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30 Sep 2021

Rachel Cernansky, Vogue Business

USA: The passage of SB62 to hold brands liable for wage theft could have global implications on regulatory legislation

"California’s garment labour law: The global implications", Vogue Business

California Governor Gavin Newsom signed a bill into law...Senate Bill 62 requires apparel factories to pay workers an hourly rate instead of per-piece produced; it will also hold brands and retailers liable for wage theft in their supply chains in California, including when third-party contractors are involved.

“It is completely groundbreaking. That onus of responsibility is a very hard thing to win, which is why it’s an incredible success,” says Thulsi Narayanasamy, head of labour rights at the Business & Human Rights Resource Centre...“This is the first step we’ve really seen in a piece of legislation that shifts the business model. It puts the onus on [brands] to ensure they are paying their suppliers. That simply isn’t something that we’ve ever seen anywhere else.”...

...The closest another piece of legislation has gotten to SB 62, according to Narayanasamy, is a due diligence law that Germany passed in July and will go into effect in 2023. It requires companies with 3,000 or more employees in Germany to take “appropriate measures” to ensure human rights and environmental protections in their supply chains, and the EU has a potentially similar effort underway, with an expected proposal for what its due diligence legislation would look like by the end of the year. However, the German law does not establish brand liability for violations in their supply chains, and it’s unclear whether the EU’s will or not.

“The real concern that civil society groups have is [whether the due diligence law] is going to be legislation that actually holds companies liable for when workers’ rights are curtailed?” says Narayanasamy. “The greatest impact that this bill passing in California will have — and we certainly intend to use it to spark the debate [in the UK] — is to say that it is definitely possible to have liability clauses included in legislation that protects workers’ rights. And on top of that, that brands themselves can be in support of that.”...

Garment Worker Center director Marissa Nuncio...says the bill’s passage...spurred momentum elsewhere overnight. “We’ve already started hearing our allies discuss the implications that SB 62 could have for advocates in other states and even other countries,” she says. “SB 62 has made California a leader and a model for the industry, and we’re looking forward to seeing similar protections get enacted across the country and the world.”