Reports

October, 09 2007 |  Share

Industrial Embroidery

Inhdelua Free Trade Zone
Choloma, Honduras

This is a somewhat small factory in the Inhdelua FTZ with approximately 370 workers, where silk screening and embroidery work is done for many labels including Nike, Old Navy/Gap, Tommy, Polo Jeans, Hanes, Osh Kosh, and others.  The factory operates 24 hours a day, seven days a week.

Owner: Kattan Family, which also owns the FTZ.

The night shift in the silk screening department is from 6:00 p.m. to 6:00 a.m., four nights a week, Monday through Thursday.  In the entire shift the workers get just one 30-minute "supper" break at 1:00 a.m..

The workers describe conditions as very tense, with constant pressure from management to reach production goals.  "The factory demands a lot — too much," the workers say.

Temperatures in the silk screening department easily reach 94 to over 100 degrees.  The workers explain, "we sweat like we're under the sun."

Four workers manage each "octopus", a silk screening machine, which has 12 to 14 arms, each arm with a name which applies different colors to the garment to make up the image and lettering.  The shirts are mounted on a wooden ironing board.

The "octopus" can easily silk screen one shirt each minute, meaning the labor cost involved in silk screening each shirt is less than seven cents.

The workers are on their feet all night, constantly walking in a circle as they attend the machine.  From the machine, the shirts go through a dryer, which is why the factory is so hot even at night.

Everyone says they are completely exhausted when they get out at the end of the shift.  By law, the regular workweek for nighttime work is 36 hours, compared with 44 hours for daytime work. 

The basic wage at the factory is 576.10 lempiras a week, or $33.15.  However, by racing to meet their high production goals, and putting in 10 to 21.5 hours of overtime each week, the fastest workers can earn from $50.37 to $75.12 a week, which would be between 93 cents and $1.15 an hour. 

In the embroidery section the day shift is from 7:00 a.m. to 6:30 p.m., or 11 ½ hours a day, four days a week, Monday through Thursday.  The embroidery section is air conditioned, but here too, the workers describe facing constant relentless pressure to work faster to meet their production goals.  Speaking during working hours is prohibited.  Bathroom visits are monitored.    One woman told us that "the supervisors are constantly watching you and if you take more than two minutes they scold you."

In the 11-½ hour shift the workers get 30 minutes for lunch, one 15-minute morning break, and five minutes in the afternoon.

The company recently hired someone —the workers thought an industrial psychologist— to motivate them to work faster and win greater results.

ABSOLUTELY NO RIGHT TO FREEDOM OF ASSOCIATION

The workers explained that if the company found out that they were even meeting with us, they would be fired the very next day.

The general manager of the factory, Gonzales Hievano, has repeatedly told the workers that the company will never accept a union, and would rather close the plant down and throw everyone out in the street, leaving them without even one Lempira (six cents).

In January and February 2003, one of the plant managers, Wilfredo Hainez — who has since left — would drive his car after work to the old part of Choloma and park twenty or so yards from the local union office of the FITH.  He went there to watch for which Industrial Embroidery workers went to visit the union office.  He created a list, saying that these workers were trouble makers and union organizers.  The current manager in the embroidery department, Luis Asternis, constantly threatens those on the list with firing.  He constantly questions these workers "why are you going around with the union?"  He makes the same threats: "If a union comes we will close the company and leave you with nothing, not even a bag of beans."

On July 16, the day before our arrival, Luis Asternis had made this very threat.

We asked if their rights are not respected, why do they not go to the Ministry of Labor for help.  The workers responded:  "The don't pay any attention to unions, they ignore us, they don't care at all."

At the end of our meeting the workers told us:  "Look, we don't want to get fired.  We need these jobs, but we want to win something, some improvements in our rights."

"THEY ARE LIARS"

If the North American companies are telling the people in the United States that in Honduras we can live on the wages they are paying, then "they are liars."

After working in the Maquila for several years, we asked if they were better off now than they were 3 or 4 years ago.  Everyone responded: "No.  Our conditions are just the same.  We can't save a cent.  We work only to feed our families."  No one can afford to own a refrigerator, go on vacation, or even see a movie.  A few could afford a bike.  That is all.

One woman, a single mother from the embroidery section, walked us through her weekly expenses.  She lived in one room, about 14' x 15' feet, with her three young children.  Their hut had no indoor plumbing.  They had an outhouse and outdoor sink.  This was where they washed — without privacy — as there was no shower.  Still, she had to pay $46.22 a month, or $10.67 a week, to rent this one small room.

MAQUILA WOMAN'S WEEKLY EXPENSES
" R/T Bus Transportation                                $3.47 
  (87 cents a day)    
A small breakfast outside the factory   $2.77
  (69 cents a day)    
" A modest lunch  

$4.62

  ($1.16 a day)    
" Rent for her one room home   $10.67
  ($46.22 a month)    
" Milk and Cereal for her children   $13.86
  (She needed two boxes of    
  powdered milk and cereal    
  a week)    
" Food   $17.33

  (A typical supper would be fried
  beans, tortillas, and 3 or 4 eggs.
  This would be the cheapest meal
  they could have.)

   
     
 Subtotal   $52.72

Of course, this does not include day care costs, clothing, medicine,
utilities or any other basic expenses.


 

Company Profiles

Polo Ralph Lauren Corporation

650 Madison Ave.
New York, NY 10022
Ph: 212 318 7000
Fax: 212 318 7690

Revenues and Profits:

 

Ending 3/29/03

Ending 3/30/02

Total Revenue:

$2.439 Billion

$2.363 Billion  

Net Income:

$172.2 Million

$172.5 Million

 

 

 

Executive Compensation:

Ralph Lauren
Chairman and CEO

Year: 2003
Salary: $1,000,000
Bonus: $5,400,000
All Other Compensation: $517,135

When adding in stock options, Lauren took in $9,544,335 in compensation.

Per week: $183,544
Per hour: $4,588.62

According to Forbes Magazine, Ralph Lauren is worth 1.9 billion dollars, is the 209th wealthiest person in the world and the 88th richest in America.

Advertising:

$200 million in Fiscal Year 2003
$547,945 per day

Other News:

Polo Ralph Lauren was one of the defendants in a lawsuit brought by Global Exchange and Sweatshop Watch on behalf of 40,000 garment workers in Saipan. The workers reported that they faced harassment, abuse, and poor working conditions. Polo Ralph Lauren was one of the companies that agreed to settle with the plaintiffs out of court.


Tommy Hilfiger

Tommy Hilfiger
25 West 39th Street
New York NY 10018

Revenues and Profits:

  Annual (ending 3/31/03) Annual (ending 3/31/02)
Revenue: $1.8881 Billion  $1.8767 Billion
Net Income: $513.6 Million  $134.5 Million
  

Advertising:

Advertising costs totaled $43,513,000,  $44,841,000and $56,329,000 during the years ended March 31, 2003, 2002 and 2001, respectively.
For 2002: Advertising costs per day: 119,213

Executive Compensation:

CEO and Chairman: Joel Horowitz. Note that on August 4, the company announced that they had named David Dyer, former CEO of Lands End, to be the CEO of the company.

Year: 2002
Salary: $662,678
Bonus: $10,053,000
Other: $5,500
Total: $10,721,178
Per week: $206,176
Per hour: $5,360.59


Honorary Chair and Principal Designer: Thomas Hilfiger
Year: 2002
Salary: $22,360,000
Per week: $430,000
Per hour: $10,750

In other news:

Tommy Hilfiger was named as a party in the Saipan lawsuit, and settled the case


Hanes: A subsidiary of Sara Lee

Sara Lee Corporation  
3 First National Plaza  
Chicago, IL, 60602  
United States
Telephone: 312-726-2600  
Fax: 312-726-3712

Revenues and Profits:

  Annual (ending 6/29/02)  Annual (ending 6/30/01)
 Revenue: $17.628 Billion $16,632 Billion
 Net Income:  $1.010 Billion $2.266 Billion

Advertising:

2002: $898,000,000    2,460,273 per day
2002: $939,000,000   2,572,602 per day

Executive Compensation:

CEO: Steven C. McMillan

In 2002, C. McMillan raked in $17,304,615 in total compensation including stock option grants from Sara Lee Corp.

Per week: $332,781.05
Per Hour: $8,319.53

In Other News:

In May 2002 Sara Lee agreed to pay $3.5 million to 139 black employees who complained of racial harassment and retaliation at Sara Lee subsidiary Hygrade Food Products Corp., a hot-dog plant that closed in 2001. The settlement came after 23 separate racial discrimination suits were filed in June 2001 by African-American employees against the company. The suits, filed in U.S. District Court, alleged that the African-American employees of the Philadelphia Ball Park brand hot dog factory were harassed, subjected to racial epithets, and denied promotions. The suit claimed that white employees received word-of-mouth notice about promotions and transfers. Employees have filed several previous discrimination and sexual-harassment suits against the plant in recent years. "Sara Lee Foods is committed to a workplace free from any form of harassment or discrimination," chief executive William A. Geoppinger said in a statement. The company also has a history of involvement in the Urban League, a non-profit organization that focuses on African American civil rights and economic self-reliance.  -- The Phil. Business Journal, 6-25-01/AP 5-29-02

Old Navy

Old Navy and Baby Gap are subsidiaries of Gap Inc. The Gap operates 4,171 store concepts at 3,097 locations. The Gap owns The Gap, Old Navy, and Banana Republic

Revenues and Profits:

  Annual (ending 2/1/03) Annual (ending 2/2/02) 
Total Revenue:  $14.457 Billion $13.847 Billion
Net Income:  $477.5 Million $-7.8 Million
 
Executive Compensation:

Paul Pressler, President and CEO

In 2002, Pressler received a total of $1,610,244.00.  He also received $21,625,000.00 worth of non-exercisable stock options.

Nike

1 Bowerman Dr 
Beaverton OR 97005-6453 
United States
Telephone: 503 671-6453 Fax: 503 671-6300
CEO: Phil Knight
Sold in: Niketown, Foot Locker, etc.


Revenues and Profits:

  Annual (ending 5/31/03)  Annual (ending 5/31/02) 
Revenue:   $10.697 Billion $9.893 Billion
Net Income:  $474 Million  $663.3 Million


Advertising:

Total advertising and promotion expenses were $1,168.6 million, $1,027.9 million and $998.2 million for the years ended May 31, 2003, 2002 and 2001, respectively.

2003: $3,201,643 per day

Executive Compensation:

Phillip Knight, CEO

Year: 2003
Salary: $1,350,000
Bonus: $1,121,840
LTIP payments $320,000
Other comp: $87,195
Total: $2,879,035

Year: 2002
Salary: $1,350,321
Bonus: $1,377,327
Other: $572,856
Total:  $3,300,504


According to Forbes Magazine, Knight is worth 4.4 billion dollars, is the 33rd richest person in America and the 45th richest in the world.

In Other News:

Three class action lawsuits were filed against Nike by its shareholders, alleging that company executives sold stock just before poor earnings were announced and the stock price plunged. The lawsuits represent everyone who bought Nike stock between December 20, 2000 and February 26, 2001. Nike denies the allegations.  -- The Associated Press, April 5, 2001


Sources: www.multex.com, SEC 10-K filings, www.ecomponline.com, AFL-CIO Executive Pay Watch, www.responsibleshopper.org, Forbes Magazine.