Requires fashion sellers to be accountable to standardized environmental and social due diligence policies; establishes a fashion remediation fund for the purpose of implementing one or more environmental benefit projects or labor remediation projects that directly and verifiably benefit the workers and communities directly impacted, to the extent practicable, at the location the injury has occurred.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A4333A
SPONSOR: Kelles TITLE OF BILL:
An act to amend the general business law, in relation to requiring fash-
ion sellers to be accountable to environmental and social standards; and
to amend the state finance law, in relation to establishing a fashion
remediation fund
PURPOSE OF BILL:
To establish a legal framework incentivizing fashion brands selling in
New York State to adopt and comply with standards of environmental
sustainability and human rights with regards to workers. This act seeks
to reduce the negative environmental and human impacts of fashion on our
world and the people working in this industry.
SUMMARY OF SPECIFIC PROVISIONS:
Section 1 establishes the title of this act. "Fashion sustainability and
social accountability act"
Section 2 amends the general business law by adding a new section 399-mm
to establish the Fashion Sustainability and Social Accountability Act.
This section defines terms, establishes due diligence requirements and
noncompliance, details reporting, provides regulatory authority, a proc-
ess of verification, and enforcement.
This section sets forth requirements for fashion sellers with $100
million in annual gross receipts that do business in the New York State
to map their supply chains and perform sufficient due diligence. This
includes identifying, preventing, mitigating, accounting for, and taking
remedial action to address actual and potential adverse impacts to human
rights in relation to workers and the environment. Covered companies
must set science based targets to reduce their greenhouse gas emissions,
work with suppliers to improve chemical management, and embed responsi-
ble purchasing practices and responsible exit strategies to improve
labor outcomes.
These requirements will be enforced by the Attorney General and viola-
tors may be fined up to 2% of annual revenues. Additionally, fashion
sellers will be held jointly and severally liable for wage theft by tier
one suppliers.
Section 3 amends the state finance law by adding a new section 97-ccc to
establish the Fashion Remediation Fund which will distribute any funds
raised by penalties to environmental or labor remediation projects in
impacted communities.
Section 4 requires the Attorney General to certify that their agency is
prepared to execute their duties under § 399-mm of the general business
law.
Section 5 provides for severability.
Section 6 sets forth an effective date.
JUSTIFICATION:
Fashion retailers largely operate in a regulatory vacuum. Currently
there are no legally binding environmental standards placed on the
apparel and footwear industries. As a result, "fast fashion" retailers
and manufacturers may ramp up production and operations without taking
environmental or social sustainability into account. Apparel and foot-
wear are responsible for a massive part of the climate crisis causing
greenhouse gas emissions, between 4-8.6% of the world's global green-
house gas footprint.
Furthermore, the industry has systemic problems with labor exploitation.
The fashion industry relies disproportionately on the labor of women of
color, especially within production supply chains. These workers are
routinely exploited, underpaid, and subject to sexual abuse in the
course of their work.
This legislation will shift the industry away from a race to the bottom
by requiring active due diligence and planning to mitigate risk. Under
the bill, apparel and footwear retailers with global revenue of at least
$100 million would be required to map their supply chains and suffi-
ciently engage in ongoing due diligence efforts to draw down their nega-
tive impacts.
Covered companies will be required to map and disclose their supply
chains from production to raw materials. Fashion companies often do not
know where their production is taking place, which makes it impossible
for them to begin to take responsibility or improve the conditions in
which their products are made.
Once apparel companies know and disclose their supply chains, they are
then required by the ' bill to address their negative impacts. This is
broadly achieved through the legally binding Mandatory Due Diligence
Framework, which requires companies to sufficiently identify, prevent,
mitigate, account for, and remediate actual and potential adverse
impacts to human rights and the environment in their own operations and
in their supply chain. Within the mandatory due diligence framework, the
Fashion Act will require companies to: 1) set and achieve climate
reductions in line with the Paris Agreement, 2) work with their suppli-
ers to effectively manage their.chemical use, and 3) measurably improve
the lives of garment workers.
The Fashion Sustainability and Social Accountability Act will be the
global leader in reducing the carbon footprint of the fashion industry
by requiring companies wishing to sell to the New York market to set and
achieve science based targets. Science based targets require that the
pace of reductions are in line with the scale required to keep global
warming below 2C from preindustrial levels, as set out in the Paris
Agreement.
The Fashion Act will also fill in a massive regulatory gap by requiring
brands to work with their textile suppliers to effectively manage their
chemical use. No more dead rivers in the name of our clothes.
Garment workers face the brunt of the industry's race to the bottom. By
requiring companies to perform mandatory due diligence, coupled with
independently verified disclosure around wages and strong enforcement
including joint and several liability of apparel companies with garment
workers for their lost wages, we can be confident that the lives of
garment workers, mostly women, will measurably and meaningfully improve.
The Act will be enforced by the Attorney General or a designated admin-
istrator. Companies found to be out of compliance and which do not reme-
dy within three months of notice of non compliance may be fined up to 2%
of annual revenues. These funds will be used for the benefit of workers
and communities directly injured and environmental benefit projects.
Fashion companies will also be held jointly and severally liable for
lost wages of the garment workers in their supply chains. Together,
these provisions will make New York the leader in corporate accountabil-
ity and demonstrate a path forward for industry to thrive within the
bounds of the planet.
LEGISLATIVE HISTORY:
2021-22: A8352 referred to consumer affairs and protection
FISCAL IMPLICATIONS:
To be determined.
EFFECTIVE DATE:
This act shall take effect immediately, except for section 5 of 399-mm
which shall take effect one year after the attorney general certifies
that the office of the attorney general is prepared to execute the
duties assigned in section 5 of 399-mm of the general business law.
