United States Department of Labor
II. Codes of Conduct in the U.S. Apparel Industry
Footnotes
1 Sri Ram Khanna, "Trends in US and EU Textile and Clothing Imports," Textile Outlook International, January 1996, 80 [hereinafter Trends in US and EU Textile and Clothing Imports]. Return to Document
2 According to Levi Strauss & Co., its "Global Sourcing & Operating Guidelines," adopted in 1991, were the first ever developed.Return to Document
3 This study focuses on the child labor issue, although other labor standard aspects of code of conduct are also controversial and require further review.Return to Document
4 This study examines the foreign implementation of codes of conduct, not domestic application -- although many companies have similar policies for garment production and sourcing within the United States.Return to Document
5 Lance Compa and Tashia Hinchliffe-Darricarrere, "Enforcing International Labor Rights Through Corporate Codes of Conduct," Columbia Journal of Transnational Law 33 (1995), 663-668 [hereinafter Compa and Hinchliffe-Darricarrere].Return to Document
6 The OECD Declaration and Decisions on International Investment and Multinational Enterprises, 1991 Review (Paris: Organization for Economic Cooperation and Development, 1992), 39.Return to Document
7 See James Michael Zimmerman, Extraterritorial Employment Standards of the United States: The Regulation of the Overseas Workplace (New York: Quorum Books, 1992).Return to Document
8 Development and International Economic Cooperation: Transnational Corporations, U.N. Economic and Social Council, 2nd Session, Agenda Item 7(d), U.N. Doc. E/1990/94 (1990), 1. Return to Document
9 The OECD Declaration and Decisions on International Investment and Multinational Enterprises, 1991 Review (Paris: Organization for Economic Cooperation and Development, 1992), 39. Return to Document
10 Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy, 2d ed., (Geneva: International Labor Office, 1991)[hereinafter ILO Declaration of Principles]. Return to Document
11 See Compa and Hinchliffe-Darricarrere at 670-71.Return to Document
12 The Sullivan Principles, developed by the Reverend Leon H. Sullivan in 1977, were aimed at U.S. corporations doing business in South Africa within the apartheid legal system. They were intended to apply pressure on the South African government to end apartheid by promoting employment practices in U.S. corporations that ensured racial equality. See Leon H. Sullivan, "The Sullivan Principles and Change in South Africa," in Business in the Contemporary World, Herbert L. Sawyer, ed., (1988), 175. Return to Document
13 Named after Nobel Prize-winning human rights activist Sean MacBride, the MacBride Principles were developed in 1984 by the Irish National Caucus to address allegations of anti-Catholic discrimination in employment in Northern Ireland. See The MacBride Principles (Washington, D.C.: Irish National Caucus, 1984), 2.Return to Document
14 The Slepak Principles were issued in 1987 by the Slepak Foundation. They were designed to apply to U.S. corporations doing business in the former Soviet Union. See Jorge F. Perez-Lopez, "Promoting Respect for Worker Rights Through Business Codes of Conduct," Fordham International Law Journal 17 (1993), 13.Return to Document
15 Maquiladoras are plants that assemble parts and components into a finished product for export. Maquiladoras are located in Mexico, Central America and the Caribbean, and assemble U.S.-made parts and components into finished goods that are exported to the United States. The Maquiladora Standards of Conduct were issued in 1991 by the Coalition for Justice in the Maquiladoras. See "Maquiladora Standards of Conduct," in The CJM Newsletter (San Antonio, Texas: Coalition for Justice in the Maquiladoras, 1992), 1. Return to Document
16 In 1995, the Clinton Administration encouraged U.S. corporations and organizations to develop their own voluntary codes of conduct for their foreign operations based on a set of Model Business Principles. See Model Business Principles (U.S. Department of Commerce International Trade Information Center, 1995). See also "Administration Releases Details on Voluntary Business Principles," Daily Labor Report, no. 104 (May 31, 1995) A-4.Return to Document
17 "The Business of Child Labour," Anti-Slavery Reporter (London: Anti-Slavery International, July 1996) 6.Return to Document
18 James Cox, "U.S. Retailers Put Pressure on Foreign Factories," USA Today, September 4, 1996.Return to Document
19 Robert D. Haas, "Ethics -- A Global Business Challenge: Character and Courage," speech to the Conference Board, New York City (May 4, 1994) Vital Speeches of the Day, 506, 507 (on file with the International Child Labor Study).Return to Document
20 Mary Scott, "Can Consumers Change Corporations?" Executive Female, May/June 1996, 43.Return to Document
21 According to the International Mass Retailers Association, companies should be good corporate citizens but the responsibility for eliminating child labor lies not with corporations but with local and U.S. governments -- "it's called law enforcement." See International Child Labor Hearing, U.S. Department of Labor (June 28, 1996) (Statement of the International Mass Retailers Association)[hereinafter Statement of IMRA].Return to Document
22 Dominic Bencivenga, "Human Rights Agenda," New York Law Journal (July 13, 1995) 5 (quoting Diane F.Orenlicher, professor of international law at American University). Return to Document
23 Recent Developments in the Clothing Industry (Geneva: International Labor Organization, 1995) 7 [hereinafter Recent Developments]. Return to Document
24 ILO Textile Report at 6.Return to Document
25 Recent Developments at 7.Return to Document
26 "Dynamic Change in the Garment Industry: How Firms and Workers Can Survive and Thrive," (U.S. Department of Labor, Office of the Chief Economist, 1996) 1 [hereinafter Dynamic Change in the Garment Industry].Return to Document
27 Jackie Jones, "Forces Behind Restructuring in U.S. Apparel Retailing and its Effect on the U.S. Apparel Industry," Industry, Trade, and Technology Review (U.S. International Trade Commission, 1995) 23 [hereinafter Forces Behind Restructuring].Return to Document
28 Ibid.Return to Document
29 Ibid.Return to Document
30 Ibid.Return to Document
31 Carol Warfield, Mary Barry and Dorothy Cavender, "Apparel Retailing in the USA-Part I," Textile Outlook International (March 1995) 38 [hereinafter Apparel Retailing in the USA - Part I]. See also Forces Behind Restructuring at 23.Return to Document
32 Trevor A. Finnie, "Outlook for the US Apparel Industry," Textile Outlook International (November 1995) 92 [hereinafter Outlook for the US Apparel Industry].Return to Document
33 Dynamic Change in the Garment Industry at 2.Return to Document
34 Ibid.Return to Document
35 Kurt Salmon Associates, "No Quick Fix for '96," Bobbin, vol.37, no.4 (December 1995) 68 [hereinafter No Quick Fix]. See also Outlook for the US Apparel Industry at 71.Return to Document
36 Ibid.Return to Document
37 Outlook for the US Apparel Industry at 71, 73; Forces Behind Restructuring at 25.Return to Document
38 Outlook for the US Apparel Industry at 82.Return to Document
39 Ibid. at 77.Return to Document
40 Jules Abend, "Private Labels, Brands Square Off," Bobbin, vol. 36, no. 10 (June 1995) 68.Return to Document
41 Outlook for the US Apparel Industry at 84.Return to Document
42 Forces Behind Restructuring at 26.Return to Document
43 Apparel Retailing in the USA - Part I at 52.Return to Document
44 Ibid.Return to Document
45 American Apparel Manufacturers Association, News Release, June 1996.Return to Document
46 Focus: An Economic Profile of the Apparel Industry (American Apparel Manufacturers Association, 1995) 3.Return to Document
47 Dynamic Change in the Garment Industry at 2.Return to Document
48 American Apparel Manufacturers Association, News Release, June 1996.Return to Document
49 Trends in US and EU Textile and Clothing Imports at 80.Return to Document
50 Apparel Retailing in the USA - Part I at 38-9.Return to Document
51 Forces Behind Restructuring at 25. Return to Document
52 Ibid.Return to Document
53 Brenda A. Jacobs, "One From Column B: Choosing the Right Trade Program," Bobbin, Supplemental Guide on How to do Business in Latin America (1995) 2.Return to Document
54 ILO Textile Report at 16.Return to Document
55 Ibid. at 7, 21.Return to Document
56 Ibid. at 7.Return to Document
57 For example, a U.S. Embassy official who recently toured a Cambodian garment factory found "problematic" working conditions, including workers who appeared to be under age (but who claimed to be above the minimum working age of 16) and forced, unremunerated overtime. American Embassy-Phnom Penh, unclassified telegram no. 2594, September 16, 1996.Return to Document
58 Retailers' sales figures are total sales, not limited to apparel sales.Return to Document
59 Kurt Salmon Associates, Financial Profile for Fiscal Year 1995 (July 1996). The Profile includes only those companies that file public documents with the Securities and Exchange Commission (SEC).Return to Document
60 The three companies that did not respond are County Seat, May Department Stores and Neiman Marcus Group.Return to Document
61 These three companies are Kohl's Corporation, the Marmaxx Group and Shopko Stores.Return to Document
62 Stage Stores, Inc. ('Stage Stores') is the new name of Specialty Retailers, to whom the original questionnaire was sent.Return to Document
63 Appendix C does not contain those policies that respondents designated confidential.Return to Document
64 International Child Labor Hearing, U.S. Department of Labor (June 28, 1996)(Statement of Levi Strauss). Spiegel, Inc. ('Spiegel') and Liz Claiborne, while they do not have formal guidelines for country selection, said in telephone interviews that they decided to sever contracts with producers in Burma because of human rights violations.Return to Document
65 Neiman Marcus and May Department Stores did not respond to the survey.Return to Document
66 Kohl's Corporation responded to the survey but regards all information provided as confidential. Return to Document
67 Shopko Stores responded to the survey but regards all information provided as confidential. Return to Document
68 Dolgencorp, a Dollar General subsidiary that imports apparel, responded on behalf of Dollar General.Return to Document
69 There is no Federal Child Labor Act. Child labor provisions of federal law are contained in the FLSA.Return to Document
70 County Seat did not respond to the survey. Return to Document
71 The Marmaxx Group (formerly known as TJ Maxx) responded, but regards all information provided as confidential.Return to Document
72 As noted earlier, child labor provisions of federal law are contained in the FLSA.Return to Document
73 Includes companies that subscribe to another organization's code (that of an association or buyer).Return to Document
74 Appendix F contains ILO Convention 138 on Minimum Age for Employment -- the most commonly cited international standard on child labor. Return to Document
75 In a clause Sara Lee Corporation ('Sara Lee') provided from an agreement with a former buyer agent, however, Sara Lee required compliance with national laws on child labor. Furthermore, a Sara Lee supplier in the Dominican Republic (BRATEX Dominicana) provided a Department of Labor official with Sara Lee's "Supplier Selection Guidelines," which state that Sara Lee will not procure goods or services from firms employing workers under age 15. Return to Document
76 This is the standard contained in Warnaco's Business Partner Terms of Engagement, which is used only for contractors' facilities. For its wholly owned plants, Warnaco indicated that it uses U.S. labor standards with respect to all aspects of labor law excluding wages.Return to Document
77 Report on Labour Standards in the Asia-Pacific Region (Canberra: Government of Australia Tripartite Working Party on Labour Standards, February 1996) 75-76. Return to Document
78 The code is called "Labor and Environmental Principles to be Observed by the Members of the Apparel and Textile Industry Commission of the Association of Exporters of Non-Traditional Products," and was developed by the Apparel and Textile Industry Commission (VESTEX). VESTEX recently retained the services of an outside auditing firm to monitor compliance of member companies with the code. Any manufacturer may choose to adopt the code, but is responsible for paying to be audited. Return to Document
79 Levi Strauss Form 10-K report to the Securities and Exchange Commission (February 21, 1996) at 11.Return to Document
80 International Child Labor Hearing, U.S. Department of Labor (June 28, 1996)(Statement of Jeff Ballinger, Press for Change).Return to Document
81 International Child Labor Hearing, U.S. Department of Labor (June 28, 1996)(Statement of the Interfaith Center on Corporate Responsibility)[hereinafter Statement of ICCR].Return to Document
82 Statement of IMRA.Return to Document
83 The following companies indicated that they use internal staff to monitor for compliance: Federated, Fruit of the Loom, The Gap, Hartmarx, JCPenney, Jones, Kellwood, Kmart, Land's End, Levi Strauss, The Limited, Liz Claiborne, Mercantile Stores, Nike, Nordstrom, Oxford, Phillips-Van Heusen, Russell, Salant, Sara Lee, Sears, Spiegel, Talbots, Tultex Corporation, VF Corporation, Wal-Mart, Warnaco, Woolworth Corporation.Return to Document
84 These companies are: Dillard Department Stores, Dollar General, Dress Barn, The Gap, JCPenney, Jones, Kellwood, Land's End, The Limited, Mercantile Stores Company, Nordstrom, Phillips-Van Heusen, Sara Lee, Spiegel, Stage Stores, The Talbots, Venture Stores, VF Corporation and Woolworth Corporation. Return to Document
85 According to AMC, its retail shareholders includes such other stores as Bloomingdale's, Saks Fifth Avenue, Dayton Hudson, Bradlee's, Marshall's, Target and Filene's Basement.Return to Document
86 Kellwood indicated that it may expand its monitoring to use another Big Six accounting firm in the future.Return to Document
87 Statement of ICCR.Return to Document
88 See Bob Herbert, "In Deep Denial," The New York Times, October 13, 1995. See also National Labor Committee press releases of October 18, 1995, November 21, 1995 and December 16, 1995. Return to Document
89 Interfaith Center on Corporate Responsibility, "Independent Monitoring Working Group Progress Report," (April 19, 1996) [hereinafter ICCR report].Return to Document
90 Statement of ICCR. According to Mark Anner, of the Center for Labor Studies (CENTRA), who coordinates the NGO monitoring team, the experience has been very positive, with most problems already resolved at the Mandarin plant. He expressed concern, however, regarding the long-term sustainability of NGO monitoring since the monitors are all volunteers (with full-time jobs elsewhere) and raise their own budget.Return to Document
91 Fruit of the Loom also requires access to subcontractor facilities used.Return to Document
92 These companies are Federated, Fruit of the Loom, The Gap, Land's End, Levi Strauss, Liz Claiborne, Montgomery Ward, Nike, Oxford, Phillips-Van Heusen, Price/Costco, Salant, Sara Lee, Spiegel, VF Corporation, Wal-Mart and Warnaco. Several other companies, including Dillard and JCPenney, indicated that they seek out suppliers with established reputations for quality that comply with all applicable laws, but did not state that they conduct on-site evaluations.Return to Document
93 These auditors are based in the region where they work. While they are specially trained in enforcing Levi Strauss' "Guidelines," they also do work pertaining to quality control and sourcing activities.Return to Document
94 Richard Rothstein, "The Starbucks Solution: Can Voluntary Codes Raise Global Living Standards?," The American Prospect 27 (July/Aug. 1996) 36 - 37.Return to Document
95 Most also indicated that, should they receive notification by a governmental authority of a violation, they would cooperate and act immediately.Return to Document
96 Kellwood reported that it suspected child labor in a facility that it subsequently decided not to use as a source.Return to Document
97 Phillips-Van Heusen reported that its quality control staff has in most cases discovered the child workers.Return to Document
98 According to Kmart, this last provision was added by its new Chief Executive Officer.Return to Document
