Reports

February, 01 2002 |  Share

Shah Makhdum Garments Full Report

Shah Makhdum Garments Factory

Dhaka, Bangladesh

Disney · Wal-Mart · Jerry Leigh

February 2002

 

 The first research report documenting working conditions at the Shah Makhdum factory was issued in November 2001. For this follow-up study, extensive, in-depth interviews were held with over two dozen Shah Makhdum workers in a safe location on Friday, February 8, 2002. Unfortunately, little has changed at the factory, especially regarding the continuing, systematic gross violation of human and worker rights.

 

Preliminary report

Link To Los Angeles Times coverage

Link to Washington Post coverage

Link to Chicago Tribune coverage

Link to Shah Makhdum Tour 2002

Compare and Contrast: Disney character Lizzie McGuire and Disney worker Lisa Rahman

 


 

 

Summary / Working Conditions at Shah Makhdum as of February 2002

  • Mandatory 14-to-15-hour daily shifts, from 8:00 a.m. to 10:00 or 11:00 p.m.
  • Forced seven-day workweek.
  • Not a single day off in the last two-and-a-half months.
  • Two 20-hour all-night shifts a month, from 8:00 a.m. to 4:00 a.m.
  • At the factory 81 to 102 hours a week.
  • Sewers paid 12 to 19 cents an hour, as little as $5.67 a week. Helpers paid just 8 cents an hour, $3.77 a week.
  • Force to work overtime and then cheated of legal overtime wage.
  • Workers earn 5 cents for each Disney garment they sew. Wages come to 3/10ths of one percent of the garment's retail price.
  • Constant pressure to reach excessively high production goals.
  • Workers describe treatment as "cruel" --verbal and physical abuse.
  • Talking prohibited.
  • Need permission to use the bathroom.
  • Denial of legal maternity leave and benefits.
  • Factory is crowded, hot and poorly ventilated.
  • Drinking water is unsafe--bacteria levels exceed maximum allowable standards by 72 percent.
  • No sick days, no pension, no religious holiday allowance.
  • No daycare center.
  • Total denial of freedom of association.
  • Workers threatened and instructed to lie to auditors and U.S. buyers. Workers forced to sign two payroll sheets.
  • Supervisors mark down 26 days worked each month, rather than the 30 or 31 days actually worked.


Shah Makhdum Garments, Ltd
72/B, Malibagh Chowdhury Para
Dhaka-1219, Bangladesh

Chairman: Bilkis Jahan

Established: April 1, 1992

Workforce: 400 employees (75 percent women; 95 percent 16 to 30 years of age)

 


Production / Labels

 

Shirts and pants-- · Disney

                           · Jerry Leigh of California

                           · Wal-Mart

The workers report that Disney's "Pooh" label has been produced at the factory for at least the last seven to eight years. Further, Disney's work has consistently accounted for 60 to 70 percent of total factory production. Disney (Jerry Leigh) and Wal-Mart have been the most regular and largest buyers from the Shah Makhdum factory.

(The Jerry Leigh Entertainment Apparel Company of California has a licensing agreement with Disney to produce the "Winnie the Pooh," "Mickey Mouse," and "Toy Story" labels. Jerry Leigh of California, founded 40 years ago, is a major apparel company in its own right, holding licencing agreements not only with Disney, but also with Warner Bros., Harry Potter, Universal, Pokemon and Hallmark. Jerry Leigh also produces private label goods for Wal-Mart, J.C. Penney and Kmart. The Jerry Leigh company states that: "All factories used must meet a strict standard of quality and social compliance requirments.")

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Disney Must Not Pull Out

Disney's "Winnie the Pooh" label has been sewn at the Shah Makhdum factory for the last seven to eight years, under a licensing agreement with Jerry Leigh Entertainment Apparel. Disney has been Shah Makhdum's most regular buyer, often accounting for 60 to 70 percent of the factory's total production. During this entire seven-toeight- year period, despite Disney's and Jerry Leigh's Codes of Conduct and monitoring programs, the workers report that not one of their rights have ever been respected at Shah Makhdum. Why would Disney need to pull out just now, after the workers bravely spoke out documenting the systematic daily violation of human and worker rights at the factory? Could this be a mere coincidence?

After all these years, Disney and Jerry Leigh owe these hard-working people more than this. Disney and Jerry Leigh should not cut and run--that would be the worst thing they could do. Rather, they should stay and finally take a stand to pressure their contractor, Shah Makhdum, to respect Bangladesh's laws.

 

 

Hours / Forced Overtime

 

  • Mandatory 14-to-15-hour daily shifts, from 8:00 a.m. to 10:00 or 11:00 p.m.

  • Forced seven-day workweek.

  • Working 30 or 31 days a month.

  • At the factory 81 to 102 hours a week.

The mandatory daily shift at the Shah Makhdum factory is 14 to 15 hours, from 8:00 a.m. to 10:00 or 11:00 p.m. he workers are required to work seven days a week, and they report not having had a single day off between ecember 1, 2001 and February 8, 2002. Even during the Muslim religious month of Ramadan, the period of asting, sewers at Shah Makhdum were forced to work seven-days a week until 10:00 at night. (In contrast, during amadan which last year fell from mid-November to mid-December, Bangladeshi government offices were open rom just 9:00 a.m. to 3:00 p.m.--and, of course, the Friday holiday was respected. The workers report that Shah akhdum management has never respected their Muslim religion.) At least once or twice a month, before shipments ust leave for the U.S., there are mandatory all-night 20-hour shifts stretching from 8:00 a.m. to 4:00 a.m. the ollowing day, after which the workers sleep on the factory floor for a few hours before starting their next shift at :00 a.m. Workers are regularly at the factory 81 to 102 hours a week. The shortest workweek the sewers could emember was 74.6 hours, which meant that even then they were forced to work 26.5 hours of overtime.

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Standard 14-to-15-hour Daily Shift

8:00 a.m. to 1:00 p.m.   

(Work, 5 hours)

1:00 p.m. to 2:00 p.m.

(Lunch, 1 hour)

2:00 p.m. to 5:00 p.m.

(Work, 3 hours)

5:00 p.m. to 7:00 p.m.      

(Forced overtime, 2 hours)

7:00 p.m. to 7:20 p.m.

(Supper, 20 minutes)            

 7:20 p.m. to 10 or 11:00 p.m. (Forced overtime, 2.67 to 3.67 hours)

Under this schedule, the workers would be at the factory at least 98 hours a week, while being paid for 88.67 hours. It should be noted that for the 7:00 p.m. break, management provides the workers with a 10 ½-cent "supper bonus."

Wages--below subsistence

  • Sewers paid 12 to 19 cents an hour, as little as $5.67 a week.
  • Helpers earn just 8 cents an hour, $3.77 a week.
  • Cheated on overtime pay.
  • Workers paid five cents for each Disney garment they sew.
  • Wages amount to just 3/10ths of one percent of the garment's retail price.

Senior sewing operators--with more than five or six years experience--earn between 2,000 and 2,200 taka a month--or $35.09 to $38.60, which comes to 18 to 19 cents an hour. Junior operators , with less than five years experience, earn 1,400 to 1,500 taka a month, or $24.56 to $26.32, which comes to 12 to 13 cents an hour, and as little as $5.67 a week. Helpers, the young teenaged girls who clean the garments by cutting off loose threads and who supply the assembly lines with fabric, are paid just 930 taka a month, or $16.32, which comes to 8 cents an hour, or $3.77 a week.

Workers have no idea how management calculates their overtime pay, but report being routinely shortchanged of at least 40 percent of the overtime hours they actually worked. When the workers dared question management personnel regarding how their overtime wages were actually set, the response they received was: "In our factory we are investing our own money, and what we think good for us, we do--that is the law--we do not care about any labor laws in Bangladesh."

 Wage Range for Sewers

(12 to 19 cents an hour)

Junior Operators 

 Senior Operators

 * 12 cents an hour

 * 19 cents an hour

 * 94 cents a day (8 hours)

 * $1.48 a day (8 hours)

  * $5.67 a week (6 days; 48 hours)

 * $8.91 a week (6 days; 48 hours)

 * $24.56 a month 

 * $38.60 a month

* $294.74 a year * $463.16 a year

  

Average Junior Operator's Wage

(1,450 taka a month)

* 12 cents an hour 

 * 48 cents a day (8 hours)

 * $5.67 a week (6 days; 48 hours)

 * $25.44 a month

 * $305.76 taka a year

 

Average Senior Operator's Wage

(2,100 taka a month)

* 18 cents an hour 

* $1.42 a day (8 hours)

* $8.50 a week (6 days; 48 hours)

* $36.84 a month

* $442.11 a year

 

Helper's Wage

(930 taka a month)

* 8 cents an hour

* 63 cents a day (8 hours)

* $3.77 a week (6 days; 48 hours)

* $16.32 a month

* $195.80 a year

Workers report being routinely paid for only 60 percent of the ovetime hours they are actually forced to work each week. In this way, factory management is cheating the workers of $3.56 to $5.76 a week in overtime wages due them, which at first glance might not seem like a lot of money, but it is equivalent to 42 to 65 percent of the worker's regular weekly wage. Losing these wages legally due them literally means the difference between eating, at least a little, or going hungry.

The average senior sewing operator's wage is a little less than 18 cents an hour. By law in Bangladesh, all overtime is to be paid at a 100 percent premium--ie. as double time. This would make the legal overtime wage at least 35 cents an hour. Working the standard workweek, 14 hours a day, seven days a week, a senior operator would be putting in 40.67 hours of overtime a week on top of the regular 48-hour workweek. When factory management routinely underreports the actual number of hours worked by 40 percent, this means the sewers are being forced to work 16.27 hours of overtime a week for which they are not paid. They are being cheated of $5.76 in overtime wages legally due them.

The workers report that their wages are also paid late. For example, the regular wage for the month of January is not paid until February 5 to 10, while their overtime pay is withheld for at least two months. The overtime for December had yet to be paid as of February 8. 

 

Workers paid just five cents for each Disney garment they sew; wages amount to just 3/10ths of one percent of the retail price.

 

There are 60 workers in an assembly line at the Shah Makhdum factory, and management fixes their production goal at 160 to 180 pieces an hour. The workers report that this production goal is too high and is not realistic. As a result, they are under constant pressure from the supervisors, who verbally abuse and scream at the workers to go 6 faster. Many workers describe the treatment as "very cruel."

The average wage for junior and senior operators in the factory is 15 cents an hour. This means that the total hourly payroll for the entire 60-person assembly line is just $9.11. On average, these workers must complete 170 garments an hour. This means that the workers are being paid just five cents for each Disney garment they sew. For a $17.99 Disney "Pooh" shirt, this means the workers' wages to sew the garment amount to only 3/10ths of one percent of the shirt's retail price.

 

Twelve to 19 cents an hour is a below-subsistence wage

 

Most garment workers in Bangladesh report that a bare subsistence-level wage which would at least allow them to meet their most basic needs would have to be at least 40 cents an hour.

Recently, the new government in Bangladesh raised the prices for gas, electricity and other basic commodities, which has put a further strain on the garment workers, whose wages were already well below subsistence levels.

To live very poorly--in conditions which would shock and sadden most American people if they only knew--the women who sew our clothing in Bangladesh calculate that they would need to earn at least 4,750 taka--$83.33-- a month in order to survive with a modicum of decency, which comes to just 40 cents an hour.

Bare Subsistence-level Wage

(4,750 taka a month)

* 40 cents an hour

* $3.21 a day (8 hours)

* $19.23 a week (6 days, 48 hours)

* $83.33 a month

* $1000 a year

 

 

If Disney paid a subsistence-level wage, would the cost of its garments double? Hardly!

 

At the current average wage of 15 cents an hour, as we have documented above, there is just a little over five cents in direct labor cost to sew the Disney garment. If the workers were now paid a subsistence-level wage of 40 cents an hour, the total labor cost involved in sewing the shirt would be 14 cents. This 14 cents would still amount to less than 8/10ths of one percent of the $17.99 retail price of the Disney "Pooh" shirt.

 

Paying a subsistence level wage in Bangladesh would add just nine cents--less than a dime--to the cost of the shirt. It is impossible to imagine the American people not being more than willing to spend that dime so the workers and their families in Bangladesh could at least climb out of abject misery and into poverty.

Continuing Violations at Shah Makhdum

  • Cruel treatment and physical abuse: Because of the constant pressure to meet excessively high production goals, the workers report suffering routine abuse at the hands of the supervisors who threaten, shout at and even physically hit the women, screaming at them to work faster. The workers describe the treatment as "too cruel."

  • Denial of legally required maternity leave and benefits.
  • Talking during working hours is strictly prohibited.
  • Workers must receive permission to use the bathroom. (There are six toilets for all 300 women--50 workers must share each toilet--and two toilets for the 100 men.)
  • The factory is crowded and poorly ventilated.

  • The drinking water is unsafe. The workers took samples of the tap water they must drink to the Bangladeshi government laboratory, which found that the drinking water was "unsatisfactory," and contained dangerously high levels of bacteria--exceeding maximum allowable levels by over 72 percent.
  • No sick days allowed, no pension, no religious holiday allowance.
  • No daycare center.
  • No space or chairs for eating. Workers must eat on the roof.
  • There is only one stairway for all 400 workers to enter and exit the factory. Though there are fire extinguishers, workers receive no formal training on how to use them.
  • Freedom of association is totally denied. Every worker agrees that any attempt to organize a union would be met with--illegal--mass firings, blacklisting and perhaps even physical attacks. (It is common for factory owners in Bangladesh to hire gangs to threaten and beat the workers.)

 

The Audit Scam

 

Of course, when it comes to business and profits, Disney and Jerry Leigh are not so naive as to be completely unable to imagine what goes on behind the closed doors of their garment contractors factories in Bangladesh. However, when it comes to social audits of working conditions, how easily the giant corporations are tricked--like taking candy from a baby.

This is how Disney's and Jerry Leigh's auditing works at Shah Makhdum:

Workers are threatened and instructed to lie to auditors and U.S. buyers. For example, if any worker is ever questioned about overtime wages, she has been instructed to respond, "We do not understand the calculation for overtime pay. But we are sure that our management is paying us the correct legal overtime due us."

Workers are forced to sign two separate payroll sheets each month. The fake one, to be given to the U.S. companies, records just two hours of overtime a day, and at least one day off a week. The real one records the five to six hours of forced overtime actually worked each day, the seven-day workweeks, and the 30 or 31 days worked each month.

Shah Makhdum's "Daycare Center" is actually a storage warehouse which is quickly cleaned and made over to look like a primitive daycare center just in time for the announced auditors' visits. When the auditors leave, the warehouse quickly becomes a storage area again.

 

The Workers' Demands

 

These are very modest, reasonable demands, and ones that are very do-able. The workers are, after all, only asking that Bangladesh's labor law be adhered to--something which the U.S. corporate Codes of Conduct also require and claim to guarantee.

  1. One rest day off per week--without a reduction in pay.
  2. Women should receive all maternity leave and benefits stipulated under Bangladesh's law.
  3. In immediate end to all psychological and physical punishment and abuse.
  4. An end to all forced overtime--all overtime should be voluntary.
  5. All regular and overtime wages must be paid according to the laws of the country

 


Letter to Michael Eisner from the Shah Makhdum workers

Letter to Michael Eisner signed by members of Congress

Janet Barret of Presbyterian Church USA questions Michael Eisner during a Disney Shareholder's meeting

Disney Cuts and Runs from Shah Makhdum (Sept. 2003)