CNMI: 10th Garment Factory To Shut Down

CNMI: 10th Garment Factory To Shut Down
Sunday: July 9, 2014
Pacific Magazine, HI

(Marianas Variety Online) – The remaining workers of Handsome (Saipan) Inc. have started cleaning up the facility of the Tanapag garment factory, which is closing its business operations on Sunday after 10 years of operating here.

Former employees, as well as some employees of its sister factory, Top Fashion Corp., were cleaning up the area yesterday and hauling office furniture, equipment and other items either for disposal or transfer to another facility.

“I was surprised that the factory is closing — I have been working here for about a year,” said one of the employees, 28-year-old Jaime Reyes, in an interview at the site.

Reyes, who worked as a runner and warehouse employee, said he and some of his fellow employees will know today whether they are going to be transferred to Top Fashion, also located in Tanapag.

Handsome (Saipan) Inc., which manufactures mostly Sears, Kmart and Liz Claiborne brands of clothing, said its closure is due to “unfortunate economic circumstances beyond their control.”

It is the 10th garment factory in the CNMI to shut down operations since Jan. 2005 when the World Trade Organization liberalized trade rules that now allow Third World countries to export more of their cheap garment products to the U.S. These Third World factories pay their workers less than the CNMI’s minimum wage of $3.05 an hour, which was last set in 1996.

Joseph Horey, counsel of Handsome (Saipan) Inc., yesterday told Variety that of the estimated 185 employees of the factory, 60 have gone back to China and 80 are transferring to Top Fashion.

The other 30 are transferring to other employers, while the remaining 15 are still looking for transfer employment, said Horey, as he expressed hope that there will be no additional factories closing.

“I think it’s too bad seeing a lot of factories closing because of changes in trade rules,” he said.

Horey said some employees may have to stay until the end of the month to completely clean up the Tanapag facility.

Handsome informed the Department of Labor as early as May 10 about its July 9 closure. Unlike the first three factories that closed last year, Handsome has given advanced notices to its employees and is current in its payroll.

Since last year, the following factories have shut down their Saipan operations: Mariana Fashions Inc. in San Antonio, Sako Corp. in San Antonio, La Mode (Saipan) Inc. in As Lito, Neo Fashion Inc. in San Antonio, Express Manufacturing in Puerto Rico, Winners Corp. 2 in Chalan Laulau, Hyunjin Saipan Inc. in Gualo Rai, American Pacific Textile in Tanapag, Hansae Saipan Inc. in Gualo Rai and Handsome (Saipan) Inc. in Tanapag.

To help the remaining factories remain competitive, the Fitial administration continues to lobby Congress to amend Headnote 3(a) of the U.S. Tariff Code and allow Saipan factories to use more imported raw materials for their “Made in the USA” garment products.

Source: http://www.mvariety.com/frontpage/front01.htm