The Lies Wal-Mart Tells: Wal-Mart’s Sourcing Practices

Wal-Mart spends millions of dollars each year on public relations hoping to counteract the negative impact the company’s business practices have on its reputation. In the process, Wal-Mart’s representatives misrepresent the company, even lying to protect its fragile reputation. This is the second post in a series examining some of the most common lies the company tells - and truth behind the spin.

Lie #2: Wal-Mart Does Not Source from Sweatshops

“When we buy merchandise, we realize that our orders touch factory workers and their communities around the world. As we reflect on the impact of our sourcing, we recognize that success goes beyond financial results alone.” [“Letter from Lee Scott,” Wal-Mart’s 2006 Ethical Sourcing Report]

The Truth:

Wal-Mart’s supplier factories continue to use sweatshop labor.  In December 2007, two nongovernmental organizations documented what they said were abuse and labor violations at 15 factories that produce or supply goods for Wal-Mart.  Labor rights groups say some Chinese companies routinely shortchange their employees on wages, withhold health benefits and expose their workers to dangerous machinery and harmful chemicals.  [New York Times, 1/5/08]

Wal-Mart purchases plastic from Chinese sweatshops.  Wal-Mart was a major buyer at the Zhifeng Hardware and Plastics Factory in Guangdong, China.  At Zhifeng, workers are at the factory 80.5 to 85.5 hours a week, working seven days a week and often going for months without a single day off. The National Labor Committee equated Wal-Mart’s monitoring of factories to Wal-Mart monitoring “well-run prisons.”[National Labor Committee, 12/07]

Wal-Mart Christmas ornaments made by children in sweatshop.  A report by the National Labor Committee detailed a Wal-Mart supplier factory where employees as young as 12 worked excessive amounts of overtime at less than the legal minimum wage of 55 cents per hour.  Workers said they were forced to work seven days a week and photos revealed workers worked with paint and chemicals without any protective gear. [New York Times, 12/12/07]

Factory inspectors “coach” employees to lie about working conditions.  A June, 2007 report by Students and Scholars against Corporate Misbehavior (SACOM) investigating Wal-Mart’s auditing procedures of five Chinese toy factories in exporting cities Shenzhen and Zhuhai found that the factories were going to great lengths to conceal labor abuses, in order to continue their ruthless cost-cutting measures. The report noted that “managers conducted ‘training sessions’ with workers on how to answer questions from Wal-Mart’s auditors in preparation for pre-announced inspections. At these trainings, managers warned workers, ‘If you answer auditors’ questions incorrectly, we get to lose orders and you get to lose your job.’” [Students and Scholars Against Corporate Misbehavior, June 2007]

Chinese factories prep workers for Wal-Mart factory audits.  The Beifa Group factory, which was a top supplier of pens, mechanical pencils, and highlighters to Wal-Mart, hired a Shanghai based consultant who promised to help them pass a factory inspection after the Group learned Wal-Mart was coming to audit the factory.  The consultant provided advice on how to create fake but authentic-looking records and suggested Beifa hustle any workers with grievances out of the factory on the day of the audit.  [Business Week, 11/27/06]

Wal-Mart supplier factories exploit child labor. In 2006, the National Labor Committee uncovered a factory in Bangladesh where an estimated 200 to 300 children were discovered sewing pants for Wal-Mart. They were routinely beaten, forced to work overtime, cheated out of their wages, given phony time cards and told to lie about their age. [National Labor Committee, 2006]

WRC uncovers problems in Central America. The Workers Rights Consortium recently released a report about the TOS Dominicana textile factory in the Dominican Republic, which is owned and operated by Hanesbrands Inc. The factory supplies heavily to Wal-Mart. According to WRC, labor violations abound at the factory, including employing coercive measures to have workers sign new employment contracts, forced and unpaid overtime, verbal harassment and abuse, and use of various illegal means to disrupt workers’ attempts to unionize. [Workers Rights Consortium, June 2007]

Posted by Media Team on Thursday, May 15, 2008

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