San Diego Embroidery Business Investigated for Overtime Wage Violations

A San Diego silk-screening and embroidery business that produces official merchandise for high-profile music artists failed to pay overtime wages for 76 workers, the U.S. Department of Labor said Monday.

King Graphics has agreed to pay $269,914 in overtime pay and liquidated damages to the affected workers as part of a consent judgment reached last month in San Diego federal court.

It also paid just over $10,000 to lift a "hot goods hold'' imposed to block the shipment of goods produced in violation of the Fair Labor Standards Act, according to the Department of Labor. The hold prevented a truckload of Britney Spears T-shirts from being shipped to Target stores, while other items were withheld from shipment to retailers such as Aeropostale, Footlocker, Hot Topic, Kohl's, PacSun, Target and Urban Outfitters.

The agency says that an investigation by its Wage and Hour Division found that King Graphics workers did not receive the required time and one-half rate for hours worked over 40 in a workweek.

"Celebrities, retailers and manufacturers profit from T-shirts sold for $40 or more, while the low-wage workers who produce the merchandise work overtime to meet consumer demand and become victims of wage theft,'' said Jessica Looman, acting administrator of the Wage and Hour Division.

The Department of Labor said its investigation also looked at manufacturers who violated the FLSA for receiving and distributing the hot goods. Those manufacturers cooperated with investigators and have agreed to comply with the FLSA.

"A manufacturer or retailer must ensure their supply chain is free of 'hot goods' -- products produced by workers whose legal rights have been violated -- or risk legal liability,'' Looman said. "All parties, from the entertainers to the distributors and wholesalers, should ensure their profits aren't supported by workers in sweatshops, many of whom are immigrant women supporting families.''