S 5393: FABRIC Act

S 5393 in plain English: The FABRIC Act would regulate the U.S. garment manufacturing industry by establishing new worker protections, requiring industry registration, and creating grant and enforcement programs. The bill sets registration fees, authorizes funding for a new oversight office, and provides grants to support the garment sector.

Stated purpose

The FABRIC Act aims to ban piece-rate pay (paying workers per item made) in the U.S. garment industry and require garment manufacturers and contractors to register with the Department of Labor, ensuring workers are paid at least the federal minimum wage by the hour.

Key points

• Requires garment industry registration with fees of at least $200 per year
• Allows civil money penalties of up to $50,000,000 for violations
• Authorizes $10,000,000 for fiscal year 2027 to establish a new oversight office, and $3,000,000 per year for fiscal years 2028 through 2032
• Provides individual grants of up to $5,000,000, with $100,000,000 total authorized for the grant program

Arguments supporters make

• Piece-rate pay often results in workers earning less than minimum wage because pay depends on speed, so switching to hourly pay guarantees a legal wage floor for some of the lowest-paid workers in the country.
• Holding brands legally responsible alongside their contractors gives big companies a strong reason to make sure the factories they hire actually follow the law, closing a loophole that has long let brands avoid accountability.
• Registration with the Department of Labor creates a public record of who is operating in the industry, making it easier for the government to identify and stop wage theft before it harms more workers.

Arguments opponents make

• Banning piece-rate pay could raise production costs enough that brands shift manufacturing overseas, potentially eliminating the very U.S. garment jobs the bill is meant to protect.
• Holding brands jointly liable for violations by subcontractors they may not directly manage could discourage companies from sourcing domestically at all, since the legal risk would be difficult to control.
• Requiring hourly pay removes a system that some experienced, fast workers prefer because it lets them earn more than a standard hourly rate; the bill may reduce earnings for high-performing workers even as it helps slower ones.

Tradeoffs

Protecting workers from below-minimum wages and wage theft may come at the cost of making U.S. garment manufacturing less competitive, potentially reducing domestic jobs; the bill also shifts legal and financial risk onto brands to enforce compliance throughout their supply chains, which could deter domestic sourcing.

Current status in Congress: In committee.

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