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National Labor Committee Response to Chi Fung Garment Factory, Producing for Reebok/NFL, Adidas and Soffee

March, 08 2009 Share

Original Report: NFL and Reebok Fumble

Chi Fung is a case example of how the lack of enforcement of the labor rights provisions in the United States-Central America Free Trade Agreement (US-CAFTA) has failed El Salvador’s garment workers –as have the codes of conduct and corporate audits of Reebok, Adidas and Soffee and those of the U.S. apparel industry’s Worldwide Responsible Apparel Production (WRAP) and the Fair Labor Association (FLA).  The Salvadoran Ministry of Labor has also been either unable or unwilling to enforce the country’s labor laws at the Chi Fung factory. Chi Fung also represents the failure of international solidarity, particularly by the National Labor Committee.  We owe it to the workers to be more effective next time.

Here is what the workers told us in late February:

“We have been giving the NLC and other people information, and lots of auditors visit the factory, and nothing changes, the situation never changes.  We receive visits from the Ministry of Labor, from the clients and conditions never change. 

“Now, no one wants problems.  We don’t want to get into trouble, we have our children, we have to pay the house rent, we don’t want to lose our jobs.  So many years of audits and nothing changes.  The same pressure, and the wages don’t change.”


Response to Chi Fung, Reebok and NFL:

1.) NFL Production: 


The workers again confirm that NFL jerseys for Reebok were sewn at the Chi Fung factory at least through the end of June or early July 2009.  It is not accurate for Reebok and the NFL to say that their jerseys were not sewn in the Chi Fung factory in 2009.

The National Labor Committee is aware of Reebok NBA garments made at Chi Fung as early as 2002.  We first encountered Reebok NFL jerseys in July 2004.

We suspected that the NFL jerseys being sewn at Chi Fung were a subcontract from the U.S.-owned Partex Apparel factory in San Juan Opico, El Salvador.  Partex was a certified manufacturer for Reebok.  It appears that Partex was sold to South Korean investors in July 2009, which was about the time the subcontracting of NFL jerseys to Chi Fung ended.

2.) Comité Occupacional:


The “Comité Occupacional” was established by Chi Fung management in July 2001.  Currently there are three members and the organization has not functioned for the last three years.

In 2001, one worker from each production line and from the packing and warehouse departments—18 workers in total—were appointed to the Committee.  The workers explained that, “Our role was more social.  We organized parties.  We held the election of Miss Chi Fung, and organized trips to the beach.”  The Committee never represented the workers in labor or management issues and was completely powerless.

Chi Fung workers never had the right to organize, and nothing changed after US-CAFTA was implemented.

3.) Failure to pay overtime:

Chi Fung stopped paying overtime some time in 2007.  It was only in November 2009 that management began paying overtime correctly.  But this was short-lived.  In the third week in February, 2010, Chi Fung management again stopped paying the legal overtime premium.  As it has done in the past, Chi Fung has reverted to paying a $3.00 incentive in lieu of overtime pay—but only to workers who reach the mandatory goals.

4.) Suggestion boxes: 

The workers refer to these suggestion boxes as part of the “factory decoration,” which no one would ever think of using.

5.) Legal severance pay:


Upon ending their employment with Chi Fung, as in other factories, the workers have the right to receive a form from the Ministry of Labor calculating what their legal severance pay should be.  However, once the worker returns to Chi Fung to pick up her legal severance, the chief of human resources begins bargaining with the worker.  She offers to pay just 50 percent of the legal severance due to workers who were “not good.”  To “good” workers, she offers to pay 60 to 75 percent of the severance payment legally due them.  The workers have little choice but to accept this, since the legal process to fight Chi Fung management would take up to 15 months and the workers are far too poor to wait that long for their money.

6.) Many toilets are still out of order:

Many toilets remain broken and out of order.  Each worker receives one small roll of toilet paper on Monday morning, which must last all week.  There are no soap or towels in the bathrooms.

7.) Excessive factory temperatures:

On February 22, 2010 at 10:20 a.m., the temperature on the factory floor reached 87.8 degrees Fahrenheit.  By 1:55 p.m., the temperature was 96.9 degrees, and by 3:40 p.m. it was 95 degrees.  A combination of high temperatures, heat thrown off by the machines and lack of proper ventilation leaves the workers dripping in sweat, trying to deal with this suffocating temperatures.

The workers also say the drinking water in the factory smells and tastes bad.

8.) Factory cameras to watch the workers:


The workers cannot say for certain that the factory cameras continue to function.  However, it strikes them as odd that management would order maintenance on the cameras two or three times a year if they are not being used.  Moreover, it is not uncommon for the owners, Don Antonio and his wife, to  suddenly shout over the loud speaker, “What is happening on Line __.  Why are so many workers missing?”  From their office above the shop floor, all the lines cannot be seen.  That is another reason the workers feel sure the cameras are still turned on them.

9.) Codes of conduct:

Various codes of conduct are posted on the factory wall, including those of Reebok, Adidas and even Nike and Wal-Mart though the latter two companies no longer produce there.  The codes remain as they always have been, just pieces of paper.  Not a single time have any of the codes been explained to the workers.

10.) Sham audits:

Right up through the Salvadoran Ministry of Labor’s factory inspection in February 2010, management has always threatened the workers that they had better speak well of Chi Fung or they will lose their jobs.

11.) Denial of Freedom of Association:


It is no coincidence that there is not one single union with a collective contract in any of El Salvador’s 107 garment and textile factories.

The International Trade Union Confederation (ITUC) notes that while “El Salvador has ratified both ILO core conventions on forced labor…there are allegations that working conditions in the export processing zones could be assimilated to forced labor, indicating the need for stricter monitoring of working conditions in these zones by public authorities.”