum wage bear the label of major manufacturers. When called for comment, several said they had given cut pieces to reputable, state-registered contractors to be sewn. Each one vehemently denied any direct or indirect knowledge of the sweatshops.

J. P. Wolk, controller of Oops of California, a women’s and children’s dress manufacturer with annual sales of $20 million, said he had no idea that his goods had been confiscated by state inspectors after they were discovered in a home.

“I’m not aware of that. They never talked to me,” Wolk said. “As far as I know, we only deal with reputable contractors. What the contractors do, I have no idea.”

When such operations are discovered, illegal aliens are reported to the U.S. Immigration and Naturalization Service, and welfare frauds are referred to the district attorney’s office for prosecution, officials said. The sweatshop owners are fined for each state labor violation and usually are forced to compensate the manufacturer for the cost of the confiscated garments. But, state officials said, manufacturers are almost never prosecuted.

“You’d have to catch the manufacturer in the house with the garments and the machines,” said John B. Carter, senior deputy labor commissioner for the state Division of Labor Enforcement in Santa Ana. “It’s impossible.”

LABOR LAWS These are the state and federal labor laws that apply to garment workers:

Minimum Wage: President Bush recently signed legislation to raise the federal minimum wage to $4.25 an hour by 1991, but that move will not affect California, where the state-mandated minimum wage is already $4.25 per hour. Trainees with no experience may be paid $3.60 an hour for up to 160 hours.

Overtime: Garment workers, like other non-salaried employees, must be paid time-and-a-half if they work more than eight hours a day or 40 hours a week.

Home Sewing: Sewing commercially at home is a misdemeanor under California law. The state law supersedes federal law, which allows some types of home work but prohibits sewing women’s garments at home.

Registration: Under the Montoya Act, all garment contractors must register with the state and pass a licensing exam that covers all applicable laws. The 1981 law also requires shops to keep wage and hour records.

Child Labor: Children under 12 may not work. Children ages 12 to 14 may not work on school days. All those under 18 must have a permit from their school districts, and in any case may not work more than 36 hours per week.