America’s retail giants have spent a decade ignoring signs of labor abuse in their supply chains, sometimes fighting government efforts to crack down, even as thousands of truckers were driven into debt and poverty, a USA TODAY Network investigation has found.
Target, Costco, Hewlett-Packard and many others have benefited from California port trucking companies that forced their drivers into debt, made them work up to 20 hours a day and sometimes paid them pennies per hour.
Retailers and manufacturers rarely hire the truckers directly. Instead, they rely on a maze of subcontractors to move their goods and have paid little attention to who their direct vendors hire.
In the 1990s, similar abuses in overseas manufacturing operations led to a widespread crackdown by U.S. brands, which now scour through their production operations to weed out child labor abuses, forced overtime and debt-driven schemes that exploit workers.
But companies have made no such effort at the southern California ports, even after hundreds of truckers told regulators they were treated as modern-day indentured servants.
In fact, when lawmakers tried to pass worker protections – a few aimed directly at helping port truckers – retailers paid lobbyists up to $12.6 million to fight the bills, lobbying disclosure records in California and Washington, D.C., show.
U.S. brands and their lobbying associations opposed a bill in California that would have criminalized wage theft in low-wage industries and another that would have made it easier for truckers to recoup stolen wages.
They fought bills that would have converted port truckers to fully protected employees and others that would give state agencies more leeway to punish trucking companies with violations.
All the while, Los Angeles-area truckers, drivers who touch half of all imports sold in stores across America, were losing a fight of their own on the waterfront.
As the USA TODAY Network reported this month, at least 140 trucking companies around Los Angeles have been accused of improperly billing drivers for their own work equipment by calling them independent contractors instead of employees. Hundreds of drivers say they were coerced into truck lease contracts they didn’t understand and found themselves $100,000 or more in debt to their employers, according to claims made to state regulators and in civil courts.
When drivers got sick or fell behind on payments, trucking companies fired them, seizing their trucks and tens of thousands of dollars they had paid toward buying them.
Faustino Denova, a Mexican immigrant with a sixth-grade education, said he regularly worked 19-hour days but still went broke trying to pay off the truck his bosses promised him. In the worst weeks, he made so little that he owed money on Friday.
“I wasn’t able to cover the expenses,” he testified in 2015 in a California case at the Department of Industrial Relations’ enforcement arm, known as the Labor Commissioner’s Office.
Lawyers and executives with port trucking companies denied widescale labor abuses and said the more than 1,100 drivers who have filed court and labor commissioner complaints represent a minority of truckers. They also say the allegations have been overstated, part of a Teamsters union organizing campaign against the industry.
No law requires retail companies to police their vendors or the subcontractors those vendors hire. And unlike with overseas manufacturing plants, there has been no public pressure to force a cleanup of the shipping industry.
That makes it easy for the companies to look the other way, said David Weil, who led the federal Wage and Hour Division under President Obama.
“Not my problem, not my workforce,” said Weil.
It was a series of high-profile revelations that led to more oversight in overseas manufacturing operations, according to Shawn MacDonald, CEO of the international research firm Verité, which produces labor and logistics studies commissioned by the federal government.
But workers involved in shipping deserve the same protection from the big companies that rely on their labor, MacDonald said.
“They’ve just never thought about this,” he said, “let alone done any due diligence.”
Reporters contacted two dozen retailers whose goods were moved by port trucking companies accused of labor violations.
Seventeen declined to comment or did not respond to multiple interview requests; the rest sent brief statements about their corporate responsibility policies.
“I wanted to let you know we aren’t going to be able to help with this story,” Nike spokesman Greg Rossiter said in an email.
“Regretfully we are not able to provide a response at this time,” Costco’s Muriel Cooper wrote.
Walmart, the biggest importer in the country, said in a statement that it expects contractors “to act with integrity and in compliance with the laws.”
“The safety and well-being of workers across our supply chain is important to Walmart,” spokesman Kory Lundberg said. He did not describe specific efforts by the company.
Only Goodyear said it took immediate action. Spokesman Keith Price said in a statement that the tire giant dropped Pacific 9 in 2015, “within two weeks” of California labor commissioner decisions in favor of dozens of drivers. Pacific 9 denied committing labor violations.
Other retail companies consider the problem out of their hands.
LG Electronics is the eighth-biggest importer in the country, according to the Journal of Commerce, a shipping trade publication. The home appliance giant said it doesn’t hold itself responsible until products are inside company-owned warehouses.
“We’re not trying to wash our hands of this issue,” spokesman John Taylor said in an email, “but it’s frankly far afield” and “really very disconnected from LG Electronics.”
Skechers shoes spokeswoman Lara Diab declined to comment because the company is “unaware of labor or environmental violations by any trucking company at the port.”