Sweatshops in Third World Countries Term Paper
- Length: 8 pages
- Subject: Business
- Type: Term Paper
- Paper: #94480218
Excerpt from Term Paper :
Sweatshops in Third World Countries
Not so long ago when the word sweatshop was mentioned, images of Charles Dickens would surface, for the notion of sweatshops seemed to be a thing of the past. However, in recent years, sweatshops have been at the forefront of media attention. They are back, actually they never truly went away at all, and they are back in full swing around the world, mostly in third world countries. Cheap labor has always been appealing to corporations, and as the business world has become globalized, outsourcing work to countries such as Mexico, China, Korea, the Philippines, India, Africa, and Taiwan have become common practice among companies from industrialized nations.
Until the last few decades, perhaps the last mention of sweatshops by the media occurred in 1911 when a fire at the Triangle Shirtwaist Company claimed the lives of 146 people, mostly women (Sweatshops Pp). This incident brought attention to the horrific working conditions of the era and resulted in the creation of workplace health and safety standards and helped shape future labor laws (Sweatshops Pp). Although sweatshops have existed for hundreds, if not thousands of years, they were thought to be nonexistent in modern society where laws existed to protect employee working conditions and provide minimum wages (Sweatshops Pp).
The word 'sweatshop' originated in the 19th century to describe a subcontracting system in which the middlemen earned profits from the margin between the amount they received for a contract and the amount they paid to the workers" (Sweatshops Pp). The margin was said to be 'sweated' from the workers due to the fact that they received minimal wages for excessive hours worked under undesirable conditions (Sweatshops Pp). Workers in sweatshops are generally subject to extreme exploitation, such as the absence of proper wages, benefits, health and safety standards (Sweatshops Pp). The United States General Accounting Office defines a working definition of a sweatshop as "an employer that violates more than one federal or state labor, industrial homework, occupational safety and health, workers' compensation, or industry registration law" (Sweatshops Pp). Secretary of Labor Robert Reich estimates that there are more than 250,000 people working in sweatshops within the United States (Sweatshops Pp).
Beginning in the 1960's, to take advantage of lower labor and production costs, many U.S. corporations began moving their operations overseas as well as outsourcing production at separately owned contract supplier facilities (Sweatshops Pp). This economic globalization gave birth to what is referred to as country hopping by corporations because as labor rates rise in one country, corporations simply move operations to a less developed country where laborers are willing to work for lower wages (Sweatshops Pp). Labor advocates and human rights groups call this a 'race to the bottom' by corporations because it "results in poor working conditions, child labor, employee harassment and abuse, and unsustainable wages for workers (Sweatshops Pp).
Starting in 1995, a dramatic series of revelations began surfacing in the media that demonstrated that sweatshops indeed persist:
activist groups revealed incidents of worker abuse in Nike's contract factories;
it was revealed that entertainer Kathie Lee
Gifford's line of apparel at Wal-Mart Stores was sewn by child laborers at a factory in Honduras;
and more than 70 people were discovered working in virtual slavery in a garment factory in El Monte, Calif., behind barbed wire, under threat of death if they tried to leave (Sweatshops Pp).
The lack of restrictive and costly government regulations overseas is very attractive to businesses for it provides a favorable bottom line, however, this lack of regulation allows dangerous work environments to flourish (White Pp). These supply chains are growing rapidly and are creating disturbing trends globally (White Pp). In the mid-1990's a nonprofit organization was established to address the issues of human rights and labor standards in factories that manufacture goods for the U.S. market (White Pp). "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" (White Pp). Verite's 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 (White Pp). It also helps consumers make knowledgeable choices about which goods are produced under verified, non-abusive labor practices (White Pp). Moreover, Verite is dedicated to improve "labor standards worldwide in subcontracting industries through a standardized process of education, training, inspections, and corrections programs" (White Pp).
In 2000, Verite released its report "Contract Labor in Taiwan: Systemic Problems in Need of Reform" to labor organizations such as the International Labor Organization and is widely circulated internationally (Verite Pp). The report was translated into Chinese by the National Labor Front and copies were distributed to the Taiwanese Council of Labor Affairs at a meeting dedicated to reevaluating contract labor regulation (Verite Pp). The Gap and other major retailers have been so moved by the report that they have conducting further research on the issue of contract labor in their factories (Verite Pp).
Taiwan is a major area of interest to corporation, investors and consumers, and is such an important area of focus concerning abusive working conditions that they recognize a need for close monitoring of factory manufacturing practices to ensure that goods are produced under equitable conditions (Verite Pp). Taiwan is a particular country of concern for the United States because it has been a major supplier of goods to the U.S. since the late 1960's (Verite Pp). "While factories in Taiwan have shifted their focus to higher-value electronics, sporting goods and bicycles since the mid-1980's, consumers remain significantly dependent upon apparel and footwear manufactured in Taiwanese managed factories" (Verite Pp). Taiwanese companies have turned their concerns to the establishment of factories in other countries to produce many of the products traditionally made in Taiwan (Verite Pp). Taiwan has been become the largest foreign investor in Vietnam, and is among the top three investors in China, as well as a major source of capital for the rising production centers of Latin America (Verite Pp). Therefore, Taiwan has not in any way ceased being a major manufacturing center, rather the most significant change is on labels, from "Made in Taiwan" to "Made BY Taiwan" (Verite Pp).
Most factories in Taiwan have been found to engage in unfair labor practices (Verite Pp). Notable abuses have been uncovered of non-Taiwanese contract laborers in Taiwan, which strongly suggest that workers are in need of stronger protections and factories should be under close outside scrutiny (Verite Pp). Managers of Taiwanese factories who bring their business practiced to other parts of Asia, Latin America and elsewhere, must learn fair methods at home as well (Verite Pp). "Overall, Taiwan plays a significant role in the global supply chain and influences labor practices worldwide. As responsible investors, consumers and companies, we should pay close attention to their production trends" (Verite Pp).
According to Council of Labor Affairs
CLA) statistics, there are 279,000 legal foreign workers in Taiwan, including approximately 135,000 workers from Thailand and 115,000 workers from the Philippines. In May of 1999, the CLA signed a labor agreement with Vietnam permitting its workers to obtain employment in Taiwan. The CLA set the quota for foreign workers at 300,000,
US Department of State 1999 Country
Report on Human Rights Practices in Taiwan)"
Due to an intense rise in labor shortage, huge numbers of foreign workers have been employed as contract laborers in Taiwan (Verite Pp). Although legally employed foreign workers are entitled to the same protection as local workers, they often receive unfair treatment, such as wage exploitation, excessive working hours, confiscation of passports and usually receive no medical coverage, accident insurance, or other benefits enjoyed by citizens (Verite Pp). Moreover, workers routinely pay exorbitant and illegal fees to labor brokers to obtain work and conditions in most factories are dangerous, due to old and poorly maintained equipment (Verite Pp). "Since the change of Taiwanese government from the Nationalist Party after over fifty years of power to the Democratic Progressive Party, labor issues in Taiwan have undergone significant reevaluation" as the new government demonstrates notable sensitivity to labor and other human rights conditions (Verite Pp).
In 1999, after Verite audits revealed that the workers had been overcharged, owners of two Taiwanese factories forced labor brokers to return USD $38,000 to Thai workers (Verite Pp).
Taiwan has long been famed for its transformation from a developing country to an industrial colossus, however, in recent years labor disputes at a Taiwanese-owned textile factory in impoverished Nicaragua has cast global attention on the island nation (Perrin Pp). Taiwan has set up scores of garment factories in Central America to produce goods for the American market, but management practices at these factories are said to seem as if they're taken from the pages of a Dickens novel (Perrin Pp). According to Charles Kernaghan, executive director of the National Labor Committee, "Taiwanese manufacturers have one of the worst reputations in the world regarding the treatment of workers" (Perrin…