Debate Over ‘Fair Labor’ Tag Spills Into Toy Aisles

The package says “Made in China.” That’s all Jacqueline Smith knows about the origins of the $4.88 truck set she holds at the Panorama City Wal-Mart. She assumes the factory workers who made it were treated well because they work for a large, reputable U.S. company. But Smith admits it’s not something she devotes much thought to.

“I look for the age level and what kind of batteries it uses. That’s about all I have time for,” she says.

The box goes back on the shelf as Smith is swept along on a wave of holiday shoppers. “Besides,” she says, “I thought that was only a problem with clothes.”

One aisle over, Bob and Phyllis Turner pick through colorfully packaged toys, resigned in their belief that most of the merchandise was made in foreign sweatshops.

“The conditions are probably awful,” says Bob Turner. “You either accept that or walk away with nothing.”

The toy aisle is the new battleground for advocates for Third World workers. They envision an army of discriminating consumers who, someday, will check for a fair labor tag and will force foreign factories to improve conditions.

But if a recent afternoon at Wal-Mart is typical, that could be a long time coming.

It’s not that shoppers don’t care about labor conditions, advocates say, pointing to years of opinion polls suggesting that they do. What they lack is reliable information and easy options.

“The good news is that there’s an enormous amount of pressure on the companies and a lot of behind-the-scenes stuff is happening,” said Alisa Gravitz, executive director of Co-Op America, a 50,000-member organization that encourages “responsible shopping” and has launched a series of campaigns against Wal-Mart.

“Many corporations are putting codes of conduct in place, putting evaluation and enforcement in place,” Gravitz said. “And nonprofits are putting in place mechanisms to track their progress. We’re getting closer [to a universally accepted label]. The bad news is, for a person trying to make a decision about a purchase today, the curtain hasn’t been raised.”

A decade of exposes and protests has forced big retailers and brand-name manufacturers to take a closer look at overseas factories, including those in China, where about half of America’s toys are made.

This month, Toys R Us Inc. Vice President Tom DeLuca visited south China to participate in a seminar with suppliers on work hours, and Wal-Mart Stores Inc. executives recently promised a liberal shareholders group it would publish its first “corporate responsibility report” on global labor issues.

Despite increasingly frequent corporate vows to monitor and improve, shoppers have no way of knowing whether the dolls, trucks and electronic gizmos in their favorite store were made under humane conditions.

Today, even the most dedicated do-gooder can get lost in conflicting claims and audits. For instance, since 1992, Wal-Mart, the world’s largest retailer, has required all suppliers to sign a code of conduct that calls for “fair” compensation and “reasonable” work hours. A spokeswoman said corporate auditors inspect 200 foreign factories each week. And yet, many anti-sweatshop groups continue to cite Wal-Mart’s relentless demand for lower prices as a driving force behind labor abuses.

Such contradictions are the rule, and perhaps are understandable, with the chaotic nature of the global economy. The toys sold by major retailers are assembled in thousands of factories, often using components made in other factories, most of which are independently owned and scattered among dozens of desperately poor nations. Labor codes and wages vary widely, and local enforcement is often weak. Because managers know a few cents per item can make or break a deal, there is strong incentive to cheat.

Ten years ago, many U.S. retailers and manufacturers disclaimed responsibility for conditions in those workplaces, saying they had no direct control over wages, hours or conduct of managers. Today, most not only require factories to follow local labor laws, they concede there have been, and continue to be, problems. Activists take that shift as a victory.

But huge, publicly traded discount chains such as Wal-Mart and Toys R Us must move cautiously, said Aron Cramer, director of human rights for corporate-sponsored Business for Social Responsibility in San Francisco. “While consumers don’t want to be associated with products made under poor working conditions, they also are looking for the lowest price. Companies are trying to balance the need to succeed with making sure that standards and practices are appropriate.”

In the last year, Cramer’s group has led workshops on labor standards for factory owners in China and Mexico, explaining concepts that many consumers might consider self-evident.

“First, we try to make the point that these issues are important,” he said. “We point out that there’s a moral imperative to treat people fairly, there’s a legal imperative to follow local laws, and also a commercial imperative, because big multinational companies expect they will deliver quality and price but also good labor practices....There’s lots of evidence there has been some very real impact.”

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Toy Factories Targeted

More radical groups have no patience for incremental change, however. Among them is the New York-based National Labor Committee, a shoestring union-supported operation headed by Charles Kernaghan, who has made a career of exposing international sweatshops.

A hero among many university students and religious activists, Kernaghan has generated headlines with reports of worker abuse in El Salvador, Bangladesh, Indonesia and Haiti. His latest investigation, released in draft form, finds similarly horrific conditions in south China toy factories.

Dubbed “Toys of Misery,” the 40-page report alleges that during the height of this year’s holiday production, teenage girls worked 14 hours a day, seven days a week, for several months. They earned 15 to 20 cents an hour, far below the local minimum wage, with no overtime premium. Some were sickened by paint and glue fumes. They slept in tiny cubicles and lined up for hours to get a shower in cramped dormitories.

Kernaghan said the report is based on interviews with workers at 18 factories, conducted by ethnic Chinese investigators from several Hong Kong religious groups. Typically, he said, workers spoke outside guarded factories while on lunch breaks.

Kernaghan said the toys they produced would be recognizable to most American kids, and could be picked up at major retailers, including Wal-Mart and Toys R Us. But he would not link specific toys with factories, or name the factories, because he said workers could lose their jobs as a result.

Representatives for retailers and brand-name manufacturers named in the report said that lack of detail undermined the report’s credibility. “It’s very difficult for a company to respond, when we have no idea what factory they’re talking about,” said Lisa Marie Bongiovanni of Mattel Inc.

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Definition of Fair Labor

She said Mattel has been a pioneer in corporate responsibility. The company adopted a comprehensive set of labor principles in 1997, and then funded investigators to make sure factories followed it. All corporate-owned factories in China have been audited, she said, and the company is looking at its independent suppliers. A few mildly critical audits, which reported 60-hour workweeks and high noise levels and stifling heat in factories, are posted on the company Web site. Mattel has spent millions of dollars rebuilding dormitories and installing new ventilation systems, she said.

But Kernaghan, Gravitz and other activists say corporations can’t be trusted to do their own policing. They want them to disclose all factory locations and provide access to monitors from local human rights groups.

They also dream of a universally accepted set of fair labor practices and a label that would tell consumers at a glance whether they can buy with a clear conscience.

But the players in this global drama are far from a consensus on how to evaluate a fair labor factory, or the concept of fairness. For now, many advocates say, the best thing consumers can do is let toy makers know they care.

“Most people in the United States really are very decent and have an ingrained sense of justice and fairness,” Kernaghan said. “But the message has not reached everyone. When it does, people are quite angry and disturbed. I think it’s just a matter of time before this thing really takes off.”