A government inspection two months ago uncovered 1,600 illegal workers and another 200 who had problems with their work records, including, in some cases, faked social security numbers.
Peter Schey, a lawyer for American Apparel, told the Times that the company "is very disappointed and disheartened at having to terminate a very large number of workers who by and large have been reliable contributors to the success of the company."
American Apparel founder and Chief Executive Dov Charney wrote in a letter that he was upset that he would have to fire so many employees, a number that amounts to 10 percent of the company's workforce.
"It is my belief that immigrants bring prosperity to any economy," Charney wrote.
American Apparel is known for its support of immigration reform. Charney told employees that if they got their work status in order they would be given preference for open jobs at the company.
The factory shakedown comes after months of trouble at American Apparel. In May, the company settled a lawsuit with the actor Woody Allen over the unauthorized use of his image in advertisements, and on Wednesday the company agreed to pull an advertisement in Britain that was criticized for being too sexually explicit.
Read more at the LA Times.