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Dell, HP & NEC Partner Flagged for Labor Practices

A US-based watchdog agency has released findings on labor abuses at MSI Computer (Shenzhen) Co. Ltd., a Taiwan-based company and supplier of global brand electronics companies including Dell, HP, NEC, and other OEMs.

The agency, China Labor Watch, did not report incidents of suicide, which in the past were associated with labor practices at global EMS/ODM provider Foxconn, but noted “serious concerns” about MSI Computer.

These concerns include:

  • Blatant discrimination against male workers and older workers
  • Hepatitis B testing is mandatory and all carriers are disqualified from recruitment
  • Pregnancy testing is mandatory and may be used in a discriminatory nature
  • There are only one or two rest days each month during the peak season
  • There is a 12+ hour/day, six- or seven-day work week during the peak season. Working hours exceed the statutory maximum, and EICC standard of 60 hours/week
  • Before work “educational sessions” and after work self-criticism reviews are mandatory, and unpaid
  • If a production quota is not met, there is additional unpaid overtime
  • There is no paid sick leave, maternal leave, or marriage leave
  • During working hours, talking is strictly forbidden, and workers are unable to use the bathroom
  • If management discovers a mistake, they will criticize or personally insult and belittle the worker
  • Seasonal production fluctuations create unreasonable work intensity with no rest, or low wages
  • The unspoken resignation rule is that workers must voluntarily resign and forfeit 12 days of wages

Since the management at MSI is only focused on end results, according to the report, the production process is sustained at the expense of the interests and well-being of the workers. Unfortunately, this is not an isolated situation, and the MSI case is representative of many electronics factories in China's Pearl River Delta.

As the readily available labor supply continues to contract, workers at electronics factories such as MSI will likely have to redouble their work intensity to complete production orders.

Executive Director of China Labor Watch, Li Qiang, states: “Workers are becoming less willing to stand for compromising working conditions, excessive hours and unfair wages. It is in the interest of the workers, factories and buyer companies to improve workers' situations and create retaining incentives.”

It is imperative for Western companies using subcontractors in Asia to put pressure on their partners to improve labor conditions. Although substandard treatment of factory workers may be accepted in China, low-cost manufacturing cannot come at the expense of human rights. Dell, HP, and NEC should make it clear to their partners that abuses will not be tolerated and lay out a plan for improvement. Otherwise, companies should consider taking their business elsewhere. The companies had said they would investigate Chinese labor practices following the incidents at Foxconn.

End-users of electronics products should also pressure companies to uphold standards throughout their supply chains. Buyers of electronics products are willing to change suppliers or exert pressure on OEMs to go “green.” Why should human rights be any different? If anything, the pressure should be more intense when it comes to labor standards.

12 comments on “Dell, HP & NEC Partner Flagged for Labor Practices

  1. eemom
    February 8, 2011

    As I read the article and found myself getting angrier with every sentence, I wondered if Dell, HP and NEC are fully aware of these labor practices and just look the other way.  After all, isn't it the reason they have gone to China.  The fact that workers are treated poorly, paid little with horrible conditions is not a surprise to anyone.  Companies tolerate what the governments allow in the name of the almighty dollar.  For these large companies to start demanding better labor conditions from their partners, there must be a loud outcry and push for them to do so.  The companies are going “green” not out of the goodness of their hearts, but because pressure dictated it. 

    A lot has to change here and maybe it will start with the workers themselves who will eventually revolt and want a more fair pay with better conditions.  Let's hope..

     

  2. Anand
    February 9, 2011

    Barbara,

     I am shocked after reading this article. How can companies even dare to put these guidelines. These are just inhumane and stupid laws. What is the government doing, why is it so insesitive to the life of people.

    I totally agree with your suggestion similar to “GREEN” we shoud certify each product if it had met the labor practices or not. Atleast this pressure will make companies think twice before creating such stupid laws.

  3. Clairvoyant
    February 9, 2011

    I think Dell, HP, and NEC would be aware of the situation at MSI in China, because I would think with large partnerships, each side would want to get to know the other company and how they run.

    This is a very bad situation, but I wouldn't be surprised if other companies in China treat their workers this way as well. Companies try to maximize their dollar in China by getting as much production done as possible, while paying very low wages to their workers.

    I think the workers put up with this type of treatment for a couple reasons. For one, they would be afraid of losing their job because they need it for an income, and second, probably many production facilities are like this so they have no better place to work.

    I think better labour laws need to be made and enforced in China. However, the government may not want to for fear of companies leaving China. It is a tough situation.

  4. eemom
    February 9, 2011

    I think the Chinese government can improve their labor laws without driving the cost out of control.  If companies are already set up in China there would be a cost associated with pulling out of that country and trying to set up elsewhere with lower costs.  As long as the cost increase in not prohibitive, the government can improve their labor practices and work on retaining the companies that do business there.  Something has got to be done and they need to start somewhere even if it is not the ultimate solution.

  5. Clairvoyant
    February 9, 2011

    Good points. I agree.

  6. seel225
    February 9, 2011

    China’s economy has become one of the most robust in the world since it began experimenting with free markets, which encouraged millions of workers to labor for low wages for companies that made cheap exports. As a result, foreign investment has poured into China.Now it's time to think about labor laws in china before it gets more worse.Working human like a machine is terrible, Chinese Government has to set up better labor laws to stop sucides of workers because of work pressure and need to increase the wages some how.

  7. eemom
    February 9, 2011

    Sounds like we are all in agreement.  I wish our opinions had enough weight to persuade the government to make the necessary changes and / or for companies to demand it.

  8. Barbara Jorgensen
    February 9, 2011

    Normally I would recommend “voting with your wallet” and shunning companies and products with questionable relationships. But then an article–I think it was in the Boston Globe–pointed out the people we really hurt are the employees of such companies. When business drops off, they are the first to feel the effects. It's maddening. Public pressure has succeeded in some areas–fast food places posting calories and fat content where customers can see it. SO we keep on trying. Thanks for your feedback!

  9. garyk
    February 10, 2011

     EBN or someone needs to send EBN on Line to President Obama, Fed Chief Ben Benanke, all persons on the House Budget Committee and the Congress and House. I'm sure the profit margins are very high for these company's

  10. itguyphil
    February 10, 2011

    What purpose would that serve?

  11. stochastic excursion
    February 11, 2011

    Kudos to China Labor Watch for taking the lead in bringing this problem to our attention.  No doubt in my mind there are unscrupulous shareholders who want to see the watchdog agency go away.  The challenge of providing solutions to the PRC, which after all was founded on the notion of improving the condition of labor there, is squarely before the American electorate.  We might assume that the current Dickensian condition is an improvement over the killing fields we can imagine existed at the start of our recent engagement with mainland China.  Lets not forget to lead by example and not go backwards ourselves in the zeal for economic growth.

  12. Hardcore
    February 20, 2011

    Does not surprise me in the least.

    The Hepatitis testing may actually be a legal government requirment though, for the local health authority , or may relate to the products they are manufacturing.

    Do you REALLY want pregnant women working in an environment contaminated with carcinogens?  A little more information is required for a balanced evaluation.

    But the other items are par for the course and quite normal, but totally illegal under China government law.

    Please understand that China law is actually quite advance in many areas, and insome cases out strips  Foreign law in terms of benefits.

     

    HC

     

     

     

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