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| TED Case Studies Number xxx, 20xx by xxxx | & SWEAT SHOPS ALLEGATIONS | General Information Legal Cluster Bio-Geographic Cluster Trade Cluster Environment Cluster Other Clusters |
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KATHY LEE GIFFORD
1. The Issue
Kathy Lee Gifford, a famous actress, a singer and a television talk show host,
came under srutiny in 1995 because her line
of women’s clothing was allegedly being
made by child labor. Kathy lee obviously refuted the allegations. This is not
an isolated case however. Nike, Gap, Guess, Bodyshop and many more manufacturing
companies came under scrutiny in recent years due to their labor laws violations
in overseas. As more information about the exploitation of indigenous peoples
comes
forth in the international debates concerning labor law violations, more awareness
is being raised, to stop the exploitation of labor; particularly regarding child
labor. The issue in this case study deals with labor rights violations.
Trans National Companies (TNCs) in attempts to make substantial profit, move
their manufacturing plants oversees where there is surplus labor availability.
In an effort to make higher profits and with fewer restrictions on labor laws,
TNCs force their workers in their plants to work extensively without any breaks
or without good working conditions. Commodities are therefore made at a cheap
labor cost, and sold back to the Western world (predominantly) at “brand name”
price. This case study deals with one such issue of labor law violations. Kathy
Lee's women's line of clothing are subcontracted to a manufacturing plant in
Hondurs, where the plant hires children to work in filthy and disease infeseted
environment. Furthermore, the children are not even paid a decent wage for their
work. see sweat shop conditions .
Kathy Lee Gifford is well known for her achievements and accomplishments as a singer, an actress, and as a television talk co-host. Kathy Lee was on the verge of becoming a well known celebrity because of her co-hosting career in the ABC talk show, "Regis and Kathy Lee Live", when her reputation and status was brought under the negative limelight.
In March 1995, Kathy Lee and her line of women's clothing came under attack when investigators from the National Labor Committee found teenage women sewing clothing at her Global Fashion plant in Honduras. The clothes were then exported to the U.S. for sale at Wal-Mart. When Kathie Lee's clothing was being produced, approximately 10 percent of the workers employed at Global Fashion were thirteen to fifteen years old. March, 1996
The young women working
in the plant for Kathy Lee were found to be of thirteen to fifteen years of
age 1 . The workers were not allowed to take
breaks, or have a drink of w
ater
if they were thirsty. They were forced to work overtime and pull twelve-hour shifts if the plant had to meet with deadlines.
Like many offshore assembly plants, Global Fashion was a humiliating place to work. About 80 percent of the sewers in
Kathy Lee’s plant were women, the majority of them very young. The women had to raise their hands to use the bathrooms,
which were kept locked. Bathroom visits were limited to two per day. The women were not allowed to talk to each other
during work. They were physically searched on the
way into the plant for candy or food, which was prohibited. The supervisors scream at them all day to work faster and faster.
As a result, those workers who
were interested in attending night school would not do so. Workers worked in
hideous conditions where they were not allowed to take breaks, not even to
relieve themselves. Furthermore, the machines they were using were rust laden
and prone to accidents. Furthermore, the machines they were using were rust laden and prone to accidents. Additionally,
those women were being paid only thirty-one cents, and they were obstructed from learning about their rights as laborers so
that they could not voice their opinions about their rights.
Global Fashion has hired at least four armed guards, who are used to intimidate the young women. Every attempt by the women to meet to
learn their legal rights is disrupted. Every attempt to organize themselves to defend their most basic human rights has been met with threats
and illegal firings.
2 .
What is a "sweatshop"? What conditions are necessary for a manufacturing plant to be labeled a sweatshop and also let us explore into the insurgence of controversy that has been created in the recent past due to the conditions and the exploitative nature of sweatshops.
Sweatshops, according to the New York State Department of Labor (DOL), are an illegal operation of the underground economy as they operate as temporary plants that can be moved at moment's notice- and can be moved quickly from one place to another. According to the DOL, "sweatshops flourish because of the huge competitive advantage they hold over legitimate businesses that pay fair wages, provide safe working conditions, pay taxes and contribute to the economic and social health of New York and the nation" 3 . Implicit in this argument, sweatshops do not give fair wages to the employees, do not provide safe working conditions for the employees; evade taxes to the state or the government, and do not contribute to the social and economic health or attributes of the nation.
The idea of competition does not merely
exist for the TNCs, but also for the "host", developing or under-developed,
countries. Just as companies, in order to be successful with a particular commodity
attempt to out drive the competitors of that commodity, likewise, host countries
outbid the other to attract foreign investments into their respective countries.
According to an editorial published in Los Angeles Times on July 24, 1995 by
Bob Herbert mentions an advertisement run in 1990 in Bobbin, a trade magazine
targeting the United States' apparel industry. The advertisement portrays an
El Salvadorian young woman next to a sewing machine in a shirt factory with
the text reading, "you can hire her for 57 cents an hour". However, a year later,
in 1991, that particular advertisement was changed to "you can hire her for
33 cents an hour". This is how developing countries, in order to attract foreign
investments, lower the cost of their labor; as a result contribute to the race
to the bottom.
However, when the allegations surfaced through the media in the United States, ABC- the network which broadcasted and owned the copyright to Regis & Kathy lee Live, attempted to undo the damage by portraying a distort Kathy Lee, “I felt like I was being of all people, being kicked in the teeth for trying to help kids.” ABC then embarked on a number of public relations programs, which attempted to show the innocence of Kathy Lee by touting her good works for charities. However, when it was discovered that few blocks away from her studio, a New York sweatshop was turning out Kathy Lee blouses for Walmart, where the workers were hired to work for more than 60 hours a week, and most of them were not even gotten paid for previous work, the entrepreneur's husband, ABC sportscaster Frank Gifford, responded by rushing to the sweatshop with envelopes of $300 in cash for the mistreated workers. See Albion Monitor
3. Related Cases
Thaiwomen
Saipan
Bodyshop
Nike
Ben & Jerry's
Russian Women Trafficking
Bracero
Africa-Textiles
Rugmark and Child labor
Nepal Sex Trade
SandleWood
Picker
4. Author and Date:
Sajeed Asghar (Titu)
Spring 2001
5. Discourse and Status:
Disagreement and in Progress.
In the 1970s, after considerable awareness was created about the slave like conditions that existed in the sweatshops, international organizations such as the United Nations drafted a "Code of Conduct" which became the "standard" to be followed by the TNCs and various host countries.
Consequently,
in 1997, the International Labor Organization adopted a Tripartite Declaration
of Principles on Multinational Enterprises and Social Policy, which had been
given considerable importance by the workers' group in 1996 in Geneva 4 .
Additionally, in May 1995, the "Clothing Manufacturers' Association
of the United States of America (employers) and the Amalgamated Clothing Textiles
Workers' Union (workers) signed for the first time a national
branch collective agreement which included, amongst other aspects, a code of
conduct applicable to enterprises and their 
subcontractors
which established minimum standards regarding wages, hours
of work, forced labour, child labour, freedom of association,
non-discrimination as well as occupational safety and health" (An article by Jean-Paul Sajhau)
In the United States, the Department of Labor (DOL) believes that it should be illegal to sell good produced in violation of labor laws 5 .
The "No Sweat" campaign includes a list of companies (mentioned below) that have taken the fight against sweatshops, have taken steps to respect labor legislation and human rightsin general in their production and marketing activities and ensures that these rights are respected by their subcontractors.
| Abercrombie& Fitch | Galyans Trading | Mast Industries |
| Baby Superstore | GapKids | NFL Properties |
| Banana Republic | Gerber Childrenswear | Nicole Miller |
| Bath & Body Works | Guess Inc. | Nordstrom |
| Bergners | Henri Bendel | Old Navy Clothing Store |
| Bryland | Lands End | Penhaligon's |
| Boston Stores | Jessica McClintock | Patagonia |
| Cacique | Lane Bryant | Structure |
| Carson Pirie Scott | Lerner New York | Superior Surgical Mfg. |
| Dana Buchman | Levi Strauss | The Limited |
| Elisabeth | Limited Too | The Gap |
| Express | Liz Claiborne | Victoria's Secret |
| Source: Department of Labor, 25 Mar. 1996. |
A detailed summary on the aggrement can also be found on Summary of the agreement .
6. Forum and Scope:
The United States of America and Bilateral.
7.Decision Breadth:
Two (2) The U.S. and Latin America
8. Legal Standing:
TREATY
In the Textile, Clothing and Footware manufacturing sectors, the
International Textile, Garment and Leather Workers' Federation has for many years been calling for a greater sense of social
responsibility by enterprises in the sectors and has provided support to national federations in their campaign for the respect
of human rights at work. In 1995, Clothing Textiles workers' Union signed for the first time a national branch collective agreement
which included,
amongst other aspects, a code of conduct applicable to enterprises and their subcontractors which established minimum
standards regarding wages, hours of work, forced labour, child labour, freedom of association, non-discrimination as well as
occupational safety and health.
According to the covenant of the United Nations' General Assembly, laws pertaining to the violations of labor rights across boarders
are being discussed, yet no proper authority is in place to implement
the law in an international arena. The United Nations and the International
Labor Organization has off and on criticized the violators (the US and the Western
Europe), but no task force has been stablished to prevent the exploitation of the workers by the TNCs.
III. Geographic Clusters9. Geographic Locations
North America
Honduras.
10. Sub-National Factors:
No.
Tropical
IV. Trade Clusters12. Type of Measure:
Ban on imports
13. Direct v. Indirect Impacts:
Indirect
14. Relation of Trade Measure to Environmental Impact
a. Directly Related to Product:
Clothing (Yes)
b. Indirectly Related to Product:
No
c. Not Related to Product:
No
d. Related to Process:
Rights (Yes)
15. Trade Product Identification:
Textiles/ apparel
16. Economic Data
An article published in www.worldfreeinternet.net on June 4, 1996, claims that Kathy Lee paid 31
cents for child labor 6
. Sweatshop is a product of our global economy, with consumers and producers
demanding cheaper and better products; and cheaper and ample labor, respectively.
When allegations of misconduct by a well know figure in the United States surfaces, as the allegations of sweatshop
abuses by Kathy Lee, the media truncates their misconduct by portraying them to be innocent and a Good Samaritan.
Coming under scrutiny from labor-rights activists, Kathie Lee Gifford announced an inspection program for all factories
producing her line of clothes. Although Kathy Lee acknowledges her contribution to the miseries of the people employed at
the factories that produce her line of women’s clothing (in New York and Honduras) she has not done much to alleviate their
sufferings. Requesting Walmart to return the cloths make off of sweatshop factories, and rushing to give the tortured women in
New York factories $300, does not make her the forerunner in the fight against sweatshops.
The following table of productivity index and hourly compensation in particular
countries better illustrates sweatshops as a global economic product.
| Country | Productivity (Index) | Hourly Compensation (includes wages & benefits) |
| U.S. | 100 | $8.00 |
| Dominican Republic | 70 | 1.15 |
| Malaysia | 65 | 1.15 |
| Mexico | 70 | 0.85 |
| Guatemala | 70 | 0.65 |
| Thailand | 65 | 0.65 |
| Indonesia | 50 | 0.15 |
No impact on trade restictions as of yet. The problems of sweatshops exists in Honduras as well as metropolitan cities like New York and Los Angeles.
18. Industry Sector:
Garment Manufacturing & Textile Industry
19. Exporters and Importers:
Importers: Honduras imports raw materials and exports finished products;
Exporters:
Walmart exports rawmaterials and imports finished garment products (women's
line of clothings in particular).
V. Environment Clusters20. Environmental Problem Type:
Labor law violations (Rights)
21. Resource Impact and Effect:
22. Urgency and Lifetime:
Moderate and 10 Years
23. Substitutes:
None
VI. Other Factors24. Culture:
No
Yes. Manufacturing jobs are being shipped overseas to developing or under-developed countries, where labor is cheap and abundant. As a result, the U.S. labor is loosing capital. However, due to less restrictions on labor laws in the third world countries, thier labor is being exploited by Kathy Lee's women's line of clothing
Yes Human Rights, Labor laws violations.
27. Relevant Literature
International Labor Organization
Kathie Lee Fashions Made By Child Labor
Sweat Shops in the Modern World by Aaron Kuller
The Students of Mr. Fernandes' Grade 6/7 Class