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WORK CONDITIONS IN
International Human Resource Management
MANUFACTURING
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The manufacturing industry is one of the most globalized industries in modern business.
According to the International Trade Administration, free trade agreements have proved to be
one of the best ways to open up foreign markets, (International Trade Administration). These
free trade agreements allow countries to trade products with ease. The manufacturing industry
has been able to capitalize on these agreements. Companies around the world began looking for
ways to reduce their overhead, which includes manufacturing costs. Companies, like Apple and
Nike, have found several benefits to making their products in different countries around the
globe.
As of November 2016, Nike has factories in forty-two countries around the globe and
employs approximately 1,068,000 people to work within those factories (Nike, Inc.). Apple uses
several different companies to fulfill manufacturing requirements, however, it has eighteen final
assembly locations within four countries across the globe (Apple, Inc.). Companies are working
globally to produce the best products with the highest possible profit margins. In 1990, [China]
produced less than 3% of global manufacturing output by value; its share now is nearly a quarter.
China produces about 80% of the worlds air-conditioners, 70% of its mobile phones and 60% of
its shoes, (The Economoist). We have seen a rise in companies looking to move their facilities
to the cheapest location. China has seen a significant increase in manufacturing, while the sector
continues to face troubles in the United States. Multinational companies that work with
manufacturers around the globe are often faced with several problems regarding the work
environment and employee safety due to different regulations around the world.
Companies are faced with new challenges regarding employee safety and the overall
conditions within the work environment as the global manufacturing environment continues to
grow. According to the United States Department of Labor, Bureau of Statistics, out of every one
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hundred manufacturing employees three were injured at work during the last year (Occupational
Injuries/Illnesses and Fatal Injuries Profiles). This makes manufacturing one of the most
dangerous industries in the private sector. According to the Occupation and Safety and Health
Administration, manufacturing is the industry with the most employee safety violations (OSHA
concern for companies and human resources departments amongst internationally operating
organizations.
Every country has an individual set of standards set forth by their individual
governments. For example, in China, it is illegal to picket or strike and employees are often
faced with harassment and jail time. Companies often use the various loopholes in legislation to
cut corners and make a higher profit margin. Coca-Cola campaigned against unionized work and
gave raises to non-union members and fired workers that protested an overtime ban in Guatemala
(Burrow). The culture within a society has a large impact on the legislation that is introduced. In
America, we believe that child labor and forced labor should be outlawed. However, other
countries, like Nigeria and Sudan, have extreme rates of child labor (Hunt). Luckily, for
employees, there are several international organizations that take a stand on employee safety and
have helped make changes to regulations around the globe. Companies often utilize third party
manufacturers to manage or run their operations in foreign countries. The increasingly popular
utilization of these other companies has increased over recent years and has led to a number of
companies facing backlash regarding their ethical practices in regards to workers in their
manufacturing facilities.
In early 2000, news was released that several employees at a Coca-Cola had accused the
manufacturing industry was facing severe scrutiny as several union-member employees were
brutally murdered in Colombia (Forero). Union lawyers filed lawsuits against Coca-Cola and its
bottling companies in Colombia. The suit alleged that the bottlers contracted with or otherwise
directed paramilitary secutirty forces that utilized extreme violence and murdered, tortured,
The Colombian union, Sinaltrainal, filed the lawsuit in Miami, Florida and alleged that
the company was allowing unionized manufacturing employees to be targeted by the militant
groups (Brodzinsky). Sinaltrainal also alleged that Coca-Cola was intentionally targeting
members of the union because they were calling for safety improvements within the factory. The
suit also stated that managers at a bottling plant in the town of Carepa in northern Colombia
directed paramilitary fighters to kill two union leaders in 1994. Two years later a member of the
unions executive board was killed at the plant by paramilitary gunmen (Brodzinsky).
The International Labor Organization (ILO) and United Nations (UN) have several
guidelines set forth that address issues with unions and workers rights to being part of a union.
The United Nations Universal Declaration of Human Rights, as established in 1948, states in
Article 23, subsection 4 that everyone has the right to form and to join trade unions for the
protection of his interest (Assembly). The ILO also has a set of standards, International Labor
Standards on Freedom of Association, that require member states to allow employees to join a
union without facing punishment or disparate treatment. Number 87 allows workers and
employers to establish and join organizations of their own choosing without previous
authorization while number 98 states workers shall enjoy adequate protection against acts of
anti-union discrimination, including requirements that a worker not join a union or relinquish
trade union membership for employment, or dismissal of a worker because of union membership
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Colombia is a member state of the United Nations and the ILO which requires they abide by the
regulations set forth by both groups. Coca-Cola responded to the employee incident.
statement addressed several issues that were brought up during the lawsuit and media coverage.
Over the past several decades, Colombia has experienced much internal
conflict, which affects trade union leaders and other people from all walks
of lifeIn a country where violence against union members has deterred
all but 4 percent of workers from unionizing, 31 percent of Coca-
Cola bottler employees belong to unions. Coca-Cola bottlers enjoy
extensive, normal relations with 12 unions in Colombia and currently have
collective bargaining agreements in place covering wages, benefits and
working conditionsThrough both collective bargaining agreements and
their own initiative, Coca-Cola bottlers work with unions and the
government to provide emergency cell phones, transportation to and from
work, secure housing, and a host of other measures to protect employees.
Additional security measures are routinely provided to union leaders and
special measures are undertaken when a threat against unionized
employees is brought to the attention of the bottler's management. We've
also established a 24-hour hotline for employees to confidentially report
any workplace concerns and/or complaints. We share global concerns
regarding the unfavorable labor environment in Colombia. Ed Potter, our
director of global labor relations, serves on the Applications of
Conventions Committee within the International Labor Organization
(ILO) (The Coca-Cola Company).
Coca-Cola felt pressure from constituents across the globe and announced their actions to
help alter the heated climate faced by union employees in Colombia. Coca-Cola showed
responsible corporate citizenship by outlining their previous history in Colombia and how they
have assisted in changing the labor climate. For example, Coca-Cola states that their director of
global relations serves on the Applications of Conventions Committee within the International
Labor Organization, which evaluates implementation of ratified ILO treaties (The Coca-Cola
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Company). The company also noted that they were actively working on finding additional third
Nike is another example of a company that been in hot water from unfair treatment of
employees. In 1991, a report was released stating that Nike was running factories with low
wages and poor working conditions in Indonesia (Nisen). People around the globe began to
protest and started to create a real issue for Nike. Nike reacted by releasing its first supplier Code
of Conduct (Nisen). In 1997, an additional plant was named unsafe for workers in Vietnam.
Ernst & Young wrote that workers at the factory near Ho Chi Minh City were exposed to
carcinogens that exceeded local legal standards by 177 times in parts of the plant and that 77
The report also included information about a Korean subcontractor that Nike utilized to
staff the factory. Employees were forced to work sixty-five hours a week, far more than
Vietnamese law allows, for ten dollars a week (Greenhouse). The report also detailed dangerous
air quality and that employees were working like slaves in horrid conditions. The report painted
a dismal picture of thousands of young women, most under age twenty-five, laboring ten and a
half hours a day, six days a week, in excessive heat and noise and in foul air, for slightly more
than ten dollars per week, (Greenhouse). Nike was also found guilty of not providing employees
with proper safety equipment when they dealt with dangerous chemicals. Nike began to feel
increasing pressure and saw a significant drop in their sales during this time period. A Nike
spokesperson made a statement to the media stating that We [at Nike] believe that we look after
the interests of our workers, and continued to say that the company had developed an action
In 1998, the company began to realize that the way it treated employees was becoming
the definition of the brand. The CEO released a statement saying, in part, The Nike product has
become synonymous with slave wages, forced overtime, and arbitrary abuse, and added, I truly
believe the American consumer doesnt want to buy products made under abusive conditions,
(Nisen). Knight, the CEO at the time, also stated that Nike would begin allowing outsiders from
labor and human rights groups to join the independent auditors who inspect the factories in Asia,
interviewing workers and assessing conditions, (Jr.). Knight went on to list more improvements
in the factories, including raising the minimum age for hiring new workers at shoe factories to
eighteen and the minimum for new workers at other plants to sixteen, (Jr.). Nike also stated they
would be increasing air quality standards and following the same standards set forth by the
United States OSHA. The company also formed the Fair Labor Association, which works to
create acceptable conditions for employees across the globe (Nisen). Although the worst seemed
to be in the past, Nikes issues didnt end in 1998 as it continued to behave unethically.
conditions and unsafe conditions. Employees reported being slapped in the face, called dogs,
and having objects thrown at them (Associated Press). According to a report, Nike was aware of
the poor treatment in Indonesia and claimed there was little it could do to stop it, (Associated
Press). One employee reported that in her Taiwanese factory, six female employees were forced
to stand in the blazing sun after they failed to meet their target, (Associated Press). The
Associated Press also obtained an internal report that stated nearly two-thirds of 168 factories
making converse products worldwide fail to meet Nikes own standards for contract
In 2014, Nike and Adidas began to experience a worker strike in China. Employees
reported that they earn as little as $1.67 an hour making shoes that sell for up to 100 times as
much in the United States, (Jamieson and Baculinao). This strike directly impacts Nike and
Adidas, but is a gauge of the general climate in the Chinese workforce. Employees are becoming
more aware of [their] rights, (Jamieson and Baculinao). The employees are demanding better
pay and more commitment to their safety at work. The companies are currently working with the
plant owner to determine what can be done to improve the environment in the factory. Adidas
reported that the supplier is in discussion with the local government and the trade union
federation to seek ways to address the concerns expressed by the workers, (Jamieson and
Baculinao).
The shoe industry is not the only one to have witnessed severe backlash after allegations
of unfair treatment. Apple, one of the worlds largest technology companies, contacted the Fair
Labor Association, formed by Nike, to perform a workplace audit of its factories in China
following complaints that conditions were unbearable (Guglielmo). Between March and
October 2013, more than half of the workforce on average worked beyond the Chinese legal
limit of 36 overtime hours per month, (Guglielmo). In 2014, Apple came under fire for
exposing employees to extremely dangerous chemicals that could cause cancer, nerve damage,
and paralysis, (Sparkes). After an investigation found that the chemicals were utilized in four
plants, Apple announced that they were able to work with managers to find safer alternative
products, and that Apple will explicitly prohibit the use of benzene and n-hexane in cleaning
agents and degreasers in its final assembly process, (Sparkes). Did the conditions really change?
The FLA conducted onsite inspections over 15 months through July 2013. There were
also follow up visits in late October and early November 2013. Apple and Foxconn created an
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action plan of 360 items that needed to be addressed at the Foxconn facilities, (Guglielmo). The
FLA later reported that 99% of the items on the Apple-Foxconn list had been corrected, however,
the BBC disagrees. Exhausted workers were filmed falling asleep on their 12-hour shifts at the
Pegatron factories on the outskirts of Shanghai, (Bilton). Undercover reporters said they were
forced to work eighteen days in a row and the longest shifts could be almost sixteen hours
(Bilton). Apple released a statement that said, in part, we work with suppliers to address
shortfalls, and we see continuous and significant improvement, but we know our work is never
done, and added that it was common practice for workers to nap during breaks, but it would
investigate any evidence they were falling asleep while working, (Bilton).
Companies are not free to act as they please. The United Nations has created the UN
Global Compact to align strategies and operations with universal principles on human rights,
labor, environment and anti-corruption, and take actions that advance societal goals, (United
Nations) amongst member states and the companies that operate within them. According to the
global compact, it is a voluntary initiative that [stimulates] change and [promotes] corporate
sustainability and [encourages] innovative solutions and partnerships, (United Nations). The
Global Compact has had a positive effect on several companies in the manufacturing industry.
Global Compact. The companys core values of Safety and Health, Environmental Stewardship,
Highest Ethical Behavior, and Respect for People are directly aligned with the values set out in
the Global Compact (DuPont). The Global Compact was endorsed by DuPont in 2001 and
continues to guide the companys actions and beliefs. DuPont believes that creating a
sustainable world cannot be accomplished by any one sector of society. We continue to seek
alliances and partnerships, particularly with organizations that recognize the constellation of
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values important to sustainable growth (DuPont). The Mansour Manufacturing and Distribution
Group (MMD) created a detailed document in 2006 stating how they support and respected the
Global Compact. MMD CEO, Yousesef Mansour stated, one of the major objectives of MMD is
to make the 10 principles of the Global Compact an integral part of the groups culturewe
embrace this initiative, and thank the United Nations for its effort in making this world a better
place, (Mansour). The Global Compact certainly makes an impact on the international business
community, however, it is not the only agency or group aimed at making work better for
employees.
The Fair Labor Association (FLA) is a collaborative effort of universities, civil society
organizations and socially responsible companies dedicated to protecting workers rights around
the world (Fair Labor Association). The FLA has worked with several companies to improve
standards for employees across the globe. Electronic Arts underwent a FLA audit in 2009 that
uncovered that some of the more than 400 workers at a factory were not using earplugs and
eye protection in work areas where they were mandatory and that deductions from pay for
workers savings plans exceeded the legal 30 percent limit (Association, Ensuring Fair
Compensation and Worker Safety in Mexico). After the audit report was released, the FLA
worked with Electronic Arts to ensure that the HR department had modified their payroll
software to detect and prevent deductions greater than 30 percent, and confirmed that a
training course for workers on proper protective equipment was implemented, (Association,
Ensuring Fair Compensation and Worker Safety in Mexico). An audit of an Indonesian factory
producing garments for Liz Claiborne found that employees were not given the opportunity to
appeal terminations and that there was inadequate space in the fusing area which did not
allow workers to have free body movement, (Association). After the audit, the factory installed
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a procedure for employees to appeal termination, and the factory also reorganized its
The United States Occupational Safety and Health Administration (OSHA) is the US
for the health and safety of 130 million workers, employed at more than 8 million worksites
around the nation, (Labor). OSHA has seen a budget increase for the previous three fiscal years
and has performed more inspections than ever before. In 2015 nearly 4,380 employees died on
the job (Labor). OSHA is helping companies follow regulations and continues to improve worker
safety. In four decades, OSHA and our state partners, coupled with the efforts of employers,
safety and health professionals, unions and advocates, have had a dramatic effect on workplace
safety, (Labor). Along with OSHA, companies are also working to improve conditions.
Coca-Cola has taken a strong stand against unethical behavior in the supply chain and has
worked to make changes to their business practices since the event in Colombia. Coca-Cola
states on their website that an essential ingredient in every one of [their] products is [their]
profound commitment to human rights and workplace rights, (The Coca Cola Company). The
company goes into further detail about how they believe in the principles set forth by the United
Nations and the International Labor Organization. The sustainability report includes transparent
information about workplace rights policy cases and issues reported by employees. Apple has
also increased safety for employees and has taken a strong stance on workers rights. According
to Apple, the Supplier Code of Conduct outlines our high standards for creating safer working
conditions, treating workers fairly, and using environmentally responsible practices. Its one of
the strictest in our industry and often requires practices above and beyond local law, (Apple). In
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2017, it is evident that companies are realizing how important employee safety is, however, there
In 2013, a factory in Bangladesh collapsed killing at least 96 people and injuring more
than 1,000 (Engel). Companies had been populating the Bangladesh area in an effort to reduce
production and labor costs. The collapse, although it did not directly affect Nike, showcases that
large parts of the industry still havent changed, (Nisen) and that the manufacturing industry is
still one of the most dangerous around. Employee safety in the manufacturing environment will
continue to be one of the largest factors for the Human Resources department to improve upon.
Manufacturing related activities among global nations are rapidly evolving (Deloitte
Touche Tohmatsu Limited- Deloitte Global). Deloitte released a manufacturing progress report in
late 2016 and found that the manufacturing industry will continue to grow. They announced that
China is still the most competitive manufacturing nation, talent is the most critical factor for
global manufacturing competitiveness, and the five Asia-Pacific nations of Malaysia, India,
Thailand, Indonesia and Vietnam are expected to be included into the top 15 nations on
manufacturing competitiveness over the next five years (Deloitte Touche Tohmatsu Limited-
Deloitte Global). Although manufacturing continues to grow, employee safety is still a major
concern. According to the United States Department of Labor, Bureau of Statistics, out of every
one hundred manufacturing employees three were injured at work during the last year
(Occupational Injuries/Illnesses and Fatal Injuries Profiles). Employers must continue to tackle
safety issues and promote employee health and safety within the manufacturing environment.
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