Discussion - PIECP Violations - Pg. 3

Avoiding PIECP Requirements Using Sub-Assembly Parts

In Florida PRIDE operates thirty-six (36) prison industries out of twenty (20) state prison facilities. Of the 36 total industries, 11 are PIECP Certified participating industries. When PIE orders are  received at any of the 11 PIE industries, PRIDE has the ability to manufacture sub-parts to their products at their other industries - PIECP Certified or not. This is true for some of the other state prison industry operations as well.

This allows for a greater variety of products and an overall increased product line they can offer to consumers - institutional and private sector. Manufacture of sub-parts is cheaper by far than ordering sub-parts from another manufacturer. This type of manufacturing of sub-parts allows for lower overhead for the companies who utilize this technique and increased profits.

In the PIECP arena, the percentage of reduced overhead and increased profits exceed those percentages enjoyed by private sector competitors. This is due to the fact that prisoners making the sub-parts in the prison industrial environment are paid at the standard prison industry wage of between $.20 and $.50 per hour worked. In the private sector, this is not the case. Employees of a private sector sister facility are paid prevailing wages for their efforts and that translates into higher per unit sub-part costs than that of a prison industry. Secondly, the PIECP prison industry is able to maintain competitive pricing of their products with the private sector companies. Retail item prices are seldom more than a few dollars per unit less than private sector manufactured products. This translates into a huge savings to the PIECP industry.

In example of this procedure, we look at the Union Metal Fabricating Plant at Raiford and its relationship to the PRIDE Furniture Group located at Polk and Sumter Correctional Institutions. If Polk Furniture receives a PIE order for 350 deluxe stacking chairs from a customer in Mississippi, they look at the parts necessary for each unit. It places an order for 350 Model #xxx-x frames in chrome, 1400 metal chair leg inserts and 2800 chromed cushion brackets to the Union Metal Fabricating Plant. They may also order 700 wooden arm rests from Sumter Furniture (they make wood furniture products). They also order 350 cardboard packing containers from PRIDE's Marion Box Industry. Sumter, Marion and Union receive the orders and put them into the production line, listing Polk Furniture as the customer. Since Polk Furniture is a sister industry, no PIECP wages are paid to the inmates who manufacture the actual parts. At no time has Polk identified to the other industries that the sub-parts are for a PIE order.

After the sub-parts are manufactured and shipped to Polk that industry manager places the PIECP order into the assembly schedule. The parts are assembled into complete units and moved to the shipping department where they are placed into the cardboard boxes and readied for shipment to the PIECP customer. Throughout the entire manufacturing and assembly process the only inmates to receive PIE wages are the assembly and shipping workers at Polk Furniture - and they're paid the state minimum wage, not prevailing wages.

This practice by PRIDE is deliberately designed to lower overhead and payroll while increasing profits proportionately. When this procedure was presented to PRIDE by Sloan in July 2006, they found that they did in fact use this practice but their PIECP Coordinator was at a loss as to how to correct the problem. They acknowledged that in some instances products are also drawn from inventory to fill PIE orders, but they have no way of knowing which inmates manufactured the products shipped. To date PRIDE has not indicated they have corrected the sub-part or inventory issues, and continue to enjoy greater profits from this failure to correct.