As it pertains to sweatshops, indications that the company was operating sweatshops came first in 1998. During this time sweatshops were found in Asia and the company was only paying workers 80 cents per day.
Nike's behavior in both these instances created a backlash that is still present. Prior to the findings of human rights violations, Nike had a good reputation as an employer. However, after the presence of human rights violations were found consumers and human rights advocates alike begin to question Nike's business practices and the company's commitment to human rights. At the time Nike promised to "increase the minimum age for workers at Nike's contract plants in Asia to 18, improve factory air quality, allow independent monitoring and provide free education for workers. But critics said the reforms did nothing to address the main problem -- that workers at those plants aren't paid a living wage. They say
U.S. companies in Asia pay workers in China and Vietnam $1.60 a day and workers in Indonesia less than $1 when these employees say they need $3 a day to maintain an adequate living standard.
Nike officials have said the company pays the minimum wage or the industry standard in whatever country they operate
in. "These factories are sweatshops," said Medea Benjamin, spokeswoman for the San Francisco-based human rights group Global Exchange. "They're clean, well-lighted sweatshops, but they're still sweatshops."
Nike's treatment of workers in Asia was only one incident of many involving Nike and human rights violations. According to Spar & Burns (2002) throughout the 1980's and 1990's Nike was constantly under scrutiny as it pertained to the company's human rights violations.
The author explains that these violations included underage workers in Indonesia, forced overtime in China and perilous working conditions in Vietnam. All of these human rights issues came to a head in the late 1990s when many interest groups and citizens of the world began to boycott Nike products.
Spar & Burns (2002) explains that Nike's human rights violations were derived in some part by the overall business strategy of the company. This business strategy was developed in the late 1960s and included the practice of reducing costs by outsourcing all jobs involving manufacturers.
Today this is a very common practice and in some ways there is much more regulation of such outsourcing so that workers are better protected. However at the time this was unchartered territory especially as it pertained to a company the size of Nike. The lack of oversight and the lack of attention being paid to human rights at the time is what allowed Nike to operate in the manner in which it did.
The company's cost saving strategy functioned by not paying workers a living wage. Although the company was paying what the workers in that area of the world were receiving for a day's work, this wage was not a living wage. This is another problem that multinational company's often have. When conducting business in a country outside of the United States that average cost of hiring a worker is much cheaper Even though many multinational companies can afford to pay employees more, they don't because they don't have to. Ultimately the ability of companies such as Nike to pay much less in labor costs can result in increased profitability. In addition, the government of many of the host countries do not have the capacity to oversee the treatment of workers, in addition, in some instances governments don't complain even if they know that human rights violations are occurring because these company's are providing some revenue for the host country and jobs for the people of the country. In the case of Nike all of these issues came into play as it pertained to the human rights violations of the company.
In addition to Nike other multinational companies have also been found committing human rights violations. One such company is Wal-Mart. Wal-Mart is the largest retailer in the world. The company has stores throughout the United States and all over the world. The main focus of Wal-Mart's human rights violations has been focused on the company's labor practices and child labor violations.
Unlike Nike, Wal-Mart's human rights violations occurred not only overseas but also in America. This is unusual because human right violations usually occur in poorer countries that have very little oversight. However Wal-Mart's relationship to the American workforce is unusual because of the size of the company and the position that it holds amongst American retailers.
Wal-Mart's labor practices have been the source of a great deal of scrutiny over the years. One of the labor complaints about the company came in the form of violations of child labor laws
. Apparently, some minors working for Wal-Mart in Arkansas, New Hampshire and Connecticut were allowed to operate some hazardous equipment.
The company was forced to pay a $135,540 fine for violating child labor laws.
As a result of this violation and other violations at the company, Wal-Mart was forced to develop a labor deal with the United States government.
However, this deal was scrutinized because it placed a great deal of restrictions on the amount of oversight that the government would have as it pertained to monitoring the company for further labor violations. In fact the deal established and 15 day notification before any monitoring could take place. According to many critics the deal that was reached was nothing more than a sweetheart deal and that it would do little or nothing to deter the company from violating labor laws. The article explains,
"The Bush Labor Department chose to do an unprecedented favor for Wal-Mart,
despite the fact it is well-known for violating labor laws, including child labor laws," Rep. George Miller (D-Calif.), the lawmaker who requested an investigation, said in a statement. He also said such an arrangement could allow the nation's largest employer to cover up evidence of a violation and would discourage employees who might fear retribution from filing a complaint ."
Recent cases involving Human rights violations and the Alien Torts Act
The violation of human rights by multinational corporations have not occurred without . This is particularly true of cases involving the Alien Tort Claims Act (ATCA). In short the ATCA, originally adopted in 1789, asserts that "asserted that "the district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States."
The law of nations is basically a treatise between nations in the international community which establishes that the laws of nature will be acknowledge and adhered to.
The purpose of the law of nations is to establish and guarantee the safety of the world's citizens. ATCA is a law that has been relatively unused but over the last few decades an increased awareness and enforcement of human rights has led many plaintiffs to address various grievances.
Specific cases in which ATCA was utilized include the consolidated cases of Ntsebeza v. Daimler a.G. And Khulumani v. Barclay's National Bank Inc.
. In the case of Ntsebeza v. Daimler a.G. The plaintiffs charged that the defendants engaged in discriminatory actions that were consistent with the constructs of apartheid which was prevalent in South Africa during the time the plaintiffs were employed by Daimler, the defendant. This period of time extended from 1973 until 1994. The acts for which the plaintiffs were suing included geographic segregation, employment discrimination based on political beliefs, arbitrary denationalization, forced exile, extrajudicial killing of family members and torture.
As a result of this discrimination, a class action suit was brought on behalf of the workers and all black South Africans.
The suit claimed that the defendants had directly and indirectly violated the law of nations.
The other lawsuit involved Khulumani v. Barclay's National Bank Inc.. This case also involved South African plaintiffs and designated four different classes of plaintiffs.
These classes included
1. The torture class-composed of those who were tortured and raped by South African security officials from 1960-1994.
2. The extrajudicial killing class-composed of survivors of persons killed by the South African security officials from 1960-1994.
3. The cruel treatment class- composed of all those who were subjected to cruel and inhuman treatment by the South African security officials from 1960-1994.
4. The detention class-composed of all those detained unlawfully and for periods of time by the South African security officials from 1960-1994.
Initially in 2004 the cases were dismissed on the grounds that the ATCA did not cover aiding and abetting liability, which would be associated with the companies involved in both of the aforementioned cases. However in 2007 the plaintiffs appealed to the second circuit and the decision of the previous court was affirmed in part and also reversed in part. The second Circuit upheld the dismissal of the plaintiffs case under TVPA. However, the second circuit reverse the decision of the court in regards to the ACA. The second court ruled instead that…