Hundreds of executives, claiming they will be forced out of business because of the new rules, held a rally on Capitol Hill last Wednesday urging lawmakers to amend the law — the Consumer Product Safety Improvement Act — which was enacted last year.
“Our industry has seen companies go out of business as a result of this act,” said Kevin Burke, president and CEO of the American Apparel & Footwear Association, who spoke at the rally. “Our members are laying off people, and our industry has incurred severe financial losses.”
With the law, Congress aimed to improve product safety and strengthen the understaffed Consumer Product Safety Commission in the wake of a string of contaminated imports from China last year that created a public panic.
The legislation set up a broad range of new rules, including significant reductions in lead allowances in children’s footwear, apparel, jewelry and toys. It also increased the age level that defines children’s products to 12 years from 8 years and increased fines for violations to a maximum $15 million from $1.8 million. The penalty for individual violations, assessed per product, increased from $5,000 to $100,000.
Rep. Joe Barton (R., Texas) and 16 House Republicans introduced a bill last Tuesday to make changes to the CPSIA, including setting specific dates for products to meet the standards and allowing retailers to sell off inventory for one year after the manufacturing standards go into effect. It also creates regulatory flexibility in exemption authority and labeling authority for the consumer product commission and permits component part testing.
But Democratic leaders, who control the agendas in both the House and Senate, supported the bill last year, and any attempts to change it could be difficult.
For kids’ footwear manufacturers opposed to the new legislation, it’s not a dispute over the responsibility of companies to produce safe products for children, but rather a question of the necessity for such rigorous laws.
“I, of course, don’t question Congress’ intentions, but I do think there are mistakes in the legislation — that it’s not as appropriately crafted as it could be,” said Bernard Leifer, president and CEO of Hackensack, N.J.-based SG Footwear, which has sent numerous letters to local congressmen and senators to urge them to consider modifications to the legislation.
“It is a question of degree. In this case, Congress has been overzealous. The new safety rules are too strict.”
Leifer said he believes the legislation will have repercussions for the children’s footwear industry, particularly for smaller companies that can’t easily absorb the high cost of product testing. “Hopefully the protestors will be heard and Congress will start to see the light,” he said.
Collective Brands Inc., parent of Payless ShoeSource and Stride Rite Corp., is taking the legislation changes in stride. “We take children’s safety seriously and work closely with our suppliers to ensure our products are safe and [that they] comply with all applicable laws, including the new U.S. requirements,” said Matt Rubel, CEO of the Topeka, Kan.-based company.
According to Rubel, the company has for several years utilized an independent lab to test its products, so the more stringent legislation is not expected to have much of an impact on its manufacturing process.
“We had been monitoring the new initiative since 2007 and took proactive steps as early as last fall to train and inform our manufacturing partners and other agents,” he said.