Index

NEWSLETTER 13, NOVEMBER 2000 Visit to Thailand

In April 2000 a Belgian TV crew made a reportage on labour conditions in the sportswear industry in Thailand to looking into the compliance at the factory level with the Code of Conduct of Nike and adidas. They were accompanied by Nike's management in Thailand to some of the factories where Nike is sourcing. Adidas refused entry to their suppliers. The TV crew conducted interviews among others with the management and workers of several factories. The documentary was aired on Belgian national TV during the European Championship Football. A researcher from the Clean Clothes Campaign went with them.

Nike's footwear is being sourced from 6 countries, 13-15% of which is being sourced from Thailand. Adidas stopped sourcing its footwear from Thailand all together and turned even more to countries like China and Vietnam, countries where reports show labour rights are much violated and trade unions are state controlled. Both companies are sourcing garments from several factories in Thailand. Nike management in Thailand named the political stability of the country, efficiency and quality of production as decisive factors to keep production in Thailand.

The central question during our investigation concerned the implementation of the Code of Conduct of sportswear producers like Nike and adidas. Are they really being implemented as Nike and adidas have consistently assured its customers? Or are labour rights consistently violated inside footwear factories as the Clean Clothes Campaign claims, or is it more like Nike's management in Thailand says, "Nike did not exploit any worker. Mistakes have happened, but no-one of us is perfect."

We also looked at whether workers can live on the wages they earn. According to the management of the factories they can. Nike's management goes even further and says "the wage is set at such a rate that workers can have a really comfortable living. They are quite well paid."

Nice apparel

Nice apparel is one of the three factories of one larger company. Their main expertise is active sportswear for example for football, golf and tennis. They produce for Nike, adidas, Fila, Reebok, Puma, GAP, JC Penney and Kostner. 60% of their export goes to the US, 30% to Europe and 10% to Japan. They have built up the company from scratch and the owners feel still a "close contact with the workers" although they now employ more than 5000 workers.

At the entrance to the factory the Code of Conduct of Nike, adidas and Reebok (in Thai) and Puma (in English) can be found on large billboards. Recently, the Code of Conduct has more and more impact according to the management of the factory. Companies like Nike, adidas and Puma will have people like PwC who come to the factory and control the labour conditions. This monitoring will only grow in the future. "We explain the contents of the Code of Conduct to workers, these are customers requirements."

This sounded interesting and we wanted to ask workers outside of the factory if they knew about the Code of Conduct and how it was implemented. In the beginning no-one dared to answer questions. Finally we talk shortly to one worker who has been with the factory for 7 years and tells us that mostly she works from 8 o'clock in the morning until 9 or 10 o'clock at night. Overtime cannot be refused. She knows of the existence of a Code of Conduct, but when asked, she does not know what it is about.

When we come back later in the evening to film the workers coming out of the factory the security calls management and we are asked to leave the surroundings of the factory. It seems that only management is allowed a close contact with the workers…. It is now 9 o'clock. Often they come out of the factory even later, we are assured by the food vendors outside the factory. A normal legal working week is 48 hours (or 8 hours a day, from Monday to Saturday). But with overtime, it can go up to 84 (i.e. 14 hours a day) according to the Thai law. The codes of conduct suggest that a working week should not exceed 60 hours, but people sometimes work on Sundays, and overnight if necessary. Different sources report that 80% of Thai garment and sportshoes workers do overtime. They are not only forced to do it to provide for themselves, they also say that they are forced to stay at work by the managers, because they can be dismissed if they refuse to.

What made us wonder even more about the implementation of a Code of Conduct in this factory was Nike's management who came with us to the factory and, while waiting for the management of the factory, told us: "Don't ask the workers about trade unions, it is a sensitive issue and will upset the management". The factory manager told us, when asked about trade unions, that these associations have no impact on the company's strategy and he doesn't negotiate with them.

Saha Union

Union footwear is part of Saha Union, one of the two large footwear producing groups in Thailand. According to their annual report Saha Union manufactures over 6 million pairs of shoes per year. In this factory there are 4015 persons working, of which 79% are women. 61% are under 25 years of age. We are shown the whole factory, there is a dormitory on the factory compounds and numerous other facilities such as a canteen and a shop. We see the Nike's Code of Conduct on the wall. We speak with a few women during their lunch break who are all wearing a nameplate with Nike's code written on the back. When asked what their nameplate says, no-one really knows. "Yes, I know what a Code of Conduct is. It means working very hard and make good quality of shoes." "these are regulations we have to follow". One of the women just started 2 months ago at the company and is earning 130 Baht per day. This is beneath the minimum wage, apprenticeship pays less. Several workers have told us, also in other factories, that workers are often rehired as apprentices a second time, for 4 months, although the legal period is only 4 months. The woman we are talking to has to wear an uniform and took out a loan of 2000 Baht to pay for this.

Chakkarat Union Footwear is part of Union footwear and was established a year ago. The factory compounds are built on the grounds of the PDA, a government related NGO. The factory is in a rural area, about 5 or 6 hours on the road from Bangkok. There are 524 workers here, who work on upper part, the most labour intensive part of the shoe. The minimum wage is lower in this part of Thailand, 140 Baht against 162 Baht in Bangkok and companies get incentives for starting production outside of Bangkok. In this factory sportshoes are produced for Nike. It is a model factory, at least looking at it from the outside… But is it? Talking to the workers and their families in the community nearby shows a much harsher reality.

According to the management the workers will make up until 4500 Baht per month, working 6 days a week 8 hours per day. The workers themselves say they only make minimum wage and will only be making more money with the overtime they are doing.

The village nearby the factory has been chosen as the place for a development project by the PDA supported by Nike. The objective is to improve the villagers' living conditions thanks to micro-credits granted to buy some hens, ducks, cattle, as well as all sorts of facilities meant to improve cultivation and education. Nike's financial involvement is splashed across numerous billboards, showing Nike's symbol, the swoosh. Very nice, but how fare the workers in the factory?

A men tells us his daughter works in the factory. She will earn about 140 baht per day. This is less than she would make when working on the field. Without overtime it would be not possible to live on this wage. Another man tells the same story about his 2 nieces. They both work in the factory and will make no more than 140 baht a day, too little to live on he says.

Safe and healthy working conditions are covered in most Codes of Conducts and have been one of the corner stones of Nike's policy. When we walk into the factory the first thing we see is 6 women who are working on the loop at the back end of the shoe, which they burn together, with no protection for their fingers. Their fingers are swollen and scarred. The Nike management nor the management of the factory have noticed this, or are very worried about this when this is pointed out to them. The women execute these delicate operations without gloves or other protection all day long.

Asking the workers about the Code of Conduct they do not know what it is. When asked about some demands in the Code of Conduct they do not know what it means either.

We also went to a subcontractor, where we were not invited by Nike.

This factory is very small, the floors are covered with materials, there is a lot of dust. This factory looks worse than the other factories we've been to. It produces garments for Nike, adidas and Puma. One of the women tells us that if they don't do overtime they get into trouble. "If we really can't do it we're sacked." They work overtime almost every day and nearly always until 8 or 10 o'clock at night. Most workers do not like to work that late, one of the reasons is that they can't find transportation anymore. She tells that trade unions are not allowed in the factory. In the factory there is only control by the subcontracting factory, never by auditing firms or the companies themselves. Also there is no sign of a Code of Conduct in the factory. Part of the production is done by workers on a daily wage, part by workers on piece rate. The quotas are set so high that it is difficult for workers to reach it. Some of the workers earn as little as 80 baht per day. When working from 8 in the morning until 10 o'clock in the evening they manage to make the quota. Even when making the minimum it is hard to make ends meet. The minimum wage has not been increased for the last 3 years, and due to inflation their real wages have decreased.

Most of the workers we talked to were not very informed about their rights at all. None of the workers in the above mentioned factories seem to be aware of the contents of a Code of Conduct. In the above mentioned factories there are no trade unions, nor did it seem that the environment was very open to their establishment. It may come as no surprise that in footwear factories in Thailand there are no trade unions at all and in garment factories they are very scarce. Most of the workers worked long hours, far more than the Codes of Conducts prescribed. Workers will mostly work the overtime without complaining as their normal salaries will not cover basic needs for them and their dependents. But when they want to refuse this it is often not possible.