Child labor is condemned across the globe, but is it fair for a multinational to terminate relationships with suppliers when incidents arise regarding the use of child workers, regardless of the implications to the community as a whole? It is fair for a multinational to cease doing business with suppliers that fail to comply with ethical labor practices. This does not mean that an isolated violation justifies doing so when the suppliers are really committed to respecting acceptable labor conditions. If a multinational allows supplies to violate ethical labor practices, it would imply that the multinational is not seriously committed to those practices and is as guilty of the violations as the suppliers. The argument that maintaining the level of employment in the community takes precedence over ethical labor practices is wrong. It would mean that any level of exploitation is preferable to having to find alternative employment or being unemployed for a period of time. The case of Nike's decision to terminate its business with Saga illustrates the importance of adhering to ethical labor practices.

Saga's violations of the code of conduct advocated by Nike were systematic,...

Nike conducted a six-month investigation of labor practices at Saga operations and found repeated compliance violations of codes of conduct regarding child labor, safety, and health and environmental issues. Violations included worker harassment, unjustified termination, and shortchanging workers on payment of wages. Moreover, the Fair Labor Association conducted an independent audit of Saga and found similar labor violations. According to Nike's CEO and president, Saga had repeatedly failed to honor commitments made to Nike to correct the pattern of violations.
In terms of the impact on the community, economics and ethical labor practices are not mutually contradictory, as will be explained in the response to the second questions. Adherence to ethical labor practices by large companies, such as Nike, can be an important part of enforcing labor codes of conduct and economically benefiting communities in the long-term.

2. lf parents in economically deprived areas willingly allow their children to work in order to survive, should it be inappropriate for international companies to allow this?

To allow child labor under…