Labor Laws Enter Debate Abuse Charges Follow Industry
Silicon Valley's Dark Side A Mercury News Special Report
by Karl Schoenberger, Mercury News
26 November 2002 (California, USA) –
Last in a three-part series
Most PC companies abandoned the practice of assembling their own products with their own labor years ago, relying instead on cost-effective contractors and their array of suppliers and subcontractors. As these supply chains multiplied and became more complex and opaque, brand makers have distanced themselves from the responsibilities of labor management.
The industry increasingly relies on contractors in China, where, as in other developing countries, the enforcement of labor regulations can be arbitrary. Yet the problem of extraordinary overtime and its legal and ethical consequences has been off the radar for the high-tech industry. Some companies are acutely aware of the controversy. But industry associations, which have been vocal on environmental issues, are still mum on the subject of labor.
The Mercury News contacted several major tech-industry associations to ask whether excessive overtime in China was a concern. Those that replied said labor issues were not on their group’s agenda.
A representative of the Electronic Industries Alliance deferred to corporate members of the six industry groups it represents, including the Consumer Electronics Association.
“The short answer is no,” said an official with the association, whose ranks include Dell Computer.
Dell routinely audits its contractor factories and requires them to comply with local laws, said spokesman Mike Maher. “It would be an issue of concern to us if we were told these things were talking place,” he said.
At IBM, spokesman Ray Gorman said his company “complies with national laws and regulations wherever we do business.”
Without industrywide recognition of the problem, critics say, no one can start thinking seriously about solutions. A kind of denial has set in, these critics warn, a belief that the sweatshop allegations that have dogged the apparel industry in China’s virtually unregulated labor environment cannot scratch the image of high-tech factories as safe, clean workplaces.
But a line worker assembling motherboards on marathon overtime shifts is just as likely to suffer carpal-tunnel syndrome or exposure to noxious fumes as a worker gluing soles on Nike shoes, say workplace experts. And physical exhaustion often leads to dismemberment or death.
“Long hours of work result in a tremendous increase in accidents,” said Garrett Brown of the Maquiladora Health & Safety Support Network, which is investigating conditions in China. “Overtime increases the exposure to chemicals that might not pose a health risk in a 40-hour week.”
In the interests of protecting its brand name, Hewlett-Packard took the industry lead in June by publishing a code of conduct that specifically addresses labor practices in its contractor factories. The move was similar to what Levi Strauss & Co. did a decade ago when it announced a code for global suppliers that raised workplace standards in the apparel industry.
HP’s “Supplier Code of Conduct” forbids child labor and mandates that workers’ wages and hours comply with local law, among other things.
“As HP gets more aggressive in this area, like we have been in the environmental area, that raises the bar,” said Debra Dunn, HP’s senior vice president for corporate affairs. “It’s not just about the terms of a code of conduct; it’s having greater transparency with the suppliers.”
Several Taiwanese electronics contractors did not respond to questions about allegations of widespread overtime abuse at their factories in southern China. But an official at Flextronics, a U.S.-owned electronics contractor based in Singapore, stepped up to the plate.
“We think being mindful about labor issues gives a competitive advantage,” said Jim Sacherman, a Flextronics senior vice president. “When you talk to the high executives in the companies we work for, they all want things done the right way. But unfortunately, contractors have to deal with people down the chain, whose job it is to cut costs.”
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