Posts Tagged ‘Labor rights’

IKEA at Tempe near Sydney’s International Airport

As Western children play today amidst all those shreds of Christmas paper wrapping and, no doubt, many adults queue up to return or exchange unwanted gifts, I wonder how many of them pause to think that IKEA, that friendly, funky store would have so many labour rights issues?

Workers in IKEA Turkey for example, report being intimidated when they attempt to join the local union, Koop-Is Sendikasi especially after a union activist on the site was sacked.

Interestingly the countries where IKEA management play by the rules are mostly in Northern Europe while the reported problem locations are found in an arc through Southern and Eastern Europe. This is in line with the predictions of Geert Hofstede’s Power-Distance Index (PDI) as they are all countries with a high PDI score; in other words, where workers tend to believe management are inherently unjust and, conversely, where management tend to believe their role requires them to get their hands dirty (I provide this as a possible explanation, not as an excuse).

The problematic sites are:

  • Portugal
  • Spain
  • Italy
  • Greece
  • Turkey
  • Czech Republic
  • Russia

The retail global union federation, UNI, has made IKEA a focus company for a co-ordinated campaign amongst affiliates and in countries where there is no strong retail/warehouse union. UNI spokesman Alke Boessiger said:

To us it is clear that all workers at all IKEA workplaces are equal and have the right to the same good working conditions and the same rights to become a union member and negotiate a collective agreement

To its credit, IKEA appears to be heeding the “reputational challenge” that all of this presents and is in discussions with UNI about addressing them.

Here is UNI’s Research Brief and below is their video explaining the goals of the campaign:

You can follow the latest on this campaign at

Samsung Galaxy S III

Samsung Galaxy S III (Photo credit: John Biehler)

If ever there was a serious contender for the title “iPhone killer”, the Samsung Galaxy S III is the closest thing I’ve seen. It’s time to take a closer look at its maker.

Samsung already sells considerably more handsets than Apple, but they don’t get anything like the amount of attention that Apple does, at least in English-speaking media. It’s not surprising: Most of their sales are made outside the USA, their stock isn’t listed on the NYSE and their product launches are in the Korean language (and in Seoul).

Korea is a pretty big player. The population of North and South combined is nearing that of Japan. Samsung looms large in South Korea’s national identity. It generates nearly 20% of the country’s GDP, a proportion that hasn’t changed much in years (AMRC, p. 48). The company’s economic output of $250 billion is larger than most national economies. At the World Expo, currently underway in Korea’s port city of Yeosu, Samsung has its own pavilion.

Like other trans-national corporations, Samsung outsources production around the world, often to places where manufacturing has lower wage cost.

The rise of Samsung and its operations throughout Asia are the subject of the first half of the book Labour in Globalising Asian Corporations published by Asia Monitor Resource Center (the second half deals mostly with Toyota).

The chapters are written by different authors and are a little episodic so, other than the general theme, the book doesn’t have an over-arching narrative. Each chapter is a meticulously pieced-together portrait of the company’s workforce, particularly Chapter 1 which makes a sweeping tour through Korea’s economic history right back to the Japanese occupation in the 1930s, the time of Samsung’s formation. It that respect it is an invaluable resource for students and others interested in alternative economics.

The book carefully documents the company’s shortcomings, mostly with respect to wages. In its home country Samsung uses a strategy of providing reasonable pay but banking on its prestige as an employer to squeeze the workforce to work harder and sacking the bottom 5-7% of performers every year as a matter of course.

The company has a declared ‘no union’ policy which it promotes by various means:

  1. Historically when workers in Korea itself start agitating for better pay, the company has given raises, neutering any union message.
  2. Outsourcing to suppliers that are separate companies on paper but actually controlled by Samsung management.
  3. In Korea and South-east Asia the company has succeeded in registering paper unions so that activists can’t obtain official recognition, and/or having real unions dissolved over minor administrative impediments.
  4. In Malaysia it also got the cooperation of the government to prevent unionization as part of the package of sweeteners to bring investment. This sounds outrageous but is possible because Malaysia has not ratified the ILO Convention on freedom of association.

It’s strange that Korea’s corporations are so virulently anti-union when Japanese companies learned a long time ago to work with them.

Samsung, owned and operated from Korea, also presents a challenge unlike anything I’ve covered to date. Whilst it is a public company it is not like other global brands, in which the largest stockholders are pension funds and no single fund owns a substantial holding. Samsung is a chaebol, a colossal interlocking network of companies all controlled by Lee Kun-hee and his family. The national government has only taken timid steps to wind back the chaebol system, despite its weaknesses such as overproduction which became apparent during the 1997-1998 economic crisis.

With no unions, little regulation and not even a fig-leaf of shareholder accountability there aren’t a whole lot of options to counter the power of the Lee Family. Social movement activism seems to be on the rise though. Last month a large meeting of three dozen activist networks took place in Seoul, making ten years of the International Campaign for Responsible Technology and they had Samsung squarely in their sights, holding a large protest outside the company’s headquarters.

The focus of this protest is occupational deaths among Samsung employees resulting from leukemia. The company has taken no action to improve safety (oddly this issue is not covered in Labour in Globalising Asian Corporations, even though it was only published a couple of years ago).

Their campaign is making some headway: on June 21st the country’s National Human Rights Commission requested that the Ministry of Employment and Labor change the rules to make it easier to prove that workplace injury and disease is attributable to the employer.

Chaebols still have to negotiate just like anyone else when their workforce is organised (it’s getting to that point that is the problem in Samsung). Just over a week ago, truck drivers belonging to the Korean Transport Workers Union achieved a 9.9% pay rise after a week-long strike. Samsung doesn’t have magic powers to prevent unionisation, just good lawyers.

Labour in Globalising Asian Corporations is available in hard copy from Asian Monitor Resource Center. It’s also available on their website in PDF. The sections relating to Samsung are:


English: Palm oil from Ghana with its natural ...

English: Palm oil from Ghana with its natural dark color visible, 2 litres Español: Aceite de palma de Ghana con su color oscuro natural, 2 litros (Photo credit: Wikipedia)

Ethical consumption is not going to solve the world’s problems, and here’s why.

To Western eyes, we only know the goods that are ‘Made in China’ that make it to our shores, so we can be tempted to think that they are representative of the country’s entire production, which would be wrong.

I’ll use Indonesia’s stats as an example.

Indonesia’s formal economy produces about $1 trillion of goods and services each year. The informal economy, which is not reported and not measured, is much larger than the formal economy. So many Indonesians working in small workshops, driving rickshaws, and so on are paid in cash and do not pay taxes.

Even within that smaller area which is the formal economy, only 15% (or 1 in 7 workers) are making goods for export, much of it raw materials such as palm oil and copper. So these companies that form part of the supply chain connected to Western consumers but are largely locally-based businesses, not employees of multinationals. Incoming foreign investment – where the operations are substantially controlled by overseas interests – represent about 5% of the economy, so it is generating perhaps 7-10% of economic activity or about 1 in 15 formally-employed workers.

Do-gooders have to remember their limitations. Even if every Western company invested in Indonesia magically stuck to all the core ILO standards overnight (ha!) it would hardly put a dent in solving the issues of Indonesia’s workers.

Besides, there is something slightly offensive in the notion that Westerners need to come in and fix things. Indonesians (and Indians, Cambodians, etc) understand their country’s challenges better than we do.

Having said all that, I’m not denying it has its place. I do think something is wrong with the world if consumers don’t care whether the person who made their household products was paid fairly, had reasonable hours and a safe workplace, regardless of where in the world they are located. I’m just saying we ought to think of ethical consumption more in this transactional manner only and not as a magic wand.

Read on:

Workers' Memorial Day poster Pray for the dead...

Workers' Memorial Day poster Pray for the dead and fight like hell for the living. - Mary Harris "Mother" Jones (Photo credit: Wikipedia)

What gets measured, gets done.

April 28 is commemorated worldwide as a memorial day of workers killed on the job.

Health and safety provides a stark example of the gulf between the workplace entitlements enjoyed in the developed world compared to the developing world. Not only are safety standards so much higher, after decades of lobbying, but it is comparatively so much easier to show an employer’s liability and thus access some form of remedy.

A forthcoming report co-published by Asia Monitor Resource Centre (AMRC) and Asian Network for the Rights of Occupational and Environmental Victims (ANROEV) draws attention to some stark realities:

  • Globally, occupational disease is a more serious problem than occupational injury, causing four times as many fatalities.
  • One reason disease receives less attention is that it is less visible; deaths occur quietly at home, usually some time after cessation of duties, instead of publicly and dramatically at work. Also once a person stops work their contact with their union (if they belonged to one) usually ceases too.
  • Another significant reason is under-reporting. The workplace death figures that many nations report to the ILO / United Nations are impossibly low. The reason is not that they are being intentionally evasive, they just don’t allocate the resources to measure the problem. In the Philippines for example, the government employs 235 labour inspectors to monitor 800,000 workplaces.

This is a limitation of the CSR approach to labour rights. Until such time as the world becomes much more transparent than it currently is, good intentions and flowery prose aren’t enough to improve people’s rights. A watchdog of some kind is needed, preferably a democratic union but at the very least some kind of impartial monitoring agency. If official statistics don’t show that there is a problem, it’s easy for officials to simply dodge the issue.

(To be continued. Next: Samsung’s Health and Safety record)

Related posts:

ClockWhen we talk about poverty; the prevalence of poverty, or about the poverty rate, these days we are usually referring to the accepted definition, which is invariably determined by income level.

The academic book Discretionary Time: A New Measure of Freedom, authored by researchers at the Australian National University (plus one colleague in Finland) suggests that we should broaden that definition.

By remarkable coincidence, the message of the book is allegorised in the recent science fiction film In Time starring Justin Timberlake and Amanda Seyfried.

‘Discretionary Time’ starts with the hypothesis that time-poverty is more than just a figure of speech, it is real. There are people working well over 40 hours a week to make ends meet. They do succeed, and their household budget is in balance, but at the personal cost of most leisure time. Their discretion to do as they please in life is limited so they might as well be regarded as poor; they are no better off.

The majority of the book consists of empirical study which does confirm the hypothesis, and also an extended analysis on the effect that marriage and divorce have on people’s discretionary time (generally: marriage increases it while divorce decreases it disproportionately for women, in most countries).

This is troubling reading.

Over a century ago, the workers of the then-industrialising nations fought hard for a working day divided between “8 hours work, 8 hours rest and 8 hours leisure”. After this was achieved, the rise of large-scale leisure time had a significant impact on economic development, too, as people went out and spent money and also began to educate themselves and improve their knowledge and skills.

Today we find ourselves in a situation where poverty, narrowly defined by money, affects maybe 1 in 8 or 1 in 6 of the population, however time poverty (having to work more than 40 hours a week to make ends meet) affects 1 in 3 or 1 in 2 -and that’s in the rich world! Think of the people working 70- or 80-hour weeks in the EPZs of China and Southeast Asia and living, single in dormitories.

The only criticism I could make of the book is that it does not acknowledge the existence of people who work long hours but enjoy their work and wouldn’t work less even if they had the option. Human Resources people tell us that about a third of the workforce is ‘actively engaged’ with their jobs, so a significant minority. That may not be enough to willingly work more hours at the expense of one’s free time of course.

Which brings me to the film.

If any film captures the gestalt of 2011 and the Occupy Wall Street movement, it is In Time.

The conceit is that, at some indeterminate point in the future, all human beings become installed with a clock that counts down to the moment of death. Everyone gets one year of time on their 25th birthday but after that, they have to work for which they are paid extra ‘time’. It is not stated but pretty clear from the film that regular wages are not enough to keep an individual comfortably ahead of their count-down. Most people end up begging or stealing for extra time; in debt, essentially. The protagonist and his mother live with only one day’s credit; a hand-to-mouth existence.

The plot grows thicker: there is not upper limit on the amount of time a person can have and, sure enough, it turns out that there are restricted areas where a small number live with thousands of years of time; effectively immortal. Moreover it emerges that they intentionally restrict the supply to keep this state of affairs.

The analogy to the 99% movement, executive pay and so on is pretty clear.

It is a very thought-provoking film and well-acted too. It seems to support a Robin Hood tax solution, though you would have to call it a Bonnie and Clyde tax if you know the scene.

See also:

The innovative Free2Work iPhone app allows you to scan and look up data about what you are buying

What a brilliant use of technology to overcome human laziness!

The only downside is that the app focuses on high-profile brands; most of the everyday commodities in your pantry will not show a result.

Free2Work is available free in the appstore.

Related posts:

Chongqing Taxi

Image by foxxyz via Flickr

Evidence continues to mount that the Chinese authorities are deliberately looking the other way when it comes to labour unrest. They don’t really have a choice. They either allow workers to get what they want in the form of moderate wage increases or face massive social dislocation from people who can’t keep their heads above water, financially.

In the last few years the number of known strikes has continued to increase, most visibly amongst taxi drivers in cities including Hangzhou, Zhengzhou, Qionghai, Foshan, Mengzi and Shanghai.

The particular issues vary but they are all essentially protesting over the same thing: meeting rising costs of living. In some cities the issue is the cost of fuel, in others it the government’s failure to increase taxi fares, in others it is over the proliferation of unlicensed taxi cabs.

Interestingly not only has this taken place without any sort of crackdown, the mainstream press has been allowed to report on it, suggesting that it is less frowned on.

Demographic pressure

Even though the Chinese labour market seems inexhaustible to the ears of Westerners, it is still fairly mobile and low-end manufacturers are under pressure to find people who will work bottom-end wages. There are now more options out there. Their response has been to move up the value chain, making more high-end goods such as laptop computers and iPads where the output justifies the higher pay. The same progression took place in Japan and then Korea.

Where does China’s anemic official state union fit into this? Hardly at all, it seems. Generally wage increases have been won by ad hoc worker coalitions working on their own. Supply and demand seems to be enough to force up wages when people feel the pressure enough. I wonder what will happen in five to ten years when, analysts suggest, growth slows down.