The Ethical Issues with Sweatshops - Essay Example

The Ethical Issues with Sweatshops Introduction With the increase in globalization, there has been a growing trend of outsourcing about developed countries. Multinationals in developed nations seek to outsource their production to developing countries where they have the advantage of cheap labor among other incentives. Most people in emerging countries such as China, India and Bangladesh live below the poverty line and thus getting employed by these multinationals seems promising to these people. However, the conditions of employment that these people are subjected to have shocked people living in developed nations. They have raised strong criticism against the presence of such places, better known as sweatshops, for the way they morally exploit these poverty stricken people. Some have also come to the rescue of the MNEs who operate such sweatshops claiming that such places offer a source of employment and income to those living below the poverty line. In this case, a discussion would be developed regarding the ethical dilemma that constitutes these sweatshops. The stance developed in this paper is that it is ethically wrong to maintain sweatshops since they override their ethical duties. Sweatshops are ethically wrong because they exploit people who are already suffering from poverty and illiteracy. Companies only focus on maximizing profits with no duty towards the people who make the company’s success possible. Discussion In 1970s, BBC published a report where they shed light to the unfair labor practices conducted by one of the most popular sportswear, Nike in developing countries. The report brought forward a grotesque picture of Nike as it showed the conditions of the shops were Nike goods were being produced. This reports raised a strong uproar among the Nike consumers as they felt cheated by the brand. Consumers strongly rejected Nike products because of the degrading way the company treated its employees in the developing countries. Nike and other MNEs who have opened up sweatshops in emerging countries have been strongly criticized for the wages they pay to their employees working in the sweatshops. These employees are not even paid the minimum wage and often earn less than 1 dollar a day. This is shocking considering that Nike is a premium sportswear company and charges extremely high prices for its products. Consumers feel cheated when they realize that the manufacturing costs of the products is not even half of the selling price. These products are made in dirt cheap prices but sold at high prices. Nike is the company that gains the maximum advantage of this situation while those living in emerging countries are poorly exploited. Nike and other such MNEs were able to get by such practices because sweatshop employees have no other option of earning income. The presence of Nike does not offer these people any incentive rather they are forced to work in the most degrading conditions to create products to extremely high standards. What is more saddening is that MNEs have paid little or no attention to how these sweatshops are operated. Sweatshop employees are forced to work extremely long and tiring hours at these places. Working hours in these sweatshops often stretch to more than 10 hours in a day. This leaves these people little time to rest let alone enjoy or socialize. Many claim that working such long hours is unhealthy for these people and they are more likely to exhaust their bodies early in their lives. Apple Inc. is one company that has been condemned for its pathetic working conditions. Various reports have shown that Apple sweatshops employees are often forced to work 24 hours at a time. Some have to stand all day during their shifts while other put in overtime of 80 hours a month (Cooper). Moreover, in the recent years, Apple’s name has been increasingly linked with poor conditions in its sweatshops. In 2009, an Apple employee at Foxconn committed suicide because he has lost an iPhone prototype and was afraid of the repercussion that he was bound to have. In the coming next two years, 18 more employees committed suicide. Other than that, conditions in the Apple factory have been known to cause many deaths because of lack of safety regulations. In one Apple factory, 137 workers were injured when they were exposed to n-hexane, a poisonous chemical used in the production of iPhone. Later in 2011, four employees died as 18 more were injured with a dust explosion in the Chengdu Foxconn factory which produced iPad parts. It is more disconcerting that Apple does little or nothing to prevent such incidents from happening. The company, it seems, feels that it has no ethical duty and continues to operate to maximize its profits. The company does not take responsibility for its workers. Instead the company has become more secretive regarding its operations in various sweatshops located throughout China. Child labor is another serious objection raised against sweatshops. Big MNEs such as Apple, Nike, Wal-Mart, J.C. Penney, Hanes and Puma have been known to employ children in their sweatshops. In a report published by the National Labor Committee, it was estimated that around 200 children are employed in the Harvest Rich factory in Bangladesh that produces clothes from well-known MNEs including Wal-Mart, Puma and J.C. Penney. The children employed in these MNEs are often as young 11 years old and even younger. They are expected to put in long hours without even one day off in a week. Usually they put in 12 to 14 hours of work each day and compensated with 6.4 cents an hour (“Labor and Work Life”). Children belong in schools rather than in workplaces. It is because companies like Wal-Mart and J.C. Penney do not care whom they hire as long their work is done, the suppliers are free to hire anyone they want; even children who cannot put in such hard work. Sweatshops exhaust its employees to the point where they commit suicide. For instance, an article published in Daily Mail pointed out that in 2011, nine Apple employees committed suicide within a gap of 3 months in the Chinese factory located in Shenzhen. The situation became so dire that Apple management had to put up safety suicide nets around their entire sweatshop to prevent over stressed employees to jump from the building (Cooper). On the other hand, another body of economists and other critics has developed a soft spot for sweatshops. Their main claim in supporting sweatshops is that these shops offer a source of income to the people living in developing nations. People living in China, India, Bangladesh and other emerging nations do not enjoy the same lifestyle as those living in developed nations. The average income of these people is less than 1 dollar a day. These people voluntarily get employment in these sweatshops because they do not have any other source of income (Powell and Zwolinski, 2). Apple Inc. claims that there is a long waiting line of people wishing to work in Apple sweatshops. The alternate these people have is to work at local shops that offer even poor wages. The wages these MNEs offer are better than local wages and it is the main reason people in developing nations wish to work in MNEs and even look forward to the creation of an MNE. However, the question that one should raise at these MNEs is whether they should use this situation of these people to exploit them. These conditions can be resembled to some extent with the conditions that plagued Europe during the industrial era when workers were forced to tolerate the worst working conditions because it was the only option for them. Because the industrial revolution created an influx of unemployed people, these people were willing to do anything to survive. The industries used this situation to exploit the people to the point where these industries disregarded the basic principles of humanity. Sweatshops are involved in similar practices. MNEs only report the good aspects of their existence, completely ignoring its own employees who work in these sweatshops. When one evaluates the picture from the other side of the coin, it is clear that MNEs are earning millions of dollars in their businesses. They can afford to pay better wages to these people. If they set a standard to better wages in the country, they could improve the overall economy of the country. But these countries are only concerned with maximizing their own profits. They do not value the efforts of their employees even when they claim that their people are important part of the company in their annual reports. When MNEs open up sweatshops in these countries, they are actually improving the economy of the country. The Chinese economy, for instance, depends heavily on these sweatshops because they bring in foreign investment in the country. These companies provide jobs to millions of people who would otherwise have remained unemployed (Kristof and Wudunn). However, MNEs cannot use this reasoning to justify their poor practices. Even if the company provides jobs to millions of people, the long turn impact of these sweatshops is not beneficial for the entire economy. These MNEs are often found to employ children even below the age of 13. These children otherwise belong in schools and colleges where they should be educating themselves to get better jobs and better living conditions. But MNEs prevent this from happening because they tempt children with the option of earning now rather than later. If child labor practices are continually practiced in these sweatshops, the developing nations would continue to suffer from this phenomenon. This is because sweatshops are concentrated in developing nations where cheap labor is available. The labor is cheap because it is unskilled and does not have the education or the skill to work in high management places. If children in these developing nations are not educated, they would grow up as unskilled labor or semiskilled labor at the best. They would then have no other option but to continue working in sweatshops. Another point raised in the favor of sweatshop is that these shops bring technology and skill in the country. When MNEs open up factories in developing nations, they transfer skills and technology in the company. They send in their skilled labor to guide the employees towards improving their skills. Also MNEs invest heavily in technology and often send in their latest technological machinery for the manufacturing process. But again this point can be refuted. This is because while machinery and skills are transferred to the developing nations, they do little to benefit the employees. They do not improve the work on the employees but rather force them to work on simple jobs that do not engage the mind. For instance, employees in sweatshops are expected to sew buttons, clean glass panels off iPods etc. These mundane tasks make the work more depressing and workers eventually exhaust themselves. Here again, one can refer to Apple Inc. While Apple has outsourced its production to China, it has kept design and development within its headquarters located in California. The company does not release the entire blueprint of its products to one factory. The task is distributed among different factories to prevent the blue print from being leaked to competitors. Apple is merely concerned with its own privacy and security issues and does not pay heed to providing education and skills to the employees working in sweatshops. There is another claim that MNEs make to support the existence of sweatshops. They claim that the presence of sweatshops decreases the price of the end product. Because the manufacturing costs are low, the selling price is also low. While this may be true for companies such as Wal-Mart, the same cannot be said for Apple Inc. and Nike who develop their products at really low prices and sell them off as luxury items. Conclusion Sweatshops have become a major point of discourse among people living in developed nations. While developing countries do not realize the full implications of these sweatshops, it is clear the MNEs operate these sweatshops for their own profit maximization without giving any heed to its employees working in these sweatshops. The employees are not even paid minimum wages and are often forced to work to the point of exhausting themselves. While these people voluntarily seek employment in sweatshops, they have no other option for employment. Sweatshops are their last resort. The MNEs who operate these sweatshops can and should offer better wages and working conditions to their employees because they have a responsibility towards the employees who work to make the MNE successful. While many have tried to defend the sweatshop phenomenon, these are just excuses for these sweatshops to continue their operations. These excuses do not justify many of the practices undertaken by these sweatshops such as child labor practices and poor working conditions. Works Cited Cooper, Rob, “Inside Apples Chinese sweatshop factory where workers are paid just £1.12 per hour to produce iPhones and iPads for the West”, Daily Mail, 25 January 2013, Web. 10 May 2014 Kristof, Nicholas and Wudunn, Sheryl. “Two cheers for sweatshops”, The New York Times, September 24, 2000. Web. 11 May 2014 “Labor and Work Life” Harvard Law. n.d. Web. 10 April 2014 Powell, Benjamin and Zwolinski, Matt, “The Ethical and Economic Case against Sweatshop Labor: A Critical Assessment”, Journal of Business Ethics, 2011, Web. 11 May 2014 Read More