For more than a decade, major American retailers and name brands have answered accusations that they exploit "sweatshop" labor with elaborate codes of conduct and on-site monitoring. But in China many factories have just gotten better at concealing abuses. Internal industry documents reviewed by BusinessWeek reveal that numerous Chinese factories keep double sets of books to fool auditors and distribute scripts for employees to recite if they are questioned.
This raises disturbing questions. Guarantees by multi-nationals that offshore suppliers are meeting widely accepted codes of conduct have been important to maintaining political support in the U.S. for growing trade ties with China, especially in the wake of protests by unions and antiglobalization activists.
Undermining Nike's boast that it maintains model working conditions at its factories throughout the world, a prominent accounting firm has found many unsafe conditions at one of the shoe manufacturer's plants in Vietnam.
In an inspection report that was prepared in January for the company's internal use only, Ernst & Young wrote that workers at the factory near Ho Chi Minh City were exposed to carcinogens that exceeded local legal standards by 177 times in parts of the plant and that 77 percent of the employees suffered from respiratory problems.
While Nike has often been attacked over low pay and long hours, the Ernst & Young report pushed hard on a relatively new front for Nike's critics: air quality in its factories. Ernst & Young found that toluene, a carcinogen, was in the air at different sites in the factory studied at 6 to 177 times the amount allowed by Vietnamese regulations, which itself is about four times as strict as American toluene standards. Extended exposure to toluene is known to cause damage to the liver, kidneys and central nervous system.
In late 2005, the ILRF on behalf of factory workers from Indonesia, China, Bangladesh, Nicaragua, and Swaziland filed a lawsuit against Wal-Mart Stores charging that Wal-Mart knowingly and systematically violated its Standards for Suppliers. More information on the litigation is available via International Rights Advocates. On July 10, 2009, this lawsuit was dismissed by the 9th Circuit court in California.
As Apple celebrated record profits, and moved closer to becoming the world's most valuable company with a market capitalisation of over $360 billion, China Labor Watch (CLW), a New York-based rights group, presented its evidence about the true cost of our obsession with technology.
China Labor Watch sent investigators to work on the production lines of ten major Chinese electronics factories, which assemble products for Apple, Dell and HP as well as Sony, Nokia, Motorola and many others.
Over an eight month period, the investigators also interviewed over 400 workers about conditions that they claim were not only unethical, but often also illegal under Chinese law.
Earlier this week, another employee at Foxconn, the world's largest electronics manufacturer was found dead at the company's sprawling factory in the southern city of Shenzhen, where over 250,000 workers assemble gadgets for almost every major electronics company.
Last year, a suicide cluster at Foxconn claimed 14 lives and prompted intense scrutiny of the inhuman working practices in the electronics industry.
For inspectors, reformers, and politicians, the sweatshop encapsulated the dangers of urban confrontations of race and class. For these observers, racial degeneration was a problem not simply for immigrants, but also of immigrants. This was especially true in an industrial city characterized by exchanges of goods and, thus, of germs. In this context, workers became, not necessarily allies to reform, but objects of - and, according to some inspectors, hindrances to - reform.
While particularly glaring in the garment industry, sweating workers through subcontracting has emerged as standard operating procedure in industries across the board resulting in massive wage and benefit cuts on one end and unparallelled accumulation of profits at the other. Employers utilize these methods of control not only in globalized industries, like garment, electronics, toy, shoe, plastics, and auto parts, but also in the non-globalized locally-based sectors like the healthcare, food processing, restaurant, hotel, custodial, construction, landscaping, information processing, clerical, customer service, and other industries.
The term "sweatshop" was initially coined during the industrial revolution in the 1880s and 1890s to describe the subcontracting system of labor. The sweatshops that served larger companies were run by middlemen who expanded or contracted their labor forces depending on the success or failure of different clothing fashions.