Garment firm agrees to pay $70K in fines

While it did not admit any guilt to the criminal charges filed by the Attorney General’s Office, N.E.T. Corp., formerly known as Suntex Manufacturing, yesterday agreed to pay a fine of $70,000 in a plea agreement entered into by the two parties before the Superior Court.

The AGO charged N.E.T. Corp. on July 27, 1999 with 30 counts of illegal deduction from worker’s salaries between July 1997 and January 1999 as well as 30 counts of official documents fraud.

Based on the complaint, the company cheated its workers when it deducted housing expenses although the employment contracts for these employees does not provide for such deductions.

The AGO added that between July 1, 1997 and January 21, 1999, N.E.T. Corp. submitted false labor document containing wrong information which showed no housing deductions when such payments were made by the workers. N.E.T. Corp. entered a no contest plea to the charges of official documents fraud.

In approving the plea agreement, Superior Court Presiding Judge Edward Manibusan sentenced N.E.T. Corp. to five years probation and ordered to pay the $70,000 fine in 24 months beginning March 25, 2000. The plea agreement was signed by N.E.T. Corp., Assistant Attorney General Marvin Williams and Robert J. O’Connor, lawyer of the garment company.

The AGO dropped 45 counts cited in the information after the corporation pled no contest to 15 counts.

Following the consent judgment, N.E.T. Corp. agreed to the issuance of a permanent injunction prohibiting it from: 1) making deductions from nonresident worker’s salary which are not provided for in the employee’s contract; and 2) using a nonresident employment contract which contains false information.

Compliance of the company on the agreement stipulated in the court shall be monitored by Price Waterhouse, an independent third party, which will specifically look into the payroll of N.E.T. Corp. Monitoring includes random spot checks and audits of N.E.T. Corp. to determine whether there are any unpaid wages or overtime.

The firm will provide the employees a detailed statement in each paycheck covering total hours worked, rate of pay, gross and net wages as well as deductions taken. Information materials shall be distributed to the employees about their rights under the CNMI Minimum Wage and Hour Act, their employment contracts and the Nonresident Workers Act.

In exchange for the no contest plea, the CNMI government will not use it as a basis to initiate administrative charges or deny renewal or replacement of work permit applications, or even revoke or suspend the business license of N.E.T.

If found guilty of illegal deduction from worker’s salaries charges, the defendant shall face a maximum jail sentence of one year imprisonment and a maximum fine of $5,000 for each count.