JEFFREY KAYE: Gorgeous, glamorous, and cutting edge: This is the public face of the $9 billion a year Los Angeles fashion business; a crossroads of the American apparel industry. But the parade of gloss and glitter is produced by the sweat and skill of a largely underground workforce. Some 120,000 mostly immigrant garment workers labor in the shadows of the LA fashion world.
KIMI LEE, Garment Worker Center: We call it the sweatshop capital of the U.S., And there's A... the reason is because all these factories are sweatshops.
JEFFREY KAYE: Kimi Lee is the director of the Garment worker Center. The organization fights for the rights of apparel workers. Lee says many of LA's 5,000 garment factories, often located in decaying downtown office buildings, are workplace nightmares.
KIMI LEE: These workers all face what we call sweatshops, where it's dirty, dusty, rats, cockroaches, no breaks; they can't go to the bathroom sometimes-- you know, they have to wait till the end of the day or their pay is docked. They work 15, 16 hours a day. Their time cards are falsified, you know, where it gets punched out at 5:00, but they stay till 8:00 or 9:00.
DOV CHARNEY, American Apparel: You're tight, relax! Relax, it's California.
JEFFREY KAYE: Enter Dov Charney, a flamboyant, Canadian-born, L.A clothing entrepreneur. Charney says he's on a crusade to smash the garment industry's culture of worker exploitation from within.
DOV CHARNEY: We've undervalued this job in the last 30 years. It's a hard damn job. I bet you, you, or your children, or many of the people within your socioeconomic group wouldn't be able to do that. It is a skilled job at this point. They're professional seamsters.
JEFFREY KAYE: Can you do it?
DOV CHARNEY: No.
JEFFREY KAYE: Charney is the co- founder of American Apparel, a three-year-old clothing company that specializes in manufacturing hip and high-end t-shirts and underwear. It's clothing made and marketed as both sexy and sweatshop-free.
DOV CHARNEY: This is basically the pitch: It's t-shirts that look good, t- shirts that feel good, and t- shirts that are made in a non- exploitative setting. Exploitation is not even an option. It's the third rail for us. We don't go there.
JEFFREY KAYE: Charney's 800 employees cut and sew clothes on new equipment, working on a mammoth factory floor that's clean, well-lit and air- conditioned. The factory's median wage is $9.24 an hour, but fast sewers working in teams instead of as individuals on assembly lines can make more, depending on how many garments they sew.
DOV CHARNEY: We've set it up so we know that even an average person working in this setting could make $100 a day in eight hours.
JEFFREY KAYE: Okay.
DOV CHARNEY: So we kind of know already, because we've made these products for so long, we know that you should be able to make so many t-shirts and you could make approximately $100. Now, if they cooperate better, and work together better, they can make up to $150 a day.
JEFFREY KAYE: Other on-the-job benefits include free phones, after-hours English classes, even a part-time masseur who's on call to try to rub away some of the aches and pains of the job.
DOV CHARNEY: She works at American apparel. She loves wearing American apparel.
JEFFREY KAYE: Workers with the right look can also be selected as models in American apparel's catalogues and ad campaigns.
DOV CHARNEY: There's her ad.
JEFFREY KAYE: Looking ahead, Charney is planning on providing his employees with paid vacations, health care, and an on-site child care center. He says it's all part of his ambition to create a company where profits and principles can coexist.
ALMA AMYA: When I met Dov, he always walks around, "hello, people! How are you doing?"
JEFFREY KAYE: Alma Amya, a Salvadoran immigrant and single mother, saw her ambitions flower after coming to work at American Apparel. Within three months, she moved from a sewing job to a front office position.
ALMA AMYA: I talked to Dov and I say, "you know what? I need something else, because I just don't want to be just a worker for the rest of my life." I have a kid, and I want to be this kid's hero, you know? I want him to be able to look up to me for what I can do and for what I can... for what I became since I was on the sewing machine.
DOV CHARNEY: Yeah, that's the key is the dignity. That's what people don't understand. "Can you give me a list of the benefits?" Who cares about the benefits? I mean, of course they're important, but they're secondary to the dignity.
JEFFREY KAYE: But not everyone is convinced that Charney is the unblemished champion of worker's rights. Organized labor, especially, criticizes the t-shirt mogul for his non-union workplace, arguing that worker treatment there depends solely on Charney's good will instead of a formal contract. (Marriachi band playing) Organized labor is instead embracing an even bolder campaign to reform the garment industry. It was launched last April with the fanfare opening of casual clothing manufacturer Team X.
TEAM X SPOKESMAN: And now, everybody, please participate with us. Free t-shirts for everybody!
JEFFREY KAYE: Team X has been financed by a venture capital fund controlled by Ben Cohen of Ben & Jerry's ice cream fame. 60 employees, members of Unite, the garment workers' union, receive a median salary of $10.50 an hour. Company President Doug Waterman says the goal is to turn the firm into a workers' cooperative.
DOUG WATERMAN, Team X: Well, the concept of worker ownership, the concept of parity between salaries and earnings that a management team earn and take, versus what the workers who are actually doing the work and making it possible for everybody to make salaries, I think is an important fact, especially in light of what's been going on in corporate America these days. We certainly can't say that we're greedy. Nobody's going to get rich here, but we're having a lot of fun; at least we're getting to have a lot of fun, and we feel good at the end of the day.
JEFFREY KAYE: For Team X and its backers, the company exists as much to promote a cause-- labor justice-- as it does to turn a profit. There's even a wall of honor for U.S. Labor heroes. Unions and groups that promote workers' rights are the biggest customers of the casual clothing made under the label Sweat X.
DOUG WATERMAN: And hopefully your next step will say, not just "made in America," but "made in a union shop." So, yes, I hope that we do provide an example, and we demonstrate that you can be successful, you can make money, you can succeed, you can grow.
SPOKESPERSON: So these are our trade shows, and this happens five times a year.
JEFFREY KAYE: Ilse Metchek isn't buying it. She's the director of the California Fashion Association, the apparel industry's trade group.
ILSE METCHEK, California Fashion Association: We applaud them for what they do, but it has nothing to do with the rest of the industry.
JEFFREY KAYE: She says Team x and American Apparel can be successful because they've carved out niche markets.
ILSE METCHEK: Look around here. We have a plush pile, we have denim, we have prints. They have none of these issues. They don't have designers. They don't have to make product ten times a year to be different. They don't have to follow the seasons. They don't change color. They have a different consumer. We're proud of them, terrific; but the product, the fabric doesn't change in 12 months.
JEFFREY KAYE: Metchek acknowledges abuses in the garment industry, but she says U.S. Garment contractors couldn't compete if they had to pay their workers much more than the minimum wage.
ILSE METCHEK: The work would be done offshore, and all of the people working here, albeit for perhaps minimum wage, would be out of work. Now, I will ask you, what do you do with them? And that's an issue that's true in restaurants, and that's true in many, many industries. It just so happens the apparel industry is under the greatest of microscopes.
JEFFREY KAYE: But the industry doesn't get enough scrutiny, says Alma Amya. She says its exploitation of workers is heartbreaking.
ALMA AMYA: Whenever I go to J.C. Penney's, Sears, and all those grand, you know, big stores, I see just a simple t-shirt -- just a simple one -- $50, $80. It makes me want to cry because out of those $80, maybe some worker back in my country or even here in LA just got a few pennies out of it. And they're getting all the profits. I mean, it makes you want to cry; for real, it does.
JEFFREY KAYE: American Apparel and Team X would like to see consumers adopt a new fashion, one in which shoppers think as much about the treatment of the people who make their clothes as the clothes themselves.