Introduction
A trade union, also known as a labor union, is an organization whose membership is made up of workers and union leaders, united for the purpose of protecting and promoting their common interests. A trade union could be one of the following: (1) a company union tasked with representing interests of a single specific company and may be lacking connection with other unions. A company union (also called a house union) is often a generally bogus and illegal union. (2) A trade union may be a general union or industrial union that represents workers drawn from a number of companies but in the same industry. (3) A trade could also be a craft union with the responsibility of representing skilled workers drawn from a specific given field such as welding or carpentry.
Functions of Trade Union
A trade union has principal reasons for its existence which include: negotiating wages and better working condition terms; regulating relations between its members (workers) and their respective employer; taking collective action to enforcing the terms of collective bargaining; raising new demands on behalf of its membership; helping settle members’ grievances.
Trade Union in Contemporary Era
A trade union would exist as a social organization in contemporary era because of its association with Social Movement Unionism theory. In this respect, the trade union would be concerned with more than organizing workers on issues relating to the workplace, pay terms and conditions. Social Movement Unionism during contemporary era emerged from political struggles in developing countries, where it was defined as a distinct industrial relations model. Therefore, trade unions and other labor movements would work together to achieve social and economic justice. The union would demand for clauses purposed to further social justice in their collective agreements. The social issues would include fair trade policies, anti-globalization campaigns, anti-poverty initiatives, race, gender and human rights.
Wal-Mart & Foxconn China
Wal-Mart and Foxconn are the two major players in the manufacturing and retailing industry respectively. Wal-Mart is currently the biggest retail store in world with a total store count of more than 8,900 stores worldwide as of February 2011. The company is divided into principal divisions, namely: Wal-Mart stores, supercenters, Sam’s Club, and Wal-Mart International (Rachleff, 2012, 198).
According to 2011 statistics, Foxconn has the second largest labor force in the world after Wal-Mart which boosts of 2.1 million associates globally. The bulk of Foxconn workers are currently employed in China stated to be 1.3 million as of mid-2011. The Trade Union Law in China requires that a trade union ought to be democratically elected by workers themselves. While Foxconn workers are aware of the existence of the Foxconn trade union, they do not have an idea of its formation. The feeling among the workers is that the Foxconn trade union is not there to defend their interests, rather to push the company’s agenda.
Structure of paper
This paper aims to make detailed comparison between a trade union of a multinational company from a developed country and a Chinese native company. The companies of choice are Wal-mart and Foxconn respectively. The trade unions of the company will be compared on three major aspects: Collective bargaining, Industrial conflict (strike), and Working conditions.
Collective Bargaining
According to the International Labor Organization, collective bargaining refers to the “voluntary negotiation between employers or employers’ organizations and workers’ organizations, with a view to the regulation of terms and conditions of employment by collective agreements” (Perrett et, 2012, 650) Alternatively, collective bargaining can be said to be negotiations pertaining to terms of employment and conditions of work held between representative workers’ organizations on the one hand, and an employer, an employers’ organization or a group of employers on the other, with a view of striking an agreement. In this respect, the dynamic of the concept of collective bargaining is basically demand and concession; while its main objective is agreement. Collective bargaining precedes mere consultation in the sense that the former assumes willingness of either side not only to listen and consider the arguments of the other, but also to let go fixed positions as appropriate in order to reach common ground.
Collective bargaining is one of the main functions of a trade union, where it procures better working conditions, salaries and wages for its union members. Collective bargaining is thus the key instrument that serves the interests of trade union members. What makes the bargaining ‘collective’ is the very presence of a trade union which represents the specific interests of workers as a collective (Ngai & Chan, 2012, 403). Compromise is thus the overriding element of collective bargaining.
Collective bargaining at Wal-Mart
Wal-Mart does not sit well the issue of collective bargaining. The company is known to be indifferent to the right of employees to engage in negotiation relating to the terms and condition of employment with their respective employer, through a trade union (Human Rights Watch, 2007, 7). To this effect, the company employs a range of tactics to defeat the spirit of collective bargaining and unions. First, Wal-Mart begins its anti-union campaign from the recruitment point of a worker or manager through intense training sessions and videos (Human Rights Watch, 2007, 2). Managers are given explicit instructions of preventing union formation through the company’s “Manager’s Toolbox”. Store managers must conduct Wal-Mart’s Union Hotline in instance where workers defy the company’s directions and attempt to organize. On collective bargaining, Wal-Mart tells its workforce they stand to lose a lot when their wages and benefits are subjected to collective bargaining (Human Rights Watch, 2007, 3).
The company has retained almost all the bargaining power in its management and it follows a conscious policy that denies the employees their right to collective bargaining (Bhattacharya, 2011, 89). In fact, the company remained unionized until 2004 when it granted workers at its Quebec outlet the permission to form a collective bargaining unit (O’Rourke, 2007, 142).
Furthermore, Wal-Mart has a labor practice that disallows collective bargaining on any issues pertaining to employed illegal immigrants. Most of the jobs that Wal-Mart offers its employees are dead end jobs, having few or none promotional opportunities. The senior management of Wal-Mart is treated well and are at the forefront in disallowing labor unions (Bhattacharya, 2011, 90).
Collective bargaining at Foxconn
In most Chinese companies, labor process is organized by the management through a centralized, hierarchical system targeted to achieve utmost productivity. As such, the Foxconn trade union is made up by appointed managerial personnel, not elected democratically (Jeffries, 2009, 700). Workers at Foxconn work hard to generate huge revenues for the country. For instance, at the Zhengzhou plant alone, the production capacity for iPhone reached 100,000 per day. Nonetheless, Foxconn is a great defaulter of labor laws and the code of conduct. This is especially true because Foxconn’s trade union has a militaristic culture characterized by military-like training especially for new workers. In this respect, workers are bound by the mandatory organizational ethos that demands for absolute obedience (Su, 2010, 350).
Working conditions at Wal-Mart
Wal-Mart has long received negative publicity because of its bad labor practices and working conditions of its employees. The company is charged with violation of US wage and hour and employment discrimination laws (Human Rights Watch, 2007, 9). A full-time Wal-Mart associate or employee has an average hourly wage of $9.76. while this is above the minimum wage mandated by the U.S. federal, majority of the associates earn below the national poverty level. In addition, the company does not appropriately compensate for overtime. The company is also known for sex discrimination as evidenced by the highest number of employment discrimination lawsuits in the U.S history (Rachleff, 2012, 199). The company intentionally discriminates against its female workers in terms of promotions, job assignments, remuneration, and training. Similarly, Wal-Mart practices discrimination against workers and job applicants with disability.
Wal-Mart has also a strategy of eliminating its long-term employees, whose wage are higher than that of recently hired workers in the effort to reduce payroll costs.
Wal-Mart has further been associated with violations of child labor laws along with other state employment regulations. Children are made to work too many hours a day and too late into the night as well as during school hours (O’Rourke, 2007, 142). The company has also a practice of forcing employees to work during their breaks and lunches besides being subjected to overnight lock-ins. Wal-Mart defends its overnight lock-in policy as a way to avert shrinkage, which alludes to theft by both employees and outsiders.
Workers at Wal-Mart are often denied their right to freedom of association so that they are unable to collectively address their workplace concerns.
Working conditions at Foxconn
In the effort to secure international supply contracts and remain competitive, Foxconn has adopted a strategy to significantly minimize its costs. In turn, incredible pressure has been put on the company’s frontline workers to deliver. Accordingly, overtime is major concern for workers at Foxconn – they are forced to avoid low profit margins by working over 12 hours a shift for 6-7 days a week (CECC, 2011, 69). The factory has a 174-hour regular shift per month, but most workers are forced to work monthly overtime of 50-80 hours (Su, 2010, 355). This contravenes the 36-hour legal limit for overtime in international labor laws, which the trade union should work to enforce to the letter.
More often, Foxconn workers have limited meal-time because they spend a great amount of time in meeting the tight shipment requirements of the company. Failure to meet the high production target automatically translates in skipping dinner or working on unpaid overtime shifts. Some workers are occasionally made to stay 20-30 minutes extra on the production lines until they meet the production targets, yet there is no compensation for the extra time worked. In other instances, workers are forced to attend unpaid work meetings after work shifts which last between 5 and 30 minutes. Frontline supervisors are required to remain at the factory for a least an hour every day with no compensation.
Similarly, the factory working environment at Airport Zone is nothing close to desirable. The area is so dusty that workers often develop ailments. The state of basic amenities at the factory is also wanting with shortages of clean water for the workers besides poor quality food. The area is also highly prone to floods during rainy days, something that cause great amount of inconvenience for the workforce (Perrett et, 2012, 659).
Work safety is also a major concern for workers at the company. Foxconn workers are prone to potential harm resulting from occupational diseases in the various departments of the company. For instance, an explosion at Chengdu plant resulted in death of 3 workers and 15 injuries, while there was a case of massive poisoning at the Wintek factory located in Suzhou in 2009. Typically, it is much easier to identify a Foxconn worker from the metal processing department because of their easily identifiable stains on clothes and shoes. Some workers have been forced to resort to ethanol and n-heptane to clean the components. The top floor of the Economic Development Zone is uncomfortably hot and ventilation is wanting. The shop floor has a distinct smell of chemical applied in machines during production. The irritating smell has led to skin allergies among most of the workers there.
In view of the above, it is evident that the Foxconn trade union has a failed in safeguarding the right of workers to safety at workplace. The Law of the Prevention and Treatment of Occupational Diseases demands employers to ensure utmost work safety in the workplace. Article 20 requires that the workplace should have sufficient protective measures, both on equipment and in facilities, fore workers against all occupational diseases. Article 26 provides for clear indication of potential harm of chemicals in use, while Article 31 calls for pre-post and on-post occupational health training for workers.
Industrial Conflicts (Strikes) at Wal-Mart
Wal-Mart deals with industrial conflicts stemming from its associates or workers in ruthless ways. The company creates a climate of fear and intimidation to their employees through retaliation, loss of benefits and sacking. The company also uses the strategy of unit packing transfer of workers to squash their union demands. In this regard, Wal-Mart often illegally transfers union supporting worker and brought in union opponents (unit packing).
In addition, the retailer used illegal techniques to collect information regarding industrial actions related to trade unions and pressurize workers to abort from such actions. Illegal surveillance and spy techniques are used to gather intelligence information pertaining to any strikes in the offing.
Industrial Conflicts (Strikes) at Foxconn China
Strikes and spontaneous collective actions which often involve a hundred to a thousand workers are synonymous with Foxconn workers. This are more pronounce in areas of Shenzhen, Chengdu and Fushan. The workers often push for increase in their wages, overtime compensations together with constant provision of hot water during winter time. The basic salary for workers for Foxconn factories is a CNY 1350, from which about CNY 150 accommodation fee and CNY 200-300 food fees are deducted automatically. The problem of wages has it roots in the company’s unethical practice to place false statements in their job advertisements where salaries are indicated to be in excess of CNY 2500 per month are promised (Hermanson, 2010, 421). In addition, Foxconn has a tendency to withhold workers’ wages especially in the lead up to Lunar New Year so as to ensure stability of workforce and save much time in training new workers. Withholding wages and salaries is against the law and the trade union is insufficient in enforcing it.
Furthermore, there is the constant problem of miscalculation of wages at Foxconn. More often than not, the overtime hours of many workers is usually less than their actual hours they worked, besides additional absence days even when they were present at work. There is a problem in this in the sense that Foxconn often comes to a conclusion that a worker has left the factory voluntarily if the calculations of days absent amount to 3days (Han, 2010, 70).
Worker protests are also common in front of the canteen against the poor quality food offered by the company. The large percent of Foxconn workers who are migrants in their late teens to 20s have high levels of anxiety, making them to often resort to desperate measures such as suicide. In May 2010, striking Foxconn workers were made to sign a document in which they pledged not to commit suicide. This followed the expose by the Students & Scholars Against Corporate Misbehavior (SACOM), which showed the deplorable working conditions at the Foxconn factory in Chengdu (Hermanson, 2010, 422).
In the wake of the spate of suicides, Foxconn introduced a hotline to address grievances of workers. However, the hotline is less effective and those who lodge complaints against the management are threatened (MacEwan & Miller, 2011, 156).
The manner in which Foxconn responds to industrial action/strikes of workers is against trade unionism. More often those who participate in strikes are dismissed without their dues.
Conclusion
To this end, it is obvious that Foxconn’s trade union is highly inactive compared to Wal-Mart’s. It does not serve the interests of the workers, making them to feel no connection and lacking confidence in it. As such, the Foxconn trade union is in urgent need of significant structural reforms to be execute its rightful role of : agitating for a decent living wage for all Foxconn workers; reforming management methodology at the company; making sure workers are not subjected to standing operation and get recess and regular meal breaks; ensure regular adequate training, protection, and health inspections of all Foxconn workers; enabling workers’ say in the formation of the trade union itself; and pushing for additional compensations following violations of workers’ rights by the company (Han, 2010, 68). These structural reforms at Foxconn will result in improved labor conditions at the company besides serving as an impetus desirable trade unionism across the electronics industry owing to the influential stature of Foxconn as the world’s leading manufacturer.
On the part of Wal-Mart, the violation of worker’s rights contradicts its core value – “respect for the individual”. There is need for Wal-Mart to embrace trade unionism so that it plays according to international labor laws. Worker’s need to be allowed freedom of association and expression (Perrett et, 2012, 649). The company ought to exceed the internal law requirements by ceasing all tactics that undercut workers’ rights to trade unions . External union organizers need to allowed to assess the conditions of workers in Wal-Marts’ stores. Finally, the company should commit to using only temporary replacement workers when theirs associates are on an economic strikes and engage with workers through company-wide communication channels (Human Rights Watch, 2007, 12).
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