Vol. V, Bulletin No. 13. October 2, 2000
Employers Mount Aggressive Campaigns against Unionization
Using Fear of Job Loss to Win Elections
Thanks partly to global opportunities opened up by trade agreements, U.S. employers are increasingly aggressive in their threats to close or move their operations abroad when unions try to organize their workers. The fears thus engendered among workers have a "devastating impact" on union organizing drives.
That trend, long common knowledge among people in unions, has now been documented in an exhaustive report released last month by the U.S. commission monitoring the mounting U.S. trade deficit. During the past two years, in the course of union certification election campaigns held in manufacturing, communications, and wholesale distribution industries, 68% of the companies involved threatened to relocate all or part of their operations. In the late 1980s, only 29% of employers made such threats.
"Not only are threats of plant closing an extremely pervasive part of employer campaigns; they are also very effective," writes Kate Bronfenbrenner of Cornell University in her 86-page report released last month. Unions lost 62% of the government-conducted elections when employers made plant closing threats; 49% when there were no such threats.
Red Arrows on Wall Map Point from U.S. to Mexico
Other highlights of the report, available on the Website of the U.S. Trade Deficit Review Commission:
Economic Boom By-Passes Workers in Prime Industries
- "Threats of plant closing were found to be unrelated to the financial condition of the company, with threats no less likely to occur in companies in a stable financial condition than those on the edge of bankruptcy. Instead, threats seemed to be primarily motivated by anti-union animus."
- The plant closing threats were usually one aspect of "aggressive legal and illegal employer behavior such as discharges for union activity, electronic surveillance, illegal unilateral changes in wages or benefits, bribes, threats to refer undocumented workers to INS, promises of improvement, and promotion of union activists out of the unit."
- Threats sometimes were direct and unambiguous--e.g., maps posted on a factory wall with bright red arrows pointing from the U.S. to Mexico. But "in some of the largest multinational companies in our sample, such as Mitsubishi, Pepsico, Royal Dutch Shell, Owens Corning, Georgia Pacific, Pratt and Whitney, or Siemans AG, workers didn't need a direct plant closing threat to worry that these companies might move all or part of their work to sites in Asia, Latin America, Africa, Europe, or Canada....A visit from officials from other countries would serve as a very credible threat of plant closure during an organizing campaign."
- Because remedies available under U.S. labor law are extremely limited, "unions filed [unfair labor practice] charges in only 14% of the campaigns in the sample where plant closing threats occurred." With little effect, since very few of the lost elections were eventually overturned.
Such hostility from employers have caused unions to shift their organizing priorities, Bronfenbrenner points out. "In a climate of constantly escalating capital mobility, it is only natural that many unions are turning toward less mobile sectors of the economy [e.g., nursing homes, retail stores, hotels, social service agencies]," she points out. "But what of the workers in the nation's most mobile industries? Whether they work in garment shops in the nation's largest cities, textile and food processing plants in the rural South, electronics component plants in Southern California, or metal fabrication plants in the Midwest, these are the American workers hit hardest by globalization."
Once, before the escalation of capital mobility, writes Bronfenbrenner, "those were the kinds of jobs that benefited most from tight labor markets and helped drive the economic expansion and build the middle class. But today workers in those industries operate in the shadow of the economic boom, sharing little, if any, of its fruits. They work ever longer hours in workplaces beset by serious job injury and health problems, with declining pay, few benefits, and little security."
If the present trends continue, the outlook for the global economy is "little more than a worldwide race to the bottom in wages, working conditions, and living conditions, that no nation can win," Bronfenbrenner says.
Two Paths toward Changing the Present Grim Outlook
She points to "two paths to break the hold that capital mobility has on the economic confidence and security of America's workers":
In the report's final paragraph, Bronfenbrenner states the challenge this way:
- First: "establishing international trade and tax policies which incorporate strong and enforceable labor standards in trade agreements and provide disincentives to companies that seek to move employment out the country...to break existing unions and prevent new unions from organizing."
- Second: making "changes in U.S. labor laws to provide for substantial financial penalties and injunctive relief for the most egregious employer violations, particularly plant closings and plant closing threats," among other legal reforms."As we enter the new millennium, the question is not whether we should fully reject or wholeheartedly embrace globalization. Instead the question is whether the disparate benefits and impacts of globalization can be reordered so that our trade agreements and labor law policies no longer serve to primarily benefit corporations at the expense of workers and communities in the U.S. and around the globe."Economists Critique Anti-Sweatshop Efforts
Have colleges and universities around the U.S. been too hasty in agreeing to monitored codes of conducts covering the manufacture of sport shirts and other goods bearing the schools' logos? Yes, according to a group of academic economists and lawyers called the Academic Consortium on International Trade (ACIT).
In a July letter to college and university presidents, ACIT expressed particular concern about agreements being made without "careful research, discussion, and debate," and "without seeking the views of scholars in the social sciences, law, and humanities who have long discussed the issues involved."
In Defense of Multinational Corporations
The schools have made agreements, over the past two years or so, with either the White House-backed Fair Labor Association (FLA) or the student-backed Worker Rights Consortium (WRC), the two organizations competing for anti-sweatshop commitments from colleges and universities. The ACIT letter criticized both the FLA and the WRC. Among things, the letter charged that both organizations :"...seem to ignore the well-established fact that multinational corporations (MNCs) commonly pay their workers more on average in comparison to the prevailing market wage for similar workers employed elsewhere in the economy. In cases where subcontracting is involved, workers are generally paid no less than the prevailing wage."Moreover, ACIT charged, "if MNCs are persuaded to pay even more to their apparel workers,...the net result would be shifts in employment that will worsen the collective welfare of the very workers in poor countries who are supposed to be helped."
A Brief Critique of ACIT's Critique
An economics professor at a Midwestern university recently called my attention to the letter, authored by the six-man ACIT steering committee, which includes Jagdish Bhagwati of Columbia University. I emailed back my reaction: "I am quite unimpressed with what I see. Sorry. Each sentence cries for comment." Among the few comments I made:
Although at the time I didn't cite any current examples of sweatshop abuses, the following new report by Business Week is pertinent. When was the last time that academic scholars produced this kind of research?
- The anti-sweatshop movement is concerned not just about low wages but a wide range of other, often more serious abuses. Excessively long overtime. Unpaid wages. Physical abuse. Verbal abuse. Sexual harassment. General lack of respect. The crushing of trade unions. Etc. In short, assaults on freedom. The failure to grasp this basic fact amazes me.
- From the days of the U.S. civil rights struggle, I remember the calls for more research, more research, and more education, before anything should be done. So I'm not that impressed with calls to do nothing to improve the situation until "careful research" is completed.
A U.S.-Funded Dungeon in China Exposed
'A Life of Fines and Beatings' is the title of an October 2 Business Week report on a sweatshop in China that made Kathie Lee Gifford handbags for Wal-Mart. "Wal-Mart Dungeon in China" was the title of a National Labor Committee report on the same sweatshop, the Chun Si Enterprise Handbag Factory in Zhongshan, a booming city near Hong Kong. It was the NLC report that prompted Business Week to launch its own three-month investigation of the Chun Si factory
By interviewing Chun Si workers, its management, Labor Ministry officials, and other sources, the magazine confirmed what it called "egregious conditions." A few of them:
"Workers there face a life of fines and beating," one worker told Business Week.
- Chun Si management confiscated all ID papers of its workers, an illegal practice that left a worker a "virtual captive" of the factory.
- Guards regularly punched and hit workers for various offenses.
- The factory did not pay for overtime work.
- Workers were paid so little, and so often fined for infractions, such as taking too long in the toilet, that at the end of a month they often owed the company money.
How Self-Policing Misses Serious Problems
Ever since 1992 Wal-Mart has required its suppliers to certify their compliance with a code of labor standards, and a few years later it began hiring auditing firms, such as PricewaterhouseCoopers LLP, to check up on the factories. "For several months," Business Week writes, "Wal-Mart repeatedly denied any connection to Chun Si." Later, in face of documentary evidence showing that it did, Wal-Mart Director of Corporate Compliance Jay Allen told Business Week: "Wal-Mart [had] denied using Chin Si because it was 'defensive' about the sweatshop issue." The magazine's straightforward analysis is:"What happened at Chun Si suggests that these auditing systems can miss serious problems--and that self-policing allows companies [with few exceptions] to avoid painful public revelations about them."Business Week rightly gives credit to the National Labor Committee and its long report, "Made in China," for first exposing the scandal. Actually, the Chun Si situation was only one of a dozen sweatshops that the NLC report exposed, all producing for household-name companies, including Nike, New Balance, Timberland, and Payless. The Business Week story summarized several of these other scandals in one paragraph. More significantly, however, it ignored the key conclusion of the NLC report:"For years, and now again with renewed vigor, U.S. companies have claimed that their mere presence in China would help open that society to American values,...spreading respect for human, women's and worker rights, and democratic freedoms by their own examples....How U.S. Funds China's Communist System
"Far from defending human rights, the record shows that U.S. companies and their contractors in China are actively involved in the systematic denial of worker rights. U.S. companies are milking a system that does not allow for dissent and where anyone trying to form an independent union will be fired, arrested, and imprisoned for five to eight years without a trial."
The NLC report also provided rarely published statistics on how the United States is funding China's corrupt Communist system. In 1997 U.S. companies were the largest providers of foreign direct investment to China. They import a full 36% of China's total exports worldwide. They import from China 1.2 billion garments each year, as well as shoes, sneakers, toys, and sporting goods that will retail in the U.S. for more than $39 billion a year. Wal-Mart alone uses some 1,000 contractors in China, an estimate, since Wal-Mart refuses to disclose them except to the government of China.
In its July-August issue (not yet posted on its Website as of this writing), the Hong Kong-based China Labor Bulletin provides further details on the plight of China's workers in sweatshops producing for U.S., Canadian, and European stores. The lead article in that issue examines in detail the fundamental weaknesses of the present monitoring systems used by U.S. multinational companies in China.
N.Y. Times Awed by Asian Sweatshops
As the Prime Minister of Thailand was seated watching colorful May Day ceremonies in Bangkok this year, two young workers--a man and a woman--presented him with a petition of some sort. News cameras flashed as they handed him the petition on their knees and backed away in the same humble manner.
I didn't find either a photo or an explanation of that event in the morning press, but I did learn that the Prime Minister, Chuan Leekpai, had used his May Day address to argue against raising Thailand's legal minimum wage levels, which had already been frozen for more than two years. The Bangkok Post's headline on the Prime Minister's speech: "Low wages better than no wages, Chuan tells workers."
Now comes the New York Times Magazine with essentially the same message in an article titled "Two Cheers for Sweatshops" by Nicholas D. Kristof and Sheryl WuDunn, a Pulitzer Prize-winning husband-wife reporting team. Yes, they write, sweatshops "seem brutal," since "some" of them not only pay "terribly cheap wages" but also "house workers in firetraps, expose children to dangerous chemicals, deny bathroom breaks, demand sexual favors, force people to work double shifts, or dismiss anyone who tries to organize a union."
Still, in the view of the two reporters and of the Asian workers they interviewed, jobs in sweatshops are better than no jobs. But are there only two alternatives? More and more Asian workers don't think so. They are rebelling against what the article admits is "the misery that [sweatshops] can engender." They are rejecting the theory that they must accept misery on the grounds that it is an inevitable pattern of industrial history, similar (as the Times team suggests) to what sweatshop workers had to endure in Great Britain in the 17th century.
Sweatshops Said to Fuel Asia's Economic Strength
The article's subtitle summarizes why Kristof/WuDunn cheer sweatshops: "They're dirty and dangerous. They're also a major reason Asia is back on track." Indeed. The article repeatedly credits much of Asia's economic power to the contributions made by the women and men in sweatshops. Well, those workers aren't so dense that they can't draw some conclusions from the vital role they play in the Asian economy. At least the dozens with whom I talked with earlier this year do. They say that it's high time that they get their rightful share of the wealth they are producing.
"Nothing captures the difference in mind-set between East and West more than attitudes toward sweatshops," Kristof/WuDunn write. Nonsense. They are out of touch, and might be shocked if they tuned in on Asians outside their limited sample to consider the views, for example, of the Bangkok-based Committee for Asian Women, as expressed in the July issue of the CAW's Asian Women Workers Newsletter.
The July issue, like previous ones, provides current examples of sweatshops in which Asian women are rising from their knees and demanding their rights. Also, this latest issue specifically attacks "the prevailing economic rationalist dogma of globalization, which today is being touted as 'the only' economic paradigm, despite the other economic alternatives that exist.." Sounds almost as though the editors were reacting to an advance copy of "Two Cheers for Sweatshops."
What I Have and Haven't Been Up To
During 1999, by the first part of October, I had published 19 issues of Human Rights for Workers during 1999. This year it's only 13. What's happened?
For one thing, last spring I went on a research trip to East Asia that required nearly four weeks of travel and more than four additional weeks of follow-up work. That knocked a big hole in my HRFW schedule. I could have caught up afterward by devoting myself to nothing else. Instead, I wrote a couple of magazine articles and early last month took a 10-day vacation with my wife to Yellowstone and environs.
I've glad I did, but as a result, I'm backlogged with letters to write, reports and books to read or at least scan, magazines to clip, software to update, and a messy home office and file room to clean up. Also, as I have done since 1992, I must write an annual report on human rights developments for an encyclopedia yearbook. So I've resigned myself to issuing only two more Bulletins during the rest of 2000, half of the end-of-1999 output. I hope to get back to posting these Bulletins twice a month next year, but we'll see.
About those articles. One, titled "Needed: A Bill of Rights for the Trade Regime," appears in the summer/fall issue of China Rights Forum published by Human Rights in China. The other, "Workers of the World," appears in the September 22 issue of Commonweal. Both develop themes covered herein over recent months, with some added twists.
Human Rights for Workers: Bulletin No. V-13, October 2, 2000
Robert A. Senser, editor
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