The GAP in El Salvador Update: The Case of Mandarin International

June, 28 1995 Share


June 28, 1995

The Repression at Mandarin Increases While the Salvadoran Government Does Nothing

Production Continues for the GAP and other U.S. Companies

In a desperate last effort, on Monday, June 26, the union workers struck Mandarin, shutting down the plant. At this moment, the workers plan to extend the strike to the entire San Marcos Free Trade Zone. The maquiladora workers, largely young women, fear that there will be a violent retaliation by armed guards hired by the zone owner, the former Salvadoran Army Colonel Mario Guerrero.


Since February 7, when the Mandarin workers notified the company that a legal union had been constituted at the plant—with the full authority and backing, at least on paper, of the Salvadoran Minister of Labor—Mandarin has set out, systematically and openly, to destroy the union.

More than 200 unionists have been illegally fired. The first union ever legally recognized in a free trade zone in El Salvador, where there are now more than 50,000 maquiladora workers, is all but broken.

Article 13 of the Salvadoran labor code prohibits the firing of pregnant women, yet Mandarin has fired more than two dozen pregnant workers.

Similarly, Article 25 of the Labor Code makes it illegal for a company to fire union employees in an attempt to break the union. For each of these illegal firings Mandarin could be fined up to 50,000 colones, or $5,793. At this point, for the more than 200 union workers illegally fired, including the pregnant women, the Salvadoran government could have fined the Mandarin company $1.2 million. Perhaps Mandarin would take the law more seriously if they had to pay for violating it. But the Salvadoran government and the Minister of Labor have done nothing. Mandarin has not been fined a single penny.

Since the beginning of June, even the pretense of negotiations has collapsed. Mandarin has continually blocked all attempts at compromise and has now simply stopped participating in meetings with representatives of the workers and the government.

Meanwhile, Mandarin, a Taiwanese-owned maquiladora operating out of the San Marcos Free Trade Zone, continues to produce clothing for the GAPJ.C. PenneyEddie Bauer and Dayton-Hudson.

Not only have the firings continued, with several workers a day being dismissed, but so have the threats.

On May 31, union activist Marcos Palacios was followed after he left work. He was taken off a bus in downtown San Salvador, pushed up against a wall and a knife was placed at his throat. His assailants warned him, "Quit the union or you'll face serious negative repercussions."

On May 17, broadcast over the plant's loudspeaker system, Mandarin attorney Evelyn Roque (who has overseen the mass firings and has threatened workers to join the company-controlled Solidarista Association) told the workers that the difference between them and the company should be settled peacefully, legally and without recourse to threats or violence. Then she said, "Let's leave that work [the threats and violence] to the Sombra Negra," or, the Dark Shadow death squad. The workers interpreted this as a veiled threat.

Mandarin is not hiding its strategy. On June 9, in what he thought was a meeting of non-union employees, Mandarin's General Manager, Mr. Liu, explained that the company plans to continue with the firing of the unionists, intends to soon close down for two months and then to reopen without the union. In fact, Mandarin has been shifting production from its Mandarin plant to another factory it owns in the San Marcos zone, its F & D plant. Mandarin has shifted some of its J.C. Penney work (the "Arizona Jean Company" operation, Penney's most popular private label) to F & D. Mandarin's chief of personnel, ex colonel Amaya, has told the women that Mandarin also owns another plant called Parrot located in Ilopango near the Air Force base, to which production is also being shifted. At the Parrot plant, Colonel Amaya explained, "the soldiers will help us keep the union out."

Exploitation at Mandarin also continues in full swing. In the month of May, it was common for Mandarin to run on daily twelve-hour shifts, 7:00 a.m. to 7:00 p.m. However, at least one day a week the workers came in at 7:00 a.m. and worked until 5:00 p.m., when they were let out of the plant for two hours. At 7:00 p.m. they were told to report back to work. From 7:00 p.m. they worked straight through to 3:00 a.m., at which time the young women were finally let out and told to be back at work again four hours later at 7:00 a.m. There is not public transportation at 3:00 a.m.; it is pitch dark and dangerous at that hour.

During their 18-hour workdays, one production line in the plant was sewing Eddie Bauer short sleeved, pocketed t-shirts. At least four minors, two of them 15-year-olds, were forced to stay and work.

This is another violation at Mandarin that they Salvadoran government is ignoring. Under Salvadoran law a minor may not work more than six hours a day, 34 hours a week, and is strictly prohibited from working overtime or at night. But, as we have seen all along, Mandarin makes its own rules.

Eighty-two women at Mandarin must sew 2,000 t-shirts a day. That is their production quota. Eddie Bauer sells the t-shirts for $12.00 each in the U.S., so the 82 women produce $24,000-worth of t-shirts a day ($12 x 2,000). Getting paid $4.50 each day, the 82 workers collectively earn $369, meaning that their wages amount to one-and-a-half percent of the sales price of the shirts in the U.S. In effect, each worker produces 24 shirts a day, earning 19 cents per shirt. What happens to the other 98.5 percent --$11.81—of what we pay when we purchase an Eddie Bauer t-shirt?

[It should be noted that the Eddie Bauer tag on the shirts shows some wild ducks and reads: "Every item we sell will give you complete satisfaction or you my return it for a full refund." The tag was printed in Hong Kong.]

Recently, a GAP spokesperson told a journalist that the GAP's senior Vice President of Sourcing had visited the Mandarin plant in early May and determined that Mandarin met GAP's high corporate standards of ethical behavior. According to the GAP, it has a corporate code of conduct which its contractors must agree to. This incident shows that a company's code of conduct often fails, because company representatives neglect to talk with the workers or consult with local independent human rights, religious or research groups. In this case, had the GAP senior vice president cared to, he could have spoken with the authors of a recent International Labor Organization (ILO) report, which documents that there are no labor rights in El Salvador and that every single attempt to organize in the free trade zones has been met with the same systematic firings and threats common at Mandarin.

If the GAP and other companies are serious about implementing ethical standards embodied in their corporate codes of conduct, they must collaborate and join forces with independent local human rights organizations which could help monitor a contractor's compliance with their code. Otherwise, the codes will be limited to having more impact for advertising in the U.S. than actually fostering compliance with fundamental human rights.

The women at the Mandarin plant are asking that the U.S. people apply pressure on the U.S. companies contracting work at Mandarin. Pressure not to leave Mandarin, not to cut and run, not to leave El Salvador, but to stay and work with Mandarin, demanding that Mandarin's management strictly comply with Salvadoran labor law, with U.S. trade law and with the corporate codes of conduct espoused by the GAP, J.C. Penney, Eddie Bauer and Dayton-Hudson.

U.S. Companies that Contract Production to Mandarin

James Oesterreicher
J.C. Penney
6501 Legacy Drive
Plano, TX 75024

Tel: 214-431-1000
Fax: 214-431-1977 

Richard Fersch
Eddie Bauer, Inc.
15010 NE 36th Street
Redmond, WA 98052

Tel: 206-882-6200
Fax: 206-882-6383 



Robert Ullrich
Dayton-Hudson Corporation
777 Nicollet Mall
Minneapolis, MN 55402

Tel: 612-370-6948
Fax: 612-370-6565 

John Shea
Spiegel, Inc.
(Parent company of Eddie Bauer)
3500 Lacey Road
Downers Grove, IL 60515

Tel: 708-986-8800
Fax: 708-796-2828 



Donald Fisher
One Harrison Street
San Francisco, CA 94105

Tel: 415-952-4400
Fax: 415-495-2922 





Judith Yanira Viera
Mandarin International, S.A.

Judith, who is 18 years old, has worked at Mandarin for over a year. On June 13, she was fired for her union activities. Two of her sisters also worked at Mandarin, but they too have been fired because of their connection to the union. Despite the three salaries from Mandarin, Judith, her two sisters and their mother were barely able to survive on the pay they received.

Judith was the secretary of a production line, which meant she oversaw the flow of piece goods through the sewing process and then to the packing department for shipment.

When orders had to be completed the women were forced to work every day from 7:00 a.m. to 7:00 p.m., or even 9:00 p.m. They worked like this the first week of June right before she was fired. At least once a week, they were forced to work 18-hour shifts beginning at 7:00 a.m. and working until 5:00 p.m., let our but required to return at 7:00 p.m. to work straight through until 3:00 a.m. At 3:00 a.m. no public buses are running, so the women have no way to get home. They have to be at work as usual at 7:00 a.m. that morning.

The last time they worked one of these 18-hour shifts, they were sewing Eddie Bauer t-shirts. Four minors, two fifteen year olds and two seventeen year olds were forced to work all night along with all the adult workers.

Judith has finished the 8th grade and would like to attend high school at night, from 6:00 p.m. to 9:30 p.m. Because of the forced overtime—if you leave you are fired—no one at Mandarin is permitted the right to an education.

Mandarin management did not realize Judith belonged to the union and they explained to her their plan to fire all the unionists, close the plant for two months, and reopen without the union workers.

Under these same conditions, Mandarin also makes clothes for the GAP, J.C. Penney and Dayton-Hudson.



How the System Works at the GAP

Last year the GAP made $310,800,000 on $3.6 billion in sales at its 1,300 stores across the U.S. and Canada. In 1994, GAP founder and CEO Donald Fisher paid himself $2,060,260—not including stock options, etc.—which comes to about $1,000 an hour. On the other hand, the teenage women sewing GAP t-shirts in El Salvador earn 56 cents per hour. Donald makes 1,800 times more than they do. Forbes Magazine states that Donald Fisher is worth $1.572 billion.

In El Salvador, 40 workers at the Mandarin plant produce 1,500 GAP t-shirts per day, which then sell for $20 a piece in the U.S. That is $30,000 worth of GAP t-shirts made in one day by 40 Salvadoran teenagers who—all together—earn $180 for the day. In effect, each worker makes 37.5 GAP t-shirts per day, for which they are paid 12 cents per shirt, or 6/10 of one percent on the sales price.

A good question for the GAP is, what happens to the other 99.4 percent of the sales price? If the worker receives 12 cents, what happens to the other $19.88?

The starvation wages the GAP pays in El Salvador provide only 18 percent of the cost of living.

J.C. Penney made $1,057,000,000 in profits in 1994, Dayton-Hudson pulled in $433,000,000, and Spiegel/Eddie Bauer earned $25,100,000.