The Wal-Mart Watch Blog
China

| Jan 29, 2010

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The Consumer Product Safety Commission has recalled two ‘Princess and the Frog’ charm necklaces today due to high levels of Cadmium, a dangerous heavy metal. The necklaces are sold exclusively at Walmart stores. It may sound like many other recall stories, but this is actually the first time the CPSC has recalled anything for containing Cadmium. The metal was spotlighted in a recent Associated Press investigation which discovered high levels of Cadmium in many pieces of children’s jewelry.

Cadmium, like lead and other heavy metals, is a known carcinogen and can cause stunted brain development in children.

The Associated Press found that Chinese factories had started using Cadmium in products after they stopped using lead due to scrutiny from the US government during the last product safety scare.

In our opinion, it is no coincidence that this first Cadmium recall happened at Walmart, either. First because the use of cadmium seems to be linked with Chinese factories, at least so far. More than 70% of Walmart’s goods come from China, making it likely that these toxic metal products could end up on Walmart’s shelves. Second, Walmart has a history of using its size and clout to push suppliers to produce at a lower cost, forcing them to cut corners to meet Walmart’s price demands and still make a profit. One of the areas that suppliers could cut corners is product safety.

We think it’s pretty irresponsible for Walmart to be selling cadmium laced children’s necklaces, or anything else with highly toxic chemicals, for that matter. That’s why we launched a campaign over the holiday shopping season demanding that Walmart remove dangerous products from its shelves. Obviously they haven’t listened.

You can read more about Walmart’s dangerous products and sign an open letter to Mike Duke demanding that he take responsibility for consumer protection here.

The official CPSC press release about the Disney ‘Princess and the Frog’ necklaces is here.

| Jan 19, 2010

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After our national campaign over the holidays focusing on product safety, an Associated Press report about the use of Cadmium in Chinese made products, especially children’s jewelry, and a huge crib recall back in November comes news of a second crib recall.

The Associated Press reports that more than 600,000 cribs are being recalled today after an infant died because of faulty hardware. Twenty models of cribs are being recalled due to issues with drop-side hardware and with slats that can break. The cribs were manufactured in China and Vietnam and sold at Walmart as well as other retailers.

According to the AP, the Consumer Product Safety Commission (CPSC) and the company producing the cribs,

“have received 31 reports of incidents involving drop-side cribs, including six incidents of children being trapped between the mattress and the drop side. The agency and company have also received 36 reports of broken slats, including two reports of trapped children.”

This second recall highlights a disturbing trend of dangerous products on Walmart’s shelves. Walmart has a history of using its size and clout to push suppliers to produce at a lower cost, forcing them to cut corners to meet Walmart’s price demands and still make a profit. One of the areas that suppliers could cut corners is product safety. Walmart has repeatedly carried products that have been identified as unsafe or dangerous by reputable consumer safety organizations and the CPSC. It is truly sad that it took a death to bring attention to these cribs.

You can read the full article here and the full CPSC press release here for more information.

| Jan 11, 2010

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After the huge scare surrounding lead in products at Walmart and other stores, you would think that companies (both manufacturers and retailers) would be more careful about testing their wares to make sure they were safe. Apparently instead, manufacturers have just started using a different toxic heavy metal instead of lead.

The Associated Press reports that since the increased scrutiny over lead, some manufacturers have simply started using cadmium, an even more dangerous heavy metal. Cadmium is known to cause cancer and stunt brain development in young people. According to the tests, twelve percent of the products tested had at least 10 percent cadmium with some containing as much as 91 percent.

Not only is cadmium just as bad a lead, apparently the Consumer Product Safety Commission is not regulating it. According to the AP,

“‘There’s nothing positive that you can say about this metal. It’s a poison,’ said Bruce A. Fowler, a toxicologist at the Centers for Disease Control and Prevention. On its list of the 275 most hazardous substances in the environment, cadmium ranks number seven.

A patchwork of federal consumer protection regulations does nothing to keep these nuggets of cadmium from US store shelves.

While the Consumer Product Safety Commission has cracked down on the dangers posed by lead, it has never recalled an item for cadmium - even though it has received scattered complaints based on private test results for at least the past two years.”

Safety is a big deal. You should be able to walk in to a store and buy a product without worrying that it is going to poison you or your child. That is why we wrote an open letter to Mike Duke, Walmart’s CEO, over the holidays calling for safe products, responsible business practices, and accountability. In it we highlighted several toys that contained unsafe chemicals, including Cadmium. In particular, according to HealthyStuff.org, the buckle of the iCarly pink belt contains 523 parts per million of Cadmium.

If you haven’t already, please take a minute to read more about our efforts to get dangerous toys off Walmart’s shelves and sign the open letter.

| Dec 01, 2009

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While Wal-Mart shoppers across America pushed and shoved one another today on Black Friday, fighting for first rights to Blu-Ray and High Def televisions, a new report about the retailer’s factories in China paints another kind of black. Everyday looks black to the Chinese workers who help produce low-priced goods and high profits for the Wal-Mart corporation. A group called China Labor Watch (CLW) released a report this week which finds that conditions at Wal-Mart’s vendor factories have not improved much this holiday season compared to Christmas’ past.

The CLW study focused on the Pearl River Delta of Guangdong Province, where millions of migrants work in light manufacturing. “Labor conditions in the Pearl River Delta have somewhat improved in recent years,” the new study notes, “but remain devastatingly brutal, characterized by long hours, unsafe workplaces and restricted freedom of association, and are in blatant violation of Chinese and international labor law.

The case of Wal-Mart, the world’s largest retailer, shows that corporate codes of conduct and factory auditing alone are not enough to strengthen workers’ rights if corporations are unwilling to pay the production costs associated with such codes.” Wal-Mart does not own any of its 100,000 supplier factories around the world. Tens of thousands of these vendors are located in China. Wal-Mart buys about $18 billion worth of products in China.

The CLW report focuses on labor violations in five factories “to illustrate systematic violations cited in Wal-Mart’s supply chain.” One of the Wal-Mart factories visited was the Dashing Decoration Company in Dongguan City, which has been in operation for seven years. The factory specializes in production of candles and Christmas lights, and employs roughly 1,800 workers. During its site visits, CLW found:

-None of the workers were given copies of their work contract with Dashing. Workers stated that their contracts were fake and do not include basic information that is required by the Labor Contract Law.

-Workers who work over six months have difficulty quitting.

-Workers only get two days off a month, and sometimes workers must work 24 hours consecutively.

-Overtime is illegally underpaid and workers are fined for refusing to work overtime. There are long overtime hours in the factory, and overtime is mandatory. Workers who refuse will receive a penalty equivalent to three day wages. The hourly rate at Dashing is around $0.65/hour. Overtime wages are illegally low at rates of $0.44/hour for regular overtime (45% of the legal minimum), $0.88/hour for weekend overtime (68% of the minimum) and $1.32/hour for holiday overtime (68% of the minimum). It is extremely difficult to ask for a day off at Dashing, unless it is for sick leave, which requires medical authorization. There is no paid vacation and pregnant women are offered 45 days of unpaid maternity leave.

-Workers must sign false pay stubs to deceive clients and lie during audits. CLW investigators discovered last year that workers are required to sign a false pay stub. Several days after signing false document, workers were given a chart with real figures

-Living conditions are very poor: bathrooms have no running water, canteen sanitation is poor and fees are deducted from wages regardless of whether workers eat there.

-Workers are fined 9 days wages for absence of more than half a day. In the Dashing worker dormitories, each room has the capacity to hold 12 persons, and currently average 10 workers per room. Communal restrooms have no running water and can hold no more than ten people. There is a bucket of water in the restroom for workers to flush the toilet, but since demand for water is higher than supply, most of the toilets are left unflushed. The workers have production quotas. If workers are unable to meet quotas four days in a row, on the fourth day Dashing will deduct overtime wages.

There is no union at this factory. There are complaint boxes located on the stairway of each dormitory floor, but workers say no one ever checks the boxes. The CLW found that every day was a black day at the factories churning out goods for American consumers at Wal-Marts.

What you can do: As a result of their study, the CLW concludes that “Wal-Mart pricing is too low.” The report notes, “As the world’s largest retailer, Wal-Mart leverages its huge orders to convince factories to sell goods at low prices that are not sustainable. This puts pressure on other brands to pay less, thereby setting a dangerous industry precedent.” CLW says Wal-Mart’s audits fail to identify all labor violations. “After failing two Wal-Mart audits, factories may bribe auditors on the third audit to avoid losing Wal-Mart orders.” The group calls for a system of external monitoring of these factories. “Wal-Mart’s corporate structure needs to focus on real change and not on image,” CLW says. “Wal-Mart routinely turns a blind eye to poor conditions in supplier factories unless investigations are made public.”

CLW charges that Wal-Mart is not enforcing its basic standards. “It has the size and power to be an industry leader,” CLW writes. “Wal-Mart needs more transparent ethical sourcing efforts.” American shoppers don’t want to hear that Wal-Mart’s low prices are built on a system of exploitation and deceit. But that’s all part of the price of shopping at Wal-Mart. You save money---but the worker’s don’t live better. For a full copy of the China Labor Watch report, go to www.chinalaborwatch.org. 

| Dec 01, 2009

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Walmart’s treatment of workers, both in the United States, and abroad, is a major issue that needs serious attention and change. In the case of workers in the US, it seems that Walmart deliberately squeezes every dime out of their workers. Overseas, it seems like workers are mistreated more as a symptom of a destructive business model.

A new report from China Labor Watch reveals labor abuses in Walmart’s Chinese factories, a failure of Walmart’s auditing system, and, ultimately, how Walmart’s demand for the cheapest goods leads other companies to follow in its footsteps, creating a race to the bottom. Here’s how it works:

“Wal-Mart pricing is too low. As the world’s largest retailer, Wal-Mart leverages its huge orders to convince factories to sell goods at low prices that are not sustainable. This puts pressure on other brands to pay less, thereby setting a dangerous industry precedent. In conversations with CLW, both factories and other brands frequently cite Wal-Mart’s pricing structure as a major source of financial pressure.”

Walmart likes to brag about how much money it saves people, even if they don’t shop at Walmart. Their argument is that by having the lowest prices, other companies are forced to compete and lower their prices as well. The same properties are at work with sweatshop labor. Walmart is a trend setter in the industry because of its size. It is important to remember that Walmart’s low prices come at a cost.

The ultimate message in China Labor Watch’s report is that Walmart needs to focus on real change, and not on image, a message we’ve been preaching for years now. The real problem, says the report is that, “corporate codes of conduct and factory auditing alone are not enough to strengthen workers’ rights if corporations are unwilling to pay the production costs associated with such codes.”

You can read the full China Labor Watch report here (pdf).

| Sep 08, 2009

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The following article was originally published on Huffington Post.

You steal, you die.

That’s the international policy apparently at Wal-Mart stores, where reports indicate another alleged shoplifter has died at the hands of a gang of overzealous Wal-Mart workers—this time in China.

According to the Associated Press report this week, Yu Xiachun, a 37-year-old woman, died 500 yards from the Wal-Mart store in Jiangxi province. Based on the local police report, Yu had exited the store and was on her way home on August 30th when she was surrounded by five Wal-Mart workers, who accused her of shoplifting.

The Wal-Mart workers asked Yu to produce a receipt, which she did. But then Yu tried to take the receipt back—questioning who the four men and one woman were, because no one was wearing a Wal-Mart uniform. The police say that the Wal-Mart workers fought with Yu, and she was knocked to the ground. She was taken to the hospital, where she died three days later. The police have arrested two of the young Wal-Mart workers who fought with Yu. It is not clear yet what they are being charged with, if anything.

Read the rest of this story ...

| Jun 19, 2009

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The U.S. International Trade Commission has made an announcement, and that announcement is one we shouldn’t be surprised by at this point. The ITC has ruled that U.S. tire companies are being harmed by cheap products from China, and as a result President Obama will have to decide whether to impose tariffs or quotas on the country that, thanks to Wal-Mart, is now America’s largest source of imports.

Of course, Wal-Mart’s tire business isn’t the only factor behind the ruling, but it certainly is one of the biggest. China sent 21 million tires to the U.S. in 2005, and that more than doubled to 46 million by last year. For its part, Modern Tire Dealer reports that Wal-Mart Stores Inc. has close to 3,200 outlets selling tires, although most of those sales are concentrated in its approximately 2,435-store Tire & Lube Service Centers nationwide.

The (United Steelworkers) union said China has more than tripled its tire exports to the U.S. between 2004 and 2008, ending jobs for 5,100 American workers. The union said another 3,000 workers would lose their jobs by the end of the year.

The next move for the ITC will be to come up with come up with recommendations on what the President should do to help U.S. companies, including a couple familiar names based in Ohio - Akron-based Goodyear Tire & Rubber Co. and Findlay-based Cooper Tire.

The case is the first test for Obama on trade with China, after he vowed during his presidential campaign last year to help unions or domestic industries seeking relief from foreign competition. Since the election, he also has pledged to avoid protectionism so as not to exacerbate the global recession.

U.S. agency rules for tire producers in China case [Bloomberg News]

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| Jun 04, 2009

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Much is made of Wal-Mart’s presence in China - from the fact that many of its products are sourced there to the realization that the growing power remains a prime target for Wal-Mart’s expansion.

Harold Meyerson, in his Washington Post column marking the 20th anniversary of Tiananmen Square, poses that it has been American capitalism - chiefly the Wal-Marts of the world - that has spurred the growth of China into a rising superpower:

The transfer of manufacturing from the United States to China—driven by the rise of mega-retailers such as Wal-Mart that have been able to enforce a regime of low wages all along their global supply chains—has diminished our middle class and expanded theirs.

In fact, Meyerson points out it was American businesses and their representative groups (here’s looking at you, U.S. Chamber of Commerce) that opposed legislation in China aimed at strengthening worker rights. The goal was to improve working conditions and arrest the practice of withholding wages and forcing employees into working insanely long hours, but American business interests succeeded in pushing amendments to “make it more acceptable to foreign firms” - a fancy way of saying weakening the effect the bill would actually have on workers and the businesses that depend on keeping costs down. No wonder they’re such close buddies nowadays.

You can read the whole column, but Meyerson unleashes his most venomous critique in his closing:

Wal-Mart, which used to lock its night-shift stock clerks and janitors inside a number of its stores until the morning managers arrived, prefers production in Guangdong to manufacturing in the Midwest. Indeed, the director of purchasing for Wal-Mart is based in China.

As historian Nelson Lichtenstein and others have documented, Wal-Mart inspires in its managers an almost fanatical allegiance to the company’s cause. In Wal-Mart world, the provincialism (if not “idiocy") of rural life is fused with a brilliance in the art of low-cost, low-wage logistics to create a company that is both authoritarian in its inner workings and a friend of authoritarian regimes abroad. The butchers of Beijing could not have found any more compatible capitalists.

Beijing’s Favorite Capitalists [Washington Post]

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27 comments | May 11, 2009

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$2 MILLION GETS WAL-MART OUT OF CRIMINAL CHARGES IN DAMOUR CASE

• Wal-Mart Pays $2M to Avoid Charges in New York Death Probe [Associated Press via Insurance Journal]
  Wal-Mart agreed Wednesday to pay nearly $2 million and improve safety at its 92 New York stores as part of a deal with prosecutors that avoids criminal charges in the trampling death of a temporary worker last year.

• Legal Eagle: Wal-Mart pays up [Capital News 9-TV (N.Y.)]
  A case out of Long Island where a trampling death of a temporary employee has Wal-Mart paying up.

• Valley Stream, NY. D.A. Lets Wal-Mart Buy Its Way Out of Criminal Charges In Trampling Death [Battlemart Blog]
  On January 3, 2009, Sprawl-Busters reported that the police in Nassau County, New York had released a new plan designed to prevent the recurrence of a trampling death that took place at a Valley Stream, Long Island Wal-Mart.
  

RETAIL SALES FINALLY STEADY?

• Retail Sales, Output Probably Steadied: U.S. Economy Preview [Bloomberg News]
  Retail sales in the U.S. probably stabilized in April and factory production fell at a slower pace, indicating the economic slump may be starting to ease, economists said before reports this week.
  

WAL-MART DUKING IT OUT WITH OTHER RETAILERS FOR ONLINE SHOPPING MARKET SHARE

• Store Names Wal-Mart, Safeway, Lowes Drive Consumers to Online Shopping [Bnet Retail]
  According to ForeSee Results, Wal-Mart is an example of a retailer whose established business is driving online sales.

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0 comments | May 06, 2009

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LONG ISLAND STAMPEDE VICTIMS WIN SETTLEMENT, SAFETY CHANGES FROM WAL-MART

• Wal-Mart to pay victims of stampede [Newsday via Chicago Tribune]
  Mega-retailer Wal-Mart will pay an unspecified sum to victims hurt in a stampede that left a security guard trampled to death at a Valley Stream store during an after-Thanksgiving sale.
  

• NY prosecutor ends investigation into Wal-Mart trampling death, creates pact with retailer [Associated Press via Chicago Tribune]
  A New York prosecutor is ending a criminal investigation into the post-Thanksgiving trampling death of a temporary employee at a Long Island Wal-Mart.
  

• Wal-Mart To Announce Changes In Wake Of Trampling Death [NY 1-TV (N.Y.)]
  Wal-Mart officials are expected to announce today an agreement to improve safety measures following the trampling death of an employee from Queens last year.
  

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