According to Sweatshop Watch, a California-based organization, roughly 90% of garment industry jobs in Saipan are held by foreign laborers. But because Saipan is an appendage of the United States, quotas on imports into the United States do not apply and "Made in the USA" labels may be sewn into the clothing manufactured in Saipan by cheap, foreign labor. Many international garment manufacturers have moved virtually their entire operations to Saipan in order to avoid these import quotas.
In early 1999, a class action lawsuit was filed in U.S. federal court in Saipan against garment manufacturers on behalf of more than 25,000 foreign workers. Two more lawsuits were filed in California and included as defendants clothing retailers in the United States. The lawsuits accuse garment manufacturers of human rights abuses, making excessive wage deductions in violation of U.S. law and allege that although garment factories on Saipan are owned predominantly by Chinese and Korean companies, agents of retailers in the United States oversee the manufacturing process.
According to the lawsuit filed on Saipan, in addition to the miniscule hourly wages workers are to be paid under their contracts, they also must satisfy a production quota. If the quota is not reached within working hours, they are required to continue working without pay until it is satisfied. Even when the quota has been fulfilled, workers are sometimes forced to contribute uncompensated 'volunteer' time to their employers.
The complaint further charges that the housing provided to the plaintiffs by their employers as a condition of their contracts "is rat and insect infested, contains only inoperable toilets and showers and significantly lacks clean, running water... The food provided by defendants to plaintiffs often contains insects, is rotten..., and not provided in sufficient quantities to satisfy their basic nutritional needs."
The situation is so bad that no plaintiffs were identified in the court complaint because they feared retaliation - physical violence, deportation and imprisonment upon return to their homelands, acceleration of repayment of recruitment fees, and similar physical and economic retaliation against their family members.
Judge Alex R. Munson initially dismissed the suit for the lack of named plaintiffs, but an appeals court overruled this decision, stating, "...We allow parties to use pseudonyms in the 'unusual case' when nondisclosure of the party's identity is necessary... to protect a person from harassment, injury, ridicule or personal embarrassment."
But last spring Munson concluded that because the CNMI is exempt from U.S. labor law, the court had no jurisdiction to hear the claims of improper deductions for substandard food and housing. He also concluded that "...(t)he plaintiffs chose to incur the fees... to be able to work in the CNMI. That [they] are required to pay debts they incurred in their home countries is not illegal."
