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Major American Brands Silent on Alleged Rights Abuses At Overseas Factories

First Posted: 07/21/11 01:26 PM ET Updated: 09/20/11 06:12 AM ET

Wal Mart

A month after a prominent human rights group accused major American brands of purchasing clothing from a factory in Jordan that systematically abuses workers, the companies have yet to declare any public action.

In June, the Institute for Global Labour and Human Rights released a report alleging that workers producing clothing for Walmart, Target, Macy's, Kohl's and Hanes at a factory in Jordan have been routinely beaten, underpaid and forced to work hours in excess of what the local law allows. The report added that workers have been forced to live in bed bug-infested dormitories that lack heat and hot water, despite the snow and ice that are a feature of local winters.

The report also alleged a pattern of widespread sexual abuse of female employees at the Classic Brands factory complex. The factory employs some 4,800 people, mostly guest workers from South Asia. One manager repeatedly raped female Sri Lankan workers, prompting a strike late last year, according to the report. Workers wanted the manager fired. Instead, the factory's owner sent the manager on a recruiting mission to South Asia as a means of temporarily removing him from the complex. The owner did not publicly discipline the manager or remove the man from his employment, said Charles Kernaghan, the institute’s director, and the lead author of the study.

In an interview with The Huffington Post, Kernaghan criticized the American brands for a lack of action following the release of the institute's report.

“When we first started with this I thought Walmart and Hanes, they are not into human rights," he said. "But we thought they would draw the line in the sand at these rapes. Instead, they’ve been virtually silent."

Hanes did not respond to requests for comment. Macy’s, Target, Kohl's and Walmart issued brief statements this week acknowledging the allegations and expressing concern, while declining to answer questions. All of the companies refused to say whether they are continuing to do business with the Jordan factory, or whether their worksite monitoring efforts need to be bolstered. None of the companies indicated they would request changes in management.

Kernaghan and the institute -- once known as the National Labor Committee -- rose to national prominence in the 1990s when his nonprofit organization revealed that a Walmart clothing line branded by the talk-show host Kathy Lee Gifford was made at factories in Central America that employed child labor. The clothing bore tags that declared a portion of all sales went to children’s charities.

In the late 1990s, the institute helped to expose the fact that Burlington Coat Factory was using cat and dog fur to line the edge of a popular coat manufactured in China and sold at its stores in the United States. Members of Congress were so outraged that by 2000, a bill banning the import or sale of products that include dog and cat fur had become law.

In a 2005 Institute report, the organization found evidence that many garment manufacturers operating in Jordan routinely confiscated their worker’s passports. The group's 2005 report prompted Senate hearings. The American government began financing third-party worksite monitors and gave funding to the Jordanian labor ministry.

The group’s latest findings are the result of a secret six-month fact-finding effort, Kernaghan said.

As American companies have expanded their reach around the globe, riding free trade agreements to tap low-wage countries for goods, Jordan has emerged as a key supplier. In 2001, the United States finalized a free trade agreement with Jordan, lifting tariffs on a range of goods, including apparel. Five years later, exports from Jordan to the United States peaked at $1.2 billion, according to U.S. Department of commerce data. After a dip caused by the global economic downturn, the country's exports rebounded in 2010. Apparel exports alone reached $1.05 billion.

But as trade has burgeoned, so has scrutiny into the conditions confronted by the people making the goods. Guest workers from poor countries employed in the Middle East -- and particularly in Jordan -- have in recent years been at the center of the debate over whether labor has been treated fairly. Non-governmental organizations, as well as the International Labour Organization, the United Nation’s worker advocacy agency, have in recent years investigated working conditions in Jordan.

Many factory workers in Jordan complain they are not paid according to their contracts and are frequently forced to work unpaid overtime, said Elizabeth Frantz, an anthropologist specializing in migrant labor issues at the London School of Economics. Many report being mistreated by private recruitment agencies that bring workers from other countries and allegedly confiscate their passports, making it impossible for them to leave even in the face of violent abuse, Frantz added.

At Classic Brands, many workers -- most of whom are guest laborers from India, Nepal, Bangladesh, Sri Lanka and Egypt -- have borrowed large sums of money to secure a job, according to the institute’s report. Workers who have complained about conditions or management at Classic Brands have been beaten and forcibly deported, the report found.

In a statement emailed to The Huffington Post, Macy’s said:

We take very seriously the allegations made in this matter and have been monitoring the situation closely with our third party supplier. The allegations have and are being investigated by independent organizations, including the Jordanian government, and at this point have been unsubstantiated.

Target indicated in an emailed statement that it has standards that apply in all facilities where its clothing is made.

Target's approach to sourcing products throughout the world is grounded in its heritage of strong business ethics.

As stated in the company's Standards of Vendor Engagement, Target will not knowingly work with any company that does not comply with the company's ethical standards. Target business partners must provide safe and healthy workplaces that comply with local laws.

Target is taking these claims seriously and partnering with Hanes - a supplier that produces product for Target - to ensure that the allegations are investigated promptly and thoroughly.

Kohl's indicated in a statement that it maintains similar vendor standards:

All Kohl’s partners have agreed to abide by Kohl’s long-standing policies on vendor compliance that are embodied in our written Vendor Terms of Engagement. Within these policies, specific requirements are outlined for working conditions, wages and benefits, working hours, nondiscrimination, compliance with laws, and other requirements that are applicable to the production of all merchandise sold by Kohl’s. As a matter of policy, should there be any violations found, we will take immediate and firm action.

And in a statement emailed to The Huffington Post, Walmart said:

At Wal-Mart we remain committed to sourcing merchandise that is produced in a responsible and ethical manner. For that reason we have partnered with the International Labor Organization’s Better Work Program in Jordan. On an ongoing basis, our Ethical Sourcing team meets with Better Work Program representatives and the Jordanian Ministry of Labor representatives, to discuss the Better Work Program and how we can continue to help improve labor conditions in Jordan.

Better Work Jordan is an independent workplace monitoring organization which receives funding from the U.S. government. Better Work also did not respond to a request for comment about its inspections at Classic Brands Wednesday. The organization did issue a pair of statements after the institute's report was released, indicating that it will await the results of a Jordanian investigation.

In March 2010, the Jordanian Cabinet agreed to gradually require all factories to submit to Better Work Jordan assessments.

One year later, Better Work Jordan evaluated 24 of the estimated 80 factories operating Jordan, including Classic Brands. Of these, 63 percent were found to have coerced workers, 29 percent used bonded labor and 88 percent housed workers in conditions that were in some way deficient, according to the report. A detailed assessment of Classic Brands was made but not included in the online document.

Some trade experts characterized the allegations of work abuse at Classic Brands as extraordinary, and not indicative of the conditions where workers produce many of the goods that Americans buy through trade agreements.

“The multinational companies that get involved with these agreements are very worried about the reputational effects of this sort of thing happening,” said Alan Deardorff, an international economist at the University of Michigan’s Ford School for Public Policy. “By in large, workers in developing countries are made better off by outsourcing.”

At the same time, Deardorff said that workers in Jordan are particularly vulnerable to abuses because of limited protections for guest workers employed in the country under the terms of its free trade agreement with the United States.

The worker rights sections of the American free trade agreement with Jordan govern domestic employees, but extend little protection to so-called guest workers, Deardorff said. In the years since the agreement came into force, most of the factories in Jordan have hired guest workers whose visas and work contracts restrict them from seeking jobs at other facilities in the country. That means a worker who is frightened, scared or disgusted by conditions at one factory is unlikely or unable to simply leave.

Jordan's minimum wage laws also do not apply to migrant workers, said Frantz, the anthropologist. Migrant workers and their employers are also not treated as equals under Jordanian law, she added.

"When the law is enforced, it is often in the employer’s favor," said Frantz. "Many migrants assume that approaching the police to lodge a complaint against an employer is futile or could even make the situation worse, as employers are known to level false counter-accusations of theft that may result in migrants being detained."

This week, the US Trade Representative’s Office, which negotiates free trade agreements, said it was aware of the allegations in the institute's latest report and has referred the matter to the State Department's Office of Global Women's Issues. A State Department spokeswoman said the department is in consultations with the Jordanian government over the issue.

The institute says it gathered the facts for its latest report through clandestine meetings with factory workers and testimonials from victimized employees recorded on their cell phones.

In December 2010, workers at the factory handed institute staff a compact disc holding many such worker testimonials, Kernaghan said. Once translated by volunteers, the testimonials told a tale of rampant, assorted and bold abuse on and off the factory grounds, Kernaghan said.

The institute subsequently interviewed some workers. One Sri Lankan guest worker escaped the factory with the help of institute staff and other workers, according to the report. She saw a doctor and told her story to a Jordanian prosecutor.

On June 17, the factory’s general manager, Anil Santha, was arrested in connection with allegations that he raped the woman, Kernaghan said. The incident was reported soon thereafter by the Wall Street Journal.

Santha was subsequently released on bond and returned to the factory twice before Jordanian labor officials temporarily barred him, Kernaghan said. The case against Santha is pending, he added.

Santha and other managers at the factory did not return phone calls.

"Nothing is going to really change until we get a law that keeps goods produced under these conditions out of U.S. consumers' shopping carts,” said Kernaghan. “That's when the companies will start to really care. Right now, we leave it all up to Walmart, which is absurd."

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