Page 10 - Fashion Law

S10 | MONDAY, AUGUST 28, 2017 | Fashion Law
| NYLJ.COM
NAFTA
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However, U.S. exports of yarns and fabrics (textiles) actually run a trade surplus (i.e., the value of exports minus the value of imports). For example, in Mexico, textiles are sewn into apparel in order to take advantage of lower labor costs, and the finished garments are shipped back to the United States and Can- ada for consumption. Also, according to the USTR, Canada was the United States’ largest export market in 2016. In testimony before the USTR, the National Council of Textile Organi- zations (NCTO) indicated that the U.S textile manufacturing supply chain employs 565,000 workers nationwide. In 2016, the industry manufactured over $74 billion and exported over $26 billion of that production. NCTO indicated that there was a $3.5 billion surplus last year.
Blindly cutting the trade deficit on apparel could negatively affect U.S. textile exports— the surplus. The demand for a country’s exports also has an impact on the value of its currency. U.S. companies selling goods abroad must convert foreign currencies back
Labor
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A disability under the NYC law is defined broadly to include “any physical, medical, mental or psychological impairment, or a history or record of such impairment,” that an employer must accommodate if the “disability is known or should have been known” to the employer. That accom- modation obligation includes a potentially lengthy interactive process and careful con- sideration of every employee-requested accommodation unless the employer is confident it can prove that any accommoda- tion would have created an undue hardship or would have been ineffective.
California: Special Case
Even outside the question of disability discrimination, California employers face special challenges when imposing a require- ment that employees remain standing. A Cali- fornia wage order requires that an employer provide suitable seating for employees “when the nature of the work reasonably permits the use of seats.” Cal. Code Regs., tit. 8, §§11040, subd. 14(A) (Wage Order No. 4-2001), 11070, subd. 14(A) (Wage Order No. 7-2001).
In California, an employer must pro- vide an employee with a seat if the tasks being performed at a given location rea- sonably permit sitting, and provision of a seat would not interfere with performance of any other tasks that may require stand- ing. Kilby v. CVS Pharmacy, 368 P.3d 554 (2016).
The issue of whether the nature of the work reasonably permits sitting is a question to be determined objectively based on the totality of the circumstances. An employer’s business judgment and the physical layout of
into dollars in order to pay their workers and suppliers, upping the price of home currency. As the demand for exports falls compared to imports, the value of our currency could decline. And this is the tightrope on which NAFTA renegotiation walks. You cannot affect change in one area without impacting anoth- er. Let’s also remember, the administration’s promised jobs to fix the deficit won’t imme- diately appear. After 20 years, the U.S. simply doesn’t have the workforce—we, as a nation, need time to train and build. Developing new and cutting-edge textile products requires a more highly-skilled and trained workforce than currently exists. And it seems unlikely and unrealistic that we want to return to sweatshops. So these future jobs in the tex- tile industry would likely be for chemists, designers, engineers, marketers and lab tech- nicians. Creating this workforce is not an impossible task, but it isn’t going to happen overnight.
Winners, Losers, Wildcards
The U.S. negotiating objectives for NAFTA are vague and in several instances are sub- stantially similar with what was concluded
the workplace are relevant but not disposi- tive factors in making that determination. The inquiry focuses on the nature of the work, not an individual employee’s charac- teristics.
Regardless of the nature of the work, if the employer argues there is no suitable seat available, the burden is on the employer to prove unavailability.
Nevertheless, California law recognizes that the employer has the right to define the duties to be performed by an employee, and that providing a certain level of cus- tomer service is an objective job duty that an employer may reasonably expect. Nev- ertheless, business judgment in this sense does not encompass an employer’s mere preference that particular tasks be per- formed while standing. The standard is an objective one.
This objective determination, under Cali- fornia law, is necessary to protect employ- ees against arbitrary determinations of the employer.
Conclusion
Fashion employers may use their judg- ment in hiring and firing, and in subject- ing their employees to particular work rules. But one must expect that these judgments will continue to be challenged by applicants, employees, and even the public, if they are considered arbitrary or unfair.
Retailers in high fashion must balance their genuine interests in building a brand culture with the requirements of labor and employment law. Practices that seem to make business sense, but which result in depriving groups of individuals from employ- ment, should be reviewed with counsel to be sure that they do not unnecessarily expose the company to liability and the brand to unneeded damage.
in the Trans-Pacific Partnership (TPP), as C&M International president and CEO, Ambassador Robert Holleyman II, the for- mer Deputy USTR, discussed in a recent interview. About all that can be broadly gar- nered from them is that the renegotiation does not look to benefit labor groups, but companies. This should come as no surprise. And so who will be the winner in this—the apparel or textile industry? For apparel, it remains unlikely that the NAFTA renegotia- tion will liberalize the “yarn-forward” rules of origin.
The added challenge to this whole process is the fact there is pressure to wrap up nego- tiations by the end of 2017. The renegotiation of NAFTA pursuant to U.S. fast track law or Trade Promotion Authority (TPA) expires on June 30, 2018, and there are upcoming elections in every member country next year. So time is the enemy of the NAFTA renego- tiation. There is a lot weighing on the talks and there is a great deal of discussion about how this process might drag on for years if a snap deal cannot be reached. The political climate gives all parties a strong incentive to finish the negotiation by the end of 2017, but a rushed timeline and lengthy agenda
Reviews
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negative review of the product and requests a refund, they leverage the refund against con- sumers, requiring the removal of the negative review before refunding the purchase price to the dissatisfied consumer. Additionally, these companies have been known to remove negative reviews and comments from their own Facebook profiles, which they use as their marketplace for selling the clothing, thereby skewing their online review presence in their favor. Although the FTC has not yet taken any specific action against these fash- ion companies, it has reportedly received many complaints from disgruntled consum- ers regarding these practices. As such, we would not be surprised if the FTC decided to pursue an investigation of these clothing companies’ consumer review practices in the future.
Activist Reviews
Recently, the fashion industry was direct- ly affected by a different category of fake reviews, that being activist reviews. Activ- ist fake reviews often aim for the opposite effect of most fake reviews—they seek to inhibit, not boost, product sales. It is likely that those composing and publishing activ- ist reviews have never purchased or even used the products they purport to review. A topical example of this is the recent surge in online reviews of Ivanka Trump’s fash- ion lines. In the fallout of Donald Trump’s presidential victory, online trolls have utilized the review function available on sites like Amazon, where Ivanka Trump’s products are sold, as a vehicle to criticize President Trump and his extended fam- ily. These reviews are often composed with intentional comicality. Documented
makes that equally unlikely to happen. Given the temperamental response of this admin- istration, there is also the risk that Trump, one of the wildcards, may pull the United States out of NAFTA if he loses patience for the renegotiation—and perhaps therein lies the greatest risk for fashion, apparel and textile companies.
Ultimately, U.S. fashion, apparel, and tex- tile industries do not want increased tariffs on imports. Neither do Mexico and Canada. Prior to NAFTA, import duties on a third of U.S. apparel faced an average tariff rate of 17.9 percent. Mexico’s average tariff on U.S. textile and apparel products was 16 percent, with duties as high as 20 percent on some products. So the most important piece to this is that the companies and the member states, whatever their flavor, want to remain in NAFTA and are pleased to support rene- gotiation. But there are tipping points for all of them. And ultimately, if these rene- gotiations fall through, the administration should remember that fashion, apparel and textile companies haven’t been calling for a NAFTA withdrawal these past 20 some years—because NAFTA has been good for them.
examples of such activist reviews include, “Too restrictive, tight, Not enough room for growth, will only fit the 1%,” a comment on one of Ivanka’s stiletto shoes reads, and “These boots are perfectly designed to trample on fellow Americans’ Civil Rights Day or Night.” (In fairness, it has been argued that such activist reviews are not as damaging to brands as other types of fake reviews might be, as this type of “fake” review does not make misleading com- ments as to the adequacy of the product itself.)
It is important to note that activist reviews like this, even if drafted in jest, may still impact a consumer’s purchasing decision, thereby affecting the legitimacy of the con- sumer review process. Some consumers look exclusively to the star rating of a review to determine whether they would like to pur- chase a given product, therefore increasing the impact of the star rating system in the absence of any context provided by the accompanying written comment.
Conclusion
As fashion retailers continue to move to e-commerce platforms, the issues surround- ing fake reviews of products will continue to linger. Fake reviews of products, whether to increase or diminish sales, affect the over- all legitimacy and reliability of consumer reviews. This will remain a constant hurdle for third-party retailers, review sites, regula- tory agencies, and other stakeholders that aim to preserve such legitimacy, as fake reviewers discover new and inventive ways to publish reviews that are not based on actual use of a given product. Brands should closely monitor what is being said about their products and be diligent in their attempts to take down and correct unauthentic posts or those that fail to disclose a material connection.