A New York State bill seeks to regulate the fashion industry’s social and environmental impacts.
Currently pending in the New York State Senate, the Fashion Sustainability and Social Accountability Act could be a watershed regulation for the fashion industry, which has traditionally enjoyed low regulation around labor and environmental issues. In recent years, concerns about the industry’s human trafficking, modern slavery, and substantial polluting impacts have increased. The Fashion Act is part of a recent shift in the legal climate around these issues in the United States.
Fashion is a $3 trillion plus industry worldwide. It constitutes an estimated 2 percent of the world’s gross domestic product. And in the United States, the apparel sector alone employs roughly 1.8 million people, within a broader retail sector that supports 32 million people through farming, textile production, manufacturing, and wholesale jobs.
Fashion contributes up to 4 percent of the greenhouse gas emissions generated worldwide. For years, scientists have tracked the pollution of waterways, which derives from synthetic textile dyes with chromium compounds, formaldehyde, and other harmful chemicals. Government sources have also emphasized such impacts on water quality. Furthermore, scientists, researchers, and industry insiders have long recommended washing new clothes before wearing them due to the unknown level and impact of chemical residue that remains on finished garments.
Fashion’s labor issues date back to the early 20th century, as evidenced by the Triangle Shirtwaist Factory fire in New York City. Labor concerns have followed the garment manufacturing industry into the present day and even around the world as companies have moved operations overseas. For example, in 2013 more than 1,100 people died when a garment factory building known as Rana Plaza collapsed in Bangladesh.
Retailers and manufacturers have also been accused of evading labor laws through the industry’s traditional wage system—which pays workers by piece produced—and by subcontracting manufacturing jobs to avoid liability for workers.
In response, California—home to the largest number of garment workers in the United States—enacted in 2010 the Transparency in Supply Chains Act and, more recently, the Garment Worker Protection Act, effective at the start of this year.
Unlike New York’s proposed Fashion Act, California’s Supply Chains Act does not require that fashion retailers and manufacturers make changes to their supply chain. Instead, the California law mandates disclosure, allowing consumers to make informed decisions about the retailers and manufacturers from whom they purchase. California’s Protection Act, the first U.S. law to establish a minimum wage system for garment workers, expands the scope and penalties of previous laws to address wage theft by manufacturers and retailers.
Many of the issues addressed by such laws stem from the rise of the global fashion system in the 1980s and 1990s, when the majority of the U.S. fashion industry’s production moved offshore. Companies began shifting their garment and footwear sourcing and manufacturing from country to country in search of low-regulation settings, which enable the low clothing prices seen in stores today.
Workplace conditions like those seen in New York City in 1911 and Rana Plaza in 2013 continued, giving rise to slavery, human trafficking, factory fires and unsafe conditions, dead waterways from toxic pollutants, and contaminated soils.
The damage produced by garment and footwear manufacturing has compelled industry insiders, consumers, researchers, and advocates to continue challenging the systems that have allowed these conditions to persist for well over 100 years.
Within the last five years, evidence of government-run internment camps in China’s Xinjiang region has come to light, drawing scrutiny to an area that has historically produced a significant amount of cotton used by the fashion industry and U.S.-based brands such as Target and Walmart.
In 2021, the U.S. Congress responded by passing the Uyghur Forced Labor Prevention Act. After receiving broad bipartisan support, the bill was signed into law by President Joseph R. Biden in December. The federal Prevention Act is broad and creates a rebuttable presumption that goods manufactured in the Xinjiang region are made using forced labor and therefore banned from entering the United States.
Binding agreements between fashion brands and trade unions are another promising response. After the Rana Plaza tragedy and the ensuing public relations nightmare for the industry, 200 fashion brands came together and signed the Accord on Fire and Building Safety, aimed at protecting workers in Bangladesh.
Experts at the Pennsylvania State University’s Center for Global Workers’ Rights found that in the five years following the disaster, formal legal rights for Bangladesh’s 4 million garment workers and suppliers remain mostly unchanged. Still, the Accord has improved factory safety for some, identifying and eliminating more than 97,000 hazards across more than 1,600 factories through independent safety inspections.
As the fashion industry emerges from the COVID-19 pandemic, it once again faces scrutiny for its climate impacts and the working conditions for garment workers around the world. Government actors in the United States and Europe are increasingly recognizing that voluntary compliance will not achieve necessary results.
Within this context, New York’s proposed Fashion Act comes to the fore. Fashion retail sellers and manufacturers doing business in New York State with annual worldwide gross receipts over $100 million—the threshold for the Fashion Act—include nearly “every large multinational fashion name,” such as Nike, Adidas, Under Armour, Zara, H&M, Gap, Chanel, Lululemon, and many more.
The Fashion Act would require companies to map 50 percent of their supply chains by volume across all tiers of production. If the bill becomes law, companies would have to make a good faith effort to map suppliers and associated supply chains—indicating legislators’ recognition of the subcontracting tactic frequently used to avoid compliance.
Companies would have to post to their websites within 12 months of enactment, a variety of disclosures, including environmental due diligence policies, processes, and outcomes. Companies would also need to include reports on their social and environmental sustainability initiatives, including relevant information from external sources and concrete activities to combat companies’ adverse impacts.
To track the effectiveness of companies’ efforts, “impact disclosure on prioritized adverse environmental and social impacts” would be required to be posted within 18 months after enactment of the original policies and procedures.
The New York Attorney General would enforce the Act. Penalties would include, but are not limited to, fines up to 2 percent of annual revenues of $450 million or more. Any collected penalties would be placed in a community benefit fund and allocated toward environmental conservation and environmental justice efforts.
If passed, New York’s Fashion Act would provide the most comprehensive approach to date in the United States to combat fashion’s labor and environmental problems.