Good intentions didn't generate business success for Just Garments

I have written before about Just Garments, the "no sweat" garment factory in El Salvador, owned by unionized workers and promising to pay a living wage to its employees. Just Garments never succeeded as a business. The Los Angeles Times now tells the story of a dream which failed to succeed in the harsh reality of the global marketplace:

SAN SALVADOR, El Salvador -- It was a story of hope: a Central American sweatshop transformed into a unionized, worker-run apparel factory, thanks to nearly $600,000 in loans and donations, including help from retailers Gap Inc. and Lands' End and the AFL-CIO.

Boosters traveled to U.S. college campuses and church basements, touting the Just Garments plant in El Salvador as a company looking to do well by doing right by employees. Impoverished Salvadorans saw a chance to earn better wages and have a say in their future.

"We had a dream," said sewing machine operator Esperanza Caridad Mejia.

In the end, that's all it was.

Just Garments closed its doors in April, owing 55 former workers $65,000 in back pay and benefits, according to a union official. Employees say they never made more than minimum wage. Many weeks they didn't get paid at all. Some have come forward alleging poor working conditions and unjust firings.

Despite the funds from major retailers and others, steady contracts never materialized. A lender is questioning how money was spent.

Just Garments is now caught in a tangle of recriminations and legal actions. The closing has unraveled the once close-knit workforce, split organizations that would normally be allied and put some U.S. anti-sweatshop groups in the position of having backed a project accused of engaging in some of the practices they condemn.

It has also prompted soul-searching by supporters who admit that operating a sweat-free factory profitably is easier in theory than reality. Just Garments, some say, was doomed from the outset, lacking sufficient capital, seasoned management or even a market for its products.(more)