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Care What You Wear

An Apparel Factory Defies Stereotypes, but Can It Thrive?

Sitting in her tiny living room here, Santa Castillo beams about the new house that she and her husband are building directly behind the wooden shack where they now live.

The new home will be four times bigger, with two bedrooms and an indoor bathroom; the couple and their three children now share a windowless bedroom and rely on an outhouse two doors away.

Ms. Castillo had long dreamed of a bigger, sturdier house, but three months ago something happened that finally made it possible: she landed a job at one of the world's most unusual garment factories. Industry experts say it is a pioneer in the developing world because it pays a "living wage" - in this case, three times the average pay of the country's apparel workers - and allows workers to join a union without a fight.

"We never had the opportunity to make wages like this before," says Ms. Castillo, a soft-spoken woman who earns $500 a month. "I feel blessed."

The factory is a high-minded experiment, a response to appeals from myriad university officials and student activists that the garment industry stop using poverty-wage sweatshops. It has 120 employees and is owned by Knights Apparel, a privately held company based in Spartanburg, S.C., that is the leading supplier of college-logo apparel to American universities, according to the Collegiate Licensing Company.

For Knights, the factory is a risky proposition, even though it already has orders to make T-shirts and sweatshirts for bookstores at 400 American universities. The question is whether students, alumni and sports fans will be willing to pay $18 for the factory's T-shirts - the same as premium brands like Nike and Adigas - to sustain the plant and its generous wages.

Joseph Bozich, the C.E.O. of Knights, is optimistic. "We're hoping to prove that doing good can be good business, that they're not mutually exclusive," he says.

Not everyone is so confident. "It's a noble effort, but it is an experiment," says Andrew Jassin, an industry consultant who says "fair labor" garments face a limited market unless deft promotion can snare consumers' attention - and conscience. "There are consumers who really care and will buy this apparel at a premium price," he says, "and then there are those who say they care, but then just want value."

Mr. Bozich says the plant's T-shirts and sweats should command a premium because the company uses high-quality fabric, design and printing.

In the factory's previous incarnation, a Korean-owned company, BJ&B, made baseball caps for Nike and Reebok before shutting it in 2007 and moving the operation to lower-wage countries. Today, the reborn factory is producing under a new label, Alta Gracia, named after this poverty-ridden town as well as the Virgin of Altagracia, revered as protector of the Dominicans. (Alta gracia translates to "exalted grace.")

"This sometimes seems too good to be true," says Jim Wilkerson, Duke University's director of licensing and a leader of American universities' fair-labor movement.

He said a few other apparel companies have tried to improve working conditions, like School House, which was founded by a 25-year-old Duke graduate and uses a factory in Sri Lanka. Worker advocates applaud these efforts, but many say Alta Gracia has gone further than others by embracing higher wages and unionization. A living wage is generally defined as the amount of money needed to adequately feed and shelter a family.

"What really counts is not what happens with this factory over the next six months," Mr. Wilkerson says. "It's what happens six years or 10 years from now. We want badly for this to live on."

Santa Castillo agrees. She and many co-workers toiled at other factories for the minimum wage, currently $147 a month in this country's free-trade zones, where most apparel factories are located. That amount, worker after worker lamented in interviews for this article, falls woefully short of supporting a family.

The Alta Gracia factory has pledged to pay employees nearly three and a half times the prevailing minimum wage, based on a study done by a workers' rights group that calculated the living costs for a family of four in the Dominican Republic.

While some critics view the living wage as do-gooder mumbo-jumbo, Ms. Castillo views it as a godsend. In her years earning the minimum wage, she said she felt stuck on a treadmill - never able to advance, often borrowing to buy necessities.