LOS ANGELES, March 19, 2015 /PRNewswire-USNewswire/ -- Workers
United to SAVE AMERICAN APPAREL (NYSE-MKT: APP), an employee
coalition of American Apparel workers announced today that it has
delivered a letter through its representative, Hermandad Mexicana,
to the company's Board of Directors. The full text of the
letter is:
March 18, 2015
American Apparel, Inc.
Board of Directors
747 Warehouse Street
Los
Angeles, CA 90021
RE: American Apparel, Inc. Workers' 13 Affirmations to
Save American Apparel
Dear Board of Directors:
This letter is addressed to the American Apparel, Inc. Board of
Directors on behalf of the American Apparel, Inc. workers. This
letter represents the sentiments prevalent throughout the company
amongst those who have dedicated their lives to manufacture apparel
in the city of Los Angeles and
contribute to making American Apparel a global success.
Below are 13 affirmations for the purpose of establishing a
clear commitment of intention to save American Apparel from those
who have usurped the legitimate interest of minority shareholders
of the company and have systematically undermined its iconic
position as sweatshop free apparel industry leader.
- The employee morale is at an all-time low. Surveillance
of employee activities is palpable everywhere. Intimidation by
company security guards and supervisors for lawfully protected
employee activity is prevalent company-wide. Supervisors have
threatened employees with termination for attending meetings or
having hand-bills in hand. Employees have been threatened
with firing for speaking with the public media. Workers have
been admonished for mentioning the name of Dov Charney during the work-day.
- A female employee was harassed and complained to the Human
Resources Department but her complaint resulted in her termination.
An additional harassment complaint from another worker was
filed and no investigation was called for. Furthermore, just
a few days later another female employee was fired for handing out
flyers while on her break.
- The "sweatshop free" business model is in jeopardy of being
eliminated given the current rate of deterioration of wages, hours,
and working conditions experienced by the American Apparel
workforce. Garment employees are working as little as 2 or 3
days per week, and many are experiencing rotating full week
lay-offs for the first time in their tenure with American
Apparel.
- The company has no ability to borrow more money beyond the
$15 million Standard General has
committed to lend, (yet, astonishingly has failed to lend anything
to date), even though this commitment was publicly promised in July
2014. At the time of Charney's removal in June 2014, the company was financially viable as
a result of an equity financing completed during that period.
As soon as Standard General was introduced to American Apparel the
cash flow began to deteriorate. Standard General
appointed a board with entirely no retail or apparel experience,
which in turn hired an inexperienced executive management
team. Their lack of knowledge and experience in the industry
obligated them to hire an army of consultants at significant costs
to the company, including exorbitant executive bonuses and six
figure salaries at the expense of production workers.
- Besides a $10 million loan
Standard General replaced as a result of Lion Capital calling
its loan with the ouster of previous CEO Dov Charney, it has not invested one cent in American Apparel. In spite of
that, Standard General has deceptively conveyed to the media that
it is providing American Apparel with "much needed
financing."
- With the removal of American Apparel's founder and the
insidious intervention of New York
City-based hedge fund, Standard General, and the resulting
reconstitution of the Board of Directors, the current executive
management team has no tenure with the business and limited retail
industry experience. The current Board, with the exception of
Lyndon Lea, has no clothing retail
experience or apparel manufacturing experience.
- The creative integrity of the American Apparel brand is being
dismantled. The company now has no tenured creative
leadership in place since the hasty and uncompassionate termination
of the two senior creative directors, Marsha Brady and Iris
Alonzo, each with 11 years of service with the company. As
of March 18, 2015 additional creative
staff was terminated, for a total of seven. The iconic cultural
brand characteristic of American Apparel is being seriously
undermined due to the replacement of experienced employees with
novices who have no understanding of the brand from inside the
company, nor any connection to the brand history, culture,
aesthetic, or values. This effectively constitutes the
elimination of the creative department.
- As the largest private employer in Los Angeles, recognized for setting industry
standards in terms of employee remuneration and benefits, which
influenced both apparel and non-apparel companies in the vicinity –
this is an alarming undeniable crisis.
- Many current senior managers and executives with tenure at the
company have told us they are appalled at the direction pursued
with the company by Standard General and its Board members. They
are frustrated by missing critical textiles, top selling products,
lack of vision, and poor communication.
- Experienced mid-level managers, creative staff, and executives
are actively searching elsewhere to apply their talent and
skills.
- Today there is no denying the steep decline of company sales.
They are at the lowest level since the company went public in
2007.
- Company vendors are not being paid in the customary timely
fashion; some even waiting beyond 180 days.
- Hundreds of current employees have complained of no longer
being able to afford the basic amenities of life including putting
food on their tables.
These are 13 affirmations that we challenge the new board to
address. The growing movement of workers within American
Apparel under the banner of – Workers United to SAVE
AMERICAN APPAREL - will not be deterred by intimidation and
harassment or a hypocritical "Code of Ethics" used for the purpose
of pretending a new found integrity to the public media, yet not
practiced by the new management. An increasing number of
formal employee complaints filed with the National Labor Relations
Board (NLRB), due to violations of federally protected activity by
the current management, are evidence of this.
We are prepared to meet with the Board of Directors to address
these issues when the Board encounters the fortitude to be truthful
and transparent with the workers who have built American
Apparel.
Sincerely,
/s/ Nativo-Vigil :Lopez
Senior Advisor
Authorized Representative
(714) 423-4800
Notes: More than two thousand employees of American Apparel have
signed petitions articulating numerous demands related to the
deteriorating working hours and conditions and have declared the
creation of their organizing coalition under the name of "Workers
United to SAVE AMERICAN APPAREL.
Photo -
http://photos.prnewswire.com/prnh/20150319/183370
SOURCE Hermandad Mexicana