Legal Question in Employment Law in Texas

piece-rate contracting in the garment industry

I'm the co-owner of a small business that manufactures handbags. We're at the point where we would like to begin contracting with an outside vendor for sewing component of production.

I understand from talking with other small-business owners that strict laws exist limiting my ability to establish a piece-rate contract with contract sewing shop for the production of our handbags. Our clear preference is to establish a vendor agreement that compensates the contractor based on the units produced.

Would you help me understand the legal issues as related to wages and contracts, and whether there are unique liabilities/risks that we face unique to the garment/apparel industry in outsourcing this work?

-dm


Asked on 1/21/03, 1:39 pm

1 Answer from Attorneys
Trang Tran Tran Law Firm L.L.P.

Re: piece-rate contracting in the garment industry

There are no restrictions to a piece-rate contract with a contract sewing shop. There are some requirements for the contract sewing shops to pay their employees minimum wage and overtime. In your contract, you should be able to require that the contractor comply with federal labor and employment regulations and indemnify you for any legal actions that may arise from their actions.

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Answered on 1/21/03, 1:51 pm


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