April 2000, Report from China: Producing for Adidas and Nike

Alice Kwan, of the Hong Kong Christian Industrial Committee (HKCIC) reports on labour conditions in China, in factories producing for Adidas and Nike. Kwan discusses the situation for Chinese garment and footwear workers, the impact of company codes, highlights important aspects of Chinese labor legislation and profiles seven companies producing for Adidas and/or Nike.

by Alice Kwan

Introduction

China is a so-called 'socialist' country which is supposed to protect the working class all the way, but sweatshops are prevalently found in cities all over the country. Since Deng Xiaoping's open-door policy was launched in 1979, thousands of factories have been established (with foreign investments) in the Chinese mainland. In 1999, there were about 20 million workers in these factories. A large number of the products are exported to the US, Europe and all over the world every year. This brings billions of dollars of trade to China and makes the economic and political elites richer and richer. However, workers are always losers in this game and get very little in reward for their effort.

Lives in sweatshops producing for TNCs

It is no longer news to reveal that workers in China producing for TNCs are working in sweatshop conditions. Most of them are young women workers who come from peasant families, and are aged 18-25. In order to improve living conditions in rural areas, most of them are forced to work 14 hours (08:00-12:00; 13:00-18:00; 19:00-00:00) a day, seven days a week in the factories. Until they get the first month's wage in the second month (average wage: RMB 300-700 ) they do not know if their hard work is properly rewarded. Although they work all day long, their wages are not enough for their own livelihoods, let alone sending money home. Besides employers often refuse to join social insurance schemes for workers. Wage arrears are not unusual, and some workers have not been paid wages for six months or more. Overtime work is always underrated. Even worse, most of them are forced to work in dangerous conditions. According to a local newspaper, there are at least 50,000 fingers amputated in industrial accidents in China every year. A few factories ridiculously set the safety standard as losing not more than two fingers a month . In violation of laws, windows in many factories are barred and gates are locked during work time. Neglect of occupational health and safety measures threatens the workers' lives everyday. They have nearly no leisure time at all. Some of them only enjoy one day-off per month - on payday. In some factories, for management and security reasons, factory workers are not allowed to go outside in the lunchtime or evening. To a certain extent, they are imprisoned. Furthermore, unlawful fines and punishment are practiced in many factories, for example talking in production lines, not switching off the lights in dormitories, not queuing up for canteens, and so on. More importantly, independent organizing is totally illegal. In extreme cases, workers are only allowed to go to toilets three times a day for not longer than two minutes each time. To prevent workers stealing materials, body searches are conducted whenever workers step out of the factories. Women workers are even checked manually by male guards. Obviously, labor rights in China are not respected.

Are Codes of Conduct a panacea?

In the wave of consumer campaigns in the North, TNCs cannot escape from the spotlight. They are forced to bear responsibilities for sweatshops in the South. In order to please the consumers, TNCs developed codes of conduct. For some people, the establishment of a code is the final victory. However, such a victory is hollow. Because of the loose monitoring and poor implementation of codes, workers in the South producing for TNCs are still working in very deprived conditions. Most workers in China do not know what a code of conduct is. Even where there is a code, workers are still forced to work extremely long hours and receive very low wages.

Most TNC's codes are very similarly focused on working conditions (i.e. working hours, forced overtime, wages, forced labor, and child labor). Not many mention the right of independent organizing and the right to collective bargaining. Both are fundamental and indispensable labor rights. If workers have these rights and can practice them freely, all complaints about working conditions can be resolved through the collective bargaining mechanism. It is paramount for workers to have the freedom to organize themselves. Codes do not help much! On the contrary, TNCs sometimes shift our attention to the working conditions rather than the organizing rights. Surely, it is relatively easy for TNCs to achieve these guarantees on working conditions. Consumers are also easily satisfied with the tiny improvement of working conditions and welcome the apparent merits of TNCs. But, the organizing rights of workers are then forgotten.

Some TNCs put the rights of organizing and collective bargaining in their Codes. But when their orders come to China, they say, "Well. We would like our suppliers to comply with our Code, and allow workers to have the right to organize. However, labor organizing is very sensitive in China. We cannot violate their laws. We are so sorry." It is just a device to wash their hands of workers' rights and not keep their promises as stipulated in the Code.

Most companies appoint social auditors, labor and human rights NGOs, or church groups to conduct so-called 'independent monitoring'. It is worth investigating how independent and effective such monitoring is, especially for social auditors who make big money in the process. Where does their credibility come from? Are they endorsed by workers? Independent monitoring without worker involvement is not acceptable. How frequent can "independent" outsiders investigate a factory? Nobody realizes the situation better than workers do. They should be involved in the monitoring. It is so important to utilize their investigations and comments.

Worker education should be promoted

Based on our fieldwork in China, we found that most workers do not know about either the Chinese Labor Laws nor companies' codes of conduct. The Chinese Labor Law is highly recommended for providing comprehensive protection of workers' rights. It is more progressive than those of many developed countries. For example, workers should not work longer than 40 hours a week; overtime should not exceed 36 hours a month; workers are legally entitled to social insurance for retirement, illness or injury, industrial injury or occupational illness, unemployment, and maternity benefits. Poor law enforcement is always disastrous for Chinese workers.

In order to empower workers for labor organizing and code monitoring, it is essential to educate them about their basic rights. Unless they are educated about national labor standards, workers cannot practice their rights or express their demands effectively. For sure, workers education is not welcomed by TNCs and their subcontractors. It does not fit in with their game of manipulation. For instance, the Labor Rights in China (LARIC) was invited to take part in the pilot scheme of the UK-based code of conduct called the Ethical Trading Initiative (ETI). The project foundered because the subcontracted factory management rejected worker education. Managers were only willing to open their factory for monitoring, which in fact was merely a visit. The impact of such a visit on working conditions is negligible. Demand for workers' education is a difficult and long struggle but it is the burning issue of the moment in China.

Codes of Conduct -- a charade manipulated by TNCs

It is true that the establishment of codes of conduct was not solely introduced by the TNCs. In the very beginning, TNCs were not always winners and surely did not have overwhelming advantages over the trade unions and NGOs. On the contrary, the latter have kept attacking the TNCs by reporting sweatshops in the South under guarantees of Codes. In the jumble of speed, money, human resources, and media collaboration with TNCs, however, NGOs now find their struggles are harder and harder. TNCs can easily spend millions of dollars to exaggerate their 'good deeds' through different media and pay social auditing companies handsomely to conduct research inside known good factories. On the other hand, NGOs are exhausted tracing the locations of tens of thousands of subcontractors all over the world, made particularly difficult by the TNCs that change their subcontractors at anytime. Without doubt, NGOs are in the adverse situation unless we overcome the manipulation of the TNCs in the game.

What is the breakthrough?

As mentioned before, struggles for labor rights struggles should include workers. They should be empowered to organize themselves and fight for their rights directly with management. Worker education is one of the essential tools. It should be included in the codes and monitoring systems in China as the top priority. Obviously, it is not a single matter related to workers in China but workers all over the world.

In the face of the struggles with giant TNCs, it is urgent to call for international solidarity among the working class, NGOs, and trade unions in the North and the South. It is true that NGOs in the South shifted much attention onto codes in the recent few years. However, codes are not our aims in reality. We have to create our own agenda and no longer follow the existing game manipulated by the TNCs. TNCs can shift their production from one city to another and one country to another. Victory can only be achieved by promoting international solidarity across the borders. For example, workers in different countries should be informed about the consumer campaigns in the North and the labor movements in other countries in the South. They should have a legal right to organize themselves. Moreover, trade unions and NGOs in the North and South should be linked closely in order to facilitate information exchange, networking, and solidarity movements for workers' rights. Certainly, the consumer campaigns in the North in the past years exerted pressure on the TNCs for the improvement of sweatshop conditions in the South. However, pressure from outside is not enough for the struggles. Workers must also organize themselves to stand up and fight for their rights in the workplace. With the powerful consumer campaigns, worker education and worker involvement in monitoring the codes should be added to our demands.

The ultimate elimination of sweatshops in the world can surely be sped up by empowering workers to organize.

According to Chinese Labor Law:

1. Working hours in China are 40 hours per week (supposed 8 hr/ day and 5 days/ wk)
2. Working days are Monday through Friday When working on Saturday and Sunday the workers have to be paid overtime rates. In reality however, most of the management will tell the workers that they will only be paid the rate for overtime when they work in the evening. This means that when the workers work from 8 am until 9 pm on a Saturday they will get overtime rate pay from 6 pm until 9 pm. However, this is against the law.
3. Overtime should not exceed 36 hours per month. But most factories fail to comply with the law. Workers are forced to work overtime. When they refuse to work overtime, they will be fined and warned. The rate that has to be paid for overtime is 150% of the normal wage on a weekday evening, 200% on the weekends, and 300% on a public holiday. However, most workers are not fully compensated according to the law. Some of them mentioned: "the management tells us that we are piece rate workers and no overtime bonus should be paid."
4. The minimum wage varies in different cities and provinces. Generally, from RMB 300-450 (1USD= 8.2 RMB). It is important to note that this is the wage for the normal working hours. Hence, when we look at the wages the workers actually get for 14 hours a day and 7 days a week; with about 700-800 RMB a month, the workers are underpaid.

Noted during the research:

• Although most of the factories withhold between 20 days and one and a half months wages from workers as a deposit to reduce the turnover rate, this is illegal.
• From the factory profiles it becomes clear that penalty systems (fines) are used, a lot of unreasonable fines can be found in our notes.
• The employer has to sign a labor contract with the workers and give them a copy. In fact, copies were not provided to the workers.
• Almost none of the factories provide social security cover, such as pensions, or coverage for illness or injury; industrial injury or occupational illness; unemployment; or maternity leave. They are indifferent about the law and the safety of the workers. Once workers are injured or sometimes even die in industrial accidents, it proves to be very difficult to get the compensation.
• Some workers complained that the quality of the food and the dormitories offered by the factories is very poor. Some of the workers cannot find alternatives and live outside the factories however, because of their limited wages.
• Most workers do not know about codes of conduct. Regarding independent monitoring, workers mentioned that there were many outsiders/foreigners visiting the workplace but no one was talking to the workers themselves.
• There is no independent trade union in China. All the trade unions have to be affiliated to the official trade union, the All China Federation of Trade Unions (ACFTU), which is controlled by the ruling party. Most of the profiled factories are privately owned. Most have no trade union in the plant. If any union is present, most workers do not know about it or claim that the trade union functions as a social welfare department, organizing events like singing contests and picnics.
• Although some of these factories have many nice facilities (for example, a basketball court, karaoke room, or library), workers claim that they have no time to utilize them due to the long working hours.
• Most of the workers employed in these factories are young migrant women. This is due to gender roles in Chinese families and because employers think female employees are more submissive and easier to control (for example, they believe that women can be more easily forced to work overtime and are unlikely to protest against the management. Most of the dormitories offered by the factories are located next to the factories, making it difficult for workers to refuse overtime.)

Factory Profiles

• Contract: Some workers claimed that they signed a contract with the management but they were given no copy. And some workers said no contract was signed.
• Wages: Workers in the sewing and thread-checking sections are paid on a piece-rate. Sewers earn about RMB 500-800 a month. During the slow season, they can only get RMB200-300 a month. For some experienced workers, they can earn as high as RMB1000 a month. A worker in the ironing section mentioned that she earns RMB 400-500. The difference of wage varies on difference tasks, sections, and workers. In the peak season, however, they will be fined if they cannot produce as effective as RMB 320 a month. In the past, RMB 1/ hour extra was added over the piece rate within the overtime period. However, it was changed in April and since then workers get less. Under the new system, they will be paid RMB 2 as overtime bonus only if they work till 10:00pm. Overtime bonus is cut half. Working on Sunday will not be counted as overtime. Overtime bonus will be paid only for overtime work in the evening. Workers receive a pay slip. For those working in the QC section, they will get a fixed monthly wage. It is about RMB 1000, which is higher than the ordinary workers'.
• Wage combination: Piece rate and overtime bonus and attendance bonus. Attendance bonus is RMB 20/ month which is for those workers having full attendance and good behavior. 1% of the total wage (RMB7 will be deducted if she gets RMB700; RMB 4 is at minimum even she does not work in that month) will be deducted but the workers have no idea what the deduction is for. Besides, there is an annual bonus for those who has worked for at least one year. It is about RMB 120/ year. One month's wages are always withheld by the management (like a deposit) because they want to keep the workers and reduce the turnover rate. If workers want to quit, they have to apply and wait for permission. Mostly, they would prefer to give up the "deposit". It is illegal to withhold their wage.
  For example: Workers worked in total 10 days in February 2000 (due to the Chinese New Year holiday), hence they got about RMB200 in that month. They could earn RMB 1000-1200 in August and December 1999 respectively (peak season).
• Working hours: 07:45-12:00; 13:30-17:30. They are forced to work overtime (18:00-2100 or 23:00) especially during peak season. They have to apply beforehand if they don't want to work overtime. It is difficult for them to get this exemption though, unless they can give a sound reason. It depends on whether it is peak season as well.
• Working days: in general, one day off a week. However, they have to work seven days a week in the peak season.
• Food: There is a canteen in the factory where the workers pay RMB1 per meal. 2 meals/ day. Total RMB 60/ month is deducted as food fee. Workers complain that the food offered is very bad. For those living outside, they prefer to cook themselves although they have very limited time to do so.
• Dormitory: Dormitory housing is provided by the factory. Workers pay RMB18/month. Although it is cheap, this reflects the poor quality of the dormitory. 12 persons share a 24sqm room with bunk beds. There is a public toilet on each floor. Hot water supply is only provided on the ground floor. Most workers prefer to live outside (especially for those married). It costs RMB 70- 200. Fee for water and electricity is about RMB 60 a month. Although they are living outside, they have to pay RMB 4/ month (RMB 2 for 2 rolls of tissue paper and RMB 2 for water supply) to the factory.
• Fee: Newcomers have to pass an examination in the factory before they can get a contract. They used to pay RMB 200 as a deposit. However, no more deposits have to be paid and those charged in the past have been refunded (since August 1, 1999). According to workers, their wages were very low in the low season last year. Some QC workers demanded that factory refund the deposit to solve their financial difficulty. Although no deposit needs to be paid, newcomers have to pay several fees before working in the factory. (1) RMB 50 for the factory uniform; (2) RMB 50 for tool fee; (3) RMB 10 for factory identity card; (4) RMB 2 for a pair of slippers; (5) RMB 96 annually for the temporary residence pass. Only the tool fee will be refunded when they resign or are fired.
• Social security: According to the workers, the management did not provide any social security to them. No medical insurance. There is a small clinic in the factory. Workers have to pay about RMB 10 for each consultation. They complained however that it was useless to consult the doctor there.
• Fines: According to workers, they were given a factory regulation handbook, which is mainly about the penalty system, when they started working in the factory. The factory identity card costs RMB10. If a worker loses it, she will be fined RMB10. RMB 2 will be charged for any card renewal.
• Leisure: table tennis, basketball, videos and T.V.
• Other issues of discontent:
  Some workers complained that they are paid on a piece rate. They get very low wages during the slow season which are not sufficient to live off of. There were not many orders in the factory in May. Workers sometimes needed not to work, however, they are not allowed to apply for holiday. It is because the management fear that they will leave and work in another factory.
  Most workers expressed their discontent with long working hours, low wages, and the reduction of the overtime bonus.
  Pay day is fixed. If the worker resigns or is fired on another day then pay day, they cannot be paid until the next pay day. Workers complain that it is very inconvenient for them because they may leave the town or enter another factory then.
  Resign: If the worker wants to quit, she should apply for it with a one-month notice. If she work less than 1 month, it is not allowed to take back her wage. For any fired workers, they cannot get back the one-month wage withheld by the management and that month's wage.
  

• Wages: About RMB500-600 / month; overtime bonus RMB2/ hour; attendance bonus RMB50/ month; annual bonus is delivered at the end of the year. It seems to be RMB 18/ month. For example: a worker will get RMB180 if she has worked for more then 10 months in that year. Most workers are paid on piece rate. Wage is always released on time (20th of every month). Workers receive a pay slip. Twenty days wages are always withheld (as a deposit) by the management in order to reduce turnover.
• Working hours: 07:00-17:00. Overtime till 20:30 on weekdays. 5.5 working days/ week.
  They work a half day on Saturdays and are off on Sundays.
• Food: Three meals are offered by the management and for this about RMB100 is deducted monthly.
• Dormitory: 12 workers share a room with basic facilities
• Fine system: for a warning RMB10, a small demerit RMB30, large demerit RMB 90
• Social security: Workers did not know whether they are provided with any social security scheme.
• Medical fee: There is a clinic in the factory. No matter if you use it or not, RMB15 is deducted monthly as medical fee.
• Occupational health and safety: Not many industrial accidents. Workers have no idea about the compensation. They heard that RMB 20,000 is the compensation for death in an industrial accident and several thousand RMB for fingers cut.
• Fire-prevention facility: Very good. Rehearsal every year.
• Leisure activities: Table tennis, dancing room, video show, and library
• Trade union: Workers claim that there is no trade union in the campus
• Strike: Workers claimed that a small-scale strike was organized last July and August. The supervisor, who mobilized the strike, was demoted to worker and all the workers involved were fired.
• Code of conduct: Workers have no idea about the Adidas Code. They never hear anything about it.
  There are many visitors (workers don't know whether they are buyers or monitors) touring around at the workplace. Mostly, these visitors talk to the management rather than the ordinary workers.
• Others: A large number of orders. There are eight production lines in a workplace. 50,000 pairs can be produced in each production line.

Workers claimed that they attended a class about the occupational health & safety and ISO 9000 training course.

Factory Profile

• Wages: About RMB500-600 / month; attendance bonus RMB50/ month; Annual bonus depends on the number of working year. Generally, RMB30 for those who have worked for 1 year. If a worker has worked for 3 years, she gets RMB90 (According to some workers, however, this bonus has already been abolished.) Overtime bonus: RMB2.4/hour. Wage is always paid on time. Workers are given a pay slip. Working hours: 07:00-17:00 (8hr/ day). Generally, no more than 60 hours overtime per month.
• Working hours: 6 days/week. Off on Sundays.
• Food: 3 meals are offered by the management. 4 dishes and 1 soup for each meal. About RMB150-200 is deducted monthly for food and accommodation.
• Dormitory: 12 workers share a room with basic facility
• Fine system: Yes, workers mentioned that it is not very harsh. Interviewed workers heard that wage of any fired workers would be confiscated.
• Social security: Workers thought that there was social security provided for them but did not know whether they got any social security scheme.
• Medical fee: There is a clinic in the factory. If you use it or not, RMB15 is deducted monthly as medical fee.
• Fire prevention facility: Very good.
• Leisure activities: Table tennis, library, etc.
• Trade union: Workers claim that there is no trade union in the campus (campus meaning the entire Yue Yuen industry area which is composed of several factories (ex. factory 1 producing for Nike, factory 2 producing for Adidas, etc.)
• Ventilation/ Odor: There is some ventilation equipment but the odor is awful.
• Codes of conduct: Workers have no idea about the codes. They never hear anything about them.
  There are many foreign visitors (workers don't know whether they are buyers or monitors) touring around at the workplace every week. Mostly, these visitors never talk to the ordinary workers.
• Orders: 200,000-300,000 in low season; 500,000-600,000 in peak season

Nike workers claimed that there are some training classes in the campus (e.g. English, computer, occupational health & safety and ISO 9000)

Factory Profile

note: Nike openly admitted that this is their supplier, which produces for colleges in the US, and disclosed its location. In May, Nike stated on its website that they are very proud of this supplier.

• Wages: Most of workers are paid on piece-rate, except for the management and warehouse workers, who are hourly paid. Generally, workers earn RMB 700-900 a month. Regarding the overtime bonus, the workers paid hourly are paid 150% for the overtime hours while the others are given certain allowances. The attendance bonus is about RMB 50 a month. Annual bonus for an ordinary worker is about RMB 50. No delay in payment. A clear pay record is given to each worker. In past years, RMB 50 was deducted monthly as a deposit during the first six months. This stopped in 1999. They have to pay RMB 70 annually for the Temporary Residence Pass
• Working Hours: Workers work eight hours a day. Occasionally, they are requested to work overtime especially in the peak season. They can refuse to work overtime if a sound reason is given. They work Monday through Friday.
• Food: RMB 135 are the monthly costs for three meals in the factory. Free dormitory was offered for the workers, eight of them share a room.
• Fines: There is a penalty system. Varying on the severity; fines will given from RMB 30, 90, and 170. Some workers complained that the regulations are too strict. For example, the light in the dormitory has to be switched off at 23:00 and smoking is not allowed.
  Workers said that only those in some particular sections are entitled to insurance.
• Medical: Regarding the medical service, RMB 20 is deducted monthly and for this workers can consult the doctor in the campus free of charge.
• Leisure: There is a library, skating court, and basket court on the campus. TVs are available in the canteens.

Posted on 14 March 2000 (note discrimination)

Note: Nike openly admitted that this is their supplier, which produces for colleges in the US, and disclosed its location

• Wages: Most workers are paid on a piece rate. The monthly wage is about RMB 500-600 (overtime bonus is included). Attendance bonus is RMB 50 a month. Also, annual bonus for the ordinary workers is RMB 50. In order to reduce the turnover rate, a half-months wages are withheld by the management always. Some workers are lucky enough to get a refund when they apply to resign but most of them cannot. The overtime bonus is RMB 3 per hour.
• Working hours: Normal working hours are from 08:00-11:30 and 13:30-17:00. Recently, overtime work has been greatly reduced from 130 hours a month to 50-90 hours per month. Generally, they have four hours overtime work on Saturday. RMB 5 is paid hourly. The total number of overtime hours is limited to 90 a month. It is not compulsory to work overtime. But, workers are it is compulsory to do so in the peak season. They work 6 days a week.
• Medical: RMB 20 medical fee is deducted monthly.
• Fines: There is a penalty system. Littering fines RMB 2-5.

Date of fieldwork: 10-11 March, 2000
Address: Mu Lun Industrial Area, Chang Ping Dongguan

• Factory started to operate in approximately1996
• Capital: Hong Kong investment. Even the senior management is mostly from Hong Kong
• Product: Sportswear
• Brand: Adidas
• Export: to US, Hong Kong, and Macau
• Number of workers: about 1000. Number of Female workers is more than male workers
• Average worker age: around 18 -28
• Origins of workers: Jiangxi, Hunan, Sichuan, Guizhou
• Contract: No labor contracts signed.
• Wages: Piece rate. RMB 300- 1500
• Working hours: 8:00-13:00; 14:00-18:00 (9 hours) 7 days a week. Have a day off after (monthly) payday.
• Overtime: Most of them are paid on a piece rate. Within the overtime period, one of them mentioned she got RMB 0.3/hour over the piece rate while the other claimed RMB 1.5/hour. Frequent overtime. They work overtime (from 18:00-00:00) nearly everyday, even till 01:00 in the peak season. Compulsory overtime. Because of huge orders always given to the factory, workers have only one day off a month. Generally, it is the day after the payday. Wage is released on time but one and half month wages is always withheld (as a deposit) by the management. If workers do not want to work overtime, they have to apply to the management beforehand but it would normally not be approved. If workers refuse to work overtime without permission, they will be fined RMB50. If it lasts for several days, they will be fired.
• Bonus: No attendance bonus nor other bonuses.
• Food: 4 meals available daily -- breakfast, lunch, dinner, snack during the night (provided that workers work overnight). Food costs RMB 55 a month.
• Dormitory: Free dormitory is provided. A private toilet in each room. Workers have to get hot water on the ground floor. They can choose to rent a room outside if they want.
• Charges: handling fee RMB 20 is charged for any newcomer.
• Fine system: Refusing to work overtime will be fined RMB 50.
• Social security: workers claimed that they were not engaged with any social security scheme.
• Factory regulation: Workers are not allowed to go out during working time. They are not allowed to have any visitors from outside in their dormitory. They have to wear slippers at the workplace.
• Leisure activities: Workers mentioned, "Other than normal working hours, we work overtime. We work all day long and have no time for leisure."
• Trade union: workers claim that there is no trade union in the campus.

One worker interviewed said that she was exhausted, however, she had no alternative. She would like to keep her job and had to stay then. Besides, most of them shared, "We get used to this working style -- endless overtime. We have no alternative and it is the life for every migrant worker."

There are three factory blocks located respectively in the Keng Tau Industrial Zone in Panyu. All of them are named Keng Tau Hangbag factory. According to the logo outside the factories, all of them are under a Taiwanese company named Glorieux Industrial Ltd. (A member of Starite International Ltd.).

• Number of workers : There are 2 factory blocks located in the village which was established in 1988. One of them has just been renovated recently and none of the workers are working there. About 300-400 workers are working in the other factory block (old factory). Over 700-800 workers in the third factory block (new factory) which was established 2 years ago. Obviously, the new factory was designed as a modern industrial campus which makes a remarkable comparison with the old factory. Unlike the other similar factories, the ratio of women workers is not overwhelming. For example, a number of male workers work in the sewing section.
• Brands: According to the workers, they produce the bags (especially the back packs) regularly for Adidas, Jansports, and Nike.
• Exports: Almost all of the bags are exported to the US, UK, Germany, Austrailia, Japan, and other places.
• Average worker age: Generally, workers are aged 18-30. However, a 15-year-old male worker working in the old factory was identified and he was recruited 2 days ago. According to the Chinese Labor Law, it is illegal to employ person under 16 and workers aged 16-17 should be protected from overtime or dangerous work.
• Origins of workers: Most of them came from Hunan, Hubei, Hebei, and Sichuan.
• Wages: Wages of sewing workers are paid in piece-rate but it varies in the factories. The sewing workers in the new factory earn RMB 700-1000 a month while those in the old factory get only RMB 300-500. For workers in the Quality Checking and packaging sections, they are hourly paid and earn about RMB 500-600. Workers mentioned that no overtime bonus was given. Within the overtime period, their wages will be counted as in the normal working hours. Extra RMB 40 will be gifted as Attendance bonus if they do not get late or absent to work in a month. Otherwise, the bonus will not be granted and also their wages will be deducted. When workers entered the factory, they are asked to pay RMB 60 as a deposit. Moreover, one month's wages are always withheld by management in order to reduce the turnover rate. This violates Chinese Labor Law.
• Hours: According to the workers, the normal working hour is 08:00-12:00 and 13:30-18:00 (8.5 hours). Starting from 19:00, workers mostly in the new factory are forced to work till 22:00 while those in the old factory work till 00:00 and even 03:00 in the peak season. The compulsory prolonged working hours surely violated the Chinese Labor Law. It stipulates that workers shall work no more than eight hours a day and no more than 40 hours a week. Even in exceptional circumstances, working hours may be prolonged by 3 hours maximum per day provided that the health of workers is guaranteed; but overtime shall not exceed 36 hours a month.
• Working days: Workers said that they generally had only one day off per month. They have to work all day long from Monday to Sunday. Some Saturday evenings, they do not need to work overtime.

Many workers interviewed complained about the long working hours and low wages. Hence, the turnover rate in the old factory is especially high. An 18-year-old woman worker in the packaging section in the old factory has just resigned because she could not stand for the endless overtime work and low wage. She mentioned that she got only RMB 300 a month even in the peak season when she worked from 08:00 till 03:00.

• Food: RMB 78 is deducted monthly as the food fee where two meals are provided in the factory. Workers have to manage their breakfast on their own. Because of the bad quality of the meals and long queuing time, some workers prefer to have their lunch outside the factories even though it is more expensive.
• Housing: Regarding accommodation, 16 workers live in a room. RMB 20 is deducted monthly. However, the living conditions in the dormitory in the old factory are much worse than that in the new factory. It is a five-floor building but the shower rooms and hot water supply are only provided in the ground floor.
• Fines: If worker is late or absent from work, a worker claimed that the factory identity card would be confiscated by the security guard and the names will be recorded then. The name of worker will be announced through the broadcast system and a warning letter with her/his name will then be posted in the campus. A worker mentioned that she was fined RMB 9 and attendance bonus and given a warning letter because she was too tired to work overtime in the evening. She complained that it was unreasonable.
  
  According to the experienced workers, the clients (e.g. Nike/ Jansport representatives) will be brought to visit the new factory since the working condition over there is better. In fact, both of them produce similar goods. Worse still, workers are told not to punch their attendance cards in the evening or on Sunday in order to convince their clients that no overtime was worked. Since then, the number of their overtime working hour is always under-recorded. Furthermore, the management will produce 2 sets of pay records. A set is prepared for the workers while the other is forged to cheat the clients. Generally, wages vary from RMB 200-RMB 1000 and the average wage is about RMB 500-600. However, management tried to convince the clients that workers are paid reasonably and indicated the average wage was about RMB 1500-1700 in the forged document.

Follow up study on 15/05/00:

This follow up study is focused on the new factory. Workers claimed that they were producing for Adidas and Jansports.

According to the workers, there several Adidas representatives visited the factory on 13 May. After that, the management announced that workers should work only 5.5 days a week (off on Saturday afternoon and Sunday) since 14 May.

Workers have to attend weekly assemblies. During the assemblies, workers are warned not to talk to outsiders about their wages. Also, they were informed that they are in the social security system and therefore RMB 10 would be deducted monthly. However, they do not know the details (for example, what kind of insurance are they entitled to? How can they get money back?).

It is suspected that the management tried to clean up the new factory so that it could be a model factory and invited the company representatives and monitors to visit there. When the researchers visited the old factory which is located in the same industrial zone, it found that the name of the factory had been changed to Kengtau Toy and Garment factory. According to the workers, it was changed two days before. However, it still produced Adidas sports bags. A worker mentioned that she worked seven days a week (workers can only be exempted from working overtime on Saturdays), from 08:00-22:00 (until 24:00 in the peak season). Her average wage was approximately RMB 500-600. She mentioned that both the new and the old factories are owned by the same employer. Therefore, it is reasonable to doubt the owners good intentions.

Alice Kwan is a researcher (China project/garment and footwear industry) with the Hong Kong Christian Industrial Committee. To contact the HKCIC: 704-5, 57 Peking Road, Kowloon, Hong Kong
Tel: (852) 2366 5860; Fax: (852) 2724 5098; E-mail: hkcic@hknet.com