‘Heavy-handed tactics’

The past three months have been tiresome and exasperating for Roland Allen. The owner of a small Chico screen-printing shop called Limey Tees, he has been working six days a week, not less than 10 hours a day, without any employees to help keep his business afloat.

During that time, he’s lost thousands of dollars in revenue and in fines—all because he didn’t have a garment license, something he didn’t even know his business needed.

Allen isn’t alone. Many screen-print shop owners in the area have been dodging bullets from the state, in the form of cease-and-desist orders for not having a garment license that most of them had never heard about.

In February, the California Department of Industrial Relations conducted a sweep of inspections in Chico and other North State communities, targeting screen-printing businesses. Shop owners point in particular to an inspector named Facundo Rosas, who works out of the Redding office, saying he used, as one person wrote in a letter to the CN&R, a “dubious interpretation of a law intended to protect sweat-shop employees from exploitation.”

A Web site, GarmentMafia.org, has emerged in response to the recent inspections and “attacks against small businesses.” These small businesses are not really garment manufacturers, the site insists.

The site also chides the state for bad timing, noting that businesses are already struggling in a weak economy.

“Nobody really knows what it is,” said Ryan Eley, sales manager at North State Screen Print and Athletics in Chico. “Nobody who does this business has ever heard of a garment license, [yet] everybody has been scrambling to get it, from what I’ve heard.”

According to the state labor code, all garment manufacturing facilities are required to have the license—and the code says garment manufacturing includes “sewing, cutting, making, processing, repairing, finishing, assembling, or otherwise preparing any garment or any article of wearing apparel or accessories designed or intended to be worn.”

While these small businesses say they are not garment manufacturers, the state places them in that category due to the term “finishing” in the definition.

The contrary argument is that the garments are already finished before arriving at a screen printer’s shop, and the printer only embellishes an existing garment.

“The law shouldn’t apply to anyone who decorates clothing,” Allen said. “It has to deal with cutting and sewing.”

Shop owners were given no grace period or warnings. Indeed, Allen said he was never informed of such a permit when he filed for a business license to operate a screen-printing facility almost three years ago.

“I’ve been unfairly picked on and bullied,” Allen continued. “But because of the bullying, I’ve had to go through the motion and get this license.”

Most of the local businesses were either hit by fines or heard about the garment license by word of mouth. In a difficult economy, they have been scrambling to keep their doors open or forced to modify operations. In Chico, Triple J Screen Printing & Embroidery has closed its storefront and contracted out production work. The family business has been operating for 23 years.

“The state of California has made it pretty much impossible for us to continue business,” said Jamie Monroe, who owns Triple J along with his wife, Melissa.

Some eight to 10 people caught up in the sweep have contacted state Assemblyman Jim Nielsen’s office in Sacramento contesting the need for such a license. The office was also contacted with allegations of unfair treatment on the part of the inspectors, reported Nielsen’s chief of staff, David Reade.

“The thing that is most distressing is what appeared to be heavy-handed tactics,” Reade commented. He said labor inspectors went into these businesses “with their police power … demanding from them things on the spot.”

Reade said the assemblyman originally was contacted by supervisors in Colusa County, where many local businesses had started coming forward with allegations, including “alleged threats to shut them down” by inspectors.

However, Department of Industrial Relations spokesperson Dean Fryer said nothing is new about the law, which was passed in 1980 to target industries with longstanding labor-abuse infractions, such as not paying employees fairly, working minors and requiring long hours without worker’s compensation.

Typically, garment manufacturing enforcement occurs in Los Angeles or the Bay Area, where the industry is widespread. Yet, the department has “periodic enforcement throughout the state in this regard,” Fryer said.

In response to the unpopularity surrounding the action, “there’s not much wiggle room” in the licensing requirements, Fryer said. “We enforce the law. We can’t change the law or be subjective to the interpretation.”

He went on to say that business owners who dispute the process “did the right thing in contacting their local legislator,” because the labor department is only enforcing the violations according to current legislation. The Department of Industrial Relations has already met with Nielsen’s office and is taking the issue seriously, Fryer said.

Simply put, Fryer said: “When you don’t have a license, we are not required to permit a business to continue operations.”

Allen believes the law is “randomly enforced.” According to a database of all businesses in the state with garment licenses, he is now one of six registered in Chico. Only five businesses in Sacramento have the license, and none in either Fresno or Bakersfield, cities with a combined population of nearly 1 million.

It took Allen three months to obtain his license. The citation itself was just $100. But, because one employee was working on the clock at the time of inspection, an extra $1,000 was tagged onto the fine.

As if that wasn’t enough, two months into the ordeal Allen discovered he was also required to post a $5,000 bond to secure his license. That was after losing revenues, being forced to turn down business and working without employees for weeks.

In retrospect, Allen wasn’t sure if he was supposed to be open at all until he obtained the license. “But I didn’t have a choice; I would have gone out of business,” he said.

Not to mention that he continually received different answers to his questions from various agencies and authorities.

“The hoops they require you to jump through are ridiculous, and all they are doing is generating revenue,” said Triple J’s Melissa Monroe.

Triple J was required to pay about $1,500 in fines, but the clincher was a $21,000 bond penalty—something the local business could not afford. After losing their appeal, the owners decided to close their production facility, expand their Internet-based business and service clients using a different model.

“It feels like extortion,” Monroe said, noting that they were forced to eliminate more than half of their employees due to the change.

Fryer says the labor department understands that business owners are frustrated. He said resources are available to help them be aware of all requirements, such as the small-business advocacy office through the Governor’s Office.

Reade says his office is investigating whether the garment manufacturing label “really applies to some of these small ma-and-pa shops,” and whether there needs to be a change in the law.

Also, the office is investigating whether field commissioners acted unfavorably.

“Government officials in the state of California shouldn’t treat business owners like subjects,” Reade said. “They should be enabling small businesses to thrive and prosper, not impeding them.

“That’s pretty scary when a big state government official comes into your business and threatens to shut down your business and livelihood.”