Reports

November, 01 2003 |  Download PDF |  Share

AAA Honduras

We're here because we trust in the Honduran worker.
(Road sign on the way to the Choloma Free Trade Zone)

The AAA factory—surrounded by barbwire, locked gates and private armed security guards—is in what is known as a bonded area, which means it receives all the same tax breaks available in the export processing zones. Namely, 100 percent exemption from all corporate, state, municipal and even sales taxes as well as all import and export duties and tariffs. Maquila companies like AAA often claim that they are not making a profit. However, by November 2002, AAA was evidently doing well enough to go to a seven-day-a-week, 24-hour a day production schedule, with two day and two night shifts. During peak production there were over 1,115 workers, but with recent mass firings of union organizers and layoffs on Day Shift #2, the factory is currently down to around 860 employees. AAA's owner, Jorge A. Faraj, who is of Palestinian decent, also has investments in banks and supermarkets in the San Pedro Sula area.

Day Shift #2 ran on 12-hour shifts Friday through Sunday. The company always classified this as a "seasonal or temporary shift." The shift first operated in 2000, was shot down, and reopened again in November 2002 in response to large new orders. Despite the fact that the shift was running full time for 10 months, the company illegally hired the workers on personal contracts which they rolled over every two months. The company did this to prevent the workers from gaining any legal rights or access to social security, vacation, Christmas bonus, or any other benefits—which only kick in after a worker has been employed for more than two months.

In August 2003, the factory fired the 240 workers in Shift #2 without paying a cent in severance or any other benefits. Of course, these mass layoffs have had a chilling effect, leaving the workers inside the plant even more frightened and concerned about losing their jobs.

SUMMARY: WORKING CONDITIONS AND VIOLATIONS

  • Hours: Dayshift #1—11 hours a day, 7:00 a.m. to 6:00 p.m., four days a week, Monday through Thursday.
  • Wages: Sewers earn 75 cents to $1.20 an hour. Average wage is 86 cents an hour, $6.88 a day, and $37.70 a week. Workers must borrow money each week in order to survive, and live in one-room huts lacking indoor plumbing. Told that the U.S. companies say their wages are adequate, one AAA worker responded: "That is a lie, because we have never had a good wage. If we earned a good living, we would not be living the way we live."
  • Excessively high production goals: A module of 15 workers must sew 3,456 t-shirts in the 10 ½ hour shift. Each worker in effect must sew 230 t-shirts per day, 22 per hour and one shirt every 2.7 minutes. Supervisors stand over the sewers threatening them.
  • Sewers work through lunch, taking just 10 minutes so they can race back to their machines in an attempt to reach their production goal.
  • Management says it will now increase the daily production goal by an additional 500 shirts, while lowering the piece-rate to just 5 cents per shirt.
  • Paid 6 cents per shirt: The workers are paid just 6 cents !!If the average wage is 86 cents an hour and each worker makes 22 shirts an hour then they make 4 cents per shirt — the 6 cent figure is correct for the 1.20 an hour wage!! for each t-shirt they sew. Their wages amount to 3/10th to 6/10ths of one percent of the shirt's retail price.
  • Total cost of the t-shirt is only $2.13: The total landed customs value of the t-shirt is just $2.13. This includes all materials, direct and indirect labor, shipping costs, and profit to the AAA company. Nike and other companies mark up the retail price of the shirt by 369 to 839 percent.
  • Nike spends 36 times more to advertise the shirt than they pay the workers to sew it. Nike spends $2.18 to advertise the shirt, while the workers are paid just 6 cents to sew it.
  • Workers actually earn less money—not more as one might think—sewing high-end Nike and Gildan shirts: Quality control demands increase, slowing production down, but workers continue to earn the same low piece-rate.
  • Extreme heat in the factory: Workers report that they are dripping with sweat all day.
  • Drinking water is filthy and unsafe: Water contains bacterial levels 1,400 percent in excess of allowable standards. The water is contaminated with fecal matter. (See water test in the report.)

 

 These Labels were Smuggled out of the AAA Plant by the Workers

 

Nike T-shirt: 100% Cotton; RN 56323; CA 05553
Adidas T-shirt: 100% cotton; RN 88387; CA 21356
Gildan T-shirt: Activewear, ultracotton, heavyweight, 100% pre-shrunk cotton; RN 93846; CA 25181
Hanes Beefy-T:100% pre-shrunk cotton; RN 15763; CA 21356
Fruit of the Loom T-shirt: Best, 50% cotton/50% polyester; RN 13765; CA 18345

 

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