What’s in our supply chain and how they do it

The blindness to those workers’ labor struggles is driving an international movement to rein in global companies and protect human rights from the assembly line to the clothing rack. “We are really talking about unaccountable lead firms who basically, through the power of their finance, hold the countries and the world hostage to their greed and profit,” says Anannya Bhattacharjee, international coordinator with the labor-advocacy group Asia Floor Wage Alliance (AFWA).

A world away from Bentonville, AFWA is helping workers on the far side of the production chain get some recognition in Geneva at an International Labour Organization conference. They are presenting a scathing analysis of how Walmart, Gap, H&M, and other Western brands systematically degrade workers’ rights in poor countries, often contravening their own supplier “codes of conduct.”

According to the latest report on Walmart, drawn from field research andinterviews with more than 340 factory workers in Bangladesh, Cambodia, and India, an under-regulated system of hyper-exploitation in subcontracted factories underwrites the real price tag behind Walmart’s brand label.

In India, researchers found that all 24 Walmart supplier factories investigated relied on irregular workforces of “short-term contract workers, daily wage workers and workers who work on piece-rate.” This casualization enables maximal “flexibility,” allowing bosses to calibrate wages according to the fluxes of the Western consumer market and the constant churn of fashion seasons. For workers, chronic economic destabilization becomes a constant of life, punctuated by bouts of joblessness, lack of social protections, sexual and physical abuse, and, without strong unions, “potential for retaliatory termination” for any form of workplace organizing.

Chronic abuse begets chronic maladies: “respiratory illnesses—including silicosis from sand blasting, tuberculosis, ergonomic issues such as back pain, reproductive health issues…and mental health problems including depression and anxiety.” One government survey found that “80 percent of all tuberculosis cases registered in 2009 were from garment workers.” Yet Walmart, which, officially at least, only subcontracts with these factories, can keep its books clean of the enormous public-health debts it has accrued in workers’ bodies.

The “standard” workday reported by Cambodian workers in 14 factories was “10 to 14 hours per day—beyond the set 8-hour workday established under Cambodian law. Workers…reported that they could not leave the factory before overtime hours were completed.”

Despite promises of industrial development surrounding foreign investment in capital-starved countries, regulatory regression has seeped into regions where Walmart sources its brand-name clothing, according to the analysis. In India, critics say recent deregulatory labor reforms promote exploitative labor practices by curbing unions’ ability to organize. Indonesia’s celebrated Special Economic Zones provide for increasingly flexible casualized employment arrangements outside domestic law, cushioned by tax breaks for multinationals.

Cambodian garment workers campaign bravely for livable minimum wages in the face of vicious oppression. In 2014, thousands of workers at a Taiwanese-owned Walmart subcontractor shoe factory were fired “after protesting against poor working conditions, including not being allowed to take breaks to go to the toilet and being forced to work on weekends and public holidays.” A wildcat walkout “met with violent police suppression that left dozens injured.”

There are also reported cases of Walmart subcontractors actively flouting pro-worker reforms. Among Bangladeshi Walmart supply-chain workers, despite recently implemented overtime rules, most interviewees “considered overtime wage rates to be at the discretion of the employer—suggesting widespread irregularity in overtime remuneration paid.”

Walmart has also aggressively resisted the critical fire- and building-safety accord that labor groups and other apparel brands have been working to implement since the devastating Rana Plaza factory collapse three years ago. Instead, Walmart has pushed its own set of watered-down non-binding guidelines as a more business-friendly substitute.

Currently, Walmart, Gap, and H&M all include social-responsibility protocols that are administered largely on a voluntary basis, including voluntary third-party supplier-auditing programs, or Cambodia’s “Better Work” initiative, which aims to establish voluntary, corporate-controlled standards for improving garment-factory working conditions. But labor groups say these measures are toothless, aimed at preempting real regulatory structures, and call out Walmart’s rules as especially weak. Unlike other companies that spell out clearer human-rights guidelines, researchers conclude, Walmart’s corporate code “has no clear initiatives aimed at ensuring living wages, defending freedom of association and publicly disclosing production units to facilitate accountability.”

In an e-mailed statement, Marilee McInnis of Walmart International Corporate Affairs argues that the company’s supplier standards already “[address] working conditions…the cultivation of a safe and healthy work environment, and freedom of association.” The company also says it is “committed to participating in collaborative efforts with external stakeholders to advance the goal of identifying risk and building a more transparent supply chain, including participation in industry groups…that can help improve operations.”

To AFWA and its coalition partners, however, industry groups only improve industry profits. They urge the ILO to establish a multilateral convention to impose independent legal accountability across all global production chains—a kind of international tribunal for multinationals—to regulate global production according to the global public interest.

“There is a reason why the lead firms have constructed the global supply chain,” says Bhattacharjee. “It is to benefit from exploiting resources, both human and natural, to the maximum without any laws to hold them back, so that wherever…the lead firm is, they gather the most profit. So it’s really a logic that we have to challenge.”

The coalition envisions a global compact that would monitor many industries—including not just garment manufacturing but also food processing, services, and other manufacturing—under one regulatory and ethical regime, overseen by “a Global Labour Inspectorate with monitoring and enforcement powers.” While promoting legal sanctions for companies, the framework also explicitly highlights the rights of migrant workers, calling for critical monitoring of the relationship between their social and legal exclusion to precarious working conditions. And through “[p]ublicly accessible transparency and traceability provisions,” civil-society groups, including grassroots labor associations, could traverse borders to bring legal challenges to multinationals based in other countries.

Yet it’s unclear what the public, including workers and consumers, would do with this democratized regulatory framework, whether people power will compel state and industry to submit to transnational jurisdiction. Society’s addiction to cheap goods and services, and the degraded labor they require, has become one of the weakest links in the supply chain—one that only communities on the consumer side of the network can fix.

MICHELLE CHEN TWITTER Michelle Chen is a contributing writer for The Nation.