Category: business

U.S. companies lobby against a policy forbidding use of Uyghur slave labor in their products

December 4, 2020 • 9:00 am

One of the world’s great instances of immorality—indeed, a case of cultural genocide—is the attempt of the Chinese to persecute and, indeed, wipe out the Uyghur Muslim minority, most of whom live in the Xingiang Autonomous Region in the northwestern part of the the People’s Republic of China—the area in red below:

According to the BBC, over a million Uyghurs have been forced into “re-education camps”—the Chinese government denies their existence)—while the AP reports that there has been forced sterilization of Uyghur women as well as other forms of coerced birth control, all meant to diminish the population.

Another form of persecution of the Uyghur is the use of the captive population by the Chinese as forced labor to make products or components of products that find their way to America and other Western markets. Companies like Coca-Cola and Nike, for example, have been accused of using materials or products (e.g., entire shoes) made by forced labor (it’s not clear whether the workers get any remuneration, but they’re working against their will, and often doing so in these camps, always under surveillance).

Other companies implicated, according to the recent (Nov. 29) New York Times article and the Business Insider articles below (click on screenshost), include Adidas, Amazon, Apple, BMW, Costco, Calvin Klein, Campbell Soups (some of the forced labor is involved in growing food), H&M, Patagonia, and Tommy Hilfinger. The NYT also reports that there are 82 foreign companies “that potentially benefited, directly or indirectly, from abusive labor transfer programs tied to Xinjiang.”

Now many of these companies, when asked to provide statements, deny that they are complicit in the use of slave labor, and assert that their own protocols and investigations have exculpated them.  (Some give no comment.) But, as Business Insider reports, denials are not convincing in light of the obstructions that China places against independent inspection and auditing:

Apple, Nike, and Coca-Cola have over the years been accused by human rights groups of a variety of labor abuses and worker exploitation, particularly in China. They have also made various pledges and taken some steps to address that criticism.

Monitoring that, however, has become difficult. Five major auditing groups hired by Western firms told The Wall Street Journal in September that they are no longer carrying out supply chain inspections in China because restrictions imposed by government officials have made it too difficult to effectively and independently evaluate working conditions in the country.

And the NYT concurs:

. . . for many companies, fully investigating and eliminating any potential ties to forced labor there has been difficult, given the opacity of Chinese supply chains and the limited access of auditors to a region where the Chinese government tightly restricts people’s movements.

In response to these reports, and in a very rare show of bipartisan support, the U.S. House of Representatives passed a new bill, the Uyghur Forced Labor Prevention Act (see the bill here), whose provisions include these (from Wikipedia):

The Uyghur Forced Labor Prevention Act would make it U.S. policy to assume (a “rebuttable presumption”) that all goods manufactured in Xinjiang are made with forced labor, unless the commissioner of U.S. Customs and Border Protection certifies that certain goods are known to not have been made with forced labor. The bill also calls for the President of the United States to impose sanctions on “any foreign person who ‘knowingly engages'” in forced labor using minority Muslims. The bill would further require firms to disclose their dealings with Xinjiang. A list of Chinese companies that have relied on forced labor would be compiled.

In light of Chinese obstructions against investigations, it seems reasonable to presume that slave labor has been used in Xinjiang-origin products, and for companies to either stop importation of products from the region, or conduct genuine, independent, and non-obstructed audits to certify that slave labor has not been used.  In fact, the bill passed the House by a lopsided vote of 406-3 (the “nay” votes were Justin Amash, Libertarian-Mich; Warren Davidson, R-Ohio; and Thomas Massie, R-Kentucky), with the Senate predicted to pass it as well. If it passes both houses of Congress, either Trump or Biden could sign it into law, and it looks like there’s enough votes that Congress could override a potential Trump veto (Biden won’t veto it).

However, the three stories below, also including one from the Washington Post, show that some U.S. companies have lobbied against this bill. While Nike denies the lobbying, asserting that it merely had “constructive discussions” with congressional staff (I don’t believe them), I am puzzled about why there would be any lobbying if the companies aren’t depending on forced labor. You might respond that they aren’t doing that, but that companies don’t want to go through an onerous and expensive process to prove it. But can’t they farm out the labor to places where it’s not forced and used as a form of persecution? Granted, it may be a tad more expensive, but I doubt Americans wouldn’t pay a bit more for assurance that slave labor isn’t being used.

From the New York Times:

From Business Insider:

From the Washington Post:

This is a serious charge, especially given the political climate in the U.S. today, formed in part by a justified repugnance towards slavery. Isn’t it possible for these companies to simply use non-forced Chinese labor from areas other than Xinjiang? What heartens me is that the House and Senate can work in a bipartisan way to effect positive change, even if this bill is a no-brainer.

Conservative Supreme Court rules against labor

May 21, 2018 • 3:30 pm

In a 5-4 decision today, with voting along political lines, the conservative Supreme Court Justices (including Trump appointee Gorsuch) ruled that workers could not file class-action lawsuits against employers if they signed arbitration clauses in their contracts that waived their right to file such suits in favor of binding arbitration. This is definitely a blow to labor; as Reuters reports:

The justices, in a 5-4 ruling with the court’s conservatives in the majority, endorsed the legality of the growing practice by companies to compel workers to sign arbitration agreements waiving their right to bring class-action claims on various disputes, primarily over wages and hours.

The ruling could apply more broadly to discrimination claims like those raised by women as part of the #MeToo movement raising awareness of sexual harassment in the workplace but the court did not explicitly address that issue.

Craig Becker, a former member of the U.S. National Labor Relations Board and now general counsel of the AFL-CIO union federation, said the decision will have a “chilling effect” on employees coming forward to complain of mistreatment.

“It will cripple enforcement of all the major employment laws,” Becker added.

Growing numbers of employers, alarmed by a rise in class-action claims brought by workers on wage issues, have demanded that their workers sign waivers. Class-action litigation can result in large damages awards by juries and is harder for businesses to fight than cases brought by individual plaintiffs.

Remember, this is about the legality of companies being able to make their employees sign waivers to prevent class-actions, which seems unfair on the face of it.

The split had Gorsuch (Trump’s flak) writing the majority opinion (see it here), joined by Alito, Thomas, Kennedy, and Roberts. As for the liberal Justices (Ginsburg, Kagan, Sotomayor, and Breyer), the New York Times adds this:

Justice Ruth Bader Ginsburg read her dissent from the bench, a sign of profound disagreement. In her written dissent, she called the majority opinion “egregiously wrong.” In her oral statement, she said the upshot of the decision “will be huge under-enforcement of federal and state statutes designed to advance the well being of vulnerable workers.”

Justice Ginsburg called on Congress to address the matter.

Brian T. Fitzpatrick, a law professor at Vanderbilt University who studies arbitrations and class actions, said the ruling was unsurprising in light of earlier Supreme Court decisions. Justice Gorsuch, he added, “appears to have put his cards on the table as firmly in favor of allowing class actions to be stamped out through arbitration agreements.”

As a result, Professor Fitzpatrick said “it is only a matter of time until the most powerful device to hold corporations accountable for their misdeeds is lost altogether.”

Will the working people who voted for Trump, thinking he’d improve their situation, be disenchanted now? Are you kidding? They won’t pay one bit of attention to this decision.

Here’s the opinion of Steven Greenhouse, former labor reporter for the New York Times:

We often ignore the fact that one of the worst things that Trump (and the Republicans) did—something that will affect the country long after Trump is out of the White House—was to unfairly block the appointment of Obama’s nominee Merrick Garland, waiting out the election to then allow a possible Republican president (Trump) the chance to put in his own nominee. That would be the odious Gorsuch.