By Haidee V. Eugenio
Variety Assistant Editor

CONCORDE Garment Manufacturing Corp. and L&T Group of Companies fraudulently induced 48 of its 1,406 former employees to sign contracts by hiring them even though the companies knew they were going to close the factory, according to the Department of Labor.
Labor also found other violations of labor laws and rules by Concorde and L&T, including their conditional renewal of contracts upon workers’ payment of recruitment fees of up to 3,800 Chinese RMB or some $489.
These were among the findings in the compliance agency case filed by Labor on behalf of 1,406 former Concorde and L&T employees, according to an “amended determination” issued on Monday by Labor Director Robert N. Magofna and reviewed by Assistant Attorney General Dorothy Hill.
Of these former Concorde workers, 84 filed a separate labor case against their former employers.
The separate case, filed through attorney Joe Hill, is for Concorde’s failure to pay wages and overtime rates, breach of contract, deductions and kickbacks, recruitment and management fees, and for unlawful termination and retaliation by employer.
The 13-page amended labor complaint dated Jan. 22 also alleges that Concorde’s daily unreasonable and unlawful body searches constituted “a pattern and practice of daily assault and battery, invasion of privacy, and search and seizure upon and to the person of each complainant, that they were coerced and compelled to endure fear of being terminated or not renewed if they complained.”
Yesterday, some 70 of the remaining 1,406 former Concorde and L&T employees showed up at the continuation of the administrative hearing on this case at the multi-purpose center in Susupe.
Labor Hearing Officer Jerry Cody, at the hearing, said former Concorde alien workers who are unable to find transfer employment for a one-year contract at the end of the 45-day deadline on Feb. 19, 2007, and former L&T alien workers hired by Concorde who are unable to find a transfer employer by March 23, 2007, should report to Labor a day after these deadlines.
Cody said these alien workers will be given a memorandum to assist them in finding a temporary job while their labor case is pending.
Assistant Attorney General Dorothy Hill, counsel for Labor, yesterday also met with former Concorde and L&T workers to hear their individual concerns and complaints.
Cody said the evidentiary hearing may be held in early April.
The department is also expected to file a motion to consolidate the agency compliance case they filed on behalf of the workers and the separate case filed with the help of Hill.
Cody said he will make a decision in the next few weeks whether to combine the two cases.
Violations
The Department of Labor, in its amended determination, said prior to the initial Jan. 3 transfer hearing, several former Concorde and L&T employees raised various complaints related to the garment factory closure and terms and conditions of their employment.
Of particular concern to Labor director Robert Magofna are those alleging fraudulent inducement to sign contracts by workers hired from off-island in late October and early November, and those alleging that Concorde and L&T made renewal conditional upon payment of recruitment fees.
As a result, Labor requested and was granted a brief continuance to further investigate these issues.
“It is the department’s position that because respondents took affirmative steps to bring these employees to the CNMI after they knew, or should have known, that they were not going to be able to fulfill the terms of their contract with these workers, they fraudulently induced these employees to contract.
“As such, the department cannot approve these terminations as undertaken in good faith for economic necessity,” said Labor.
A labor investigation found that as early as Sept. 26, 2006, the respondents’ corporate management in Hong Kong decided to implement a significant reduction in force of its Saipan operations, effective January 2007, and this was conveyed to senior management in Saipan in early Oct. 2006.
The decision to close Concorde garment factory was made on or about Nov. 18, 2006, said Labor.
However, Concorde’s 48 new hires from China entered the CNMI on or after Oct. 28, 2006 and the last four arrived on Nov. 4, 2006.
Concorde initially announced that it was closing in early February 2007.
But due to a series of protests by hundreds of workers demanding reimbursement of fees paid to a recruiter that had a relationship with Concorde and the payment of tax rebates, it closed on Dec. 12.
Concorde arranged for the pro-rata reimbursement of fees and on Dec. 12, 806 checks totaling $910,068.40 were distributed to workers.
As of Jan. 25, 2007, approximately 947 of the 1,406 former employees had been repatriated.
The second major finding by Labor is the renewal of contracts upon payment of Concorde and L&T workers’ payment of recruitment fees.
“This would constitute a condition of employment not approved by the director of Labor, in violation of (the CNMI Nonresident Workers Act),” said Labor.
Labor said insofar as Concorde and L&T took any portion of the fee either directly from the employee or as a kickback from the recruiter, it should be treated as a deduction from the first paycheck of the renewal contract.
“And as such, would likely reduce the employees’ wages to a rate that is less than the minimum wage,” Labor said.