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Disturbing Trends in GLOBAL PRODUCTION.

As U.S. corporations farm out their manufacturing overseas, they are becoming enmeshed in labor conditions that are violations of basic human rights and public relations nightmares.

ON THE U.S. ISLAND territory of Saipan, workers are held in virtual bondage, unable to leave their sub-minimum wage jobs because they cannot repay recruiting fees as high as $7,000. In Honduras, employees at a garment factory told student activists that they earn about $20 for a 60-hour workweek. In China and Vietnam, human rights groups report that workers making shoes are routinely abused physically. In the Maquiladoras along the U.S.-Mexican border, women are tested for pregnancy as a condition for employment, required to take birth control pills, and suffer other violations of their fundamental rights.

Fueled by an abundant supply of labor in the global market, capital mobility, and free trade, many American companies farm out much or all of their production to independent factories in countries with rock-bottom labor costs. The lack of restrictive and expensive government regulations overseas is also very attractive to businesses, reflecting favorably on the bottom line. This lack of regulation allows dangerous work environments to flourish. These rapidly growing supply chains are creating disturbing trends across the globe.

Verite was established in 1995 as a nonprofit organization to address the issues of global human rights and labor standards in factories that manufacture goods for the U.S. market. It offers inspection of labor practices, consulting services, and in-house training to American companies and organizations addressing child labor, hazardous workplace conditions, and sweatshop issues. Verite has an international advisory board and capabilities in more than 30 languages. Its goals are to ensure that goods produced by child labor, prison labor, and sweatshops are not found in the global production chains of U.S. companies; to help consumers make knowledgeable choices about which goods are produced under verified, non-abusive labor practices; and to improve labor standards worldwide in subcontracting industries through a standardized process of education, training, inspections, and corrections programs. The 10 most disturbing trends in global production identified by Verite follow.

1 Contract labor. In many areas of the world--including the Middle East, Japan, and Taiwan--overseas workers are hired through brokers in order to fill jobs in labor shortage areas that local people do not want. The foreign workers ante up incredibly high fees in order to get positions, which supposedly pay several times what they can make in their home countries. However, given these high fees, they consequently end up in virtual debt bondage to the factories. In many cases, they are enticed by the prospect of high-paying jobs in other nations, only to find that various deductions and interest rates (up to 25% per month) have reduced them to the level of indentured laborers.

In some instances, workers spend their entire salary for up to two years just to pay off recruitment fees and interest. Moreover, desperate to keep their jobs in order to pay off their debt, they are extremely reluctant to protest a wide range of other abuses, including excessively long and often illegal working hours and physical and sexual abuse. Their desperation is heightened by the fact that, often, an entire family's savings or assets are depleted in order to pay for the employment fee.

2 Child labor. In Latin America, about 15 to 20% of all children work in the garment, shoe, or mining industries. In Africa, youngsters comprise 17% of the continent's workforce. It is estimated that there are about 100-200,000,000 children working around the world--95% of them in developing countries. For example, according to human rights advocates in China, a young girl was forced to work 12-hour shifts seven days a week, earning about seven cents an hour. For her 84-hour workweek, she received $5.55. The company often confiscated all of the young workers' identification cards to prevent them from seeking employment elsewhere, and usually they were owed back wages.

The complexity of the child labor issue is illustrated by the following points:

* Mandatory school age varies throughout the world.

* In situations of extreme poverty, families actually have a higher standard of living when children are permitted to work (even part time).

* Governments themselves in some countries hire children, particularly in agriculture.

* Issues about piecework (often done at home or to assist parents) are complex, as is the issue of labor done in exchange for land, housing, firewood, etc. In areas where there are few or no schools (or where rudimentary supplies are unavailable), employment is often the only alternative.

Contrary to the perception generated in the media, child labor is not always due to the whims of rapacious employers. Recognizing this, Verite and some of the leading footwear and apparel companies have begun a dialogue on the issue of a living wage. At present, this topic is widely debated and there is little agreement about what constitutes a living wage, who is responsible for ensuring it, or if it is even possible.

In the longer term, the need for child labor (especially on a full-time basis) will begin to subside as greater numbers of adult workers are paid a living wage. Often, though, the first step in Verite's process is to ensure that even the most basic minimum wage regulations are respected. For example, it has combined with factories in India to set up a school in a brass works. The proximity and structure of the school allowed students to attend class and still continue to work part time at the factory.

Verite's approach stresses the need for collaboration among governments, local non-governmental organizations, UNICEF, the International Labor Organization, companies, etc. in order to devise locally relevant, effective, and long-term solutions. Otherwise, solutions driven by what may be deemed best in a Western, industrialized context can be more harmful to local communities than the problem they were designed to solve.

3 Cheating on wages and excessive overtime. A U.S. Department of Labor report stated that as many as 55% of garment factories violate overtime pay laws. Workers average 65-75 hours a week in sweatshops, but are not being compensated fairly--or legally! Employers under-record overtime hours, and employees are not aware of the companies' policies--i.e., labor laws specify that pieceworkers are entitled to receive overtime premiums, but do not specify the rate. In some factories, pieceworkers do not receive any overtime pay for hours worked in excess of the normal 176-208 a month. Employers worldwide routinely penalize or fire those who decline overtime.

Verite has toiled extensively to negotiate the repayment of back wages to workers. As a result, workers in Bangladesh and Taiwan received $19,000 and $36,000, respectively, for back wages that had illegally been withheld from them. While these examples are still the exception and not the rule, Verite has conducted, and will continue to do so on an ongoing basis, seminars and education programs to train workers on financial matters (how wages are calculated, local wage regulations, labor law, etc.).

4 Paying less than a living wage. A living wage is one that sustains basic needs. Millions are not receiving a living wage. Even when overtime pay is included, they still do not earn enough for them to meet their basic needs. A 1999 Verite report suggested that 43% of the factories surveyed violate minimum wage laws. For instance, an average worker in a textile factory in Haiti earns $2.22 per day. After deducting for transportation to and from the job and a simple meal from the stalls outside of the factory, it leaves just 61 [cts.] to rent a one-room hut that costs $7.10 per week and has no running water. It is clear that workers do not have enough to meet their own basic needs (school, medicine, clothing, etc.), let alone those of a family.

5 Exposure to hazardous chemicals. In 1996, two Chinese women died and more than 30 developed leukemia and anemia from inhaling toxic fumes from benzene and other chemicals in poorly ventilated foreign-owned shoe factories in the coastal province of Fujian. A clinic near Shenzhen, China, has been established for the sole purpose of treating poisoned workers. The majority of in-patients are suffering from paralysis or are in comas. Their average ages are 19-23.

Such extreme conditions are to be found throughout the world. Verite is equally concerned by milder conditions that, if left unchecked, could have devastating effects. These include hazardous chemicals stored near drinking water, cafeterias, and open flames; toxic runoff that pollutes community water sources; etc.

6 Harassment and mental, physical, and sexual abuse. Workers commonly report oppressive conditions that include no benefits, nonpayment of wages, forced overtime, sexual harassment, mandatory pregnancy testing, verbal and physical abuse, corporal punishment, and illegal firings, among other human fights violations. Children can often be found toiling in factories with their parents instead of going to school, and performing tasks that are detrimental to their physical well-being and development. Factories frequently have too few bathrooms and they are often locked, broken, and filthy. Many workers report that they are not allowed breaks, even for food and water.

7 Women's rights abuses. The global workforce manufacturing consumer products is comprised of 90% women; thus, a disproportionate share of the abuses encountered are women's rights abuses. Employers in Asia and Central America, for instance, require pregnancy testing, birth control, and sometimes sterilization for their female employees. Factory managers in Saipan and Mexico are notorious for denying maternity leave benefits by firing pregnant women and pressuring female workers to have abortions if they want to keep their jobs. Women are sexually harassed on a daily basis. Sexual assaults occur with alarming frequency and are not reported, as the women fear losing their jobs. As cited in a National Labor Committee report, women (some as young as 17) were not allowed to go to the bathroom for their entire shift.

In addition to these more flagrant abuses, women bear an inordinate share of the burden with regard to issues like child care, nutrition, and health. Factories, particularly in export processing zones such as Maquiladoras, are often at such a distance from towns that women are exposed to dangerous transportation, rape, lack of adequate child care, opportunities for breast-feeding, etc.

Verite has begun setting up pilot breastfeeding programs in on-site creches in factories in Bangladesh, a country where breastfeeding was an important tradition. By allowing women to bring their infants with them to the factories, the nutritional and socio-cultural advantages of breast-feeding are maintained.

8 Suppression of unions. On average, in over 200 factories monitored by Verite, less than 10% of workers know their rights on issues of minimum wage, overtime pay, benefits, paid leave, and the right to organize as a union. They are routinely fired or punished for any signs of unionization. A Beijing factory worker made a T-shirt with the Chinese lettering for "collective bargaining" and was sentenced to three years in a labor camp on a charge of printing slogans that were "calculated to incite."

Beyond the outright suppression of unions, Verite investigates and documents the numerous attempts not only to prevent the formation of unions, but to quell workers' voices as they attempt to raise any grievances, collectively or otherwise. Regardless of a company's or country's policy on unions, suppression of workers' rights to express concerns is an all-too-common violation of fundamental human rights.

9 Forced overtime. Employers regularly use threats of denied wages, physical abuse, or unemployment to coerce overtime work. Production quotas are often raised for those refusing overtime, and many are fired for refusal to work more than 48 hours a week. Seventeen-hour shifts are common in factories throughout the world, and many workers are denied even one day off per week. Overtime pay is slim to none in global sweatshops. Employers are infamous for forcing overtime by announcing more work at quitting time and locking the factory's doors--frequently leaving young mothers with no child care options.

On Verite's recommendation, some factories--in China, for example--have begun to redefine their production schedules, thereby reducing the need for excessive overtime. In two of these factories, a 20% increase in productivity and improved worker morale has been reported.

10 Blurred supply chains. In countries such as Malaysia, the number of workers making shoes, clothing, and textiles has increased 600% since 1970. The U.S. has lost more than 400,000 such jobs since 1973. With this trend in global production likely to continue, it is crucial that every link in the supply chain be transparent. Companies are farming production out to suppliers who, in turn, are subcontracting to other suppliers, which tends to hide exactly who is producing for whom.

Moreover, major branded corporations are beginning to realize that the repercussions of their sourcing decisions are enormous. Who they choose to do business with has become an indirect endorsement of the conditions found in their factories. Consumers, shareholders, and employees are no longer content to hear that workplace conditions are beyond their control. Accordingly, companies must create a system where they can track their suppliers, as well as their suppliers' suppliers.

Heather White is executive director of VeritY, an Amherst, Mass.-based nonprofit organization that serves as an independent monitor of global human rights and labor practices.
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Publication:USA Today (Magazine)
Date:May 1, 2000
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