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How Wal-Mart is Remaking our WorldJim Hightower, Hightower Lowdown Viewed on March 4, 2003 |
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Working for Wal-Mart in China... for Nothing
Summary: Wal-Mart/Qin Shi Factory
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· 14-hour shifts, 7 days a week, 30 days a month.
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· Housed 16 to a room and fed two dismal meals a day. |
There are 1000 workers at the factory; 90% of them young men 16 to 23 years of age; almost all migrants are from rural areas.
Wal-Mart started producing Kathie Lee handbags at the Qin Shi factory in September, 1999. The workers passed us a Qin Shi/Wal-Mart invoice form dated September 2, 1999 which calls for the production of 5,400 Kathie Lee handbags (style #62657 70575) to be delivered no later than October 20, 1999.
Before that Qin Shi produced handbags for Payless carrying the Predictions label. (In 1999, Payless was the eighth largest importer by weight of goods entering the United States. Wal-Mart was, of course, the first. In the latest six-month period availableOctober 1999 to March 2000-a search of U.S. Customs Department shipping records made available in the PIERS database, show that 53 percent of Wal-Marts total imports worldwide come from China.)
The daily work shift at the Qin Shi Factory is 12 to 14 hours, seven days a week, 30 days a month. At the end of the day the workers return home to a cramped dorm room sharing metal bunk beds with 16 other people. At most, workers are allowed outside of the factory for just one and one half hours a day. Otherwise they are locked in.
Working up to 98 hours a week, it is not easy to find the time to go out. But the workers have another fear as well. Before entering the Qin Shi factory, management confiscates the identification documents of each worker. When someone goes outside, the company also takes away their factory I.D. tag, leaving them with no identification at all. If you are stopped by the local security police you could be detained and deported back to your rural province as an illegal migrant.
When you need to use the bathroom the company again confiscates your factory I.D. and monitors the time you spend. If you are away from your workstation for more than eight minutes you will receive a severe fine.
All new employees are illegally charged a deposit of 80 rmb ($9.64 U.S.) for a three year work contract, along with another 32 rmb ($3.86) for the first 10 days living expenses, which includes two dismal meals a day.
Further deductions from the workers wages are made for the temporary residency and work permits the workers need, which the factory management intentionally delays applying for for several months. This also leaves the workers trapped and afraid to leave the factory grounds, since without these legal permits they can be deported at any minute.
Qin Shi management also illegally withholds the workers first months wages, so it is only at the end of the second month that the workers receive, or may receive, their first pay. Because of all of the deductions and fines, many workers earn nothing at all after two months work, and instead, are actually in debt to the company.
Fines for violating any of the strict company rules are severe, a practice made even worse by the fact that armed company security guards can keep 30 percent of any fines they levy against the workers.
The workers making Wal-Mart Kathie Lee handbags report being subjected to body searches, as well as physical and verbal abuse by security guards and quality control supervisors.
The workers are charged 560 rmb ($67.47 U.S.) for dorm and living expenses, which is an enormous amount given that the highest take home wage our researchers found in the factory was just 10 cents an hour. There were others who earned just 36 cents for more than a months work, earning just 8/100th of a cent an hour. Many workers earned nothing at all and owed money to the company.
Seventy percent of the workers said they lacked money for even the most basic expenses, and were forced, for example, to go without even bread and tea for breakfast.
Lacking money and with constraints on their freedom of movement the Qin Shi workers making Kathie Lee handbags were being held in conditions resembling indentured servitude.
In a vicious trap, they did not even have enough money to travel to look for other work.
A Wal-Mart Production order was carried out of the Qin Shi Handbag Factory by the workers. The production order was signed on September 2, 1999 by Yu Lin Chen and Su Chun Wong.
Kathie Lee Handbags |
The Qin Shi Handbag Factory was to produce 5,400 Kathie Lee handbags, style #62557 70575 with a delivery date of October 20, 1999. The invoice notes that Wal-Mart will accept no late deliveries.
Label notes: A portion of the proceeds from the sale of this product will be donated to various childrens charities.
The Qin Shi factory has such a notorious reputation for cruelty and exploitation that the workers admit they are ashamed to tell anyone where they actually work to endure such conditions must mean that you are very, very poor and down on your luck.
Wal-Mart carried out an inspection/audit at Qin Shi in early November 1999 and the factory passed with flying colors. The audit was obviously a farce as will become clear later and one can only conclude that Wal-Mart simply does not know and does not care what its contractors are doing.
Eventually the workers at Qin Shi could stand no more abuse, and fought back. Eight hundred workers were fired in December, but they did at least win some of their back wages.
The regular daily work shift is:
· 7:00 a.m. to 12 noon
· 1:30 to 5:30 p.m.
· 6:30 to 9:30, 10:30 or 11:30 p.m.
The workers are at the Qin Shi factory up to 115½ hours per week, from 7:00 a.m. to 11:30 p.m., or 16 1/2 hours a day, seven days a week. This was the schedule in September, which is their busy season, when they were making the Wal-Mart handbags.
But they were paid for only 14 hours a day, and 98 hours a week.
Working seven days a week and 30 days a month, essentially the workers would receive one day off every other month.
All overtime work is mandatory. The 98-hour workweek at Qin Shi exceeds the legal limit on total overtime by 200 percent. (Chinas labor law states that overtime cannot exceed 36 hours a month, or 9 hours a week over the regular 40-hour, 5-day workweek).
Despite these excessively long hours, the workers receive no overtime premium, earning always the same standard piece rate.
All the workers at Qin Shi are paid according to a piece rate system, which varies given the type of operation required. Piece rates per unit completed ranged from 1/10th of a cent to 4/10ths of a cent, with the average being just a little over 2/10ths of a cent. So, for example, if a worker sewed 100 pieces for the Kathie Lee handbags, he or she would earn 24 cents.
In September and October, when the factory was producing Wal-Mart, the range of the workers wages varied wildly, but no one came even remotely close to making the already below-subsistence legal minimum wage of about 31 cents an hour, on which no one can possibly survive.
The highest take-home wage we found in the factory was just 10 cents an hour, or $1.20 a day -- $44.22 for 37 days of work.
The average wage in a sample of 24 workers amounted to only 3 cents an hour. However, of that sample 46 percent of the workers earned nothing at all after more than a months work, and in fact owed the company money due to all the deductions for company dorm and food expenses, fines and other illegal withholdings.
One worker earned 36 cents for the entire month of August, which would amount to 8 cents a week, or 8/100ths of a cent an hour.
The Kathie Lee handbag the workers make at the Qin Shi Factory retails at Wal-Mart for $8.76, which by American standards is quite cheap. However from the perspective of the average worker in the factory, earning just 3 cents an hour, the Kathie Lee handbag is very expensive indeed. At 3 cents an hour, he would have to work 299 hours to purchase such a handbag for his girlfriend.
Because of the pitiful and illegally low wages at the Qin Shi factory the workers were forced to go without even the most basic necessities. Seventy percent of the workers reported lacking the money for even a tiny breakfast. Kept in the position of indentured servants, the workers had no money or savings even to leave the factory to look for other work.
Average Wage at Qin Shi· 3 cents an hour Highest Wage at Qin Shi· 10 cents an hour
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Legal Minimum Wage in Zhongshan City
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The pay records below were drawn from a sample of 24 workers from the Qin Shi Handbag Factory in Zhongshan, China, where they sew Kathie Lee handbags for Wal-Mart. The workers are paid according to a piece rate. They work 12 to 14 hours a day. The paycheck they received on October 31, 1999 covered the 37-day period from August 20 to September 27. The names of the workers are being withheld to protect their security. Since Qin Shi factory management fines the workers $2.49 for failure to return their pay records, the workers had to take advantage of their one-hour supper break to sneak out and xerox their pay stubs.
19 Workers Surveyed from the Sewing Department
Worker |
Hourly Wage |
Daily Wage (12-14 hr workday) |
No. Days Worked |
Net Pay (after deductions for dorm, food, fines) |
Number of Pieces Sewn each day |
Average piece rate pay per unit |
Total Gross Pay (before deductions) |
A |
9-10 cents |
$1.20 |
37 |
$44.22 |
1,010 |
2/10 of 1 cent |
$60.12 |
B |
8-9 cents |
$1.09 |
34 |
$36.99 |
413 |
4/10 of 1 cent |
$52.89 |
C |
6-7 cents |
$0.86 |
38 |
$32.77 |
1,073 |
1/10 of 1 cent |
$48.67 |
D |
6-7 cents |
$0.86 |
37 |
$31.69 |
760.22 |
2/10 of 1 cent |
$47.59 |
E |
6-7cents |
$0.83 |
37 |
$30.60 |
673.30 |
2/10 of 1 cent |
$46.51 |
F |
6-7 cents |
$0.81 |
37 |
$30 |
622 |
2/10 of 1 cent |
$45.90 |
G |
0.8-0.9cents |
$0.11 |
27 |
$2.89 |
361 |
4/10 of 1 cent |
$40.00 |
H |
4-5 cents |
$0.61 |
35 |
$21.20 |
331 |
3/10 of 1 cent |
$37.11 |
I |
0 cents |
$0.00 |
35 |
(owed $1.81) |
684 |
2/10 of 1 cent ($0.0014759) |
$35.30 |
J |
3-4 cents |
$0.44 |
40 |
$17.71 |
393 |
2/10 of 1 cent |
$33.61 |
K |
3-4 cents |
$0.43 |
37 |
$16.63 |
434 |
2/10 of 1 cent |
$32.41 |
L |
0 cents |
$0.00 |
35 |
(owed $7.11) |
398.4 |
2/10 of 1 cent |
$27.71 |
M |
0 cents |
$0.00 |
32 |
(owed $20.72) |
401 |
2/10 of 1 cent |
$22.53 |
N |
0 cents |
$0.00 |
23 |
(owed $18.92) |
691.83 |
1/10 of 1 cent |
$18.19 |
O |
0 cents |
$0.00 |
31 |
(owed $19.16) |
474 |
1/10 of 1 cent |
$17.95 |
P |
0 cents |
$0.00 |
19 |
(owed $23.61 |
515 |
1/10 of 1 cent |
$13.49 |
Q |
0 cents |
$0.00 |
17 |
(owed $26.39) |
309.5 |
2/10 of 1 cent |
$10.72 |
R |
0 cents |
$0.00 |
9 |
(owed $33.49 |
324 |
1/10 of 1 cent |
$ 3.61 |
S |
0 cents |
$0.00 |
10 |
(owed $34.46) |
186 |
1/10 of 1 cent |
$ 2.65 |
--Five Workers Surveyed from the Gluing Department-- |
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T |
7-9 cents |
$1.03 |
37 |
$38.19 |
740.11 |
2/10 of 1 cent |
$54.10 |
U |
1 cents |
$0.15 |
32 |
$4.91 |
541 |
2/10 of 1 cent |
$42.05 |
V |
5 cents |
$0.65 |
35 |
$22.77 |
480.34 |
2/10 of 1 cent |
$38.67 |
W |
0 cents |
$0.00 |
27 |
(owed $11.20) |
340 |
3/10 of 1 cent |
$25.90 |
X |
0 cents |
$0.00 |
24 |
(owed $20.84) |
446 |
15/100 of 1 cent |
$16.27 |
Note: The monthly payday is on an irregular schedule, varying according to production volume and delivery date. Deductions are withheld from the workers wages for living/dorm expenses, food, job placement fee, temporary residency permit and various fines (e.g.-for not returning ones pay record). The exchange rate is 8.3 rmb to $1.00 U.S.
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Wal-Mart Discloses Factory Locations to Government in ChinaWhy does Wal-Mart refuse to provide this same
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During the busy season, workers will be at the factory up to 14 hours a day, seven days a week, from seven a.m. to 10 p.m. earning just 33 cents an hour |
The National Labor Committee recently purchased a Disney garment in a Wal-Mart Supercenter in Shenzhen in the south of China. A hangtag on the garment identified the specific name and location of the factory in China where the Disney childs sweatshirt was made. The question is: If Wal-Mart and Disney will provide the authoritarian government in China with the names and addresses of the factories in China where they are making their goods, then why do they continue to refuse to release this very same information to the American people? In China, under the Law of Consumers Rights (Chapters 2 and 3), consumers have the right to know the origin of the products they purchase, including supplier information. Of course, like all laws in China, implementation can be weak and spotty. Still, the principle exists and in some cases Wal-Mart and Disney respect the law and make available their suppliers names and locations. |
See: Mulans Sisters/Working for Disney is No Fairy Tale by Hong Kong Christian Industrial Committee and CAFOD Hong Kong, April 1999 |
Why is it that Wal-Mart can trust the Chinese government, but it will not trust the American people? From the hangtag on the Disney garment we learn that it was sewn at the Midway Daily Products Factory, located in Guangzhou, Guangdong Province, China. Not that Wal-Mart or Disney would have much to brag about regarding conditions at the Midway factory. During the busy season, workers will be at the factory up to 14 hours a day, seven days a week, from seven a.m. to 10 p.m. earning just 33 cents an hour. Ten workers share a single dorm room. Any attempt to form an independent union will be crushed. If a worker is absent for three days, he or she is fired. Arriving at work 15 minutes late is punished with a fine amounting to more than a full days wages. During the slow season, when workers are in a 50-hour weekly schedule, they earn $16,68. Overtime is rewarded with an extra 10-cent-an-hour premium. |
Working for Wal-Mart in China: Earning 36 cents a month, 8 cents a week
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Another example of wages at the Qin Shi Factory, where they sew Kathie Lee handbags for Wal-Mart, is outlined below. At Qin Shi, the regular shift is 12 to 14 hours a day, seven days a week, with one day off per month. 1.) Mr. X, Shandong Province: Started working in the trimming section of the factory in March 1999, earning just 65 cents an hour (5.4 rmb) in August and around $6.02 (50 rmb) in September. This would put Mr. Xs average wage for these two months at 77 cents a week8/10ths of a cent per hour. 2.) Mr. Y, Guangxi Province: Started working in the factory on April 30, 1999 and by October 29, after working 5 months and 29 dayshad earned a total of $19.52 (162 rmb). This amounts to 75 cents for a full 91-hour workweek, or 8/10ths of one cent per hour. 3.) Mr. A, Guangxi Province: Started working in the factory May 4, 1999, and after nearly six months of work, on October 30, was paid a total of $42.17 (350 rmb). This would come to $1.62 a week2 cents an hour. 4.) Mr. B, Guizhou Province: Was able to earn just $39.76 (330 rmb) in five months of work, and received his first pay only after completing three months of work. His pay averaged $1.84 a week2 cents an hour. 5.) Mr. C, Henan Province: Started working on July 22, 1999, receiving his August wages on September 30, earning $30.24 (251 rmb). This was the highest wage in the group, coming to $6.98 a week8 cents an hour. However, the following month, he received only partial payment. 6.) Mr. D, Henan Province: Started working on June 18, 1999 and received just 36 cents for the full month of August. This amounts to earnings of 8 cents a week, or 1/10th of a cent (.09 cents) an hour. The following month, Mr. D did much better, earning $14.46 (120 rmb) for September. His 4-cent-an-hour wages, $3.34 for the weekranked him among the top 30 percent of wage earners in his production team of 80 people. 7.) Mr. E, Henan Province: Started working on June 7, 1999, but by the end of October had earned nothing at all, and in fact owed the factory $12.05 (100 rmb). After 19 weeks of work, Mr. E had actually lost money. 8.) Mr. F, Henan Province: Started working on June 14, 1999 and received $24.14 (200.4 rmb) for July, ranking him 10th in earnings among his 100-member production section. For August, Mr. F received $12.05 (100 rmb) which still ranked him in the top 14 percent of his team. For the two months, Mr. Fs average weekly wage was $4.185 cents an hour. |