How Hasbro, McDonalds, Mattel, and Disney manufacture their toys

Dieser Bericht "Wie Hasbro, Mc Donald's, Mattel und Disney ihr Spielzeug herstellen -
Bericht über die Arbeiterrechte, die Arbeitssicherheit und Gesundheitsbedingungen
von ArbeiterInnen in der Spielzeugindustrie in Fabriken in Südchina, die von
ausländischen Investoren kontrolliert werden" wurde im Dezember 2001 von der
Misereor-Partner-Organisation Hong Kong Christian Industrial Committee auf der
Basis eigener Nachforschungen im Sommer / Herbst 2001 erstellt. Er ist der derzeit
aktuellste Bericht über die Arbeitsbedingungen in der asiatischen Spielzeugindustrie.
HOW HASBRO, MCDONALD’S, MATTEL AND DISNEY
MANUFACTURE THEIR TOYS
Report on the Labor Rights and Occupational Safety and Health
Conditions of Toy Workers in Foreign Investment Enterprises
In Southern Mainland China

Hong Kong Christian Industrial Committee
December 2001
How Hasbro, McDonald’s, Mattel and Disney Manufacture Their Toys?
Report on the Labor Rights and Occupational Safety and Health Conditions of Toy
Workers in Foreign Investment Enterprises in Southern Mainland China
Executive Summary
From August to October 2001, the Hong Kong Christian Industrial Committee (HKCIC)
conducted a research on the occupational safety and health (OSH) conditions and
consciousness of workers employed in the manufacture of toys for export in
Guangdong province of mainland China. 93 workers were interviewed with a
questionnaire that focussed on the OSH and related issues. The research covered more
than 20 toy plants of varying sizes out of which 8 major supplying toy
companies/corporations were identified for detailed research. 7 of them belonged to
Hong Kong based corporations and one belonged to South Korean capital. The largest
manufacturing company and its subsidiaries employed about 25,000 workers, while the
smallest one had about 300 workers. All of them were operating in the major industrial
cities in Guangdong province, namely Shenzhen, Dongguan, Guangzhou and Nan Hoi.
They were all suppliers to prominent toy companies, retailers and brand names in the
world, namely Hasbro, McDonald’s, Mattel and Disney. A rough estimation shows that
the above trans-national toy giants share more than 50% of the global toy market.
It should also be noted that the above brand name toy companies have been contracting
the manufacture of toys all over the world and all of them have developed
comprehensive company codes of conduct or ethical business principles to regulate
their global suppliers. All of them have been relying on either an internal monitoring
system or commercial social auditors in conducting factory audits or inspection on the
labor and OSH standards of their global suppliers. Yet, aside from violations of the
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Chinese Labor Law regarding wages and working hours, the research found that the
OSH conditions at the 20 supplier plants were far from satisfactory. Not only was the
Chinese Labor Law and the industry's social code (ie the International Council of the
Toy Industry or ICTI's Code of Business Practice) violated, each individual company's
code of conduct was poorly observed. There was a general lack of OSH provision and
consciousness amongst both the workers and the management personnel at the factory
level. In some cases, the working conditions as well as the OSH problems were so
serious that grave concern was called for.
The HKCIC has studied and compared the company codes of conduct or ethical
business principles of Mattel, Hasbro, McDonald's, Disney, as well as the ICTI Code of
Business Practice. It is found that all these giant toy companies propagated their
commitment to work with their suppliers all over the world in implementing the
company codes of conduct or ethical business principles. The question is what goes
wrong here? Interviews with toy workers provide evidence of the failure of a lot of
code monitoring or ethical standards auditing, both internal and external. The bitter
irony is that about 90% of the interviewed workers report that they do not know what
company code of conduct or ethical business principles are.
Since 1996, the HKCIC, in collaboration with the Asia Monitor Resource Center
(AMRC) and the Coalition for the Charter on the Safe Production of Toys, have
released a number of reports on the working conditions of mainland toy factories that
contracted manufacturing for the world’s top toy labels, including Mattel, Hasbro,
McDonald’s and Disney. 1 Violations of the Chinese Labor Law, the ILO (International
Labor Organization) core labor standards as well as the ICTI Code of Business Practice,
are persistent in the export toy industry in mainland China. Nor is the failure of toy
companies’ voluntary codes and the monitoring system a newly discovered thing. On
top of wages and working-hours violations, the safety and health of millions of workers
employed in the export toy industry in this country remains an important but long
forgotten issue. Of the million-strong workforce employed in the toy industry, an
absolute majority of them are migrant workers coming from inland provinces and most
of them are women workers. Incidences of industrial accidents or the acquiring of
1 Two reports, namely “Labor Rights Report on Hong Kong Invested Toy Factories in China No.1” and
“Labor Rights Report on Hong Kong Invested Toy Factories in China No.2”edited by AMRC for
Coalition for the Charter on the Safe Production of Toys were released in 1996 and 1997 respectively.
“The Working Conditions of the Toy Industry in China” written and edited in the same collaborative
effort was released in 1999. In August 2000, the HKCIC released a report on McDonald’s, named
“McDonald’s Toys – Do They Create More Fun or Exploitation”. Later in the same year, HKCIC
released the “Beware of Mickey” report on the conditions of Disney workers in China. In December, the
AMRC released a report on the monitoring system of Mattel, named “Monitoring Mattel: Codes of
Conduct, Workers and Toys in Southern China”.
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chronic occupational diseases could mean deaths, loss of working ability or equally
terribly, the carrying of chronic diseases back to the home provinces as these migrant
workers finished their short service term in the foreign owned toy plants.
Compensation for industrial injury or accidents is usually below the labor law standards.
Treatment for injuries or occupational diseases is, in most cases, improper or limited.
On top of them, the OSH problems are, very often than not, neglected by the workers
themselves, the plant management and the trans-national toy companies that place
orders. The result is repetition of human tragedies, many of which are not made known
to the general public.
While the giant trans-national companies in the toy industry have been propagating
their social responsibility to the international community, the responsibility of actually
implementing the ethical business standards, including paying the costs and building
infrastructure for observing such standards, are largely shifted to their global suppliers
along the production chain. On the ground level, we witness rather the persistence of
social irresponsibility.
The HKCIC believes that the toy retailers and brand name companies should be held
responsible for the labor rights abuses and OSH problems of the toy workers employed
by their supplier plants in mainland China. These mainland workers may not have a
contract with Mattel, Hasbro, McDonald’s or Disney, but every day they are
manufacturing semi-finished or finished products that bear the labels of these
trans-national toy giants. The order placing practices of these trans-national companies
(including the bid to the bottom pricing practice, zero inventory and just-in-time
production) should be held largely responsible for the long working hours, low wages
as well as safety and health hazards that are found at the supplying factory level. The
practice of trans-national companies in contracting out social responsibility and
industrial accidents via the global sub-contracting system will not be accepted by the
international community that is increasingly concerned with labor and social standards.
The HKCIC believes that both the trans-national toy companies as well as their
suppliers have the responsibility in seeing that the Chinese Labor Law as well as the
voluntary codes of conduct or ethical business standards of the toy industry be
implemented in real terms. The trans-national toy retailers and brand name companies
that determine the pricing and delivery lead time of the actual manufacturing of toys
should take up a larger share of liability. They should demonstrate their commitment
by evaluating their order placing practices that, eventually are responsible for the labor
rights abuses and OSH problems found at the supplying factory level.
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The HKCIC demands that, both the trans-national toy companies and their suppliers,
1. Develop both long and short term plan of corrective actions, to address and
eventually eliminate the occupational safety and health hazards found at the work
place.
2. Comply with the Chinese Labor Law and improve the working conditions of toy
workers.
3. Set up occupational safety and health committees with workers representation and
participation at the factory level to monitor the safety and health conditions in the
manufactures of toys.
4. That the Hong Kong Toy Manufacturers' Association and the Hong Kong Toy
Council develop a plan of occupational safety and health education that aims at
improving the consciousness of toy workers towards safety and health issues, as well as
their legal rights. Such a platform should be open to NGO participation.
Statement on the Presentation and Usage of this Report
The HKCIC would like to make a clear statement here regarding the objectives,
presentation and usage of this report.
1. This report is published to give a general illustration of the problems regarding
the OSH and working conditions of toy workers that manufacture for the world’s
top brand name companies, namely Hasbro, McDonald’s, Mattel and Disney.
The HKCIC, as well as concerned international communities, would condemn any
penalizing actions, or gestures which would result in a penalizing effect, that might be
taken up by the above 4 brand name companies towards the 20 supplying factories that
are currently employing a 90,000 strong work force. Any utilization of the report
information that results in a simple cut and run action by the concerned brand name
companies that would lead to the closing down of the supplier factories and mass
unemployment of the toy workers would be condemned and exposed to the
international community.
In August 2000, McDonald’s consented to the termination of contract with City Toys, a
premium toy supplier operating in Shenzhen, mainland China. The move was made
after the release of HKCIC’s report on the gross violations of labor rights and South
China Morning Post’s coverage of the use of child labor at City Toys. The cut and run
act resulted in the closing down of 4 subsidiary plants of City Toys and the immediate
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lay off of tens of thousands of workers without due compensation. In a meeting
HKCIC had with the Corporate Responsibility Department of the McDonald’s
headquarters in HK in November 2000, HKCIC demanded reinstatement and
compensation to City Toy workers. It was met with rejection and a clear statement
from the McDonald’s representative, declaring that the City Toy workers were not
McDonald’s workers. Having learned about how fragile a ground lies corporate
responsibility, and not wanting to see a repetition of the same disaster, HKCIC has no
choice, but to veil the names of the 20 supplying factories that are covered in this report.
The supplying factories are named by alphabets as Factory A, Factory B etc. They
could be identified with the toy labels they were manufacturing. It should be noted that
such arrangement would, in no way, diminish the responsibilities the brand name
companies have for their suppliers.
All the individual names quoted in this report are pseudo names. This is to avoid
retaliation on individuals for expressing their opinions during the interviews.
In this report, reference to monetary terms are made first in the currency used in
mainland China ie. RMB. Conversion to US dollars is made at an approximate
exchange rate of 1USD = 8.3RMB.
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Content
7 I. The Hong Kong Toy Industry and the International Sub-Contracting
System
18 II. Comments and Recommendations on the OSH and Working
Conditions of 8 Supplying Toy Companies in Mainland China
34 III. Individual Company Reports
34 III.1. Report on the OSH and Working Conditions of Company A
62 III.2. Report on the OSH and Working Conditions of Company B
76 III.3. Report on the OSH and Working Conditions of Company C
84 III.4. Report on the OSH and Working Conditions of Company D
92 III.5. Report on the OSH and Working Conditions of Company E
100 III.6. Report on the OSH and Working Conditions of Company F
111 III.7. Report on the OSH and Working Conditions of Company G
116 III.8. Report on the OSH and Working Conditions of Company H
121 IV. Comparison on Company Codes of Conduct, the ICTI Code of
Business Practice and the Chinese Labor Law
129 V. Concluding Remarks
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131 Appendix - Occupational Safety and Health Questionnaire
I. THE HONG KONG TOY INDUSTRY AND THE INTERNATIONAL
SUB-CONTRACTING SYSTEM
The Hong Kong toy industry started in the 1950s. In the beginning, the operations were
small and depended heavily on manual labor. In 1967, the biggest factories in Hong
Kong employed around 1,500 workers.
A. Playing the OEM Role
In the early seventies, the industry saw rapid development as production was
diversified from stuffed toys and wind-up toys to battery-operated toys and later,
electronic and even interactive toys. In 1977, Hong Kong had 1,629 plants producing
toys and games. The number grew to 2,244 in 1982. From late seventies to early
eighties, the industry saw a turning point as major multinational toy companies, such as
Hasbro and Tonka, started to set up offices and move their production to Hong Kong.
They set their eyes on Hong Kong because of the low production and labor cost.
Gradually Hong Kong manufacturers played the OEM (original equipment
manufacturing) role to US, Japan and European toy companies shifted to focus on
design and innovation as well as the ownership of toy labels via mergers and take over.
That gave Hong Kong manufacturers the opportunity to export to overseas market
without bearing the marketing risks. A number of toy companies emerged to become
OEM partners to big multinational toy companies.
B. Moving to Mainland China
In the early 80s, 2,200 toy factories employing 51,716 workers were found in Hong
Kong. The number of workers dropped to 46,198 by 1987 and further to 3,437 in
1997 – a result of the rising production and labor cost in Hong Kong. The open door
policy of China starting 1979 helped Hong Kong manufacturers solve the problem by
shifting the production base of toys to the Pearl River Delta of Guangdong province of
mainland China. Today, it is estimated that only about 2% of the total volume of Hong
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Kong’s toy export is made in Hong Kong. The rest comes from China. A survey done
by the HKTDC in 1997 revealed that almost 95% of HK toy manufacturers had
relocated their production facilities to the Chinese mainland. The Hong Kong Trade
Development Council (HKTDC) reported that, about 3,000 HK toy companies were
estimated to be operating in HK and the Chinese mainland. 2 The estimated number of
workers employed by HK toy companies was around 3 million. Figures from the Hong
Kong Census and Statistics department shows that export of the toy industry reached
US$91.5 billion in year 2000.
C. The International Sub-Contracting System of Toys
The US, being the largest market for consumer goods in the world since the cold war, is
also the host of the world’s biggest toy companies. Since the 60s, American toy
companies have been sub-contracting the production of toys to Asian countries. Their
first stop was Japan and in the 1970s, it was Hong Kong.
The manufacture of toys was then broken down into processes which allowed for an
international division of labor and the emergence of trans-national toy companies.
A simplified production chain is drawn as such:
Concept – R&D – Design – Sample – Testing – Manufacturing - Marketing
Production processes that are less profitable were contracted out to wherever the cost is
cheap. The higher end of the production chain, for instance design as well as R&D, are
taken up by the trans-national toy companies because of higher value-added-ness and
thus a better profit margin. The increasing importance of patent rights aggregates this
uneven distribution of profit margins.
On the other hand, as trade becomes not only international but global, production
(especially over-production) becomes more and more dependent on consumption. That
necessitates good access to big overseas consumer markets for instance the US, Europe
and Japan. The other end of the production chain, ie, distribution and marketing, also
becomes increasingly important. Retailers, especially global chained retailers like
ToysRus and Wal-Mart, dominate the picture 3 . According to the Toy Manufacturers of
2
P1, “Practical Guide to Exporting Toys for HK Traders”, March 1999, published b HKTDC Research
Department.
3
In 1996 and 1997, ToysR’Us was the biggest traditional toy retailers in the US, taking up a market share
of 18.9% and 18.4% respectively. This was followed by Wal-Mart that had 15.3% and 16.4% market
share. The situation changed in the past two years. Wal-Mart surpasses ToysR’Us to become the biggest
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America in 1999, the average gross profit of toys taken by retailers is about 33%. 4
The production chain of the toy industry, composing of sectors that have uneven value
added-ness and different profit margins, is more a hierarchy than a chain.
Toy Retailers (eg ToysR’Us, Wal-Mart)
↓
License / Brand Name Owners (eg Disney)
↓
Trans-National Toy Manufacturers (eg Mattel, Hasbro)
↓
Sub-Contracting Toy Manufacturers (OEM Toy Manufacturers)
The chain remains the same hierarchical when placed against the geographical
background.
Retailers (US, Japan, Europe)
↓
License / Brand Name Company (US, Europe, Japan)
↓
Trans –National Toy Companies (US, Europe, Japan)
↓
OEM Toy Companies (Hong Kong)
↓
Production Facilities (Mainland China, Vietnam, Thailand, Mexico etc)
How is profit distributed down the hierarchy? How is responsibility, particularly social
responsibility, shared down the hierarchy? If the globalization of (toy) production of
trans-national (toy) companies is said to have created jobs to developing countries, why
is it that only low-end, exploitative jobs are contracted out, and the profit hierarchy has
not been changed at all? Who will be next after Hong Kong and China? Will the
race-to-the-bottom-game end?
D. Changing Landscape
toy retailers in the US market.
4 P.29, “Practical Guide to Exporting Toys for HK Traders”, March 1999, HKTDC Research Department.
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To acquire a larger market share and to remain competitive in the manufacturing of toys,
aggressive trans-national toy companies start to either move upstream to buy more
licensed products; or move horizontally to acquire other ODM toy companies. Since
mid 1980s, Hasbro for instance, has been acquiring license companies and other toy
companies such as Kenner, Parker Brothers, Tonka, Larami, MicroProse, Galoob, Tiger
Electronics, Oddzon and Cap Toys, Bludbird and Atari etc. The company is also the
licensee to a number of frenzy hit characters or series, like the Star War series,
Telebubbies, Spice Girls, Pokemon, and recently Harry Porter. Mattel has acquired
Fisher-Price, Tyco, and Pleasant Company etc.
Besides vertical integration, the toy industry is closely linked with the entertainment
industry. Huge license fees are paid to giant entertainment corporations like Warner
Brothers and Disney and to manufacture toys based on TV series and cartoon movie
characters. In the last 20 years, a close link was built between the toy manufacturing
industry and the fast food industry. Global fast food chains like McDonald’s comes into
the scene. Premium toys are produced to promote the chain store’s business.
What happens is that the industry is controlled in a small number of giant players. They
include trans-national toy retailers that dominate the marketing of toys in the world’s
most important toy markets, a few entertainment or fast food giants that hold license to
popular product lines or labels. And a number of prominent trans-national toy
companies. The toy industry remains highly concentrated at the top of the pyramid. It
is estimated that the top 50 toy companies in the US have captured about 90% of the
market sales of the US, which is also the world’s single biggest toy market. These
include names such as Mattel, Hasbro, Galoob Toys, Toy Biz … , to name but a few. 5
E. Contracting Production
To take a more focussed look at the manufacturing sector of the production hierarchy,
the sub-contracting of toy production takes place via various channels. Trans-national
toy companies, toy retailers and license companies that own no production facility, may
place orders with OEM toy companies through:
1) The local or regional buying office, eg Disney, Mattel and Hasbro
2) Agents or promoting companies, eg McDonald’s
3) Trading companies, eg Li & Fung also sources production for Disney
4) The importer
5 P21 “Practical Guide to Exporting Toys for HK Traders”, March 1999, HKTDC Research department.
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There are problems associating with different ways of contracting production.
1. Contracting production via a middleman may further squeeze the price down the
chain. The lower the price the middleman offers, the higher the profit margin he
can get. The middleman helps largely in racing the price to the bottom.
2. Profit maximization being the objective, the buying office (of a trans-national toy
company) would “naturally” seek for the lowest price. The interests of the
company’s buying office may clash with the social responsibility commitment of
the mother company.
F. Trends in the Toy Industry
As global competition for greater market share and for cheaper production and labor
cost continues, the toy industry has been re-engineered to meet the grand challenge.
These changes will be directly responsible for worsened conditions for manufacturing
toy workers.
1. Mergers and Acquisitions of Toy Companies
In light of a rising trend of merging activities of trans-national toy companies,
their bargaining power is further enhanced vis a vis the supplying companies. To
survive, the supplying companies are forced to be more and more “competitive”,
in terms of price, quality, lead time etc.
2. “The Retailers’ market”
The greater concentration in the retail sector in the US and Europe, results in a
continued squeeze on prices, while shorter life cycle of toys has increased the risk
of product development. 6 In order to be more competitive, retailers need a small
inventory and a responsive supply that can capture the whims of the market. The
risk of inventory is gradually shifted to the manufacturers. Orders will be placed
just before the shopping season begins.
G. Industrial Re-Engineering and its Relation to the Working Conditions of
Workers in China
1. Just-in-time delivery
Small orders with short delivery lead-time are placed with manufacturers as
6 Trade Watch, April 2000, HKTDC Research Department.
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uyers wait to see the market response. By adopting just-in-time inventory
systems, overseas buyers may put more pressure on toy manufacturers for smaller
orders and shorter delivery time. “It places the burden of inventory management
on the toy manufacturers, complicating their already tricky timing exercise during
the holiday season.” 7
The following table is about the delivery lead time given by the four trans-national
companies, Mattel, Hasbro, Disney and McDonald’s to their OEM suppliers. The
time is taken as between the placing of the order and the delivery of goods on
board. Thus only the time spent on manufacturing the particular product is taken.
Table 1: Delivery Lead Time
No. Product Type
Delivery Lead Time
(in week)
Order Quantity
1 Action Figure 2 5040
2 Doll 2.5 7200
3 Figure 2.5 10800
4 Doll 4 11520
5 Electronic Toy 4.5 35160
6 Plush 5 8640
7 Electronic Plush 5 12960
8 Electronic Plush 4 11890
9 Action Figure 5.5 47800
10 Activity Toy 6 24000
11 Plush 7 5004
12 Plush 7 5004
13 Plush 7 6960
14 Plush 7 4008
15 Plush 5.71 4998
16 Plush 6.57 4998
17 Plush 5.71 4992
18 Plush 6.57 5004
19 Plush 5.71 4998
20 Plush 6.57 5004
21 Plastic Playset 4.14 12784
22 Electronic Robot 2 24996
23 Electronic Interactive Doll 4.43 50004
24 Electronic Interactive Doll 2.57 6000
25 Plastic Playset 4.71 20001
26 Plastic Playset n/a n/a
27 Plastic Playset n/a n/a
28 Doll n/a n/a
29 Activity Toy n/a n/a
7 P7, Practical Guide to Exporting Toys for HK Traders, March 1999, TDC Research Department.
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30 Baby Playset n/a n/a
31 Plastic Toy 5 10008
32 Plastic Playset 6.57 25008
33 Toy Watch 2 10754
34 Wire Control Car 2 1200
35 Projector Dome 6.43 n/a
36 Plastic Toy 5 n/a
37 Plastic Playset 5 n/a
38 Action Figure 5 n/a
39 Action Figure 6 n/a
40 Plastic Toy 4 n/a
41 Plastic Playset 4 n/a
42 Plastic Playset 4 n/a
43 Plastic Toy 4 n/a
44 Plastic Toy 4 n/a
45 Plastic Toy 4 n/a
46 Electronic Interactive Doll 2 2100
47 Electronic Toy 2.14 5500
48 Electronic Interactive Doll 1.86 48000
49 Electronic Interactive Plus 1.43 4400
50 Electronic Interactive Doll 1 4000
(Source: toy manufacturers in Hong Kong)
Take the case of the production of electronic robot (no.22), only 2 weeks were
given for an order quantity of 24996 pieces. Of course there are a lot of factors that
are absent at this stage to help evaluating the delivery lead time, such as the
production capacity of the supplier plant and the steps that are needed to produce
the product. Yet, the figures still give us a glimpse on the tight production schedule
of the toy industry and its workers. The following question should rather be
directed to the 4 trans-national toy companies, namely Hasbro, Mattel,
McDonald’s and Disney:
2. Pricing
� How are orders placed with the suppliers?
� How do the 4 companies balance just-in-time delivery with the company
commitment to comply with the Chinese Labor Law with regard to
limiting working hours to not more than 40 a week?
The pricing of a piece of toys, hard or soft, in general is composed of the following:
labor, depreciation, raw material and overhead. In a buyers’ market that pit
manufacturers against manufacturers, workers against workers and countries
against countries, prices race to the bottom.
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The following information shows the percentage of direct labor cost
(take-home-pay for workers) over the retail price of a number of toy products
produced by Mattel, Hasbro, McDonald’s and Disney in facilities in mainland
China.
Table 2: Direct Labor Cost Percentage
No. Product Type
Direct Labor
Cost
Direct Labor Cost /
Retail Price
Retail Price %
1 Action Figure US$0.659 US$11.99 5.5
2 Doll US$0.46 US$9.99 4.6
3 Figure US$0.21 US$7.49 2.8
4 Doll US$0.561 US$16.99 3.3
5 Electronic Toy US$0.81 US$44.99 1.8
6 Plush US$0.168 US$6.99 2.4
7 Electronic Plush US$0.387 US$15.49 2.5
8 Electronic Plush US$1.188 US$43.99 2.7
9 Action Figure US$0.148 US$4.49 3.3
10 Activity Toy US$0.105 US$14.99 0.7
11 Plush US$0.367 US$9.99 3.67
12 Plush US$0.368 US$9.99 3.68
13 Plush US$0.36 US$10.99 3.28
14 Plush US$0.382 US$9.99 3.82
15 Plush US$0.175 US$6.99 2.5
16 Plush US$0.175 US$6.99 2.5
17 Plush US$0.175 US$6.99 2.5
18 Plush US$0.175 US$6.99 2.5
19 Plush US$0.267 US$9.99 2.67
20 Plush US0.175 US$6.99 2.5
21 Plastic Playset US$0.264 US$10.99 2.4
22 Electronic Robot US$0.539 US$76.99 0.7
23 Electronic Interactive Doll US$0.87 US$29.99 2.9
24 Electronic Interactive Doll US$0.26 US$64.99 0.4
25 Plastic Playset US$0.273 US$12.99 2.1
26 Plastic Playset US$0.216 US$11.99 1.8
27 Plastic Playset US$0.245 US$34.99 0.7
28 Doll US$0.144 US$11.99 1.2
29 Activity Toy US$0.14 US$19.99 0.7
30 Baby Playset US$0.175 US$24.99 0.7
31 Plastic Toy US$0.045 US$4.5 1
32 Plastic Playset US$0.094 US$12.5 0.75
33 Toy Watch US$0.035 US$1.99 1.76
34 Wire Control Car US$0.264 US$27.2 0.97
35 Projector Dome US$0.215 US$24.99 0.86
36 Plastic Toy US$0.17 US$4.99 3.4
37 Plastic Playset US$0.4 US7.99 5
38 Action Figure US$0.323 US$7.69 4.2
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39 Action Figure US$0.172 US$5.39 3.2
40 Plastic Toy US$0.517 US$10.99 4.7
41 Plastic Playset US$0.32 US$7.99 4
42 Plastic Playset US$0.407 US$7.99 5.1
43 Plastic Toy US$0.17 US$3.69 4.6
44 Plastic Toy US$0.192 US$3.99 4.8
45 Plastic Toy US$1.78 US$4.69 3.8
46 Electronic Interactive Doll US$0.831 US$2499 3.33
47 Electronic Toy US$1.314 US$27.99 4.7
48 Electronic Interactive Doll US$2.454 US$99.99 2.45
49 Electronic Interactive Plus US$0.73 US$24.99 2.92
50 Electronic Interactive Doll US$0.82 US$19.99 4.1
(Source: from toy manufacturers in Hong Kong)
None of the above cases show the four trans-national companies as paying more than
6% of the retail price of their products to the Chinese workers. In the most extreme case,
only 0.4% or US$0.26 was paid to the workers for the electronics interactive dolls that
were sold at US$64.99.
� Can Mattel, Hasbro, McDonald’s and Disney be sure that the less than 6%
direct labor cost / retail price is enough to pay the minimum wage and legal
overtime compensation to a Chinese worker that works 14 –16 hours a day in
the peak season?
3. Job Insecurity
Seasonality is obvious in the toy industry and this applies to both the US and
European market. The retailing system in the US and the toy business rely heavily
on the holiday season of conscience. And Chinese workers work long hours just to
support the December shopping craze. Lately, there is a tendency to push the
holiday season to just a few weeks before Christmas. The holiday season of
shopping is compressed due to keen competition and the reliance on just-in-time
delivery. That means the peak season for toy production has a tendency to
becoming shorter and drawn closer towards the end of the year. On the part of
Chinese workers, it means more irregular and fragmented work as well as unstable
employment. Visits to toy factories in China during the slack period give a stark
contrast to the scenario in the peak season. Up to half or two-third of the workforce
would be laid off during the slack season.
The table below shows the seasonal demand pattern for a total of 21 toy products of
Mattel, Hasbro, McDonald’s and Disney in the year 2000. As shown, July –
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September is the peak season for toy production in the mainland facilities that
produce the four labels. It should be added that on top of the seasonality is the
popularity of the particular toy. The demand for interactive doll (no 48)
demonstrates a big fluctuation. It rises from 2.66% in the second quarter to the peak
of 84.88%. From there drops to 12.47% in the last quarter. Similar fluctuations can
be observed with item 3, 24 and 34.
Table 3: Year Demand Pattern (Year 2000)
No. Demand Pattern (in%) Jan-Mar Apr-Jun Jul-Sep Oct-Dec Total
1 Action Figure 13.3 22.5 44 20.2 100
2 Doll 11.3 19 47 22.7 100
3 Figure 9 22 56.3 12.7 100
4 Doll 12.5 24 47.5 16 100
5 Electronic Toy 13.5 20 47.5 19 100
21 Plastic Playset 18.5 22.4 47.2 11.9 100
22 Electronic Robot 20 14.4 50.6 15 100
23 Electronic Interactive Doll 18.7 29.7 27.8 23.8 100
24 Electronic Interactive Doll 6.1 25.4 53.9 14.6 100
25 Plastic Playset 12 20.7 53.7 13.6 100
31 Plastic Toy 17.45 22.61 38.58 21.36 100
32 Plastic Playset 11.56 63.77 4.9 19.77 100
33 Toy Watch 20.59 30.81 24.81 23.79 100
34 Wire Control Car 35.27 2.72 37.41 24.6 100
35 Projector Dome 1.51 25.8 41.8 30.89 100
N/a 10 18 55 17 100
46 Electronic Interactive Doll 10.33 6.08 63.09 20.5 100
47 Electronic Toy 5.95 10.51 68.87 14.67 100
48 Electronic Interactive Doll 0 2.66 84.88 12.47 100
49 Electronic Interactive Plus 14.26 13.41 63.93 8.4 100
50 Electronic Interactive Doll 9.51 34.47 35.9 20.12 100
(Source: from toy manufacturers in Hong Kong)
Sub-contracting workers are dismissed or “told to take a vacation” during the slack
season. In most cases, they are not compensated. The seasonality of the industry
makes these workers seasonal workers, depriving them the right to enjoy long-term
benefits, such as pension and progressive training.
Too big a fluctuation in the yearly demand pattern is not advantageous to the
development of a long term working relationship between the order-placing
company and the suppliers, which is important to the implementation of the toy
companies’ code of conduct.
� Will Mattel, Hasbro, McDonald’s review their yearly demand pattern with
16

their suppliers? What will the four companies do, as said in all the four
companies’ code of conduct, to work with the suppliers in implementing the
company code of conduct?
� If the industry is becoming more seasonal, should the code of conduct of the
four trans-national toy companies also cover the irregular or seasonal
workforce?
4. Occupational Safety and Health Problems
Long working hours, low wages, payment by piece rate, are some of the major
reasons behind the OSH problems, both accute and chronic, of the sub-contracting
toy workers in mainland China. What happens in the upper stream of the industry
have implications for the management of workflow and the pay system at the
supplier level. The tendency of the industry to price down, the just-in-time delivery,
as well as inventory control, are related to long working hours and persistent
exposure to a higher risk of acquiring OSH problems at the supplying factory level.
17

II. Comments and Recommendations on the OSH and Working
Conditions in 8 Supplying Toy Plants in Mainland China
This part is a summary of the research findings based on the interviews and finished
questionnaire conducted with 93 toy workers employed by 20 manufacturing plants
operating in Guangdong province of mainland China. The research was conducted
from 9 August to 21 September 2001.
A. Research Objectives
The Occupational safety and health problem at the work place remains a problem that
receives less attention. By interviewing more than 90 mainland workers, the HKCIC
aims to:
i. Understand the OSH problems and conditions associated with the manufactures of
toys for export to the world’s leading toy companies.
ii. Understand the toy workers’ awareness for OSH and related issues.
iii. Understand the toy workers’ legal consciousness regarding labor rights.
iv. Give a voice to the needs and aspirations of the toy workers.
B. Research Target
i. Production plants
93 workers from more than 20 operating plants of varying sizes were interviewed in
this research. Amongst the 20 operating plants, the research team identified 8 toy
corporations or companies to focus the study. 7 of them are Hong Kong capital
investments whereas the other one is a South Korean company. The names of the 8
corporations and their subsidiaries will not be disclosed to protect the contracting
factories and their workers. They will be named by alphabets but they can be
distinguished in terms of their supplying relations with the 4 brand name toy companies.
The biggest corporation amongst the 8 identified suppliers employed around 25,000
workers during the peak season, whereas the smallest one had a 300-strong work force.
All the operating plants are located in industrial cities in the Pearl River Delta of
Guangdong province, namely Shenzhen, Dongguan and Nan Hoi.
All the 20 and more plants were supplying to world famous brand name companies in
the toy industry namely, Hasbro, Mattel, McDonald’s and Disney etc.
18

Table1: The 4 trans-national toy companies and their suppliers
Trans-National Toy Companies Suppliers
Hasbro Company A, B, C, D
McDonald’s Company E, F, G, H
Mattel Company A, B
Disney Company B, G, H
ii. Workers
A total of 93 workers (44% male and 56% female) were interviewed. They were
working in different departments, both production and non-production. Their age
ranged from 18 to 35. They came from different inland provinces in the mainland,
including Sichuan, Henan, Hubei, Hunan, Guangxi, Jiangxi etc.
Table 2: Distribution of interviewed workers in various departments
Department Percentage
Assembly and Packaging 40%
Spraying and Coloring (included paint coloring, spray
coloring and refine coloring)
24%
Molding 8%
Sewing 6%
Others (include work processes such as making holes,
trimming, wood processing, mold making etc)
22%
Table 3: Distribution of workers employed in the 8 supplying companies/corporations
Supplying company/ corporation Percentage
Company A 26%
Company B 16%
Company C 14%
Company D 13%
Company F 9%
Company G 7%
Others (including Company E + H) 15%
C. Research Methodology
The research aimed at giving a general picture of the OSH problems and consciousness
of toy workers manufacturing for export, and equally importantly, to give a voice to the
workers. All the interviews were done based on a 3-page questionnaire. As
occupational safety and health issues involve not only infrastructures, but also
management policy and workers’ consciousness, it is thus important to understand how
workers view and frame the problems. Open questions were asked where appropriate. It
is deemed that not only the statistics, but the way workers understand and frame the
19

problems is also indicative of the level of their OSH consciousness which in itself is an
important reference standard to evaluate the OSH provisions and policies carried out by
the factory management. Whenever possible, the interviewed workers would be asked
to assess and prioritize the most serious source of hazards at the work place. This
should give a reference to factories and brand name companies in addressing the
problems.
The drafting of the questionnaire is based on consultation with OSH experts in the US,
India and Hong Kong. The questionnaire has three sections. The first part asks about
specific OSH problems identified in different departments of a toy factory. Questions
in the second part ask about other OSH infrastructures and policies executed at the
work place. The last part looks at the interviewed workers’ OSH consciousness and
awareness of their legal rights. The last question asks workers to indicate their interest
in receiving more information and training on OSH issues.
D. Research Findings – Summary
The following is an abstract of the research findings based on the 93 finished
questionnaires. It gives a general picture of the OSH conditions found in the 8
supplying toy companies/corporations that manufactured for Hasbro, Mattel,
McDonald’s and Disney during the research period.
(A) OSH problems Encountered in Different Departments
The Assembly and Packaging Department
� Work Stress is the major OSH problem found in this department. The assembly
and packaging department is the last department where all the pressure associated
with various stages of production will be accumulated. This is particularly serious
in the peak season. Interview findings showed that this department worked up as
long as 12 –16 hours a day, if not overnight, during the peak season. To meet the
tight delivery time and shipment schedule, long working hours is usually coupled
with a high daily production quota thus scheduled. Failure to hit the production
quota usually means overtime work (in a lot of cases, not duly compensated
according to law) and unstable lunch breaks. In some cases workers had to finish
their lunch and dinner breaks in a couple of minutes whereas in other cases,
workers had to eat at the work place and go back to work immediately after
lunch/dinner. Stomach and digestive problems were common due to work stress.
In a lot of instances, workers felt under great pressure to get the permission from
20

the supervisors to go to the toilet or to drink water.
� Ergonomic problems associated with long and repetitive jobs found in this
department include, stiffness, numbness, pain and physical weakness developed at
various body parts of the body including shoulders, necks, waist and the lower
bottom of the body. Workers assembling or packaging stuffed toys had skin allergy
and sore throats as they inhaled the stuffing particles in the air. Temperature at the
work place was another source of health hazards especially in summer, which is
also the peak season. In Factory B, cases of workers collapse as they could not
stand the long hours and the heat were reported.
The Spraying and Coloring Department
� A lack of safety and health training for new and current workers is a major
problem found in this department. Spraying and coloring workers are persistently
exposed to chemicals. Yet it is found that they were at most taught about the usage
of the chemicals but not the hazards and proper treatment in case of chemical
poisoning. The interviewed workers in this department had inadequate
understanding of the chemical labels they came across. They could not tell
whether the labels were correct or informative enough. None of the 22 interviewed
workers could name the chemicals (including paints, thinner and other chemicals)
they were using. Nor the usage, hazards and treatment in case of poisoning.
� Most of the visited plants had ventilation system installed in the spraying and
coloring department. Yet as workers were not equipped with proper knowledge,
they could not tell whether the ventilation system could effectively lower the level
of paint particles in the air. On the contrary, a lot of them complained about strong
chemical smell and high paint particle level as indicated by either their body
discomforts or the need to frequently change their cotton masks.
� The inadequate provision of personal protective equipment (PPE) is another
common problem. Three scenarios regarding this issue can be generalized. 1. The
factory management did not deliver any PPE to the workers and workers were
exposed to chemicals without protection at all. 2. PPE would be delivered and
workers would be requested to wear whenever there is a factory inspection or
social audit. The provision of PPE was more for show rather than the protection of
workers. For the rest of the time workers were working under no protection at all.
3. In some of the plants visited, PPE was delivered once a week. But the workers
reported that the cotton masks and cotton gloves were filled with paint particles or
21

dirtied in one or two days’ time. That indicates either an excessive high chemical
paint exposure or the employment of improper PPE. It should be noted that the
PPE in use in the reported cases referred to cotton masks and gloves whose
effectiveness in protecting workers against direct skin exposure, inhalation and
chemical poisoning was called into question.
� Interviews with the workers indicated a strong reluctance to wear the PPE, if
delivered. The main reasons for that are inconvenience, feeling uncomfortable and
the fear that wearing PPE would slow down the production speed and thus
affecting the income. It should be understood that production stress, the daily
production quota system, as well as the piece rate payment of wages are important
reasons discouraging workers from wearing the PPE.
� The availability of proper solvent for workers to wash their hands is another issue
of concern. Workers could not wash away the chemical paint left on their hands
with plain water. They did so with thinner of various kinds whose hazards they
were totally ignorant of.
� Bodily reactions to long hours of chemical exposure as reported by the
interviewed workers include, dizziness, headaches, skin allergies, sore problems,
vomits and a higher liability to acquire hepatitis B.
� Other sources of safety and health hazards identified in this department include
poor ventilation, high temperature (during summer) and noise pollution
(associated with the spraying machines and the ventilation).
� Long working hours, especially during the peak season, is a constant problem.
Cases of working 12 –16 hours a day or even overnight during the peak season
were reported. It should be noted that working long hours in the spraying and
coloring department means being exposed persistently to chemicals thus creating
double hazards to the workers.
The Die-Casting Department
� Mechanical injury is a constant source of hazard in the die-casting department.
Accidents like cutting fingers can easily take place in the die-casting department if
machines are poorly maintained, not properly guarded and proper safety training
for workers is not provided. The interviewed workers were asked questions about
machine guard and related operation problems. It is found that the die-casting
22

machines operated by many interviewed workers were one-button rather than
two-button controlled. Mechanical injuries can easily happen as workers use the
other hand to place or hold the plastic or metal parts for molding. The danger
aggregates when workers have to work fast during the peak season. Incidents of
mechanical injury were reported in Factory A, B, and E. In one incident, the
emergency button that cut off the power supply was located far from the injured
worker’s work place and the worker had his fingers cut. The interviewed workers
also expressed concern about operating unguarded machines.
� Formal and proper training on the safe operation of machines is absolutely
necessary for both new and current workers. In many of the interviewed cases, it is
found that workers were verbally instructed about how to operate the machines not
how to “safely” operate the machines. Few workers reported that safety machine
instructions were posted.
� Other hazards identified in this department include noise pollution and high
temperature. Yet few workers reported that they were delivered PPE like ear plugs,
face and eye masks. The other main problem is that workers showed reluctance in
wearing the PPE. Fear of slowing down the production speed and affecting income,
inconvenience and feeling uncomfortable are the major reasons for that.
� Strong physique is required in this department and very often, male workers are
employed. Factories would also arrange two or three shifts for workers. Workers
work shorter hours. But the liability of having industrial injuries is high in the
die-casting department especially without proper safeguards and training
provision.
The Sewing Department
� Finger cut is a commonly identified industrial accident in the sewing department.
The needle of the sewing machine can be easily broken when workers are
operating in high speed. Accidents of this kind frequently take place in the peak
season. No factory has machine guard installed in the sewing machines.
� Noise pollution is another problem. The interviewed workers in some of the
visited factories said they could hardly hear or talk to each other at the work place.
No factory was providing regular ear tests or ear protection to workers.
� Long working hours is identified by workers as a major hazard. Workers have to
23

sit for 12 – 16 hours, sometimes overnight, repeating the same motif of work.
Ergonomic problems like stiffened shoulders and waists, fatigue, body weakness
and pained legs (to operate the handle of the sewing machine) are commonly
found. The provision of standardized wooden seats might not fit workers of
various heights. That might aggregate the ergonomic hazards workers thus
suffered.
The Silk Screening Department
� Silk screening workers are exposed to chemicals. It was observed in the course of
the interviews that the paint had got into the hands of the interviewed workers.
Workers interviewed in this department did not understand the hazards of the
chemicals and the thinner used.
Tooling Department
� The work place at the tooling department is usually noisy and the temperature
high. Temperature of the tooling machine in operation can be as high as 200 or
300 degree C whereas temperature at the work place ranges from 33 –38 degree C.
Exhaustion, high temperature as well as mechanical injury are common sources of
hazards.
Hole Pressing Department
� Mechanical injury is identified as a source of hazards in this department. Absence
of proper machine guard and a lack of proper training for workers could result in
injuries especially when production pressure is intense during the peak season.
The Trimming Department
� Interviewed workers from this department were given a cutter to trim the edges of
plastic toy parts. They were not equipped with proper gloves and could get cut
from time to time, especially during the peak season. Lack of proper treatment
could result in infection and other ulcerous diseases.
(B) Other OSH Problems in General
Fire drills and fire prevention
� Amongst the plants visited, large-scale operations have regular (quarterly or
yearly) fire drills at the work place. Still more has to be done. First, even for
large-scale plants, the fire drills might not necessarily cover the dormitory. Second,
in some factories, the fire drills were done by selective or random participation
24

from each department (like asking part of the work force or the security guards to
participate). It could be that the management did not want to disrupt production
especially during the peak season. Yet, this undermines the meaning and
effectiveness of fire drills. Third, fire drills were found to be effective since the
participated workers said the drills helped them to identify the exits. But many of
them did not know how to use the fire extinguishers. For smaller to medium sized
plants, having infrequent or even no fire drill is a problem. Some of the
interviewed workers, whether from large or small-scale plants, also reported
storage of goods at the alleys. This was the case especially during the peak season
or when there was no factory audit. What is reflected from the workers shows that
fire prevention has to be persistently taken rather than a show for audits. And that
there is a further need to strengthen the fire prevention consciousness at both the
workers and the management level.
Long Working Hours
� Long working hours is a persistent source of safety and health hazards for all
plants, big or small. The interviews were done in August and September. It was
the peak production season and thus also the high-risk season for safety and
health problems. As gathered from the interviews, most of the workers worked
seven or six-and-a-half- day a week and 14-18 hours a day at most. The worst
case reported overnight work and continuous overnight work. Long working
hours led to exhaustion and lack of concentration that could lead to industrial
injuries. What is more worrying is that long-hour work undermines the health and
the body resistance towards various kinds of diseases and chemical poisoning. It
leads to hidden and chronic health hazards. The implications call for grave
attention as the work force in the toy industry is highly seasonal and mobile,
workers might not be able to identify or prove the acquisition of occupational
diseases once they left the factory.
Faints and deaths
� Faints are constantly reported in the workers’ interviews. Cases were reported to
have happened in the assembly department of Company D, the spraying
department of Company B, the tooling department of Company C, the hole
making department of Company H and the spraying department of Company A.
This constitutes not a small percentage for a random research. The fact that faints
are common during the peak season should not undermine its grave implications.
Possible reasons leading to faints at the work place can be long working hours,
physical weakness, heat or chemical poisoning etc. In most cases, proper
25

treatment and detailed diagnoses were not given, making it difficult to relate faints
to work place hazards and to eliminate the source of hazards. Workers in general
were told to take a rest, have some herbal ointment and go back to work. A general
lack of proper diagnoses and medical documentation as well as a general
negligence at both the workers and the management level calls for alarm.
� Though not equipped with enough access to information to clarify, cases of
unknown deaths were reported in the trimming department of Factory H during
the research period. As understood by the interviewers, the causes of deaths were
not known making it impossible for the family or the fellow workers to investigate
whether the deaths were occupation related. It is understood that there might be a
lot of reasons, both relating and not relating to the occupation, that lead to
unknown deaths during a worker’s terms of service at a particular factory. Yet, the
way the reported case of unknown death was handled was both illegal and unjust.
The management did not want to spread the issue and a sum of compensation was
given to the families. Without proper assistance and adequate legal knowledge, the
families could not get due compensation according to law. Nor were they equipped
with the means to demand or take an investigation on whether the death were
occupation related. Whereas the rest of the work force was kept in the dark while
the source of hazards was not eliminated.
Medical Provision and Lack of an OSH Policy
� Body check-up
Regular body check-ups (yearly or twice a year) took place in the large-scale
plants that were visited. It varied from factory to factory whether the check-ups
were paid by the management or the workers. What cannot be accepted is that
some of the factories, even large-scale ones, used body check-ups as a screen test
to remove workers (current or new) that were weak or sick. These workers would
be blatantly fired, “advised” to quit or simply told by the management to take a
“long vacation”. What these factories doing is illegal and irresponsible as the
Chinese Labor Law states that workers that have acquired diseases or illnesses
during the terms of service should be protected, not fired.
� Factory clinic
Large-scale factories had factory clinics, but not for smaller scale ones. In general
workers had to pay a subsidized medical fee. Workers would be sent to the hospital
in case of industrial injuries.
26

� OSH policy
None of the factories visited had an OSH policy or an OSH committee that
workers could name of. It can be seen in the above parts that a systematic
documentation of the medical and injury records is urgently needed. A record of
both workers’ medical histories as well as that of the factory’s OSH hazards and
accidents can help both parties to identify, report, investigate and eliminate
hazards. It also helps both parties to give and receive proper and legal treatment.
Women’s health
� A large proportion of the work force in the toy industry is female labor. In many
instances, women workers have to pay a high price in exchange for a job in the
factory. The Chinese Labor Law as well as the “Regulation on the Protection of
Female Workers” states clearly the rights of women workers to legal protection
during the menstruation period, pregnancy, maternity and breast-feeding period.
Yet none of these provisions was implemented for rank and file women workers in
all the 20 plants covered in the research. The fact that both the workers and the
management did not have the awareness for gender specific rights and provisions
calls for urgent attention and improvement. As reported in a case, it was generally
accepted that the pregnant worker would “naturally” quit the job when she was
about to give birth.
(C) Legal Rights Knowledge and Awareness of Workers
The following figures give an idea of the legal rights understanding of the 93 workers
that were interviewed.
Table 4:
Questions:
27
Yes, I
know
I’ve heard
about it
No, I don’t
know
1.Do you know the legal minimum wage of the town
you are working in?
10% 0 90%
2.Do you know the legal working hours ceiling of
the town you are working in?
4% 1% 95%
3.Do you know how much compensation you can
get if you are industrially injured?
0 1% 99%
4.Do you know anything about the Chinese Labor
Law?
8% 25% 67%
5.Do you know anything about the “Regulation on
the Protection of Female Workers”?
0 1% 99%
6.Do you know anything about the “Law on the
Protection on Teenagers”?
1% 1% 98%
7.Do you know anything about code of conduct? 9% 1% 90%

8.Do you want to get more information and training
on OSH issues?
28
Yes, I
want.
82%
I have no
opinion.
16%
No, I don’t
want.
2%
� The Chinese Labor Law is the relatively more well-known or well-heard-of piece
of labor rights provision amongst the interviewed workers. But the percentage is
still low, less than 25%.
� Company code of conduct as put forth by trans-national corporations and in this
case, all the four world-famous brand name toy companies, is, disappointingly
poorly known amongst the interviewed workers. Only 10% of the interviewees
said they knew or had heard about company code of conduct. This is a big slap in
the face for the trans-national companies that have spent millions of dollars
promoting and propagating their company code of conduct which they claim, can
protect third-world workers along the production chain.
� A significantly high percentage of the interviewees (80%) showed positive interest
in acquiring more information and training on OSH issues. This represents a voice
and a desire for more education and rights protection, contrary to the casual
argument that mainland workers coming from poor inland provinces had low
educational level and were too pragmatic and utilitarian to care about their rights.
� It is found that without proper legal rights education, workers have a lot of wrong
interpretation and confused understanding about their rights and relevant labor
rights provisions. A large proportion of the interviewees took legal minimum
wage as the lowest pay they had ever received. Similarly, they confused company
code of conduct with factory regulations. This totally works against the intended
objectives of having a company code of conduct. In many instances, workers
could not even tell what brand name product they were manufacturing. Nor could
they distinguish and see the relationship (both business as well as ethically binding)
between the trans-national companies that placed orders and the supplying factory
that they had an employment relationship with. Without proper training and
education in this regard, code of conduct cannot work effectively as a tool to
protect the interests of grass-root workers. And the supplying factory can take
advantage of workers’ ignorance to give a sham to code of conduct or ethical
business standards.
� Inadequate understanding of their legal rights has more implications as workers in
general equate labor rights with proper payment, working hours and other benefits.

A serious lack of consciousness for laws on women worker protection, teenager
protection, OSH protection and industrial injury compensation means that workers
do not understand their rights to healthy and safe work and that health and safety
are regarded as marginal issues compared to work pay. This reflects in a lot of the
interviews as workers could only tell the pay day but nothing about the treatment
and sources of assistance that they could turn to in case of accidents or injuries.
They expressed a vague understanding and reliance on the management to take
care of everything if misfortune knocked on the door. Such a mentality and such a
serious lack of rights consciousness is both worrisome and dangerous.
(D) Comments and Recommendations
1. OSH at Three Levels
� The OSH issue is a complicated issue. It relates not only to the nature of the
industry and physical factors, such as the physical set up of the work place, the
machines in operation and the raw materials used. It is also highly related to
administrative and management policies including work flow management,
personnel management and factory information documentation etc. Thirdly, the
OSH issue cannot be separated from education and training, both for rank and file
workers as well as the management.
� The first rule on OSH and related issues is always prevention and not aftermath
treatment. To develop a preventive plan requires identification, investigation,
analysis, documentation and evaluation. And that it should be done in a consistent
and interactive manner.
� Three levels of hazard control are distinguished: engineering control,
administrative control and personal protective measures. It should be emphasized
that to prevent, it is more important to first reduce the risk and hazard level at the
work place and gradually replace it with a healthier work environment. Taking
personal protective measures is always the last resort. Yet the general response
from the management would be putting the blame on the poor consciousness and
reluctance of workers to wear PPE. This argument puts the cart before the horse
and cannot be accepted.
The HKCIC demands that the supplying factories/toy companies covered in this
report start a thorough investigation of the OSH hazards and devise a progressive
plan to ratify OSH problems at all the three levels ie engineering, administrative
29

and personal protection level.
2. Ratifying long working hours
� The research findings show that long working hours and huge work stress under
the piece rate pay system and the production quota system are two general and
major sources of hazards to safety and health, be it large or small scale factories.
And it is the situation for the toy industry as a whole, especially during the peak
season.
� The HKCIC demands that the factory management of the 8 supplying
companies that are covered in this report, review and re-arrange the work
flow and work force management.
� At the same time, the 4 brand name toy companies, namely Hasbro, Mattel,
McDonald’s and Disney should also review and re-schedule the production
lead time they give to all their supplying factories.
� The HKCIC believes that one cannot go without the other. Both the order-placing
toy companies and the supplying factories should work together in this particular
area.
3. Establish a systematic approach to OSH issues
� As gathered from the workers’ interviews, none of the visited factories seems to
have developed a systematic and coherent approach to prevent, identify, report,
investigate, ratify and document OSH and related problems. None of the factory
visited had an OSH committee to specifically handle the matter.
� This is true not only at the supplying factory level. It applies also to the 4
trans-national toy companies. Cases of failure of code of conduct auditors,
whether internal or external, to spot the problems can be found in detailed factory
reports put under Part III.
� The HKCIC demands that the 8 supplying companies set up OSH
committees to develop a systematic approach to OSH issues. The
formation of this OSH committee should have rank and file workers
participation. (for details about the OSH committee, see Part IV)
� The four brand name toy companies, namely Hasbro, Mattel, McDonald’s
30

and Disney, should take up the responsibility to support and give
assistance, including technical, informational and financial ones, to their
suppliers to ratify safety and health problems and to prevent and control
safety and health hazards. Without substantial commitment, a better OSH
code or more factory audits are nothing but a sham only.
4. Formal OSH education and training for both workers and the management
� A lack of formal safety and health training is a chief factor directly responsible for
industrial accidents or injuries and chronic occupational diseases. Mechanical
injuries like cutting hands and fingers, as well as chemical poisoning are two
common OSH problems associated with the toy industry. They can be more
effectively controlled if formal training and education is given to workers. All the
8 supplying toy companies fare poorly in this area. It should be reminded that
providing education and training to workers by no means imply that the
management can shift the responsibility to the workers. Without proper
engineering and administrative control, a mere provision of OSH education and
training has no substantial meaning.
� The HKCIC deems that both the supplying factory and the brand name toy
companies, namely Mattel, Hasbro, McDonald’s and Disney, should
support and cooperate in launching formal OSH training for both workers
and the management.
5. Regular Medical Check-Ups and Documentation
� Medical check-ups can help the factory management to identify and trace the
sources of hazards to eventually control and eliminate them. It is not a means to
screen, remove and penalize sick workers.
� Regular check-ups should be provided to the whole work force. A personal as well
as factory-level medical history record should be kept. Workers should be
educated about the significance of such a recording system.
� Medical check-ups cannot be isolated from a coherent OSH approach that
coordinate resources and investigates the linkage between symptoms and
occupation related hazards and diseases.
6. Safety and Health Protection for Women Workers
� Gender specific training and legal rights education should be given to both the
31

management and the rank and file women workers. Both parties should learn that
women workers enjoy legal protection in particular areas.
� Pregnant workers should not be arranged to take up dangerous or high-risk jobs.
� It is recommended that the medical provisions can be more gender specific and
more assistance should be given to women workers during the “4 periods” –
menstruation, pregnancy, maternity and breast-feeding period – according to the
labor law.
7. Measures to be taken at specific departments
The Assembly and Packaging Department
� Long working hours and work stress are two major problems in this department.
� It is demanded that both the supplying factory and the 4 brand name toy
companies work together for a better lead time schedule that gears towards
reducing overtime hours and improving unstable working hours.
� It is recommended that more breaks be arranged between the two lunches
� Workers should be given lunch breaks of reasonable length for them to eat and
take proper rest.
The Spraying Department
� Constant exposure to chemicals is a major hazard in this department.
� Education and training on the name, composition, hazards and proper treatment of
the chemicals used should be given to the workers.
� Chemical labels should contain information such as the names, composition,
hazards, use instructions, and proper treatment. They should be written and put in
a clear and easy to read manner.
� The supplying factories should replace hazardous chemicals with ones that are less
hazardous to health.
� An OSH committee should keep a record of the hazardous chemicals used, explain
to the workers, and deliver appropriate PPE that offers effective protection to
specific chemical poisoning to workers.
� Engineering control measures should review and improve ventilation system at
the work place.
The Sewing Department
� Noise pollution and ergonomic problems are identified in this department.
� It is recommended that more breaks be given between the two lunches.
32

� Regular ear test be given to workers to keep record of the hearing problems of the
workers.
� The factory management should review the work floor plan to avoid an
over-crowdiness of workers and sewing machines at the shop floor.
The Molding Department
� Mechanical injury is the major hazard.
� Proper machine guidance and maintenance should be kept.
� Formal safety training is urgently needed for both current and new workers.
� OSH education should be given to workers to strengthen their safety awareness
and awareness for their rights protection in case of industrial accident.
� An industrial accident record should be kept. The information is useful for further
engineering control and safety education purposes.
� Working long hours should be avoided in the molding department. A better
management system of the work flow that aims at minimizing accidents not
maximizing production should be put in place.
III. 1) REPORT ON THE OSH AND WORKING CONDITIONS OF
COMPANY A
The following report is structured as such:
I. Company information
II. Research Sample
III. Overall Conditions on Occupational Safety and Health (OSH) in Company A
IV. Overview on the Working Conditions in Company A
33

V. Report on Factory A1
VI. Report on Factory A2
VII. Report on Factory A3
VIII. Report on Factory A4
IX. Report on Factory A5
I. Company Information
Company A is a Hong Kong based enterprise. It was established in the 1980s and was
listed in the Hong Kong stock market. Just like other Hong Kong toy companies,
Company A receives OEM orders and is an important vendor to a lot of toy retailers and
brand companies all over the world.
Subsidiaries
Company A has a number of subsidiary plants located all in the industrial areas of
Guangdong province, including Punyu, Dongguan and Shenzhen. It is estimated that
these plants employ a total of more than 10,000 workers.
Products
Products manufactured by Company A include battery operated toys, electronic toys,
plastic toys, pre-school toys, educational and infant toys, premium toys, as well as
stuffed or plush toys and dolls. Europe and the US are two major markets.
Major Clients
Company A is the major supplier to a number of toy brand companies including
Hasbro, Mattel/Fisher-Price, Tomy, Unimax, Galoob, Takara, Bluebird, Asahi,
IDT, Ohio Art, Toy Biz etc.
Business Performance
Company A consistently recorded a sales performance of over HK$1 billion in 1990s.
A prominent proportion of that came from toy production.
Research on Company A was conducted by visiting and interviewing workers
employed in 5 subsidiary plants of Company A. They are:
1. Factory A1 (Shenzhen)
2. Factory A2 (Pun-yu)
3. Factory A3 (Dongguan)
4. Factory A4 - (Pun-yu)
34

5. Factory A5 - (Dongguan)
II. Research Sample
The following research was conducted from July to September 2001. 24 workers from
the above 5 subsidiary plants of Company A were interviewed. They included
supervisors, non-production and production workers, coming from different
departments including assembly, spraying, quality control, metal component, injection
molding, pressing, packaging, testing, welding, trimming and finishing department.
The information of the interviewed workers are categorized as follows:
Sex Female Male
Number 12 12
Age range 16-20 21-25 26-30 Above 30 Not sure
Number 4 9 7 2 2
Terms of service Under 1 year 1-3 years Above 3 years
Number 11 10 3
III. Overall Conditions on Occupational Safety and Health (OSH) in Company
A
It is found in our investigations and interviews that there are serious occupational safety
and health hazards in the subsidiary plants of the company. These include both accute
hazards and chronic occupational diseases. There is a serious lack of safety and health
understanding and knowledge on labor laws and relevant regulations on the part of
workers. At the same time, the management is reluctant to disclose and address safety
and health problems. The hazards identified in the investigation are summarized as
follows.
1. Lack of safety and health training
Most of the workers did not receive formal on-the-job safety and health training. They
were told to observe and follow what their seniors were doing. Their only source of
information on production process and factory rules came from supervisors or fellow
workers. Yet safety and health hazards were missing from these informal couching.
They were told how to use the chemicals but not the names or the hazards of these
chemicals. Nor was there proper labeling on the chemicals. The interviews reported
35

workers using thinner and solvents to wash paints on their hands which later caused
skin diseases and allergies. In some of the subsidiaries, personal protective equipment
was delivered to workers (according to some workers, that was to impress auditors or
visitors). Lacking safety and health consciousness, they did not understand the
importance of wearing protection equipment. The management would rather turn a
blind eye to the problem and very often, it became too late when workers finally
realized the costs they had to pay.
2. Long working hours and safety and health
Occupational hazards brought by high temperature, sound pollution, chemical exposure
and repetitive body movement would get serious when workers had to work under such
an environment for long hours. It is one thing written in the Chinese Labor Law that
workers should work 8 hours a day, 5 days a week and not more than 3 overtime hours
on average a day. It was another thing in reality when most of Company A's workers
labored up to 14, and at most 18 hours a day if not overnight, and 7 days a week during
peak season.
Long working hours function with the piece rate system and a high daily production
quota to achieve the biggest squeeze on labor. By paying the piece rate and setting a
high quota, workers have to work long hours (in order to finish the quota fixed by the
management) and work quickly at the same time (otherwise they would be penalized by
not getting over time compensation if the quota is not reached). Whereas paying the
time rate will have workers wanting to work over time but not as efficiently.
Long working hours, a constant deprivation of rest and sleep is a dangerous factor that
first means longer exposure to industrial hazards. Second, the level of hazard alertness
of the workers would be lowered thus throwing them to higher risk of industrial injury.
Third, prolonged fatigue undermines the health of workers making them vulnerable to
chronic diseases or ergonomic problems which may not be detected during their service
terms in the factories.
Long working hours may be caused by the order placing practices of retailers and brand
name companies. They should bear the responsibility in causing the seasonal
fluctuation and shorter and shorter delivery time giving to the manufacturers. To ratify
the problems, the retailers and brand name companies should also should review their
order-placing schedule and give a reasonable delivery time to the vendors. Meanwhile
Company A should review the working hour schedule and give more breaks and rests to
36

the workers.
3. OSH problems are serious in the spraying department
The OSH problems in the spraying department of the subsidiaries of Company A are
serious. The spraying department was the department most complained about by the
interviewed workers. Problems such as high temperature, poor ventilation, long
working hours, sustained exposure to chemical paints, inadequate personal protective
equipment and lack of OSH consciousness of workers, are stringent. In some of the
subsidiaries, workers reported that the management did nothing to improve their
conditions. Hazardous chemicals were not substituted with less hazardous ones, no
resources were put for mechanical re-engineering, nor were personal protective
measures adequate. The cotton masks and gloves delivered could not prevent
poisonous chemicals from getting into workers' hands and skins. Nose bleeding and
faints were found at the work place especially during the peak season.
4. Body Check-up serves other ends
Regular body check-ups were provided in certain subsidiary plants of Company A
while in some subsidiary plants, workers had to pay for them before getting the job. Yet
it was found that body check-ups could be abused as screen tests to recruit “healthy”
workers and remove sick ones. Current workers or new recruits could be fired or
rejected if they were physically weak or found to have acquired diseases. It seemed that
the management of the Company was more concerned with its production being
disrupted by having weak or sick workers rather than the health of workers.
5. A general lack of OSH awareness and policy on the management’s part
In some subsidiaries of Company A, there was no regular fire drill at the work place and
dormitories. Even if fire drills are conducted few times a year, engineering and
management control is also important in implementing fire control. These include
using non-inflammable materials, keeping a good storage of materials and
semi-finished parts, good ventilation and the right temperature at the work place. More
so, persistent education to both workers and the management on fire consciousness,
especially during the peak season should be given more priority. More care should be
given to consciousness building work for both workers and the management of
Company A.
37

Besides fire, a general lack of OSH consciousness was found on the management level.
In certain departments and subsidiary factories, personal protective equipment (PPE)
would be delivered. But an evaluation on the engineering and management control
over industrial hazards is needed and measures be adopted to remove or contain the
hazards. Otherwise it is just shifting the responsibility to the workers by focussing on
PPPE only and workers are blamed for not wearing them.
6. Workers had low OSH consciousness
The following is a statistical analysis on the legal and OSH awareness of 24 workers
interviewed from Company A.
Questions
38
Yes, I
know
I've heard
of it
I don't
know
What is the minimum wage of the town you are
working in?
4% 0 96%
What is the ceiling of working hours in the town
you are working in?
0 0 100%
If you have acquired occupational diseases, do you
know how much compensation you are entitled to?
0 4% 96%
Do you know anything about the Labor Law? 12% 25% 63%
Do you know anything about the Regulation on the
Labor Protection of Women Workers?
0 0 100%
Do you know anything about the Law on the
Protection of Teenagers?
4% 0 96%
Do you know anything about code of conduct? 0 0 100%
Do you want to get more information and training
I don't
on OSH? Yes. have an No.
79% opinion.
13%
8%
The above figures show a serious lack of understanding on laws and regulations on the
part of the interviewed workers. The most well known law was the Chinese Labor Law
and still less than 40% of the interviewed workers said they knew or had heard of it.
Not being equipped with legal knowledge, workers often had distorted understanding
of their rights. In one case, a female worker was asked if she knew anything about the
Regulation on the Protection of Female Workers. Her reply was “Yes, I do. It tells us
that female workers have to quit their job when they are pregnant.” Such a distorted
understanding of laws and workers’ rights reflects how illegal management practices
and abuses of labor rights are taken as the rule of life.
Company codes of conduct, which were claimed to have been implemented by

etailers and brand companies that laid orders with Company A, were alien
things to the interviewed workers. It is ironic to compare the amount of
resources these retailers and brand companies put to propagate their own codes
of conduct to the media and consumers of their home countries with that
devoted to educate production workers about these codes of conduct. If codes
of conduct are not meant to be public relation gestures, it is high time that
workers be equipped with it as a tool for changes that they have a part to play
in.
Despite their poor knowledge on the issue, 80% of the interviewed workers
wanted to have more OSH education and training. But a general helplessness
and apathy was expressed. Answers like these were given. “You think you
can get it when you want? No way!”, “It makes no difference, what can a
worker expect?”, “I don’t know how long I can stay in this factory. I might be
leaving tomorrow, who knows?” This reflected their dissatisfaction about the
OSH conditions they were under but were either afraid or feel helpless to put
that into expression or action. Industrial seasonality is also a great hindrance
to conducting OSH training to workers. Workers would rather sacrifice their
health and safety to earn a bit more before they are laid off.
IV. Overview on the working conditions in Company A
Over the years, high quality and quick delivery are the competitive edges of Hong
Kong toy OEM companies, including Company A, in the world’s major toy
markets. Toy retailers and the brand companies demand only safe toys, high
quality and timely delivery at the expense of the working conditions, and in
particular, the health and safety of toy production workers. Hong Kong toy OEM
companies therefore has also paid little attention to the safety and health
infrastructure of their plants. Despite its size, Company A is in no exception. If
big OEM companies like Company A has difficulty in complying to the labor and
safety and health standards, it is hard to imagine that smaller counterparts can.
1. Wages
To give a matrix, the highest pay a production worker earns in the peak season
amongst the 24 interviewed workers in Company A is compared with that in the
low season. A production worker having worked 14 - 18 hours a day and 31 days
in the peak season of July and August would get RMB500 - 700 (USD40 - 87.5) a
month. In low season, the worst case amongst the 24 interviewed workers got
39

only RMB200 - 300 (USD25 - 37.5) a month. A case was reported in which an
hourly salary of as low as RMB0.8 (USD0.1) was paid. This violated the
requirement of paying the minimum wage at local townships. Details can be seen
in individual factory reports.
Most of the production workers in Company A were paid by piece rate. They were
not paid the legal compensation rate for overtime work. In some subsidiary plants,
the pay record system was not clear and workers did not know exactly how their
wages were calculated. Wages remained a major area of complaint during the
investigation. As in many other enterprises, there was a one-month lag in
delivering wages to the workers. This pull them back from quitting their jobs or
taking leave during the peak season.
2. Working hours
On the one hand Company A was placed with a lot of orders from retailers and
brand companies, most of them were placed in a few months’ time before the
Christmas season. On the other hand, that also means that workers have to work
long hours during the peak season. In one case, workers were laboring
continuously for long hours for 100 days without a break in order to finish the
Christmas order. To beat the lead time, lunch time was squeezed. In Factory A2,
instances of workers being locked up to have their lunch at the plant were reported.
Long working hours not only violates the Chinese labor law, it poses serious
damage to workers' health.
3. Freedom of association
It was reflected in this investigation that workers' right to strike and associate was
not respected in Company A. A wild cat strike was reported in one subsidiary
plant, Factory A5, in 2001. Workers in Factory A5 were all dismissed. Besides,
none of the subsidiary plants of Company A has a trade union. It is a big irony to
see that on the one hand all the core clients of Company A, for instance Hasbro
and Mattel, support freedom of association. And that the Chinese Labor Law
states that workers have the right to associate and represent their rights. Yet
Company A is acting in violation of this particular clause.
4. Other welfare
Most of the interviewed workers that most of them did not sign contract with their
employers and were not insured properly according to law. It is a surprise given
the big size and production scale of Company A. Besides, complaints about food
40

and lodgings remained a most frequently raised topic amongst the interviewed
workers.
V. Report on Factory A1
Location: second industrial zone of Shenzhen, Guangdong province.
Factory A1 has two plants, the old and the new plant. They are located in the same
neighborhood. The following report was done by interviewing workers from both the
old and the new plants of Factory A1.
1. Working conditions
1. Wage violations
� Production workers in Factory A1 were paid by piece rate.
� In addition to the piece rate wage, production workers received a full
attendance bonus of RMB50 (USD 6.02) and a living allowance of RMB 50
(USD6.02) a month.
� Three examples gathered from different departments were cited to illustrate
the wage violation found in Factory A1.
a. A worker from the pressing department worked 31 days in July 2001. He got
RMB750 (USD90.36) as the July salary. That included the bonuses and
allowance. He knew that he was given RMB2.25 (USD0.27) as the over time
hourly compensation. But it was not a fixed over time rate.
b. A worker from the assembly department said his salary ranged from
RMB380 to RMB800 (USD45.78 to USD96.39) between the slack and peak
season, allowance and bonuses included. As he understood it, he was not
given over time compensation on Saturday and Sunday.
c. A QC supervisor got RMB 1000 –1500 (USD120.48 – 180.72) a month
during the peak season. This supervisor was paid by time rate. He normally
worked 26 days a month and had 3 over time hours a day (more during peak
season).
By the time of the visit (July – September 2001), the legal minimum wage for the
second industrial zone of Shenzhen was RMB440 (USD53.01) a month. It was
based on a 40-working-hour week, and 20.92 working days per month basis
(approved by the Chinese government). Reducing the legal minimum wage to
hourly pay, the legal minimum hourly pay should be RMB2.6 (USD0.31). Over
time rate on weekdays should be 150% of the normal hourly rate, ie RMB3.9 or
41

USD0.47 per hour. 200% of the normal hourly rate on the weekly legal rest day
which usually is Sunday, ie RMB5.2 or USD0.63 per hour. And 300% on statuary
holidays, ie RMB 7.8 or USD0.94 per hour.
Although we did not know the exact number of working hours of the three workers,
a simple hourly pay comparison with the legal minimum pay standard helps to
illustrate the wage violation. The pressing worker claimed to have received an
over time rate of RMB2.25 from Factory A1. He should get a legal over time pay
of RMB3.9 an hour for over time work on week days. What he got for over time
compensation was even lower than the regular minimum hourly pay rate (RMB2.6
per hour). He had no rest day in July. And he was not paid the legal over time
rate for working on the weekly legal rest days (RMB 5.2). This was the same for
the assembly worker. Of the three cases, only the QC supervisor had a higher
chance of being paid the legal rate according to law.
2. Working hour violations
Workers from Factory A1 had not taken any rest day for the past four months.
During this peak season, they started working from 08:00 to 21:00 and had two
lunch breaks of one hour each. That means they worked 13 hours a day during this
peak season. Over time work started after 21:00.
It is stated in the Chinese Labor Law that workers work 40 hours a week and not
more than 36 over time hours a month or 3 over time hours a day. Workers should
have one day off each week. Factory A1 obviously violated the Chinese Labor
Law on working hours.
3. Others
� No contract was signed with production workers.
� For workers that had contracts, they were not given any copy for reference.
� There was a one-month lag in delivering wages.
� It was not clear whether the management had insured the workers. The
interviewed production workers were not aware of any deductions for insurance
from their wages.
2. OSH conditions in Factory A1
� The Pressing Department
� No formal training was given to the workers. The supervisors would verbally
42

explain about machine operations to production line workers.
� Some of the pressing machines were operated with one button. Workers are prone
to higher injury rate with one-button machine operation.
� Some pressing workers worked on shifts of 11 hours each. There was no break
besides the two lunches. Having worked long hours, workers that took the night
shift would doze off at the work place, thus further increasing the danger.
� Temperature at the work place was high, about 42-43 degree C. But workers could
have access to drinking water.
Lack of training and long working hours are two risk factors that can lead to injury in
the pressing department. The interviewed workers in the pressing department
expressed concern about the high temperature and air quality.
� The Assembly Department
� No formal training was offered. Supervisors gave verbal explanation to new
workers on how to perform their jobs.
� The assembly workers worked an average number of 13 hours during the peaks
season. The number of working hours was high and breaks are little. In some
occasions, they had to work overnight.
� Workers complained of great work stress. When they had finished their daily
work, they had waist and shoulder ache for having sat for long hours making
repetitive movement.
� Workers used thinner and other unknown solvents to clean machines as well as
excessive paint stain on their hands. They seldom put their gloves on and they did
not know the hazards of the thinner they used.
� The glue used to stick iron and magnetic components had strong chemical smell.
Workers could not name the glue nor its hazards.
� Workers operating the injection machine said noise pollution was serious. They
had to use their hands to hold the semi-finished products and use their legs to press
the button. It required great concentration and their hands would be pressed if they
were distracted or too tired.
� In summer the work place could get stuffy with poor ventilation and a high level of
dust.
Long working hours caused ergonomic problems. Lack of knowledge and
protection on chemical poisoning was another potential hazard.
� The Packaging Department
43

� No formal training was offered.
� Workers worked from 07:30 to 23:30 during the peak season. There was no break
besides the two lunches.
� Workers had to stand and perform their job.
� Interviewed workers said they were exhausted after standing more than 10 hours
without a break.
� Complaints were also made about the stuffy air at the work place.
Long working hours causing ergonomic problems as well as work stress were
major sources of hazard in the packaging department.
� The Die-Casting Department
� An industrial accident was reported in July 2001. A die-casting worker had two
knuckles of his finger cut by the die-casting machine. The injured worker was told
to take rest at the dormitory and was given RMB15 (USD1.875) a day as living
allowance. The management paid for the medical expenses but not any
compensation to the injured worker. According to the regulations on
compensation on industrial injury in the Chinese Labor Law, the amount of
compensation is determined after an assessment and injury rating. The
management of Factory A1 just paid the medical fees and an arbitrary allowance
which is in violation of the labor law. The injured worker had not recovered by
mid September. No further assessment and rating for compensation was made.
� The interviewed workers recalled that they had long overtime work the night the
accident took place. They criticized that the power switch of the machine was too
far away from the operating worker thus making it difficult for him to cut off
power immediately when the accident happened.
� The operating machines gave loud noise. Yet workers did not wear the ear
protection delivered by the management saying that it was uncomfortable and
inconvenient to their work.
� Temperature was high and machines were packed together, making the work place
particularly hot and noisy.
The OSH problems found in this department were largely related to machine
operation, namely machine safeguard, maintenance and sound pollution.
Improvement should look into the engineering aspect and the management aspect
to see how exposure to the risky environment can be minimized.
Factory A1 should establish an OSH and injury documentation system. Training
should be given to workers. Workers should get access to knowledge about safety
44

machine operation and their legal rights in case of industrial injury
.
� The Spraying Department
� No formal training was offered. The supervisors only reminded workers not to get
the paint into their mouth and not to use thinner to wash their hands.
� The interviewed workers did not know the names or the hazards of the chemical
paint they were using.
� Cotton gloves and masks were delivered to the workers. Workers explained that
the piece rate work required them to work quickly and "wearing gloves and masks
would slow down the speed". Low wages and production pressure were the main
reasons for not wearing them. Cotton equipment would get dirty with paint at the
end of the day. Workers either had to wash the cotton masks and gloves by hands
everyday or they waited for new delivery every other few days. Interviewed
workers did not think the cotton equipment would give them much protection.
� An interviewed worker said she felt dizzy and had headache from time to time.
New workers not used to the chemical smell could faint at the work place.
Whereas stomach problems and dizziness were common symptoms amongst old
workers. She recalled a woman worker being fired after fainting two times at the
work place last October. Because of that, workers did not want to report their
sickness. The interviewed worker would rub some ointment in case she felt dizzy
during work.
� Although the supervisors had verbally warned workers against using thinner to
wash their hands, many workers would still do so as there was not much
alternative. Some workers developed skin allergies and skin diseases because of
that.
� This department had been busy for months as the peak season had come. They
worked from 07:30 - 23:00 everyday. They were off only on Sunday night.
Chemical poisoning is a potential hazard in the spraying department. The management
of Factory A2 had not taken a positive and open attitude to identify and remove hazards
as well as equipping workers with the knowledge and means against chemical
poisoning.
� OSH infrastructure in Factory A1
� Fire extinguishers could be found in both the old and the new plants. But there
was no fire drill at the work place and dormitory.
� Interviewed workers from the pressing and packaging department said they did
not know where the exits were when fire took place. Another worker from the
45

metal department commented that the work place was too packed with machines
and the alleys were blocked. "It does not make a difference (where the exits are),
anyway, you go where you go."
� The factory did not have an OSH department. In case a worker felt sick, the
management would not investigate if that was related to their occupation.
� There was no body check-up for production workers whereas supervisors or above
could go for a yearly blood test.
� There was no factory clinic. Workers paid for their own medical expenses.
� The factory management would arrange for cool drinks once or twice a week for
some departments.
3. Workers' Consciousness on Labor Laws and Related Regulations
The following is a statistical analysis on 9 interviewed workers from Factory A1 on
their understanding of the Chinese Labor Law and related regulations.
Questions
46
Yes, I
know
I've heard
of it
I don't
know
Do you know the legal minimum wage of the town
you are working in?
0 0 100%
Do you know the ceiling on working hours in the
town you are working in?
0 0 100%
Do you know how much compensation you can get if
you acquire occupational diseases or injuries?
0 15% 89%
Do you know anything about the Chinese Labor Law? 22% 22% 56%
Do you know anything about the Regulations on the
Protection of Women Workers?
0 0 100%
Do you know anything about the Law on the
Protection of Teenagers?
0 0 100%
Do you know anything about code of conduct? 0 0 100%
Do you want to get more information about OSH and
related training? Yes, I do
78%
I don't
have an
opinion.
11%
No, I
don't.
11%
4. Words from the workers
� A male worker from the die-casting department, Xiao Wang
"Wages in this factory is very low. It's RMB1.4 (USD0.175) for women workers
for an hour. They get RMB2 (USD0.25) an hour for overtime work. For male
workers, we get RMB12.5 (USD1.56) a day. During the peak season, we worked
at least 3 hours overtime. That is the case from Monday to Saturday. We don't
have to work overtime on Sunday night. We have not taken a day off for months

now. In the worst case we have to work overnight. But after all these, RMB 600 -
700 (USD75 - 87.5) is all I get. That includes everything, overtime rate and
allowances. We "take vacation" when there is no order. The food at the dormitory
is poor and workers have to eat outside. My wife and I rent a 7-square-meters
squatter nearby. We eat, sleep, cook, sleep and bath inside this small cube. It costs
us RMB70 (USD8.75) a month. We spend another RMB200 (USD25) a month on
food. Including every other petit expenses, we have to spend RMB400 - 500
(USD50 - 62.5) a month. You can tell how much is left of my wages. And we
have to save money for the low season when nobody can tell how much work there
is to do. I just learn from my colleagues that we will take a long vacation starting
October …."
� A female worker from the spraying department, Ah Hua
"We labor till 23:00 at night these days. Back to the dormitory, you have to take
turns to take a shower, wash your clothes and you can sleep only at around 2am.
The other morning you have to get up at 6:30am for breakfast and go to work at
7:30am. How can we have enough sleep?" "The chemical smell is strong at the
work place and you can see paint dust everywhere. I wanted to throw everyday
when I first came. I never stopped having stomach ache and dizziness in the first
month." "Our work is counted by piece, so everybody wants to finish as many as
possible. We had a better price for our job last year. It is much worse this year. I
went to work everyday and I got only RMB 600 - 700 (USD72.29 – 84.3) a month.
For a lot workers, the average is just RMB400 - 500 (USD48.19 – 60.24) a month.
And we pay for our food and lodgings. If it were not for sending my son to school,
I would never work in the spraying department."
VI. Report on Factory A2
Location: industrial district of Punyu City, Guangdong province
Number of workers: about 4000, approximately 70% are male workers.
1. Working Conditions
1. Wages
The biggest complaint was about wages. There was no pay roll and no pay scale.
Not knowing how their pay was calculated and not being able to appeal to the
management, workers felt that the pay system was unfair and the wage variations
between production workers was big. Besides, Factory A2 did not always deliver
wages on time. It could cause financial stress to workers as their wages were
47

already low and they lived on a meager level. “We would skip lunches if we do
not have money. We would borrow from friends and survived till the pay day.”
Wages were low. Below are three examples on wages delivered in a month during
the peak season in the assembly department:
Worker A got RMB 340 or USD40.96 (from 08:00 - 20:00 every day for 31 days).
Worker B got RMB 302 or USD36.39 (from 08:00 - 23:00 everyday for 26 days).
Worker C got RMB 400 or USD48.19 (from 08:00 - 23:00 for 28 days and in one
day he worked till 04:00 am). The above wages did not include food and lodgings
to be deducted.
The legal minimum wage for Punyu City was RMB450 or USD54.2 by August
2001. The legal minimum daily rate should be RMB21.4 (USD2.58) counting on a
20.92 working day per month basis which is used by the Chinese government. The
minimum hourly rate should then be RMB2.7 (USD0.33).
We take the case of worker C and try to calculate what he should get in
comparison what he actually received. Worker C worked 28 days in that month.
He worked, up to 23:00 every day (ie 4 over time hours a day). On one day he had
over time work till 04:00 (ie 8 over time hours) and let’s assume it is a regular
week day. There are 22 working week days in July. The number of his over time
hours (on week days) should be 21 x 4 + 8 = 92 hours. And the OT rate for week
days is 150% of the regular pay rate, that is RMB2.7(regular rate) x 150% x
92(OT hours on week days) = RMB372.6. The remaining 6 days are holidays and
still he worked 12 hours (8 regular hours and 4 OT hours) on holidays meaning 72
OT hours on weekly holidays. 200% of the regular pay should be given to him for
working on weekly holidays. His compensation for OT work on holidays should
be RMB2.7(regular rate) x 200% x 72 (OT hours on holidays)= RMB388.8. His
total income including over time compensation for both week days and holidays
should be RMB372.6 + RMB 388.8 + RMB400 = RMB1211.4.
2. Working hours
This is an example on 19 August 2001 (Sunday): workers were not allowed to go
out during lunch time. The management brought lunch boxes to the work place.
Workers ate at the work place and went back to work immediately after lunch.
Workers complained about long overtime hours. Workers in the assembly
department had to work till 24:30 and overnight during peak season. When the
department had to rush production, workers had to take turns to go to the
48

washrooms. Female workers complained that they had to wait long before it came
to their turns. There was no break besides the two lunches.
3. Others
� No contract was signed with production workers in Factory A2.
� Production workers were not insured.
� Food and lodgings were poor. There was a time last year when two
people had to squeeze and share a bed in the dormitory.
2. OSH Conditions in Factory A2
� The Assembly Department
� Workers worked an average of 13 hours a day during the peak season. At most,
they worked till 24:30 and even overnight. At one time, they were made to eat at
the work place and go back to work immediately.
� No formal training was offered.
� Workers reported that small injuries like having their fingers pressed by machines
or cut by the grinding machines were common.
� Glues were used in the assembly department but they could not name them or their
hazards. Gloves would be delivered to some of the workers. The rest would
receive them whenever there were factory audits or visits.
� The Welding Department
� Workers welding the iron parts would get burnt from time to time. Gloves would
be delivered to them when there were factory audits or visits.
� High temperature in this department was another source of hazards.
� The Trimming Department
� Workers used knives and cutters to trim the semi-finished products. The utensils
would cut their hands and fingers. Yet they were seldom delivered gloves.
� No formal training or education on how to minimize injury was given.
� Long working hours (from 08:00 to 23:00 or 24:00 during peak seasons) led to
workers fainting at the work place.
� Workers complained that the work place was too stuffy especially during the
summer peak season. Too many workers crowded at the work place and two cases
of heat poisoning were reported in the assembly department this July.
3. OSH infrastructure and provisions at Factory A2
49

� The management demanded that workers took an annual body check-up. But that
was paid by the workers and it cost them RMB40 (USD5) each.
� In the body check-up that took place in the second half of last year, more than 100
workers were found to have acquired hepatitis B. They were fired and were
delivered their wages but without legal compensation. This year 50-60 workers
were found to have hepatitis B and they were fired too. An interviewee
commented, "They told you to take a rest, we all know it means you are fired."
� There were regular fire drills at the work place.
The management of Factory A2 took no measures to investigate if mass
acquisition of hepatitis B was related to work or other hygiene problems. The
management took the irresponsible way out by simply firing them and without
legal compensation. This is a case of labor rights violation as well as an evasion of
the responsibility of the management for the safety and health of their workers.
4. Workers' Consciousness on Labor Law and Related Regulations
The following is a statistical analysis on the legal consciousness of five interviewed
workers from Factory A2.
Questions
50
Yes, I
know
I've heard
about it
No, I
don't
know
Do you know the legal minimum wage of the town
you are working in?
0 0 100%
Do you know the working hours ceiling of the town
you are working in?
0 0 100%
Do you know how much compensation you can get
if you have occupational diseases or injuries?
0 0 100%
Do you know anything about the Labour Law? 0 80% 20%
Do you know anything about the Regulations on the
Protection of Female Workers?
0 0 100%
Do you know anything about the Law on the
Protection of Teenagers?
0 0 100%
Do you know anything about code of conduct? 0 0 100%
Do you want to get more information about OSH
and OSH training?
I don't have
Yes, I do
an opinion.
80%
20%
No, I
don't.
0
Some of the interviewed workers remarked that if the training was free, they wanted it.
Otherwise they would not go for it. Another one made this comment, "I might leave

when I can't stand anymore. Or I might just be fired tomorrow. I don't care."
5. Words from Workers
� A male worker in the trimming department, Xiao Qiao
"We sleep very little. When we came back to our dormitory, it was after 12am.
There were only two bathrooms on the dormitory floor. It took three hours (till
3am) before all of us could finish our shower. It pissed us off if there was no water.
You could not take a shower. You could not wash your face and brush your teeth
the next morning. We are all exhausted. We can take a half-day rest after working
overnight. But that is not enough." "It is difficult to ask for a day leave when we
have to rush production. Even if you are so lucky to have a day off, you are not
allowed to stay in the dormitory. We can only go outside and sleep under the
trees."
� A female worker in the assembly department, Xiao Tong
"We have seen people fainted at the work place. That's expected. We are tired, we
get low pay, we don't eat well, we can't sleep well, we want to save every penny
we've got… A lot of us young girls just buy an ice-cream or a slice of water melon
for lunch. You just don't want to eat being so tired and under such heat."
VII. Report on Factory A3
Location: Dongguan City, Guangdong province
Number of workers: 8000 - 100,000 workers. More than 70% are women.
1. Working Conditions
� Contract
� It was not sure how big the proportion of the workforce had signed contracts
with the management. But workers commented that the contracts were more for
show to auditors than to protect their rights. If anything happened, workers might
still not know how they could use the contract to claim their rights.
� It was difficult for workers to quit and they could only get 40% of their pay if
they did so.
� Working hours
� Most of the workers worked from Monday to Sunday in peak season. They could
get a day off on Sunday night. An interviewed worker said the management had
51

warned her not to tell the real working hours during factory audits or visits. She
was threatened with being fired if she did so.
� Wages
� Cleaning workers, clerical workers and supervisors or above were paid by time
rate. All production workers were paid by piece rate.
� The interviewed workers felt helpless as they said that workers could not
understand the wage calculation. They did not know the grand production of the
production line nor the unit price of the different kinds of products they produced.
Nothing was listed on the pay stuff except their ID number and the amount of
wages for the month. There was no way to check and verify their pay.
� On average, production workers' salaries ranged from RMB500 or USD60.24
(assembly department) to RMB600 or USD72.29 (testing department). That
could drop to RMB300 or USD36.14 during the slack season.
� Take an example: A female worker in the assembly department worked 27 days in
June, 10-12 hours a day, got RMB686 or USD82.65. She did not know how that
was calculated. She was paid by piece rate. There was a daily quota to finish and
she could not leave until she had finished the quota. She did not know if she was
paid any overtime compensation. The RMB686 salary she got included RMB30
(USD3.61) full attendance allowance and a RMB30 (USD3.61) deduction for
lodgings. The factory did not provide for food and she had to spend around
RMB200 (USD24) on food and other petit expenses.
The legal minimum wage in Dongguan was RMB400 (USD48.19) by the time of
the research. Take the government reference of 20.92 work day per month as the
basis, the minimum daily pay in Dongguan should be RMB19.1 (USD2.3) and the
minimum hourly pay should be RMB2.39 (USD0.28). Let’s assume that the 27
days she worked were normal week days. She worked an average of 3 over time
hours a day (she reported working 2 to 4 over time hours a day). The over time
compensation rate for her in the month would be RMB2.39 (minimum hourly pay)
x 150% x 3 x 27 = RMB290.3. Adding that to the minimum wage of RMB400, she
should get RMB690.3
In this particular case, Factory A2 was paying the minimum wage to this female
worker. After paying for food and other expenses, the pay she got might not be a
sustainable living wage. But whether the minimum was paid (in this case) or not
(in the case of other subsidiary plants), the pay scale and legal knowledge on
minimum payment was not known to workers in general. In no way can they tell
52

if their rights are respected or violated.
� Living Conditions and Medical Provisions
� 16 people stayed in a room in the dormitory. The dormitory was cleaned and
sterilized once a week. Couples had to stay outside.
� Workers could go to the factory clinic and they paid for the medical expenses.
� There was no pay for sick leave and thus workers in general would not take sick
leave. They would just buy medicines from pharmacies if they felt sick.
� Workers were insured and RMB30 (USD3.75) was deducted each month.
� Monitoring of Code of Conduct
� Most of the interviewed workers had not heard about code of conduct. Only one
interviewed supervisor knew about it. He said code(s) of conduct would be
implemented just 10 days or so before a factory audit. And there was a special
department dealing with records and auditing related business. Take the case of a
client’s audit, the management would have learned about it 10 days before. The
management would tidy things up and couched workers to give the right answers
during the audit. Things would go back to "normal" after the audit.
2. OSH Conditions
� The Assembly Department
� A worker remembered having attended a training course when she first
entered the factory. But that was basically an introduction on factory regulations
and fire prevention. It was nothing about safety and health.
� Workers in this department worked from 08:30 - 22:30 everyday during the
peak season. In the worst case, they worked till 3 and 4am.
� They had two lunch breaks of 1 hour and 45 minutes respectively. There was
no other break aside from those.
� Workers were exposed directly to thinner and other chemical solvents when
they were cleaning the finished toy products. But neither could they name the
chemicals, or their hazards.
� The management would deliver cotton gloves but they did not want to wear
them saying that they were hot and uncomfortable.
� Workers said that long working hours was the major problem in this
department. Work stress was great as they had to finish 3000 pieces each day
before they could leave. And they were not paid the compensation rate. They said
that during factory audits, things would be a bit better. But it was back to "normal"
53

when the audit was finished. This shows how code of conduct is implemented or
effective only during the time of factory audits.
� The Spraying Department
� During the peak season, workers in the spraying department normally worked 13
hours a day not including the two lunch breaks. As for overtime work, it went up
to as late as 2am if the production schedule was really tight.
� The interviewed workers remembered being told about the names and usage of the
chemicals but not the hazards or prevention and treatment of chemical poisoning.
� Most of the chemicals did not have labels or instructions informing readers about
first aid measures in case of chemical poisoning.
� Cotton gloves and masks would be delivered before a factory audit or visit. But
workers reflected that the chemical paints could still get into their skins even with
the cotton gloves on.
� The management had warned the workers not to wash the paint with thinner. But
some workers still did so because they had no other alternative. The chemical
paints on their hands could not be washed away by plain water and soap.
� A clerical worker told the interviewer that the management would switch to using
other more expensive chemicals when there was a factory audit and visit. It would
be replaced with cheap ones that they had been using when the audit was finished.
� There was a ventilation system at the work place but the air still had a strong
chemical smell.
� New workers could not get used to the smell. They felt dizzy and wanted to throw.
An old worker in the department showed the skin allergies she had acquired on her
two arms to the interviewer. She could not tell if they were related to her job.
� Fainting at the work place happened since the working hours were long. The latest
case of faint happened on 25 August 2001. Fainted workers were told to take a
rest and went back to work after a while.
The practice of the management of Factory A3 in shifting chemicals violated the
right of workers to a safe work place as well as their right to know what hazards
they were being exposed to. It also shows how code of conduct is weak in
implementation in protecting the safety and health of workers.
� The Pressing Department
� Noise pollution was serious in this department.
� The smell of melted plastic was strong.
� Temperature was high. The pressing machines were packed together and the
54

operating machines further accelerated the temperature.
� Workers did not receive formal training. Senior workers and engineers would
explain the machine operation to new workers. There was nothing on safety
issues.
� Ear protection and masks were delivered when there was a factory audit or visit.
An interviewed worker was told that the ear protection was expensive and they
were not meant to be delivered for 'ordinary times' meaning when the factory was
not being audited.
� Pressing workers worked in three shifts of eight hours each. They had no break
besides the two lunches. Interviewed workers all said that working continuously
for eight hours under such a high temperature and noisy environment was
exhausting. Breaks are needed despite the three shifts in the pressing department.
An assessment of the hazards of the working environment and the conditions of
workers is needed.
� The Sewing Department
� Workers in this department had waist pain, sore shoulders and stiff necks in
general. Everyday when they were off their work, they felt exhausted and their
bodies ached all over. They sat working for long hours, had their head bent, and
their shoulders and two hands repeating the same movement everyday.
� Workers in this department said exhaustion, eye stress, stiffness, numbness, pain
and other ergonomic problems were the major hazard.
3. OSH Infrastructure and Provisions at Factory A3
� There were regular fire drills at the work place and the dormitory. Workers said
they knew the fire exits but not exactly how to use the fire extinguishers.
� Workers did not know from which department could they seek help on OSH
related problems. According to the interviewed workers, a sick worker would be
"advised" to take rest. But no investigation on whether workers' illnesses were
related to their job was made.
� The factory would have body check-up for new workers. Every 6 months, the
factory would have a body check-up for workers. That included blood pressure
test, eye test, but not included hearing test.
4. Workers' Consciousness on Labor Law and Related Regulations
The following is a statistical analysis on the legal consciousness of the 7 interviewed
workers from Factory A3.
55

56
Yes, I
know
I've heard
about it.
No, I don't
know
Do you know the legal minimum wage of the town
you are working in?
0 0 100%
Do you know the working hours ceiling of the town
you are working in?
0 0 100%
Do you know how much compensation you can get
if you have occupational diseases or injuries?
0 0 100%
Do you know anything about the Labor Law? 14% 0 86%
Do you know anything about the Regulation on the
Protection of Female Workers?
0 0 100%
Do you know anything about the Law on the
Protection of Teenagers?
14% 0 86%
Do you know anything about code of conduct? 0 0 100%
Do you want to get more information about OSH
and related training?
Yes, I do.
86%
I have no
opinion.
14%
No. I don't.
0
Remarks: When asked if workers felt that the OSH protection was enough at Factory
A3, three of them said ordinary workers did not have enough information to tell and
judge about OSH issues. One interviewee commented, "Even if it (OSH protection) is
not enough, how can it be changed in a factory as big as this?"
5. Words from Workers
� A female worker from the packaging department, Xiao Nan
"There is a lot of overtime work in this factory. We work 10-15 hours a day. I've
been admitted for more than 4 months and I got two days' leave only. I got
RMB600 - 800 (USD75 - 100) a month. I pay for my food and I rent a place at
RMB30 (USD3.75). My two younger brothers are in school and I come to work
here to support them. But the wages is so low that I have difficulty even to support
myself. That's why I haven't sent a penny home." "I have never thought that
working in a factory means laboring non-stop from day to day. I 'd quit for a better
factory if there is one."
� A female assembly worker, Xiao Kai
"I've been here for more than a year. The highest salary I got was RMB800
(USD100). For that, I had to work till 12am or later every day. The lowest I got
was RMB200 (USD25). That was delivered after the Chinese New Year. We had
a bad time this Chinese New Year. We got our December wages (of year 2000)
only after the Chinese New Year (end of January 2001). Workers in some
departments were delivered lunch coupons over the Chinese New Year, whereas
others got nothing. We had no wages and no lunch coupons for more than 2

months. We had no money to send home for the New Year, we did not even have
money to eat. I learned that some workers from my plant had to pick up remains in
the canteen. We are still angry about it. How can you treat workers like this?"
VIII. Report on Factory A4
Location: Punyu City, Guangzhou, Guangdong province
1. Working Conditions
� Average wages for production workers ranged from RMB400 - 600
(USD48.19 –72.29).
� Production workers were paid by piece rate. In the trimming department for
instance, workers got RMB1.6 (USD0.19) an hour and RMB2.1 (USD0.25) an
hour as over time compensation.
This was in violation of the minimum wage of Punyu, which was RMB450 (USD54.21)
a month. The daily minimum wage of Punyu should be RMB21.5 (USD2.59), based on
the government reference of 20.92 working days per month. The minimum hourly wage
should then be RMB2.7 (USD0.33). Factory A4 was in violation of the local minimum
wage and over time compensation payment.
� Workers in the trimming department for instance did not have a single day off
during July. This was also in violation of the one weekly rest day provision as
stated in the Chinese Labor Law.
� No contract was signed with production workers.
� Workers did not know if they were insured.
2. OSH Conditions in Factory A4
� The Assembly Department
� Long working hours caused physical exhaustion to workers.
� Work stress was great as workers had to finish a daily quota as many as
2000 - 3000 pieces a day. They could not leave before finishing the
quota.
� The supervisors would allow for one worker each time to go to the
washroom or to drink water.
� Workers had to sit working for more than 12 hours a day during the peak
season. There was no break besides the two lunches.
� Workers from this department also complained about the noise pollution
57

when machines were in full operation.
� The Welding Department
� New workers were taught how to weld iron and metal
components. There was no formal training regarding OSH
and no personal protective equipment was provided for
welding workers. Workers would burn their hands as they
used the iron welders.
� Noise pollution. Some of the machines in this department
gave a loud noise in operation. Only the QC workers wore ear
protection.
� Drinking water was accessible for workers at the work place.
� The trimming department
� Workers would cut their hands and fingers using
knives to trim the semi-finished products. They
were not delivered protection equipment.
� No OSH training was offered to them.
3. OSH Infrastructure and Provisions at Factory A4
� New workers had a body check-up when they entered the factory. Regular
check-up was provided every year.
� There was a medical clinic. Workers paid for their medical expenses and the
management would pay for treatment in case of occupational injuries.
� There were fire drills at the work place and in the dormitories.
In general, the interviewed workers were worried that chemical poisoning and
exhaustion due to long working hours would adversely affect their health.
4. Workers' Consciousness on Labor Law and Related Regulations
The following is a statistical analysis on the legal consciousness of three workers
interviewed from Factory A4.
Questions Yes, I know
Do you know the legal minimum wage of the
town you are working in?
Do you know the working hours ceiling of the
town you are working in?
58
I've heard
of it
No, I don't
know
33% 0 67%
0 0 100%

Do you know how much compensation you can
get if you have occupational diseases or injuries?
0 0 100%
Do you know anything about the Labor Law? 33% 0 67%
Do you know anything about the Regulation on
the Protection of Female Workers?
0 0 100%
Do you know anything about the Law on the
Protection of Teenagers?
0 0 100%
Do you know anything about code of conduct? 0 0 100%
Do you want to get more information about OSH
and related training?
67% 0 33%
Remarks: When asked about the regulation on women worker protection, an
interviewed worker replied, "I know, it says pregnant women have to resign." (Remark:
The Chinese Labor Law says just the contrary.) When asked about whether they
wanted more OSH information, a worker replied, "You think we can have it if we want?
It's not possible."
IX. Report on Factory A5
Location: Dongguan City, Guangdong province
Number of workers: 700 - 800 workers, about 60% are female workers
Working Conditions in Factory A5
1. Wages
� It was written on the recruitment ad of the factory that a worker could get
RMB550 (USD66.3) a month. All the interviewed workers said it was a big lie. A
production worker got an average of RMB300 - 500 (USD36.1 – 60.2) a month
subject to departmental variations. There was no other allowance or subsidy.
� This is an example in the assembly department. A worker worked every day from
08:00 to 22:00 in April 2001. She took no leave, was never late for work and she
got only RMB330 (USD39.76). She vaguely knew that she got about RMB0.8 or
USD0.1 an hour.
� No over time compensation was paid to production workers.
� Workers from Factory A5 also complained that there was more than a month's lag
in delivering wages.
2. Working hours
� In the peak season, workers worked 12-17 hours a day and 7 days a week. The
number of overtime hours ranged from 4 - 9 hours during the peak season.
Interviewed workers said they had two holidays only (on 1 May and 1 July) since
the beginning of this year.
59

3. Penalty
� Workers were not allowed to quit especially during the peak season. They had to
give up as much as 40 days' salary if they did so (the factory would deliver wages
in 40 days' lag and very often workers could not get their last pay before they left
the factory). As it was difficult for workers to get an approval for leave or take a
rest during the peak season. They would just not go to work and by doing so, they
had to pay a penalty of three days' salary for being absence from work.
� There were a number of other penalties if workers were found to have violated
factory rules.
4. Incidents of strike and stoppage of work
� In May this year, workers in the die-casting department took a wild cat strike in
protest of low wages. An interviewed worker said that the management took
action to fire all the workers that took part in the strike. When the Labor Bureau
came for an investigation, the factory asked workers to leave from the backdoor
for fear that workers might complain during the investigation. The interviewed
worker was amongst the workers that were made to leave during the Labor
Bureau's investigation.
5. Others
� 14 people stayed in a dormitory room. A female worker said there was only one
toilet and bathroom on each dormitory floor. The sanitation was horrible as too
many people were sharing one toilet facility.
� No contract was signed with production workers nor were they insured.
60

III. 2) REPORT ON THE OSH AND WORKING CONDITIONS OF
COMPANY B
The following report is structured as such:
I. Company Information
II. Working Conditions in Company B
III. An Overview of the OSH Conditions in Company B
IV. Workers' Consciousness on Labor Law and Related Regulations
V. Words from Workers
I. Company Information
Established in 1993, Company B is one of the biggest OEM toy producers in Hong
Kong. Going back to history, company started off initially as a small toy workshop in
Hong Kong in the 1970s. Today, the annual sales performance of the company is
estimated to be over HKD 1 billion a year. In the 1980s, Company B was contracted to
manufacture Cabbage dolls, the most popular toy that created a swirl wind in the US
and European market in mid 80s. From then on, Company B expanded its business to
Shenzhen in mainland China. The company has a number of subsidiary plants in the
mainland, employing more than 10,000 workers. The company is a key supplier to a
number of toy retailers and brand companies.
Products
The chief products of Company B are plastic toys, electronics and electrical toys,
plush toys, and die cast cars etc. US and Europe are two major markets. By the
time the research was done from July - September 2001, the company was
producing dinosaurs, Barbie dolls and die cast cars.
Core clients
61

The core clients of Company B include Hasbro, Mattel, Disney, Playskool,
Fisher-Price etc. In 1999, Company B was contracted to produce the Star War series.
In the early 1990s, Company B acquired the licensee to produce the Snoopy line.
Subsidiary Plants
The corporation has three subsidiaries for toy production. They are all located in the
second industrial zone of Shenzhen, Guangdong province.
1. Factory B1
2. Factory B2
3. Factory B3
The following is an overall report on the working and OSH conditions of the three
subsidiary plants of Company B. A rough estimation is that there are more than 10,000
workers employed in the three plants of Company B. They come from different
provinces like Hunan, Hubei, Guangxi and Jiangxi province.
Table on information of the interviewed workers from Company B
Sex Female Male
Number of workers 8 7
Age range 16-20 21-25 26-30
Number of workers 9 5 1
Terms of service Under one year 1-3 years More than 3 years
Number of workers 8 5 2
II. Working Conditions in Company B
1. Overall Conditions in Company B
� As one of the top OEM toy manufacturing company in Hong Kong, the
working conditions of Company B are no better than those in the small
factories.
� It was found that workers worked an average of 14-18 hours a day and 31
days a month in the peak season of 2001.
� The average wages of a production worker recorded in this period was
around RMB500 - 700 (USD60.24 – 84.33) a month. That would drop to as
low as RMB200 - 300 (USD24.10 – 36.14) during the slack season. The
company did not pay the legal minimum wage of the second industrial zone
62

of Shenzhen which was RMB440 (USD55) by September 2001.
� There were problems with wage calculations, deductions, penalties and wage
delivery time.
� Long working hours was a serious problem. Workers did not have a single
day off for months during the peak season. This, not only violates the
regulations on working hours in the Chinese Labor Law, it also threatens the
safety and health of workers.
� There is no maternity protection for female production workers. Not only is
this a violation of the labor law, the unequal treatment between production
and non-production workers is discriminatory.
2. Wages
� Starting in May 2001, Company B had been recruiting new workers. The
recruitment ad offered RMB320-600 (USD38.55 – 72.29) to workers during the
probation period. After that a worker could get RMB700 (USD84.34) or above.
The factory would provide for food and lodgings. Applicants must have finished
junior high school education. Yet the real pay a production worker could get was
lower than the advertised.
� Wage calculations varied between departments and different plants in Company B.
It was also dependent on the unit price of the products. It was therefore difficult to
deduce a single way of wage calculation. The following are a few examples.
� Case One - A female worker from the spraying department got her July (2001)
salary in mid August at RMB560 (USD67.47) before deducting food and lodgings.
It included RMB60 (USD7.23) allowance for full attendance. She worked for
60-80 over time hours in that month.
� Case Two - A female worker in the metal parts department got RMB12 (USD1.44)
a day and RMB2 (USD0.24) an hour for overtime compensation.
� Case Three - A female worker from Factory B3 got her July (2001) salary by mid
September. She got RMB700 (USD84.34) in July after working 31 days from
08:00 - 24:00 ie. 16 hours a day. She did not work on Sunday night. Not including
lunch breaks, it was estimated that she worked up to 92-96 hours a week. Her
hourly pay was roughly estimated to be RMB1.7 (USD0.20).
The legal minimum wage of the second industrial zone of Shenzhen was RM440
(USD53.01) a month. Based on the government reference of 20.92 working days a
month, the legal daily minimum wage should be RMB21 (USD2.53) and the
minimum hourly pay should be RMB2.6 (USD0.31).
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If the number of over time working hours of female worker in case one was taken
as 60 in July 2001, her over time compensation should be RMB2.6 (legal hourly
rate) x 150% (legal over time rate) x 60 = RMB234 (USD28.19). Adding that to
the minimum wage of RMB440, plus RMB60 for full attendance, her July salary
should be RMB734 (USD88.43) before food and lodging deduction. Factory B
violated the legal minimum wage payment, the legal working hours limit and the
unreasonable delivery of wages as stated in the Chinese Labor Law.
In case two, the worker received a daily pay of RMB12 (ie an hourly pay of
RMB1.5) and an over time rate of RMB2 from the factory. This was also a clear
violation of the minimum pay of the local township. This is the same for case three.
What the workers in the two cases received for over time compensation was even
lower than the legal minimum pay, not to mention the legal over time
compensation rate.
� Production workers were paid by piece rate. It said in the recruitment ad that "you
get more the more you work." The truth was workers had to finish a daily quota.
Otherwise their wages would be deducted. Absence from overtime work or taking
a leave without permission, even on state holidays, would result in wage
deduction.
� In some of the subsidiary plants of Company B, there was a 40 to 45-day lag in
delivering wages to workers making it difficult for workers to quit their jobs as
they might want to.
� The interviewed workers from Company B also complained about the wage
variation even for workers working in the same line and on the same job. They did
not know how their wages were calculated. Nor was there any way for them to
counter check their wages and the pay scale.
.
3. Working hours
� The working hours of the assembly workers in Factory B3 were as such: 08:00 -
12:00 13:30 - 17:30 18:30 - 22:30. In the peak season, workers had to work till 1or
2am. This was so in August 2001 and there was not a single day off. The Chinese
Labor Law allows for 40 working hours a week and not more than 36 over time
hours a month. Yet, workers in the subsidiary plants of Company B worked for
nearly 100 hours a week, more than 2 times of what is allowed for in the labor law.
The number of overtime hours in some of the subsidiary plants mounted to 120
hours a month, 3 times of what is allowed for in the labor law.
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4. Contract and Insurance
� Contracts were signed with supervisors or above but not production workers.
� Supervisors or above were insured but not production workers.
� Workers recalled that starting from last year, the management started insuring
workers on industrial accidents and that some production workers had contracts.
But they did not know whether themselves had a contract or were insured.
Remarks: It is a common practice for foreign investment enterprises in
Guangdong province to sign contract and insure only part of the workforce. The
reason is that the enterprises fear that disclosing the true size of the workforce to
government departments would subject them to various kinds of charges and
administrative fees. That's why it is found that in the same factory, some workers
may have contracts and insurance while others not.
5. Food and lodgings
� A dormitory room in Factory B2 was about 30 square meters. 16 people stayed in
one room. There was ventilation in dormitory rooms but no storage for private
belongings was provided. Hot water supply in the dormitory of Factory B3 was
poor causing a lot of inconvenience as workers had to wait long queues to get hot
water.
� Female workers from Factory B3 expressed worry about their security as the
female dormitory floors were cleaned by male cleaning workers.
� RMB30 (USD3.75) was deducted for lodgings.
� RMB90 (USD11.25) was deducted each month for food ie RMB1.5 (USD0.1875)
for each meal. But a lot of workers preferred eating at stalls outside the factory
and that cost RMB1.5-2 a meal.
6. Medical provisions
� It was difficult to take leave especially during the peak season. Workers would
rather take medicine from a local pharmacy than ask for a sick leave. A worker in
the spraying department recalled her experience of getting only a four-hour-leave
when she had a high fever. She went back to work afterwards. Back to the work
place, she had to finish the quota of the day as everybody else did, otherwise her
wages would be deducted. Another worker from the same department reported
that at one time, the management deducted one day's salary from her when she
went to the factory clinic for her skin allergy. The medical fees were paid on her
own.
65

7. Penalty
� Company B had a list of factory rules and regulations that were not conveyed to
workers when they entered the factory. According to Article 19 of the Chinese
Labor Law, labor disciplines should be written down on the contracts.
� They knew about these rules and penalties only when they violated one or two of
them. Here are few examples of factory rules and penalties. Staying up too long at
the washrooms would be fined for RMB5-20 (USD0.625 - 2.5). Yet, a production
worker on average earned only RMB12.5 (USD1.56) a day. A fine of RMB5
(USD0.625) would be imposed for not wearing the uniform. Absence from work
would cost a worker one day's salary plus RMB20 (USD2.5) a day. The subsidiary
plants of Company B violated the Chinese Labor Law which stated that the
employer should not impose unreasonable or arbitrary penalties on workers.
III. Overall OSH Conditions in Company B
The following is a report on the overall OSH conditions at the three subsidiary plants of
Company B. 15 workers from different departments and plants were interviewed.
� The Spraying Department
� No OSH or formal training was offered to workers.
� A senior worker said they were instructed on how to use thinner, acetone, ethylene
trichloride and other chemicals but not on preventive measures or treatment in
case of chemical poisoning.
� Workers could not name the chemical paints or their hazards and the management
did not explain anything about that. An interviewed worker commented, "Who
would be so stupid to tell you these things (hazards)? What happen if people are
scared and quit their jobs?"
� Personal Protective Equipment (PPE)
- A spraying worker would wear a glove on the hand that held the
semi-finished products and the un-gloved hand would be holding the
spraying machine. When they had to work fast, they would not wear any
glove lest slowing down the speed.
- Chemical paints would get onto the hands even if gloves were worn. It was
difficult to wash the paint with plain water. Workers would use other
chemical solvents they could not name or tell their hazards to wash the paint
stains. They did not know other alternatives although they understood that it
66

was not a good way of cleaning their hands.
- The management delivered cotton masks to spraying workers but workers
were not sure if the cotton masks could protect them from taking in the
chemicals. Paint and chemical dust could still get into their mouths and all
the interviewed workers said they could only assume that wearing cotton
masks were better than nothing.
- An interviewed supervisor said the management would make sure that
everybody wore gloves and masks when auditors from Hasbro and Mattel
visited the plants.
� Dizziness, sore throat and skin diseases were reported. Interviewed workers said
the smell of acetone was particularly strong and the air was stuffy at the work
place. The air outside the plants smelled particularly good to them everyday when
they were off work. "I feel like a bird leaving its cage."
� Having worked long hours in the stuffy work place, female workers felt physical
weakness. And cases of faint were reported at the work place. The latest case
recalled by an interviewed worker took place in December 2000. The
management paid the hospital fees for the worker but she was dismissed some
time after that.
� The Painting Department
� Workers in this department used 4 pens of different sizes to paint the small parts or
joints of the semi-finished toys. No OSH training or instructions of whatever kind
was given to them.
� They did not know what chemicals were being used. Nor could they tell their
hazards.
� There was no labeling on the chemical paints and nobody had told them anything
about the hazards of chemical exposure.
� Workers were not given any PPE eg. gloves to wear. To perform the job which
required delicacy, it was impossible for their hands and fingers not to get in touch
with the paint.
� The interviewed workers reported some common job-related illnesses they had
like skin allergies, skin diseases, physical weakness and dizziness. Some of them
said they wanted to throw after working long hours.
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� The Assembly Department
� No formal OSH training was offered.
� Chemical solvents were used in this department to clean the finished products. But
the workers did not know their names and the hazards.
� Cotton gloves were delivered to workers.
� Workers worked long hours in this department during the peak season. A welding
worker working in the assembly department of Factory B3 said she worked sitting
there for as long as 13-15 hours during the peak season. When there were a lot of
orders, it was normal for them to work from 08:00 - 23:30. At worst, they stayed
up till 1 - 2am.
� There was no break other than the two lunches. The management would deliver
drinking water to them three times a day. When there were too many orders to
finish, workers had only 30 minutes for lunch and had to get back to work right
after that. Workers had to take turns and get a permit for going to the washrooms.
� The major source of work stress came from the work flow arrangement and the
pay system. Wages was calculated based on the grand production of a team. The
team had to finish a fixed quota everyday otherwise the whole team had to work
overtime. If the team could not finish the quota within eight hours, the workers'
clock machine cards would record 7 working hours for the day although the whole
team might have to stay up and work till they finished the quota. In this way,
workers were subject to a lot of stress and pressure that came both from the
supervisors and their peer.
� A female worker making die-cast cars recalled having worked till 3am at one time.
She could never get enough sleep and she had developed stomach problems and
sore eyes because of all the stress. To assemble die-cast cars, she used a particular
kind of glue and that caused discomfort to her eyes. Her hands would also be cut
by the sharp edges.
� Strong chemical smell and the over-crowdiness in the old plant also put workers in
an uncomfortable working condition. Cases of heat poisoning took place in
Factory B3.
� The Die-Casting Department
� No OSH training was offered.
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� A case of industrial injury was reported in March 2001. A worker was arranged to
try operating the die-casting machine shortly after recruitment. He had two
fingers cut. The management paid several thousands RMB and dismissed him.
No compensation was made. This is in violation of the Chinese Labor Law and
related regulations on compensation for industrial injuries and injury rating for
handicapped workers. Compensation to injured workers should be made after an
investigation and injury rating made by the Labor and Social Security Bureau.
� Workers worked in two 12-hour shifts in this department. To keep the machines
running, workers took turns to take their lunches. Lunch breaks were short of
about 20 - 30 minutes. Works stress and short lunch break could be a source of
hazards to workers' health.
� OSH infrastructure and provisions at Company B
� Absence of an OSH policy and documentation system
Cases of industrial accidents were reported during the investigations. It was
difficult to verify these cases in this research as the management of Company B did
not have an OSH department to document and investigate accidents and
occupational diseases. It becomes difficult to trace the causes as evidences and
records cannot be collected. Nor was access to information open to workers.
Given that the OSH conditions in Company B were not satisfactory and varied a
lot between different subsidiary plants, there is an urgent need to establish a safety
and health recording system as well as a compensation system that abides to the
labor law. It is important that rank and file workers can get access to the safety
and health records of the factory as well as information that informs them of their
legal rights. A systematic safety and health education was called for here in
Company B.
� Fire control
� Fire control measures varied between the three plants. Factory B3 was the least
satisfactory as workers could not tell the fire exits, nor could they understand fire
drills very well. "Fire exits? Any road is an exit when there is fire."
� In Factory B2, there was an annual fire drill held at the work place but not the
dormitory. Yet the interviewed workers failed to tell the fire exits. A worker from
factory B2 pointed out that early this year, a small fire broke out when
semi-finished products piling near the drying machine dropped into the heated
liquid chemical that were used to clean the molds. This worker commented that
the chemicals should be covered and there should be a more systematic control on
69

the storage of semi-finished products. They should not be placed near high
temperature machines or flammable chemicals.
� A senior worker from Factory B1 said they had two fire drills each year and each
of the three plants would send 20 people to attend. In 1998, a fire broke out not
long after the fire drill and this worker recalled that those that had been drilled
were more alert than the others. But there were too many workers making way for
the exits. This worker criticized that too many goods were piled up at the alleys
and exits. And the way the chemicals were treated also had problems. Thinner
contained in barrels were just left at the work place or exposed without proper
cover. This worker feared that given the large size of workers in the company, a
fire accident could bring disasters.
� Infrastructure
� Conditions in Factory B3 were far from satisfactory compared with the other two.
The plant building was old, the shop floor was crowded, temperature was high
(around 38 - 41 degree C in summer) and the ventilation poor. It was easy for
workers to acquire skin diseases or faint at the work place. This August was
particularly bad as workers in Factory B3 had to work till 2am almost everyday.
� Body check
� The management would arrange for a body check-up for new workers. But it
looked more like a screen test to pick the more able-bodied workers. Weak ones or
those that had other diseases would not be recruited.
� Industrial Injury and compensation
� Regarding industrial injuries, the management would pay for the medical
expenses. Minor industrial injuries like having fingers cut by sharp edges or
pressed by machines were common. The lack of an industrial accident
documentation further made it difficult for workers to prevent injury and to claim
their rights.
� Women worker protection
� When asked if there was any protection for pregnant workers, all the interviewed
workers said pregnant workers had to resign and leave. This is in violation of the
Chinese Labor Law as well as the Regulation on the Protection of Women Workers.
Not equipped with legal knowledge, workers in Company B had a distorted
understanding about their maternity and other women workers' rights. Only
supervisors or the above rank could have a three-month maternity leave.
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� Summary of OSH problems in Company B
� Both accute and chronic hazards to workers' health and safety were identified.
� Heat poisoning, fainting, injuries and ergonomic problems were identified.
� Chemical hazards was identified as a big problem. Many of the interviewed
workers could name the chemicals but could not tell their hazards or ways to
prevent and treat chemical poisoning.
� Long working hours and heavy workload was another major source damaging the
health and safety of workers. The Chinese Labor Law controls the number of
working hours to 40 a week and that of overtime hours to not more than 2 per day.
The reality was that workers in the three plants worked 7 days a week and up to 14
- 18 hours a day during the time of the investigation. This largely increases the
risks of industrial accidents and injuries.
� There was a lack of OSH training and education. Workers had low legal and OSH
consciousness. Reluctance on the part of the management of Company B in
addressing OSH problems and disclosing OSH figures and information only
increases further the risks and poses a long term threat to the safety and health of
workers in Company B.
IV. Workers' Consciousness on Labor Law and Related Regulations
The following is a statistical analysis of 15 interviewed workers from the 3 plants of
Company B on their OSH and legal consciousness.
Questions Yes, I know
71
I've heard of
it
No, I don't
know
Do you know the legal minimum wage of the town
you are working in?
7% 0 93%
Do you know the working hours ceiling of the town
you are working in?
0 0 100%
Do you know how much compensation you can get
if you have occupational diseases or injuries?
0 0 100%
Do you know anything about the Labor Law? 14% 33% 53%
Do you know anything about the Regulations on the
Protection of Women Workers?
0 0 100%
Do you know anything about the Law on the
Protection of Teenage Workers?
0 0 100%

Do you know anything about code of conduct? 0 0 100%
Do you want to get more information and training on
OSH?
60% 40% 0
� 60% of the interviewed workers wanted to know more about OSH issues. But at
the same time they did not have much expectation for any change. "Just like the
Labor Law, it's good to have it but it may not be able to protect us." One female
worker said she had never heard about occupational safety and health. She had a
vague impression that the labor law could protect their rights.
� Only one of the interviewees knew about the legal minimum wage. For others,
they thought legal minimum wage referred to "the lowest wage one had ever got".
� Less than half of the interviewed workers said they knew about the labor law.
None of the workers knew about the other regulations concerning labor rights.
Workers had no idea how to use these laws to defend their rights. And the
company offered no legal education to equip its workers in this area.
� Company B is the core supplier to many of the world's top toy retailers and brand
name companies. Yet none of the interviewed workers had heard about code of
conduct. What is implied is that code(s) of conduct is more a management and
business issue rather than one that empowers workers' consciousness and rights.
V. Words from Workers
� A male interviewee from the delivery department, Xiao Xiang
"Our plant contracts production to more than 10 other sub-contracting factories
almost everyday. We also sub-contract orders to other factories. My
responsibility is to deliver these contracted goods. It's no big deal working till
mid-night and what can the labor law do about it? We are even asked to lie to the
auditors, so what? Tell me which factory is not doing the same? This is the life for
us workers. Of course I want to earn more. But it's just too exhausting. I'd rather
give up the full attendance allowance and take a leave. I wish I can have a day
off."
� Another male interviewee from the delivery department, Xaio Su
"I have grand parents, parents and a younger brother at home. My family has ten
acres of land. But I didn't want to waste my time in the rural village, so I came to
Guangdong. The highest wages I got this year was RMB440 (USD53). Except for
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a day leave and a Saturday that I did not have to work overtime, I had been
working till 11pm or after mid-night that month. It's too exhausting."
"This factory plays tricks. If we cannot finish the quota, our working hours would
be deducted. At one time my time record marked 6 hours when actually I worked
till 12am. Being insulted by the supervisors is a common thing. My supervisor
always complains that I am slow. My job is tiring as I have to pack, carry goods
and clean up things. I have never been lazy but I have never had a good time with
my supervisor. My colleagues feel bad for me for I have no dignity."
"When I'm back to the dormitory after a long day's work, I have to wait till 3am to
take a shower. What's more ridiculous, we have only 2 washroom for 40 people in
our department. My supervisor scolded me again for going to the washroom."
"My family is poor but I can't find an extra penny to send home. It seems that all
these hardships do not make much sense …."
� A female worker from the spraying department, Xaio Feng
"We work long overtime hours like dogs when the factory has a lot of orders. We
are told to take vacation when there is nothing to do. And we have to pay
RMB120 (USD14.46) for food and lodgings even if we have no work to do
leaving us with RMB200 -300 (USD24.10 – 36.14) to survive the slack season."
"It is after mid-night when we are back to the dormitory. And it makes you feel
even more tired seeing a long queue in the bathroom. By the time I go to bed, it is
already 2am and at 8am the next day, I am already at my work place. It's the same
everyday. It's very exhausting."
� A female interviewee from the assembly department, Xaio Yiao
"The major problem is fatigue. My shoulders were stiffened and aching after days
and nights of work. We have very little time to take rest. I don't complain about
working hard. It's expected because we need to earn money. But what happens
now in this factory is that I'm tired to death and I haven't earned much. It makes
everything meaningless. I know I don't have anything to do if I go back home…. I
don't care much about safety and health issues. I don't know what that means."
� A female interviewee, Xiao Wei
"I've worked for more than a year now. The highest wages I've got was RMB700
(USD84.33). On average I get RMB500 - 600 (USD60.24 – 72.29) a month when
we have plenty of orders; and RMB300 (USD36.14) during slack season. My
husband also works in Shenzhen. He is a driver and earns RMB1500 (USD180.72)
a month. My kids are left with my parents at home. My husband and I come from
73

poor village where nothing can be grown from our lands. We have to leave our
home. We live separately because we don't have enough money to rent a flat. We
meet every Saturday. My salary is meager and I can't save much. In toy factories,
you get a better income only during peak season. When the slack season comes,
you can't even survive with what you get, not to mention keep any savings."
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III. 3) REPORT ON THE WORKING AND OSH CONDITIONS OF
COMPANY C
This following report is structured as such:
I. Company information
II. General working conditions in the subsidiary plants of Company C
III. Overall OSH conditions in the three plants of Company C
IV. Workers consciousness on Labor Law and related regulations
V. Words from workers of Company C
I. Company Information
Company C is a Hong Kong based enterprise majoring in the production of electronic
toys, plastic toys, die-cast toys, stuffed toys and gift toys. The chief clients for
Company C are Hasbro and Wal-Mart. The company has more than 5 subsidiary
plants located all in Guangdong province of China. The company also has overseas
plants outside mainland China. The total number of employees is estimated to be
around 20,000.
The four subsidiary plants visited are:
1. Factory C1 – near Guangzhou, Guangdong province
2. Factory C2 – near Guangzhou, Guangdong province
3. Factory C3 – near Guangzhou, Guangdong province
4. Factory C4 - near Guangzhou, Guangdong province
The following report was done by interviewing 13 workers from the four subsidiary
plants of Company C. Information about the interviewed workers is as follows:
Sex Female Male
Number of Workers 12 1
Age range Under 20 20-30 years old Above 30 years
Number of workers 2 9 2
Terms of service Less than 1 year 1-3 years Above 3 years
Number of workers 3 6 4
II. General working conditions in the subsidiary plants of Company C
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Plant C1:
- C1 had about 200 - 3000 workers
- The schedule of working hours in Factory C1 found by the time the research was done
was as such: 08:30 - 12:00 13:00 - 17:00 Over time started from 17:30 - 23:30
- A rough estimation of average daily working hours during the peak season was
estimated to be 10 - 13 hours.
- Over time work would be prolonged to as long as 23:30 during the peak season.
- Workers were paid by time rate during the probation period and shifted to piece rate
after that.
- A rough estimate of their wages between slack and peak season varied from RMB300
(USD36.14) to RMB1000 (USD120.48).
- Workers had old age insurance, RMB 36 (USD4.34) was deducted per month.
Plant C2
- C2 had about 3000 workers.
- Workers worked 7 hours each day.
- The number of overtime hours were not more than 3 per day.
- Workers were paid by time rate at RMB2.57 (USD0.31) per hour. An overtime rate of
150% the normal pay rate was paid
- Workers got a weekly day off on Sunday. During the peak season, when workers had
to work on Sunday, they would be paid 200% the normal hourly pay and 300% on
national holidays.
- Workers reported an average income of about RMB500 (USD60.24) per month. The
factory did not provide for food. RMB40 (USD4.82) was deducted for lodgings each
month
- RMB 68 (USD8.19) was deducted for applying the temporary resident permit
- 12 workers shared one room in the dormitory.
- The interviewed workers said that the living condition was acceptable in this factory.
Plant C3
- C3 had about 3000 - 4000 workers.
- The interviewed workers reported that they worked an average of 70-80 overtime
hours a month during the peak season. Working on Saturday was counted as over time.
- Workers were paid by piece rate. The interviewed workers said an over time
allowance of RMB1.3 per hour was given. But the wages fluctuated between the slack
and peak season from RMB200 (USD24.10) to RMB 500 (USD60.24) in average.
Senior and proficient workers could get about RMB1000 (USD120.48) during the peak
season.
- There were a number of deductions to be made from their salaries: RMB27 (USD3.24)
for temporary residence permit, RMB40 (USD4.82) for family planning fee to the
76

government, RMB25 (USD3.01) for labor administration fee and RMB120 (USD14.46)
for management fee. Not much was left to a worker's monthly salary after all the
deductions.
- The factory did not provide food and lodging to workers.
- Normally, a production worker that shared a flat with others has to pad about RMB100
(USD12.05) for rent, RMB20 (USD2.41) for water.
Plant C4
- C4 had about 3000 - 4000 workers
- The number of normal working hours in C4 were 7, from 08:00 - 11:00 11:45 - 16:00.
- Overtime work started from 16:30 - 21:00. But sometimes workers were requested to
have no dinner break and worked straight from 16:00 to 19:00.
- Wages are paid on time rate of RMB2.57 (USD0.31) an hour.
- Overtime rate was paid at 150% the normal hourly pay on week days and 200% on
Sunday. Workers could get Saturday and Sunday off outside the peak season.
- Workers were paid an allowance of RMB250 (USD30.12) per month during low
season.
- They received an average income of RMB500 - 800 (USD60.24 to 96.39) per month.
- The factory did not provide for food and lodgings. Workers paid RMB40 (USD4.82)
each month for lodgings and RMB2.7 per meal.
- RMB23 (USD2.77) would be deducted each month for applying the temporary
residence permit and RMB35 (USD4.22) each month for pension.
III. OSH conditions in Company C
General Conditions
- No occupational training for workers was offered to new or current workers.
- No medical check up was provided for new or current workers. This violates the
Chinese Labor Law (chapter 6) which states that workers, especially those working
under hazardous environment, should be provided with regular body check-up service.
- Production workers were not insured for industrial accident. In case of industrial
injuries, the management would pay for the medical expenses. The subsidiary plants of
Company C did not have an OSH policy or any documentation accessible to workers on
chemical usage, safety and health as well as injury records at the work place.
- An annual fire rehearsal was conducted at the subsidiary plant level but the
dormitories were not covered. Interviewed workers said they knew how to make way
for the fire exits but not how to use the fire extinguishers.
- Long working hours is a problem especially during the peak season. It is an
underlying source of hazards to the safety and health of workers.
- Chemical poisoning is found to be a risk factor in Company C. According to Article
77

15 of the ILO convention on regulation of industrial chemical usage (1990), the
employer has the responsibility to inform employees about the hazards of the chemicals
used at the work place as well as assist employees to get access to such information.
Regular training and education on the safe usage of chemicals should be provided to
employees. Mainland China has signed such an ILO convention. The Chinese Labor
Law and relevant regulations also stated the responsibility of employers in protecting
workers from hazards in general and chemical poisoning in particular. Interviews with
workers from Company revealed that no training on chemical usage and hazards were
provided and no personal protection equipment was delivered. This is acting in
violation to the Chinese Labor Law and the ILO convention.
� The Injection Molding Department
� No occupational training on machine operation was provided to the workers.
New recruits were asked to follow and learn the operation of machines from the
seniors.
� Temperature was high at about 33 -38 degree C in summer. Water was
sprayed and fans were installed to relieve the heat. Besides that, there was no other
ventilation system. Temperature of the molding machines went up to 200 - 300
degree celsius in full operation. Workers could be burnt easily.
� The management delivered two pairs of gloves each month. Most of the
workers did not wear them because of the heat and inconvenience.
� The injection molding machines were automatically operated. The machines,
especially the grinding machines gave out loud noise in operation. Only some
workers were delivered ear cuffs.
� There was a strong chemical smell in the air when the plastic was heated and
molded. The use of thinner and cleansing alcohol in a poorly ventilated work place
made workers feel sick and some even fainted under the heat.
� Workers felt body discomfort, dizziness, tiredness from repetitive body
movements and exhaustion working under high temperature. Cases of faints were
reported at the work place.
� The interviewed workers identified heat stress as the main source of hazard in
this department.
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� The Spraying Department
� There was no training or instructions on the names or the hazards of the
chemicals used in this department. Most of the interviewed workers said they did not
know what chemicals were used. Nor could they tell the hazards of the chemicals.
� Cotton masks were delivered. Masks could be delivered every half a month,
once a year or three times a year, as it varied from plant to plant. It seemed that
Company C did not have a standard policy on OSH and PPE provision.
� The interviewed workers said that even with the masks on, the paints would
still get onto their skins. It called into question whether the cotton masks were
effective in protecting workers against the particular chemicals that was in use.
� Cotton gloves were provided too. Workers felt it inconvenient wearing the
gloves. If paints got into their hands, they would wash the paint away with thinner.
But they could not tell whether the thinner was non-hazardous to their health.
� No other break was given besides lunch and dinner.
� The management would deliver cold drinks to workers once a week during
summer. But interviewed workers said they seldom left their work to go for drinking
water, especially when the production pressure was intense.
� Workers felt that the workplace was fairly hot in summer.
� The air was filled with chemical smell and workers reported dizziness and
throat discomfort.
� The interviewed workers said that chemicals and heat are two major
problems in this department.
� The Assembly Department
� Workers used glue to stick components together. Except for a few occasions,
most of the workers did not wear gloves, eye protection or mask. The glues, thinner
and other chemicals could get into their skins, hands, eyes and respiratory system.
� Work stress was great. The investigation learned that a daily production
quota of 5000 to 10000 pieces was set by the time the interviews were done. Workers
had to work overtime if they could not finish the quota. Workers dared not leave their
work and go to washrooms or drink water.
� The number of overtime work varied between different departments and
subsidiary plants, depending on the size and kinds of orders that were placed. It
varied from 2 or 3 hours to 6 hours a day. But generally speaking, a worker at the
assembly department was estimated to sit working for 10 - 13 hours. They had
79

ergonomic problems such as fatigue, pain, as well as numbness and stiffness over
their shoulders, neck, waist, legs and eyes.
� Workers in this department identified chemical exposure and long working
hours as the major problems.
IV. OSH and Legal Rights Consciousness of Workers in Company C
Below is a statistical analysis on the OSH and legal rights consciousness of 13 workers
interviewed from the 4 subsidiary plants of Company C.
Do you know the legal minimum wage of the town
you are working in?
Do you know the legal working hours ceiling of the
town you are working in?
Do you know how much compensation you can get
if you are industrially injured?
Do you know anything about the Chinese Labor
Law?
Do you know anything about the Regulation on the
Protection of Female Workers?
Do you know anything about the Law on the
Protection of Teenagers?
80
Yes, I
know
I’ve heard
about it
20% 0 80%
0 10% 90%
No, I don’t
know
0 0 100%
0 10% 90%
0 0 100%
0 0 100%
Do you know anything about code of conduct? 0 10% 0
Do you want to get more information and training on
OSH related issues?
Yes, I
want
90%
I have no
opinion
10%
No, I don’t
want
� More than 80% of the workers knew nothing about the Chinese Labor Law and
there was a lot of misunderstanding and misinterpretation of the labor law. Workers
generally associated the labor law with inspection from the Labor Bureau. A
considerable number of them took the legal minimum wage as the lowest wage they
had ever received. None of them had heard of the regulations on the protection of
women workers and the law on protecting teenagers.
� A lot of the interviewees took code of conduct as another piece of factory rules.
Without being aware of the client companies' code of conduct, it was difficult for

workers to use these codes to improve their working conditions. More so, mistaking
code of conduct as factory rules implied that company code of conduct could be
misused by the factory management to impose extra demands to workers for
compliance and not necessarily using the code to give better protection to workers'
rights.
� When asked about their understanding of women workers protection with regard
to the maternity rights, most of the interviewees thought that it was not feasible. As
they understood it, pregnant workers had to resign on their own. While Company C
failed to give maternity and women workers rights protection to its workers, it could
be seen from this example how workers had been mistaking the violations of workers'
rights and the labor law on the part of the management as the rule of life.
� Regarding their rights to compensation and medical treatment in case of industrial
injury, the interviewees believed that the management would take the financial
responsibility and hospitalize the injured worker. Again, without being properly
equipped with legal rights consciousness, workers could not know what rights they
were entitled to and whether the management was complying to the labor law.
� 90% of the interviewees welcomed free education and training on OSH protection.
They thought that the management had to give consent and assistance to that.
V. Words from Workers
� A male interviewee, Xiao Chi
“Everyday, we work under high temperature of about 33 – 38 degree C in the molding
department. The molding machines are noisy and hot. The air is filled with strong
chemical smell. And I have to repeat the same movements, open the machine, put in
the plastic, press the machine, take out the plastic ….. A lot of us cannot stand the
heat, the smell and the noise, and some of us faint.”
� A female interviewee, Xiao Dong
Xiao Dong comes from Hunan province. She has worked in the spraying department
for more than 6 years. She is quick and earns RMB800 - 1000 (RMB100 - 125) a
month. But Xiao Dong has to support her family. Her husband came to Guangdong
province to work but could not find a job as he was considered "old". Her husband is
in his forties now. Xiao Dong has a son that is of school age. Xiao Dong cannot
afford to send him to schools in Guangdong province because of the high school fees.
Besides, as a migrant worker, she has to pay a number of fees to the government, like
the temporary residence permit fee, the family planning fee, labor administration fee
81

and other management fees etc.
Having worked over the years in the spraying department, Xiao Dong is in touch with
chemicals and thinner everyday. She said she got used to them. She knows that these
chemicals were poisonous but not exactly what and how. Some of her colleagues
complain about sore throat and other sickness. She begins to feel worried now. But
what worries Xiao Dong more is her "old age". She will pack and leave for home
when no factory will take her anymore one day.
III. 4) REPORT ON THE WORKING AND OSH CONDITIONS OF
COMPANY D
The following report is structured as such:
I. Company information
II. General working conditions in Company D
III. Overall OSH conditions in Company D
IV. Worker consciousness on Labor Law and related regulations
V. Words from workers of Company D
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I. Company Information
Company D is a top OEM toy company in Hong Kong. The company won great
success in early years by manufacturing girls toys and stuffed toys. Production then
was expanded to infant toys, pre-school and educational toys, electronic toys,
inflatable toys or beach items, plastic toys, premium & novelty items, stuffed or plush
toys and dolls and polyresin items. Company D supplies to a number of prominent
toy brand companies including Hasbro. The company had an annual sales of over
HK$1 billion over the past years. The company has a number of subsidiary plants in
major industrial cities in Guangdong province.
Subsidiary plants of Company D
� Plant D1 (mainly produces stuffed toys)
� Plant D2 (mainly produces plastic and electronic toys)
� Plant D3 (mainly produces plastic and electronic toys)
� Plant D4
The following report is based on interviews with 12 workers from two subsidiary plants
of Company D, namely Plant D1 and D2, both located in the second industrial zone of
Shenzhen, Guangdong province. The interviews were taken from July to September
2001. It was also the peak production season.
Information about the interviewed workers are as follows.
Sex Female Male
Number of Workers 8 4
Age range Under 20 20-30 years old Above 30 years
Number of workers 1 7 4
Terms of service Less than 1 year 1-3 years Above 3 years
Number of workers 4 3 5
Working conditions
� Plant D1
1. Wages
It was learned from interviewed workers from Company D that their wages were
composed of the following parts.
83

Table on wage composition and wage fluctuation in Company D (August 2001)
Working day Daily rate
RMB10.3
Work days in
peak season
Over time Over
hourly production
rateRMB2.4 bonus
84
Food to be Actual monthly
deducted
per month
pay
28 - 31 days 4 - 8 hours 0 - RMB50 RMB30 RMB600 - 800
Work days in
20 - 25 days RMB30 RMB200 - 300
slack season
The legal minimum wage in the second industrial zone was RMB440 (USD53) by the
time of the interview. Based on the government reference of 20.92 work day per
month, the daily minimum rate should be RMB21 (USD2.53) and the minimum
hourly rate should be RMB2.6 (USD0.31). Based on the legal minimum hourly rate,
over time rate on week day should be 150%, ie RMB3.9. Company D did not pay the
legal daily rate or the legal over time compensation rate. Payment to workers during
the slack season was also below the legal minimum wage.
� On the pay stuff was written the exact amount of a worker’s monthly salary. But
workers did not know the pay scale, the pricing or the wage calculation scheme. It
was difficult for them to counter check their pay.
2. Working hours
� Workers were working long overtime hours up to as late as 12 - 2am by the time
the interviews were done. They worked from Monday to Sunday with no day off.
Working on Sunday was counted as overtime work.
3. Contract and social security provisions
� Only part of the workforce had signed contract with the employer. The
interviewed production workers did not have contracts with the company.
� The interviewed production workers were not insured for social security. The
proportion of insured workforce could not be verified
4. Living conditions
� Workers staying in the old dormitory complained that the living conditions were
not satisfactory. The dormitory was worn out and the supply of running water was
not good. 18 people shared a dormitory room with bath and toilet facilities.
5. Labor disputes
� A stoppage of work was reported in a subsidiary plant of Company D in year 2000.
Workers were dissatisfied with the production quota and overtime compensation

system. Overtime compensation was given only when workers had finished the fixed
quota. Workers protested against the high production quota. They would have their
wages deducted if they failed to finish the quota. There were also problems in the
overtime hour calculation. Workers thus had a stoppage of work. In the end, the
management adjusted the overtime rate to RMB 3.9 (USD0.47), effective from
August 2000.
� Plant D2
� Wages for production workers was RMB21 (USD2.53) a day. After deducting
food and lodgings, it was RMB11.4 (USD1.37) a day. The overtime compensation
rate was RMB2.63 (USD0.32) an hour. It was lower than the legal over time
compensation rate for the second industrial zone of Shenzhen, ie RMB3.9.
� During the peak season, workers might have to work till mid-night.
� Training was arranged for new workers. Factory rules and basic safety regulations
were explained.
� Food and lodgings were provided and charges were deducted from workers'
salaries.
� The interviewed workers reflected that conditions in Factory D2 was better than in
Factory D1.
OSH Conditions in Company D
The following is an overall report on the OSH conditions at Plant D1 and D2.
� The Sewing Department
� Noise pollution in the sewing department was serious. Workers could not talk or
listen to each other at the work place. It took some time for their hearing to return to
normal when they were off work. No ear protection was given.
The current maximum noise pollution exposure limit in mainland China is 90dBA based
on an 8-hour working day and 40-working-day a week. The interviewed workers
were not provided with any ear protection and they reported temporary hearing
obstacles after work. This raised the alarm of their exposure to a noisy working
environment that might have exceeded the national exposure limit. An assessment of
the noise level should be undertaken.
� Work stress was another major problem. Workers were paid by time rate. The
daily production quota was high. Workers had to sew as quickly as possible to finish
the quota. It was easy for the needle of sewing machine to get into their hands when
they sewed at a high speed. It was more tiring with fur stuffed toys as they had to sew
85

from inside out.
� Ventilation was not good at the work place especially during summer.
� There was no break besides the two lunches. Workers sat working for 13 and 14
hours a day during the peak season. The wooden seats had no back support and the
height of the seat might not match with the sewing machines. All the interviewed
workers said their elbows were pained, their waist stiffened and legs numbed when
they were off work. Workers of weak body build up could faint after long working
hours.
The sewing department required workers to sit for long hours, performing repetitive
movements. Ergonomic problems will be developed leading to chronic health
deterioration or other occupational diseases. Workers claimed that noise pollution,
long working hours and work stress were the major problems in this department.
� Die-Casting Department
� New workers were instructed verbally about the safe operation of machines. But
there was no formal safety training.
� Engineers would come to check the machines every morning. Workers were
asked to sign their names before they started their work.
� The machines were lubricated and that reduced the noise level. But no ear
protection was delivered.
� The die-casting machines were one-button controlled instead of two. Workers
would use the other hand to fix the component part and they could have their hands
pressed.
� Workers worked two shifts and regular hours.
� The interviewed workers complained that temperature at the work place was high.
� The Assembly Department
� Workers were given a fixed quota to finish each day. If they could not finish the
quota, they had to work overtime. Overtime work could run up to 2 to 3am. Work
stress was a problem. There was no break besides the two lunches.
* By the time of the visits, workers worked an average of 14 - 16 hours a day.
It could be longer if they had to rush for shipments. All the interviewed workers said
they did not have enough rest.
� Workers felt that their waists were stiffened and their elbows ached after long
86

hours of work. Ergonomic problems were identified.
� When workers were producing furry toys, the work place would be filled with fur
particles. They wore no masks and they would have throat discomfort after a short
while.
� Some workers used thinner to clean the components and the machines. They did
not know anything about the chemicals.
The number of working hours in the assembly department during the peak season
exceeded the national standard. Complaints from the interviewed workers in this
department focussed on long working hours and work stress. Ergonomic problems as
well as chronic occupational diseases would be developed.
� The Silk Screening Department
� A female worker that had worked in the department for years did not know what
chemicals was used for silk screening. She was not instructed on the hazards or the
treatment in case of chemical poisoning.
� Chemical smell was strong in this department.
� Cotton masks and gloves were delivered but workers generally did not wear them
finding it inconvenient to have gloves on and work.
� The paints would get onto their skin and they would first use thinner to wash away
the paints and with detergents for a second time. But the color and stain was still left
on their hands indicating that the paints might have stayed or got into their skins.
� Workers might felt dizziness and other body discomfort but they were not sure
whether that was related to their job.
Article 15 of the ILO C170 Convention on safe usage of industrial chemicals (1990)
stated that the employer should inform workers about the hazards of the chemicals
being used. The employer should also assist employees to get access to relevant
information and provide regular safety and health training to employees on chemical
usage. Chemical poisoning in the silk screening department is a major risk factor as
workers would be exposed to a lot of chemical paints, thinner and solvents under
long hours. Company D gave no protection to workers in this department nor did
they provide training and information to prevent them from chemical poisoning.
87

� OSH Infrastructure and Provisions in Company D
� There was an annual fire drill at the work place and the dormitory in both plants.
Most of the interviewed workers knew the fire exits but not how to use the fire
extinguishers.
� None of the two plants have a specialized OSH department.
� As regards welfare and medical provisions, the interviewed workers did not know
whether they were insured for industrial accidents and old age insurance. Workers'
rights to compensation in case of industrial injury or occupational diseases were not
protected.
� Workers had to go to hospitals and paid RMB52 (USD6.5) for a body check-up
before they entered the factory. The management did not pay for anything.
� No regular body-check-up was provided in both plants. There was no medical
provision or factory clinic. Workers had to pay for their own medical expenses. They
could get a sick leave only if they could provide a medical record from the local
hospital. In case of industrial accidents, the management would pay the medical fees.
Chapter 6 of the Chinese Labor Law states that the employing unit should provide
regular body check-up f or workers engaging in hazardous work.
Workers' Consciousness on Labor Laws and Related Regulations
The following is a statistical analysis of the 12 interviewed workers from Plant D1 and
Plant D2.
Do you know the legal minimum wage of the town
you are working in?
Do you know the working hours ceiling of the town
you are working in?
Do you know how much compensation you can get
if you have occupational diseases and injuries?
88
Yes, I
know.
I've heard of
it.
No, I don't
know.
0 0 100%
0 0 100%
0 0 100%
Do you know anything about the Labor Law? 8% 16% 76%
Do you know anything about the Regulations on the
Protection of female Workers?
0 0 100%
Do you know anything about the Law on the 0 0 100%

Protection of Teenagers?
Do you know anything abut code of conduct? 0 0 100%
Do you want to get more information about OSH
and related training?
89
Yes, I do.
80%
I have no
opinion.
20%
No, I don't.
0
Workers from Company D had poor legal and OSH consciousness. They had poor
knowledge about the labor law and related regulations. Company codes of conduct
is like an alien thing to workers and it raises doubt as how they can protect workers
interests when workers could not tell if they were complied or violated.
� On the other hand, about 80% of the workers wanted to know more or receive
training on safety and health after the interviews were done. This shows that workers
are not apathetic to their safety and health conditions if they can have access to the
means of improving it.
Words from Workers
� A female interviewee, Xiao Hoi
"I worked in a foreign invested toy factory years ago. A fire took place in that factory
and a lot of female workers were killed. I am very sensitive to safety issues. Last
time the light bulb at the work place was burnt, I was so scared that I ran for the
stairway. My colleagues laughed at me. Yes, I might be over-sensitive. But it can be
very dangerous if a fire breaks out."
� A senior female worker at Plant D2, Xiao Wang
"Only management staff had maternity leave. We, workers on the production line went
to work as usual even if we are pregnant. And you will quit, as everybody else does
when you are about to give birth. The management would quickly give an approval."
� A female interviewee , Xiao Chen who had worked 6 years shifting between the
two factories.
"There is nothing written on the pay stuff. I've worked for so long and I don't know how
they calculate and deduct our wages. If you go to the accountant, you have to test
your luck."
� A female interviewee from the assembly worker, Xiao Rou
"We are working late till 1 or 2am. We have to take turns to take shower before we go
to bed. At 7am, we get up and it's another work day."

III. 5) REPORT ON THE OSH AND WORKING CONDITIONS IN
COMPANY E
The following report is structured as such:
I. Company information
II. General working conditions in Company E
III. Overall OSH conditions in Company E
IV. Worker consciousness on Labor Law and related regulations
V. Words from workers of Company E
I. Company Information
Company E is a Hong Kong based company. The company has two subsidiary plants in
Guangdong province. Plant 1 is located at Dongguan City and plant 2 is at Shenzhen.
Founded more than 10 years ago, Company E manufactures plush toys, plastic toys,
90

premium and gift toys. Its biggest client is McDonald’s and Plant 1 mainly supplies
Happy Meals premium toys to McDonald’s in the US. Company E designs,
manufactures and packages toys. The annual sales of the company reaches
HK$170million a year. The asset of the company is estimated to be HK$140million.
Production Flow
1. Plush Toys
- Conceptualization and sample – counter sample – die-cut mold – die-cut patterns
& materials – sewing – stuffing – finishing – assembly – packing – final inspection –
delivery.
2. Plastic Toys
- Conceptualization and Sample – prototype – mold – injection – decoration –
assembly – packing – final inspection – delivery
The following report was compiled based on the interviews done with workers from
Plant 1 located in Dongguan. Plant 1 manufactures both plastic and stuffed toys for
McDonald’s.
There were approximately 3000 – 4000 workers working in the two subsidiary plants of
Company E. They came mainly from inland provinces like Sichuan, Hunan, Hubei,
Guangxi, Guangdong and Anhui etc. About 60 – 70% of them are women. Their age
range from 18 to 30.
II. Working Conditions
1. Working hours and wages
� The calculation of wages varied between departments. Production workers were
paid by piece rate.
� The following are a few examples on payment found in this plant.
� Case one: A worker from the spraying department received his July salary in early
September. He worked 31 days in July and 5-6 hours over time a day. He got
RMB600 (USD72.3) after deducting RMB125 (USD15.06) for food and lodgings
from his salary. He was paid by piece rate and no over time pay was given.
� Case Two: An assembly worker worked roughly 100 over time hours in July.
After deducting food and lodgings (RMB125), she was left with RMB400 - 500
(USD48.19-60.24) as July salary. In slack season, she could get only RMB200
(USD24.10). In case no production order was placed, no extra allowance was given
to her.
� Case three: Workers in the QC department was paid by a time rate of RMB16
(USD1.93) a day. His hourly rate was RMB2 (USD0.24). For over time work, he
91

would get an over time compensation rate of RMB1.8 per hour, which was even
lower than his regular hourly pay.
� Case four: Payment varied from less than one hundred RMB to several hundred
RMB in the tooling department depending on the skill level of the workers. No over
time compensation was given even during statutory holidays.
The legal minimum wage in Dongguan by the time of the interview was RMB400
(USD48.19). Workers should get a minimum daily pay of RMB19.1 (based on the
government reference of 20.92 working days a month) and a hourly minimum wage of
RMB2.39. None of the above cases complied to the minimum pay standard of
Donnguan.
� Sick leave was not paid.
� Workers received a pay roll that recorded the monthly wage but with no
breakdown. Workers did not know how their wages were calculated.
� There was a one-month lag in delivering wages. Workers normally received their
salary one month later. This effectively pre-empted workers from quitting their jobs.
3. McDonald’s Code of Conduct
� By the time the interviews were done in September 2001, it was learned that
workers from the spraying department were arranged to work the night shift from
6pm to 6pm. As understood from the interviewed workers, the delivery lead time
given by McDonald’s was so short that it was impossible for the factory to meet the
schedule. Workers from the spraying department were scheduled to take the night
shift. Workers were exhausted by the new arrangement. They were not compensated
at all. Long overnight work increased the risk of industrial injury and caused new
safety and health problems to the workers.
� The problem here lies more with McDonald’s harsh procurement policy. It is clear
from this case that the short deliver time demanded by McDonald’s is directly
responsible for the labor abuses committed to the workers of the company. The
supplier has to finish the order within the short lead time, while at the same time
“comply” to the company’s code of conduct. The pressure imposed by McDonald’s
on its supplier is immediately shifted to the workers, causing abuses of their rights
and new hazards to their safety and health.
The question is, does it bother McDonald’s that the terms and conditions offerd by the
buying agents might conflict with the very code of conduct of the corporation? While
McDonald’s insists that it is the responsibility of the suppliers to comply with its code
of conduct and that McDonald’s is committed to work with its suppliers to implement
92

the code, the procurement policy of McDonald’s makes its own code a hypocritical
gesture only.
4. Contract and insurance provisions
� Production workers signed no contract with the management.
� Not every new worker was provided with body check when they were recruited.
� RMB60 (US$7.23) was deducted from the salary of production workers for social
insurance. But because there was no breakdown in the pay roll, the interviewed
workers could not tell what kind of insurance or social security provisions they were
paying for.
� There was a factory clinic and workers paid for their own medical fees.
5. Penalty
� It was difficult to get approval for taking leave, even sick leave, from the factory
management. Workers had to give up a day’s salary if they took a leave. Three days’
wages would be deducted for being absent from work for 1 day. This held workers
back from taking any leave.
� Penalties of various scale were charged. To take an example, workers would be
fined RMB30 – 40 (US$3.61 – 4.82) for dozing off at the work place. That equaled to
2 to 3 days’ salary for a lot of production workers.
6. Monitoring McDonald’s code of conduct
� Workers were cautious when asked about McDonald’s. An interviewed worker in
the sewing department knew that their client, McDonald’s had a code of conduct.
“McDonald’s code of conduct was posted on the wall. That is a show only. For
outside inspection. The management would falsify when the inspector comes. Who
dares to …” She was signaled by her colleagues and refused to tell more. “In fact this
factory is not bad compared to others.”
� It was learned from other workers that the management had warned its workers
against disclosing anything about the factory conditions to outsiders. The
management would instruct workers with a set of frequently asked questions
whenever there was an audit.
It is an irony to see that before the company code of conduct brought any real benefits to
the workers in the vendor factory, more pressure was laid onto the workers as they
were threatened and couched by the management to give the "right" answers to the
clients' auditors. This fear for retaliation was adamant amongst workers that it
inhibited workers from articulating and claiming their rights.
93

III. Occupational Safety and Health Conditions in Company E
Plant 1 manufactures both plastic and stuffed toys. The investigation mainly focused
on the tooling and spraying department where safety and health problems were more
accute.
1. The Tooling Department
� Plant 1 manufactured molds that supplied to other departments. Molds were made
from steel and other metals. About 30 - 40 workers were working in the tooling
department. High temperature and much noise was produced in this department. But
workers were not provided with any ear or eye protection. The finished mold was hot,
heavy and had sharp edges. This became another source of hazards as workers, not
wearing appropriate metal gloves, could be cut easily by the sharp edges.
2. The Spraying Department
� Chemical exposure
Workers knew that they were exposed to different kinds of chemicals and thinner
everyday. But they were not informed about the hazards of these chemicals; nor were
they instructed how to properly handle these chemicals.
� PPE
Paint dust level was high and the chemical smell was strong at the work place. A
ventilation system was in place and workers were equipped with both cotton and
cartridge masks. But the cartridge masks were heavy and created other discomfort,
like dizziness, to workers. They were worn only when requested by the management
during factory inspection. When there was no inspection, workers normally wore
cotton masks.
� Cotton gloves were also provided but not many workers wore them as they found
that wearing gloves would slow down their speed. They used thinner to wash away
the paints on their hands.
� Temperature
Workers also reported high temperature at the spraying department and some workers
felt dizzy and other body discomfort staying up long under high temperature.
� Health hazards
The interviewed workers said they suffered from health problems like fainting,
vomiting, dizziness, loss of appetite, fatigue and body weakness. They attributed
these health problems to long working hours, stress as well as chemical exposure.
94

� General OSH conditions and infrastructure
� The factory had regular fire drills at the work place.
� The management did not have an OSH department to deal with safety and health
issues.
� Workers had to get permission for going to toilets and drinking water. Workers
found such an arrangement inconvenient especially during summer when the
temperature at the work place was high.
� Long working hours - Plant 1 workers worked an average of 15.5 hours a day for
the whole week during peak season. There was no day off. Fatigue and lack of sleep
was another important source of hazards.
� The interviewed workers were asked why they did not wear the personal
protection equipment provided by the management. They said that wearing
protective equipment like the charcoal masks, ear plugs and cotton gloves made them
feel even more uncomfortable. More importantly, wearing these provisions would
slow down their speed. Production workers were paid by piece rate, meaning you
earned more if you worked fast enough. They had to give up either higher income or
safety protection.
The factory management of Company E did provide PPE to workers. Yet a more
positive approach would be conducting an evaluation of the hazards and risk factors
at the work place and improve the OSH conditions from engineering and
management control of hazards. Relying on workers' wearing PPE is both passive
and misleading as it is the responsibility of the employers to provide a safe and
healthy working environment to the employees. Too much reliance on the provision
of PPE in replacement of a fundamental eradication or containment of the hazards
finally could result in placing the blame on the reluctance of workers to wear PPE
only.
� Industrial injury
� While the interviews were done with workers from Plant 1, a case of industrial
injury was reported at Plant 2.
� It was reported that in 1998, a new worker who had been recruited for five days
had his right elbow cut when he was operating a molding machine. The injured
worker did not know that the machine went out of order as he operated it. He was
rated by the Social Security Department as a 4th grade handicap. The injured worker
later engaged in a two-year lawsuit against the factory for compensation. He got
95

RMB26,000 (US3250) in court on 10 October 2000. The monthly salary for this
worker in the molding department was RMB490 (US61.25) per month before the
injury. This injured worker went back to his hometown in Sichuan when the lawsuit
finished.
This case illustrated first of all a lack of OSH training to workers could lead to injury to
the workers. They might lose their working ability for life. Company E did not give
enough protection or training to its workers and in the end the worker paid the cost.
From the length of time this lawsuit had dragged, it can be seen how difficult it is for
a migrant worker that comes from inland province to claim back their legal rights in
court. The injured worker had to stay for 2 years, without job and salary, and without
working ability, in Shenzhen while the lawsuit was under procedure. A lot of workers
did not have the financial means to bring a lawsuit against the employers nor could
they afford the long wait while living on nothing in the cities. They would not take up
a lawsuit to claim their rights and compensation. Some of them would accept
whatever amount of money the employer offered them. While others simply would put
the blame on themselves and went back to their home towns. Even for those that had
successfully claimed compensation, the damage done to their bodies was permanent.
If they lost their working ability for life, a meager compensation would not be enough
for them to survive the rest of their life. It is therefore of utmost importance that the
employers should take up preventive measures to protect the OSH conditions of their
employees.
IV. Workers' Consciousness on Labor Law and Related Regulations
Reported below is the statistics on the OSH and legal consciousness of 5 workers
working in Plant 1 of company E.
Do you know the legal minimum wage of the town
that you are working in?
Do you know the working hour ceiling of the town
you are working in?
Do you know the amount of compensation you can
get if you are injured in an industrial accident?
Do you know anything about the Labor Law?
96
Yes, I
know.
I’ve heard
about it.
20% 0 80%
20% 0 80%
No, I don’t
know.
0 0 100%
0 0 100%

Do you know anything about the Regulation on the
Protection of Female Workers?
Do you know anything about the Law on the
Protection of Teenagers?
Do you know anything about code of conduct?
Do you want to get more information and training
on occupational safety and health?
97
0 0 100%
0 0 100%
20% 0 80%
Yes, I
want.
100%
I have no
opinion.
0
No, I don’t
want.
0
Workers from plant 1 of Company E had poor knowledge on OSH and the labor law.
Although 20% of them had heard of code of conduct, they were refrained from
discussing it. More education on the legal rights of workers is needed for workers in
this Company.
VI. Words from the workers
1. A female interviewee from the spraying department
“The working hours are long and pressure great in this factory. My team has to finish
45000 units everyday. During peak season, it is the normal case for us to work over
time till midnight everyday. We have no day off. At present, all of us are scheduled
to take the night shift because the management has already started producing a new
product line before the order is placed. Recently, we work from 6pm to 6am. This is
to avoid the inspection of the client. The re-scheduling makes us very tired. We can’t
help dozing off at the work place and we will be fined RMB30 – 40 (US$3.61 – 4.82)
for that.”
2. A male interviewee in the storage department
“Our wages are already low during low season. The unit price gets lower and lower and
we, piece rate workers, get only RMB200 – 300 (US$25 – 37.5) a month.” “We don’t
know how they calculate the wages. Piece rate or time rate? You can never tell how
it comes down to the few dollars you receive. What can we do about it?”

III. 6) REPORT ON THE WORKING AND OSH CONDITIONS IN
COMPANY F
The following report is structured as such:
I. Company information
II. Report on Plant F1
III. Report on plant F2
VI. Company Information
Company F is a Hong Kong based company. The company has two operating plants,
namely Plant F1 and Plant F2, both located in the second industrial zone of Shenzhen,
Guangdong province. Plant F1 officially supplies to McDonald's. But Plant F1 would
split the orders of McDonald's and sub-contract production to the other subsidiary,
Plant F2, for production.
Location
Plant F1 – second industrial zone, Shenzhen, Guangdong province
Plant F2 – second industrial zone, Shenzhen, Guangdong province
98

Product
Games, non-electronic toys, plastic toys, pre-school toys, educational and infant toys,
premium and novelty items, plush toys, and roto casting.
Past labor abuse records
� Since 1998, industrial injuries and accidents records had been reported.
� September 1998 - Workers went to the Social Security Bureau to complain the
factory for not insuring workers and no compensation was made in case of big
accidents and injuries. When the bureau sent an investigation to the factory, the
factory guards barred the officials from entering the factory. In the end, the
management submitted to the demands of workers under public pressure.
� Company F was found to have been keeping false records for company audits. In
general conditions in F2 were much better than F1. Plant F2 would receive orders
from clients while sub-contracting some of them to Plant F1. But all these were
done with full knowledge of the client and its buying agent. While Plant F1 failed
to meet the audit requirements of its clients, compliance in Plant F2 was half of the
picture only as further sub-contracting between the two companies was the
practice.
The following report was done by interviewing 19 workers from both plants of
Company F. Their information is as follows.
Sex Female Male
Number of Workers 7 12
Age range Under 20 20-30 years old Above 30 years
Number of workers 8 10 1
Terms of service Less than 1 year 1-3 years Above 3 years
Number of workers 7 10 2
Report on Plant F1 of Company F
10 workers from Plant F1 were interviewed. 3 of them were female and 7 were male.
There were 8 workers from the spraying department and 2 workers from the trimming
department. Of the 10 interviewed workers, 5 were under 20 years old whereas 5 were
between 20-30 years old. 5 of them served less than 1 year and the other 5 served
between 3-5 years in Factory F1.
99

General Working Conditions in Plant F1
There were about 2000 workers in plant F1 by the time of the investigation. The
recruitment ad said the factory was recruiting workers between 18 - 27. No contract
was signed.
� Wages
� More than 80% of the interviewed workers complained against the wage
calculation.
� Production workers were paid by piece rate and time rate. But time and piece rate
would be switched depending on the batch of orders the plant was placed with.
� It was reflected from interviewed workers that the management would pay by
piece rate when there were a lot of orders, and time rate during the slack time.
� The unit price of piece rate work was kept with the management, and workers had
no idea about the pay scale.
� Piece rate workers had to finish the daily production quota, if not, they had to work
overtime to finish it without compensation But the management would raise the
quota so that it became more and more difficult for workers to finish the quota.
� For example, workers in the assembly department had to finish 45 batches of toy
pens within the "official" working hours at first. That was raised to 60 and 70 later.
Workers had to rush and still they could not finish the quota within eight hours and
had to work overtime without being paid proper compensation rate.
� It was difficult for workers to appeal or check their wages if they found problems
with it.
� RMB190 (USD22.89) was deducted for temporary residence permit.
� Production workers on average had RMB300 - 500 (USD36.14 – 60.24) a month.
Yet the management would falsify the pay record and on paper, workers got a
monthly pay of around RMB600 - 900 (USD72.29 – 108.43). What the workers
actually earned was not earn enough for their survival.
� Working hours
� The normal working schedule at Company F was as follows: 08:00 - 12:00 13:30 -
17:30. Overtime work during peak season: 18:30 - 21:30. It could be as late as
24:00 or 27:00 when they had to rush for shipments.
� The spraying department took two shifts and each shift was 10 hours long. The
night shift started from 21:00 to 07:00. There was a 30-minute break in between.
� Usually the assembly department had to work long hours when they had to meet
shipment dates. Workers reported working till 3am. But they were told to take
vacation when there was no work to do.
100

� Normally, Sunday would be off. But not a single day was off during the peak
season.
� Fraud
� The factory had a set of false pay rolls and false time cards to deal with social
audits.
� Production workers did not have to punch the clock machine. Only supervisors or
above rank did so.
� As appeared on the pay rolls, a worker might get RMB600 - 900 (USD72.29 –
108.43) a month. The reality was that the worker might get just RMB 300 - 500
(USD36.14 – 60.24) a month.
� Workers had to sign their names on both real and false pay rolls. But they were not
given any copy.
� The management would couch workers to give "correct" answers to auditors.
Occupational Safety and Health Conditions in Plant F1
� The Spraying Department
� Workers in this department said they did not know what chemicals were used nor
could they tell the hazards.
� The chemical smell at the work place was strong and there was a lot of paint dust.
� The carbon masks they wore would be filled with paint dust every one or two days.
But the management would only deliver new ones once a week.
� Workers used the gloved hand to hold the semi-finished toys and the other
un-gloved hand to hold the spraying machine. But the paint would still get onto
their skins and into their hands.
� They would wash their hands with thinner. The thinner had very strong chemical
smell but it washed the paint stains away very quickly. The supervisor told
workers that the thinner was not harmful to human beings. Their hands felt dry
after being washed with the thinner. They could not tell if the thinner was
hazardous.
� Workers had sore discomfort, felt dizzy and wanted to throw after being exposed
for long to the chemical paint.
� Noise pollution was another problem in the spraying department. Workers could
not talk to or hear each other when the spraying machines and the ventilation fans
were in operation. No ear protection was delivered.
� Work stress was strongly felt by the workers. Plant F1 workers were producing
plastic toy trains at the time of the investigations. The daily production quota was
4000 -5000 cars a day. Workers wanted to finish the quota as soon as possible
because they knew that they could not get any compensation for overtime work
101

and that they could not leave without finishing the quota.
� Besides the two lunch breaks, they did not have chance to take a rest. Their waist
and shoulders were stiffened and pained at the end of the day.
� In the latest body check-up, quite a number of workers were found to have
hepatitis B.
� OSH Infrastructure and Provisions at Plant F1
� There were fire drills at the work place and dormitories.
� No formal OSH training was offered to workers.
� Plant F1 did not have a specialized OSH department to address occupational
diseases and injuries.
� The interviewed workers did not know if they were insured or not.
� The management arranged for medical personnel to have body check-up for
workers every year. But workers had to pay for the fees.
� Anybody failed in the body check-up would be fired or "advised" to leave. No
compensation was given.
� There was a factory clinic and RMB5 (USD0.625) was deducted from their
monthly pay.
Workers' consciousness on the Labor Law and Related Regulations in Plant F1
The following is a statistical analysis on the legal consciousness of 10 interviewed
workers from Plant F1.
Questions
Do you know the legal minimum wage of the town
you are working in?
Do you know the working hours ceiling of the town
you are working in?
Do you know how much compensation you can get
if you have occupational disease or injuries?
102
Yes, I
know
I've heard of
it.
No, I don't
know
0 0 100%
0 0 100%
0 0 100%
Do you know anything about the Labor Law? 0 0 100%
Do you know anything about the Regulation on the
Protection of Women Workers?
Do you know anything about the Law on the
Protection of Teenagers?
0 0 100%
0 0 100%
Do you know anything about code of conduct? 0 0 100%
Do you want to get more information on OSH and
related training?
Yes, I do
70%
I have no
opinion
No, I don't
0

103
30%
A lot of the interviewed workers had primary education level, they knew almost
nothing about OSH and labor laws. The management was the only source of
information on such issues.
4. Words from Workers of Plant F1
� A female interviewee from the Furnishing Department, Xiao Li
"Our department did not have much work to do and that's why I got very low
wages. It is about RMB300 (USD37.5) a month. I cannot save even one penny
after working 3 months now. I don't know how the wages is calculated. If you go
to the line supervisor, the line supervisor would ask you to the floor supervisor.
The floor supervisor would then ask you to go the accountant. Anyway, you don't
get any where."
� A male interviewee form the Spraying Department, Xiao Ting
"The management told us to lie to auditors. They asked us to tell the auditors that
we had RMB800 - 900 (USD100 - 112.5) a month when we had only RMB300 -
400 (USD37.5-50) a month. They asked us to tell the auditors that we worked 8
hours and not more than 3 overtime hours a day when in fact we had more than 3
overtime hours everyday. They asked us to tell the auditors that we had four days
off in a month. The truth is we have never had a single day off for months now."
� Another male interviewee from the Spraying Department, Xiao Gor
" Our wages is low and the calculation of wages a mess. The supervisors and the
leaders were picking up things and yelling at people the whole day. We were not
treated as human beings. We had young female workers leaving because they
could not stand the yelling and language abuse. Even the security guards did not
respect us. They would use fists not just hands. And the factory would just turn a
blind eye. Anyway we are always wrong. The management had many ways to
give you a bad time. You would not be fired because they have to compensate you.
You would be told to "take a leave". But you can't go anywhere but you have
report duty at anytime they like. If you fail to do so, they have a good excuse to
fire you without paying any compensation."
Report on Plant F2 of Company F
9 workers from Plant F2 were interviewed. 4 of them were women and 5 were men.

There were three coming from the spraying department, 3 from the assembly
department and the other 3 from the pressing and other departments. In terms of age
distribution, 3 were under 20 years old and the other 6 were between 20-30 years old. 5
of them had served less than 1 year at Plant F2. 3 had served 1-2 years and 1 had served
2-3 years in Plant F2.
1. Working Conditions in Plant F2
� General
There were about 2000 workers in plant F2. Most of them came from An Hui,
Sichuan, QuiZhou provinces. The factory would recruit only 18 years or above.
� Wages
� Most of the interviewed workers did not know how their wages was calculated as
they did not know the unit price of the products.
� Workers were paid time rate during slack time. The hourly rate was RMB1.63
(USD0.33). The legal minimum wage of the second industrial zone was RMB440
(USD56.4) by the time of the interview. Based on the government reference of
20.92 working days a month, the minimum daily pay should be RMB21 (USD0.37)
and the minimum hourly rate should be RMB2.6 (USD0.34). Plant F2 was
delivering wages in violation of the local minimum wage.
� Starting form July 2001, workers from plant F2 were told that they would be paid
RMB440 (USD53) for their basic wages. Take the July wages as an example. The
management would ask workers to sign two sets of pay stuff. The wages written
on the false pay stuff was RMB 600 - 800 (USD72.23 – 96.39). But in fact
workers got only RMB200 - 500 (USD24.01 – 60.24) in July. Assembly workers
in July got even as low as RMB100 - 400 (USD12.05 – 48.19) because of less
orders being placed with the factory.
� Workers could appeal to nowhere if they found problems with their pay.
� Production workers did not have to punch the clock machine so they had no idea
how many hours they had worked.
� Working hours
� The pressing department had two shifts: 08:00-20:00 and 20:00-08:00. Each shift
had 12 hours. Deducting one hour for lunch, workers of the pressing department
had 3 overtime hours a day. They had RMB440 (USD53) as basic wage. The
overtime rate was RMB2.63 (USD0.32) an hour. An average of their salary was
RMB 600 (USD72.29) a month.
104

� For other departments in general, the working schedule was: 08:00-12:30
13:30-17:30. Overtime work started from 18:30 - 21:30. There were not many
orders by the time of the investigations. Workers were off their work at around
21:00. But if the orders were big, workers worked late till 24:00 or 26:00 and no
day off will be taken.
� The packaging and assembly department had the most "flexible" hours. They
worked without stop during peak season. They "took vacation" during slack time..
No wages would be delivered during the slack season.
� Food and lodgings
� RMB140 (USD16.87) was deducted for food each month. But the workers
complained that they were fed with vegetables and did not have much to eat. A lot
of workers would eat outside thus increasing their financial burden.
� Another RMB35 (USD4.22) was deducted for water and electricity at the
dormitory. 12 people stayed in one room.
2. OSH Conditions in Plant F2
� General OSH conditions
� There was an annual fire drill at the work place.
� Plant F2 did not have an OSH department to plan training, design engineering and
management control and document OSH related records.
� No OSH training was given to new workers nor were current workers provided
with relevant education.
� The factory provided an annual body check up to workers. Workers had to pay
RMB60 for it. But the body check up was more a screen test for the management
to fire physically unhealthy workers. Weak workers or workers found to have
failed in the body check up would be fired, advised to leave or take a long
vacation.
� In the body check up done in April 2001, a lot of workers were found to have
acquired hepatitis B.
� As the factory did not insure workers on health or industrial injury (nothing was
recorded on the pay stuff), it would be difficult for workers to claim their rights
when they found themselves to have acquired occupational diseases.
105

� The Spraying Department
� Some of the spraying workers said the chemicals had labels that listed the names
and components of particular chemicals. There were also warnings against using
thinner to wash stained hands. But no formal training on proper chemical usage
was given to workers.
� Since workers had to use their hand to paint small parts and joints, it would affect
the quality if they wore gloves. That's why workers in general did not wear
gloves.
� Workers thought that chemical exposure was the major source of hazards in this
department.
� The Assembly Department
� Workers had to work long hours of 11 or more a day, not including lunch hours.
� There was no break. Workers had to take permits to go to the washroom.
� Except for some sections, most of the assembly workers would not wear gloves
because that was inconvenient to their work.
� For the rest of the workers, they were not given any other personal protective
equipment.
� Workers identified work stress as the major source of hazards in this department.
Chapter 6 of the Chinese Labor Law states that it is the responsibility of the employers
to provide a safe and healthy working environment to the workers. In case hazards
were identified, the employers should take measures to remove or contain the hazards
by engineering and management control. Demanding workers to wear protective
equipment is a passive measure and it is easy for the employer to shift the responsibility
to the reluctance and negligence of the employees for not wearing the PPE.
� The Pressing Department
� Male interviewees said that new workers were instructed about how to use the
machines and other safety issues.
� The pressing machines were operated with two buttons. A safety instruction was
put up.
� Only workers working at particularly noisy sections were given ear protection.
� The dust level at the storage section was the greatest. Workers there wore eye
masks, ear protection and masks.
� High temperature was also a source of much discomfort especially during
summer.
� Workers in this department identified noise pollution and high temperature as the
106

main hazards.
3. Workers' Consciousness on the Labor Law and Regulated Regulations in Plant F2
9 workers from plant F2 were interviewed and an analysis is given as below.
Do you know the legal minimum wage of the town
you are working in?
Do you know the working hours ceiling of the town
you are working in?
Do you know how much compensation you can get
if you have occupational disease or injuries?
107
Yes, I
know
I've heard of
it.
No, I don't
know
30% 0 70%
30% 0 70%
0 0 100%
Do you know anything about the Labor Law? 105 20% 70%
Do you know anything about the Regulation on the
Protection of Women Workers?
Do you know anything about the Law on the
Protection of Teenagers?
0 10% 90%
0 10% 90%
Do you know anything about code of conduct? 55% 0 45%
Do you want to get more information on OSH and
related training?
Yes, I do
80%
I have no
opinion
20%
No, I don't
0
The code of conduct of McDonald's was posted. The interviews also showed that
workers claimed that they knew code of conduct and relevant labor laws. But as
commented earlier, knowing about code of conduct does not mean that workers are
empowered to make use of the codes to protect their rights. It takes more education,
both to the management and the workers to create an environment free of fear and
retaliation at the work place before the codes can be effectively implemented. As
regard training and education, most of the interviewed workers expressed an eagerness
to participate.
4. Words from Worker in Plant F2
� A male interviewee in the Spraying Department, Xiao Bei
"My wife used to work with me in the same department. She went back home to
take care of our child early this year when we did not have enough work to do and
our wages were too low. It is not any better now. I got only RMB200 - 400
(USD25 -50) left after deducting food and lodgings. I haven't sent money to my

family for 6 months now. Last year we had a stringent life and we were able to
save RMB1300 (USD162.5). We were so happy. But it was not so this year."
"I have started working here and there since 15 years old. I heard people saying
that you could earn more in Guangdong. But it was worse. I have worked for
three years in the spraying department, I always suspect that the paints are
poisonous. I have sore discomfort ever since I've started working in this
department."
"We never know how the wages is calculated. There is no pay stuff and no way to
check. We were given a table (of wages) to look at for a few seconds before
signing our names for claiming our wages. We get what they give us."
� A male technician in the engineering department, Xiao De
"The major client of plant F2 is McDonald's and a lot of things are stricter than
before. Of course every time when auditors from McDonald's come, the
management would "prepare" something. To speak the truth, no factory can get a
pass if the auditors really act strict”
108

III. 7) REPORT ON THE OSH & WORKING CONDITIONS OF
COMPANY G
The following report is structured as follows.
I. Company Information
II. General working conditions in Company G
III. OSH conditions in Company G
IV. Workers consciousness on Labor Law and related regulations
1. Company Information
Factory location: Second industrial zone, Shenzhen, Guangdong province
Ownership of Capital: South Korea
Production: OEM Plush toys for export
Clients: McDonald’s, Disney Park, Cega, Warner Brothers
7 workers from Company G were interviewed from July to September 2001.
II. Working Conditions in Company G
1. Long Working Hours
� The following is a one-week record of the long working hours in the sewing
department of factory G.
Sewing department of Company G from 8 – 13 July, 2001
8 July 2001 Overnight
9 July 2001 Overtime work till 2am
10 July 2001 Overtime work till 4am
109

11 July 2001 Overnight
12 July 2001 Overnight till 11am, 13 July
2001
� Workers were supposed to come back to work in the afternoon of 13 July 2001. It
was later called off by the management as no worker could get up and come back
to work after a week’s overnight work.
� The interviewed workers reported working an average of 150 – 160 over time
hours a month without day off during peak season. They could get one day off
during slack season. Company G has the greatest number of working hours
amongst the factories covered in this report. It exceeds about 2 times the national
limit on the number of working hours, which is 40 hours a week and not more than
36 over time hours a month.
� The electronic department also worked long hours till 2-3am in August 2001.
� Besides the 1.5-hour lunch break and the one-hour dinner break, workers had to
work continuously without any small break. The production schedule was highly
stressful and workers would be scolded or embarrassed by the supervisors for
going to the toilets for too long. Workers said many of them could not stand the
extremely long hours and wanted to quit their jobs.
2. Low wages
� Production workers in company G were not compensated for overtime work.
� 100 RMB (US$12.05) for food and 50RMB (US$6.02) for lodgings was deducted
per month.
� Case one: By the end of August 2001, an assembly worker got his July salary of
RMB788 (US$94.94), food and lodgings deducted. He worked for 26 days in July.
He had overtime work for 3 to 7 hours everyday (the earliest time he was off from
work in July was 9pm, the latest was 2am).
� The legal minimum wage of the second industrial zone of Shenzhen by the time the
interview was done was RMB440 (USD53). Take the government reference of a
20.92 working days per month, the daily minimum wage should be RMB21
(USD2.53) and the minimum hourly wage should be RMB2.6 (USD0.31). The
legal over time compensation rate per hour should be 150% of the normal hourly
rate, which is RMB3.9 (USD0.47). In a conservative estimation, let's take the
number of over time working hours as an average of 5 per day for 26 days in this
case. The over time compensation should be RMB513 (USD61.8). Adding that to
the legal minimum wage of RMB440, these workers should at least get RMB953
(USD114.8) in July 2001. Company G had violated the legal minimum pay and
the working hour limit of the local township.
� Workers also complained about errors in the calculation of hours and wages. The
110

hour record was the most complained about. Workers had less working hours on
their time record than the number they had actually worked. The clock machine
was adjusted to give a false record. For instance the punch machine would take
24:00 as 21:00. Workers were underpaid for their over time work and the
falsification would make verification difficult.
3. Contract and insurance
� The interviewed workers had signed contracts with the management but copies of
the contracts were not given to them.
� Only part of the workforce was insured for industrial injury. The proportion of
insured workers amongst the workforce could not be verified.
4. Code of Conduct
� Of the seven interviewed workers, only one interviewee (a non-production worker)
had heard about code of conduct. Most of the production workers did not know
anything about it. The interviewee said McDonald’s and Disney’s codes of
conduct were posted on the wall but nothing would be done about it not until an
audit was to take place. The management would falsify records and made other
arrangements for the audits and inspection.
Occupational Safety and Health Conditions in Company G
1. General Conditions
� The interviewed workers told the interviewers that the fire drills were just for
show to auditors and inspectors. Workers were more worried about possible fire
hazards associated with the storage of flammable stuffing materials at the work
place.
� The interviewees were also worried about their safety on their way to work.
Workers had to cross a road as they walked from their dormitory to the production
plant and that exposed them to car accidents. In the past, car accidents happened.
Cases of workers being knocked down by motor bikes on their way to work were
reported. The motor-cyclists left without compensating the injured workers.
Workers had reflected their concern to the management but the management
refused to take responsibility claiming that the accidents were not related to
production.
� However, it is stated in the Chinese Labor Law that the employer has to insure
workers for traffic accidents on the way to and from work. The employer has the
responsibility to ensure workers' safety and give them assistance when accidents
happen.
� The management practice of delivering wages to workers at night during the peak
111

season was another issue of concern. Such a practice exposed workers to high
risks of robbery.
2. Sewing Department
� No OSH training was given to workers.
� Long working hours leading to ergonomic problems was the major hazard.
Workers said the lower part of their bodies was stiffened and numb at the end of
the day. It felt like their legs were theirs no more. Their shoulders and necks were
pained and stiffened. Continuous overnight and long working hours was
extremely exhausting.
� A daily production quota was set and working hours would be deducted if they
could not hit the quota within the required time. Workers had to work overtime
without compensation till the quota was reached. Work stress was huge and this
coupled with long working hours was the biggest source of hazard in the sewing
department.
� Cotton gloves were delivered to the workers but most of the workers did not put
them on. What workers feared most was failure to reach the daily production
quota rather than safety and health hazards. Wearing gloves could slow down their
speed and failure to reach the production quota could lead to deduction of working
hours and lower wages. The management should review the production schedule
rather than just requiring workers to wear personal protective equipment.
� Workers in the stuffing department said the work place was dusty and the
ventilation poor. Temperature ran high during the summer peak season.
Worker Consciousness on Labor Law and Related Regulations
The following reports some statistical figures on the legal and OSH consciousness of 7
interviewed workers.
Questions
Do you know the legal minimum wage of the town
you are working in?
Do you know the working hours ceiling of the town
you are working in?
Do you know the amount of compensation you can
get if you are injured in an industrial accident?
Do you know anything about the Chinese Labor
Law?
112
Yes, I
know.
I’ve heard
about it.
No, I don’t
know.
0 0 100%
0 0 100%
0 0 100%
0 57% 43%
Do you know anything about the Regulations on the 0 0 100%

Protection of Female Workers?
Do you know anything about the Law on the
Protection of Teenage Workers?
113
0 0 100%
Do you know anything about code of conduct? 28 0 72%
Do you want to know more information and training
about occupational safety and health?
Yes, I
want.
100%
I have no
opinion.
0
No, I don’t
want.
0
� Amongst the interviewed workers, only one non-production workers knew about
code of conduct. According to them, the codes were posted on the wall but not
implemented during the time when no factory audit took place. The situation in
Company G shows how code of conduct is an exercise for the management only. It
could have no relevance to the workers. The working conditions, despite the
“implementation” of a code of conduct of McDonald’s and Disney’s, had not been
improved. Unless the workers are involved in the implementation and monitoring
of the codes, it remains as an empty piece of paper only.
� Workers from Company G showed a serious lack of OSH and legal consciousness.
The interviews found that all of them wanted to receive education and training on
OSH protection. They were not apathetic to their rights and safety and health if
they had the access to improving that.

III. 8) REPORT ON THE OSH & WORKING CONDITIONS OF
COMPANY H
The following report is structured as follows:
I. Company information
II. General working conditions in Company H
III. OSH conditions in Company H
IV. Workers consciousness on Labor Law and related regulations
I. Company Information
Company H is located in Dongguan City, Guangdong Province. Company H is a Hong
Kong investment. The production plant in China manufactures stuffed toys. Its chief
clients were McDonald's, Wal-Mart, Hello Kitty and Disney (not an official
licensee)
II. Working Conditions in Company H
Company H employed about 300 workers by the time of the visit. They come from
different provinces like Sichuan, Hunan and Quizhou etc. Most of the work force is
female. Workers are aged around 18 – 28.
I. Working conditions
(1) Low wages
� Wages for production workers were calculated on piece rate. No over time
compensation was paid.
� Workers were given no pay roll. They signed their names and got salaries from the
management. It was difficult for them to counter check their pay. And they had no
knowledge about the wage calculation.
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� Great wage variation was found between workers. Senior workers got as much as
RMB800 - 1000 (around USD96.39 – 120.48) while junior workers got as low as
less than RMB100 (USD12.05) after deduction of food and lodgings.
� Take the case of a male hole-maker who worked 19 hours everyday (not including
supper time) till 2 to 3am, and 7 days a week. He earned around RMB500
(USD60.24) a month. That means he earned less than RMB19 (USD2..29) for 19
hours a day and less than RMB1 (USD0.12) an hour.
� Another male hole-maker shared his example. He worked till 11pm every night in
May this year. What he got was RMB240 (USD20.9) after deduction of food and
lodgings.
� The legal minimum wage of Dongguan by the time of the visit was RMB400
(USD48.19). In both cases, the company had not given due over time
compensation to workers nor did the company pay the minimum wage.
(2) Delay payment of wages
� There was a 45-day lag in delivering wages to the workers. By the time we
interviewed the workers around end of July, workers just received their May
wages. This was to defer them from quitting the job at will. Workers said they
dared not run away no matter how hard it was at this factory because they did not
want to give up their held wages.
� New workers had to pay a down payment of RMB80 (USD9.64).
(3) Long working hours
� Workers started working at 7:30am everyday. The number of working hours
ranged from 13 to sometimes more than 20 hours a day. This is the situation for
most time of the year without a distinction of peak and low season. The "normal
working hours" was 9. The rest was counted as over time.
� Workers could have lunch and dinner time of one hour. That would be shortened
to half an hour when they had to meet the shipment date. Workers had to swallow
their lunch in couple of minutes and started working immediately.
� No other break was given between lunch break. Extremely long working hours
exhausted the workers. Work stress was great and workers had to get a permit to
go to the washroom.
� A time record kept from 9 - 13 August, 2001 showed that workers finished their
work from as "early" as 12:40am to as late as 04:00am. They came back to work as
usual the next day. Nobody had enough sleep. Faints were frequently reported at
the work place.
� Workers had to work long hours to hit the production quota set by the factory.
That ranged from 600 to 1000 pieces per day.
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� In terms of day off, only one day off was taken from June to August this year
meaning workers had worked consecutively for more than 100 days by the time
with any break.
(4) Living conditions
� Workers paid RMB60 (USD7.23) for food every month. But the interviewed
workers found that the food was unpalatable. RMB 20 (USD2.41) was deducted
each month for water and electricity.
� The factory had a 6-storyed dormitory. Eight double bunch beds were placed in
each room. Sometimes 2 people had to share the lower bunch meaning that at
worst 24 people would be squeezed in a room. Workers complained about the
over-crowdiness and poor living conditions.
(5) Social insurance and contract
� The interviewed workers had no idea whether they were insured or not.
� As found from the interviewed workers, a large part of the production workforce
did not have contract with the employer. For those that claimed they had signed a
one-year contract but they were not given any copies of it. If workers are not given
copies of the contracts and do not understand how the contract can protect them,
signing contract is just an exercise for auditors or government officials rather
than a guarantee of rights for workers.
(6) Taking leave
� Getting permission from the management to take leave was difficult. Workers that
wanted to go to the doctor had to squeeze their lunch time to do so.
(7) Penalty
� A fine was imposed if faults were found on products. It was the same for failing to
meet the daily quota. The interviewed workers did not understand well the scale
of punishment. The penalties further increased the work stress to the workers.
(8) Welfare
� Workers were not provided with any welfare or medical provision at all.
II. OSH conditions in Company H
1. The Hole-Making Department
� No training was given to the workers.
� A hole-making worker had to use his feet to press the hole-making machine to
make holes, while his hands were used to fix the semi-finished product in place.
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The worker had to coordinate both hands and feet well and with care. In case the
worker felt tired or was in bad conditions after long hours of work, his hands could
be easily pressed by the machine.
� The factory did not provide any iron gloves for the workers.
- The dust level (from stuffed materials and the surface of dolls) was high at
the work place. No mask of any sort was given to the workers. There was no
ventilation system except some fans and the air was stuffy. Workers would
have respiratory diseases or skin allergies being exposed to for long hours in
such a working environment.
2. Stress and long working hours
� Stomach problems were common amongst workers due to long working hours and
pressure from work.
� Other ergonomic problems such as stress and pain over the neck and shoulders
were common as they were required to perform repetitive movements for long
hours everyday.
� The interviewed workers were worried that long working hours weakened their
bodies. They caught diseases easily and would faint at work.
3. Fire Control
� There was no fire drill at the work place. The interviewed workers were not aware
of fire control measures. It is dangerous as the factory produces stuff toys and
workers could not tell if the storage of inflammable materials meet safety
standards. Long working hours that lowered the alertness of the workers further
increases the danger.
4. Medical provision and check up
� The factory never provided body check up for workers. Nor did they buy any
industrial accident insurance for workers.
5. A reported case of death
According to Hong Kong Commercial Daily's coverage (a Hong Kong newspaper)
on 17 April 2001, a female worker, Wang Cei Xiang was sick in the middle of her
work. She died the next day. "The labor regulations in that province (meaning
Guangdong province) is not strict enough. Some of the local departments stand by
the employers rather than the employee. Workers thus are maltreated by their
employers … their situation is apprehensive." (quoted from Hong Kong
Commerical Daily 17/4/2001)
Wang Cei Xiang, named in the above news coverage came from Quizhou province
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to work in this toy factory in Dongguan City, Guandong province, Wang was 27.
On 28 March 2001, Wang fainted at the work place. The factory management
refused to lend money to her younger brother for taking Wang to the doctor. Her
brother borrowed money from fellow workers and took her sister to the nearest
sanitation center (the medical people you find there are not registered). People at
the sanitation center suggested them going to the hospital. But that would cost
them at least several hundreds. Her brother had no other means to seek for
medical treatment. He planned to take her sister back home. To everybody's
shock, Wang died the next day in the bus as she was on the way home. Wang was
not taken for a check and her cause of death was not known. But her relatives all
related it to her job as she had been working long hours at the factory without
taking proper rest. The factory denied responsibility. At the intervention of the
Labor Bureau, the factory management agreed to pay RMB11,000 (USD1375) to
the family. Her case was not considered as a case of industrial death.
We cannot verify the cause of death in Wang's case. But Wang's case was reported in
both the Hong Kong newspaper and the local media. In the first place, Company H did
not provide a safe and healthy working environment to its workers. When Wang fainted
at the work place, the management did not provide any assistance or medical provision
to her. Wang could not get access to any medical or financial resources. After Wang’s
death, the management did not investigate the case acting both in detriment to the
rights and interests of both Wang’s family and the rest of the employees in Company H.
Not knowing how to claim their legal rights, Wang’s family could just accept what the
management offered.
Wang’s case is a grave example of labor rights violations in Company H. Wang’s death
should be an alarm to all the manufacturers and the trans-national toy companies that
negligence of safety and health issues, long working hours can lead to grave
consequences.
III. Legal and OSH consciousness of workers in Company H
� Worker’s OSH and legal consciousness was low in company H. The interviewed
workers heard nothing about the national labor law or relevant regulations
protecting workers and women’s rights. They did not know what code of conduct
was. The legal knowledge of workers in Company H is the poorest amongst all the
companies covered in this report.
� Regarding OSH, the interviewed workers could not tell whether their deteriorated
health condition was related to their work or not. They did not know their rights to
compensation if they had acquired occupational diseases or injured in industrial
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accidents.
� Workers in Company H were exhausted by working excessively long hours and
receiving low wages. They did not have the space to care about anything.
However after the interview, all the interviewed workers expressed a strong desire
to learn more about their legal rights and OSH related training.
IV. Comparison on Company Codes of Conduct, the ICTI Code of
Business Practice and the Chinese Labor Law
The following table lists the relevant sections on safety and health of the company code
of conduct (or ethical business principles) of the four brand name toy companies,
namely Hasbro, McDonald's, Mattel and Disney, that are covered in this report. The
safety and health sections of the International Council of the Toy Industry's (ICTI)
Code of Business Practice as well as the Chinese Labor Law also are enlisted to
compare with the company codes.
Table on the comparison of company codes, ICTI - COBP and the Chinese Labor Law
Hasbro, Inc.
Global Business
Ethics Principles
McDonald's Co.,
Code of Conduct
for Suppliers
Mattel,
Global
Manufacturing
Principles
4. Health and Safety
Employers shall operate their facilities (and, where provided,
dormitory living facilities) in such a way as to ensure that all
employees have a health and safe environment. Hasbro and its
suppliers and business partners will work together to promote an
awareness of health and safety issues, including issues surrounding
fire prevention, emergency evacuation, proper use of safety
equipment, basic first-aid and the proper use and disposal of
hazardous waste materials.
Workplace Environment
Suppliers shall provide their employees with safe and healthy
working and, where provided, living conditions. At a minimum,
potable drinking water, adequate, clean restrooms, adequate
ventilation, fire exits and essential safety equipment, an emergency
aid kit, access to emergency medical care, and appropriately lit work
stations must be provided. In addition, facilities be constructed and
maintained in accordance with the standards set by applicable codes
and ordinances.
7. Workplace Safety
a. There must be trained or certified safety professionals and a
written safety program must be developed.
b. Combustible materials must be properly handled with special
precautions taken in spraying and mixing areas.
c. Machines with revolving or moving parts must be guarded and
employees will receive special training on the use of this
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The Walt Disney
Company,
Code of Conduct
for
Manufacturers
International
Council of Toy
Industries
(ICTI),
Code of Business
Practices
(revised 8 June
2001)
machinery.
d. Hazards must be eliminated where possible. Employees must be
provided and trained on the use of Personal Protective
Equipment where hazards cannot be fully eliminated.
e. Mattel will identify all hazardous materials and properly train
employees on the appropriate procedures for handling these
materials.
f. Safety training must be conducted for special work categories
(industrial trucks, electricians, maintenance, painters, molding
operators, etc.)
g. Employee exposure to chemicals and vapors must be below
legal requirements or Mattel Standards whichever is the most
stringent. In special cases where ventilation cannot eliminate the
exposure, respiratory protection will be used and employees
trained.
h. All accidents must be investigated and corrective actions
documented.
i. All locations must continuously reduce accident rates and have
specific targets on reductions.
8. Health
a. In locations where there are more than 1000 employees, there
must be an on site medical facility for routine medical treatment
and work-related injuries. In locations where there are less than
1000 employees treatment must be available to employees
within 15 minutes if there is not a clinic on site.
b. The facility must have lighting which meets Mattel's standard or
local requirements, whichever is higher.
c. Temperatures must be measured during hot and cold seasons
and if they exceed local or Mattel standards corrective actions
must be taken.
d. Noise must not exceed 85dBA. Hearing protection must be used
in any areas that exceed this limit. If the local limit is lower, the
lower limit will be used.
Health and Safety
Manufacturers will provide employees with a safe and healthy
workplace in compliance with all applicable laws and regulations,
ensuring at a minimum reasonable access to potable water and
sanitary facilities; fire safety; and adequate lighting and ventilation.
Manufacturers will also ensure the same standards of health and
safety are applied in any housing that provide for employees.
2. Workplace
a. that toy factories provide a safe working environment for their
employees and comply with or exceed all applicable local laws
concerning sanitation and risk protection;
b. that the factory is properly lighted and ventilated and that aisles
and exits are accessible at all times;
c. that there is a adequate medical assistance available in
emergencies, and that designated employees are trained in first
aid procedures;
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People's
Republic of
China, Labor
Law
(1995)
d. that there are adequate and well-identified emergency exits, and
that all employees are trained in emergency evacuation;
e. that protective safety equipment is available and employees are
trained in its use;
f. that safeguards on machinery meet or exceed local laws;
g. that there are adequate toilet facilities which meet local hygiene
requirements, and that they are properly maintained;
h. that there are facilities or appropriate provisions for meals and
other breaks;
i. if a factory provides housing for its employees, it will ensure
that dormitory rooms and sanitary facilities meet basic needs,
are adequate ventilated and meet fire safety and other local laws;
j. that no metal or physical disciplinary practices are employed.
Chapter VI: Occupational Safety and Health
Article 52 The employing unit must establish and perfect the
system for occupational safety and health. Strictly implement the
rules and standards of the State on occupational safety and health,
educate laborers on occupational safety and health, prevent
accidents in the process of work, and reduce occupational hazards.
Article 53 Facilities of occupational safety and health must meet the
standards stipulated by the State. Facilities of occupational safety
and health installed in new projects to be rebuilt or expanded must
be designed, constructed and put into operation and use at the same
time as the main projects.
Article 54 The employing unit must provide laborers with
occupational safety and health conditions conforming to the
provisions of the State and necessary articles of labor protection,
and provide regular health examination for laborers engaged in
work with occupational hazards.
Article 55 Laborers to be engaged in specialized operation must
receive specialized training and acquire qualifications for such
special operations.
Article 56 Laborers must strictly abide by rules of safe operation in
the process of their work. Laborers shall have the right to refuse to
operate if the management personnel of the employing unit
command the operation in violation of rules and regulations or force
laborers to run risks in operation; laborers shall have the right to
criticize, report or file charges against the acts endangering the
safety of their life and health.
Article 57 The State shall establish a system for the statistic, reports
and dispositions of accidents of injuries and death, and cases of
occupational diseases. The labor administrative departments and
other relevant departments of the people's governments at or above
the country level and the employing unit shall, according to law,
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Comments:
compile statistic, report and dispose of accidents of injuries and
deaths that occurred in the process of their work and cases of
occupational diseases.
1. Hasbro's Global Business Ethics Principles
� The Hasbro code on health and safety is weak and vague. Hasbro commits only to
"work together to promote an awareness of health and safety issues" with its
business partners. To promote a health and safety awareness is just a preliminary
step. The company has not committed to remove or eradicate safety and health
hazards that are identified in the production facilities of its vendors.
� The Hasbro code has set no standard on safe production and healthy working
environment.
� The commitment of Hasbro to its vendors/suppliers is not clear. As the section on
safety and health puts it, "manufacturers shall operate facilities in such a way
as…", Hasbro does not demonstrates any pro-active commitment to assist its
vendors/suppliers to achieve the safety and health goal.
2. McDonald's Company Code of Conduct for Suppliers
� The McDonald's code has set a minimum standard on a number of items like
"potable drinking water, adequate, clean restrooms, adequate ventilation, fire exits
and essential safety equipment, an emergency aid kit, access to emergency
medical care and appropriately lit work stations." These could be understood as
minimum standards to the manufacturing industry but not specific to the hazards
of toy production. There is no provision on how to remove or control hazards
related to the toy industry.
� The commitment of McDonald's to the suppliers is not clear as it is written that
"suppliers shall provide their employees with safe and healthy working and, where
provided, living conditions." It largely shifts the responsibility to the suppliers.
And that commitment to safety and health is the commitment of the suppliers to
their employees not that of McDonald's to its suppliers together with their
employees.
3. Mattel's Global Manufacturing Principles
� Compared with the other company codes, Mattel has the most comprehensive
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standards on the safety and health of toy production.
� Standards are set for specific hazards associated with toy production. Hazardous
areas like chemical exposure, embustible material storage and machinery
safeguards are covered. Standards are set on medical provisions, lighting,
temperature and noise pollution.
� Mattel's GMP includes a program that has different components in establishing a
procedural approach to meet the safety and health standards and to reduce accident
rate. These include a written safety program, safety professionals, identification
of hazards, elimination of hazards, use of protection equipment, training,
investigation and documentation.
� The training component in Mattel's GMP covers the not only the safety personnel
or professionals, but the employees of the suppliers at large (see 7c, 7e, 7f and 7g).
� What needs further clarification and programming is the target of Mattel's
commitment. Different from the other three companies, Mattel owns its
production facilities as well as contracts production with vendors or suppliers.
Mattel defines the GMP "to guide Mattel and each of its business partners'
operations in implementing GMP." And "Mattel will work closely with all
business partners to ensure that corrective actions are completed in a timely
manner." (provision 11). Mattel commits to act in a pro-active manner, to
implement the safety and health standards not only of its own facilities but also its
vendors/suppliers'. In provision 7e, the company makes further commitments as
"Mattel will identify all hazardous materials and properly train employees on
the appropriate procedures for handling these (hazardous) materials." Yet it
is not clear if this strong commitment to training is applicable only to the
employees of Mattel's own facilities, or that it also commits the company to
training for the employees of its vendors and suppliers. No program or
information is publicized with regard to the implementation and the applicability
of the above training commitment.
� The Mattel Independent Monitoring Council (MIMCO) has defined a program in
phase to monitor Mattel's own as well as its vendors/suppliers' facilities. It should
be emphasized that monitoring is one component only. HKCIC shares with
Trocaire and the Irish Congress of Trade Union's comment on MIMCO audits that
"there must be worker ownership of the aims, process and outcome of monitoring.
Worker empowerment must be part of the process and the aims of the
monitoring initiative. A necessary part of acceptance of this principle is that
successive amendments or even a future redraft of the GMP by workers and their
representatives, Mattel management, the monitoring council and labor rights
organizations may be necessary to transfer ownership to all key stakeholders."
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(January 2000).
� HKCIC holds the position that the principle of workers' participation and the
multi-stakeholder approach should be applied not only to Mattel, but all other
companies, in the implementation, monitoring and training on company code of
conduct. The worker participation and multi-stakeholder element should be
integrated into Mattel's monitoring and training component.
4. The Walt Disney Company's Code of Conduct for Manufacturers
� The health and safety section of Disney's is weak and not specific to toy
production. References are made only to the provision of potable water, sanitary
facilities, fire safety, lighting, ventilation and housing only. No standard or
program is defined in specific to controlling the hazards of toy production without
which it raises doubt to the implementation of such a loose and non-specific health
and safety code.
� Similar to Hasbro and McDonald's, the Disney code is written in a manner that
shifts the responsibility of providing safety and health conditions to the
manufacturers only. By using language such as "manufacturers will provide",
"manufacturers will also ensure that", responsibility and commitment becomes
that of the manufacturers to their employees only. Disney's commitment first to
the manufacturers and second to the employees vanishes behind the rhetoric.
5. The ICTI Code of Business Practices
� The ICTI - COBP is weak and not specific to hazards commonly found in toy
production. No standard on the safe operation of the industry is set. The
provisions covered largely concern sanitation, housing, food provision and other
living conditions. Whereas provisions on emergency exits, safety equipment and
machinery are general and not targeting at specific risks and hazards associated
with the manufacturing of toys.
� There is no program goal nor is there an approach defined to guide the industry in
identifying, eliminating and containing hazards and providing protective
equipment to employees.
� The training component, which is essential to effective implementation of safety
and health principles, is totally absent in the ICTI - COBP.
� The ICTI - COBP has no position that would include workers' participation at any
level. The importance of workers education and workers participation has no
place in the ICTI - COBP.
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6. The Labor Law of the People's Republic of China
� The OSH section of the PRC labor law states a systematic approach to achieving
safety and health at work. It requires that "the employing unit must establish and
perfect the system for occupational safety and health." Employers are required to
implement the standards, prevent accidents, reduce hazards and educate laborers
on safety and health.
� Regular health examination for employees engaged in work with occupational
hazards is required.
� The law also gives employees the right "to criticize, report or file charges
against the acts endangering the safety of their life and health." The right to
disobedience is protected as "laborers shall have the right to refuse to operate if
the management personnel of the employing unit command the operation in
violation of rules and regulations or force laborers to run risks in operation."
� It is in the spirit of the OSH section of the Chinese Labor Law to involve
employees in monitoring and participating in the OSH policy and program of the
employing unit. The law requires both a top down and bottom up approach to
achieving safety and health standards at the work place.
7. Concluding remarks
� It can be seen from this comparison that there are variations amongst different
company codes and institutional standards on OSH issues. The company codes of
Hasbro, McDonald's and Disney are weak and non-specific to toy production and
the language is vague and misleading as they sound more like protecting the
company rather than the employees of the vendors/supplier/manufacturers. The
responsibility of the companies to their vendors/suppliers/manufacturers should
be stated in unambiguous language.
� All the four companies should state clear a pro-active approach that commits to
assist in more substantial terms their vendors/suppliers/manufacturers in
implementing their respective codes. This is of essential importance as in this
report it is shown that the industry has structural problems, particularly regarding
pricing and delivery time that contribute to non-compliance, rather than
compliance, to labor rights and OSH code provisions. Toy companies should take
the initiative to address these fundamental problems before any labor or OSH
principles can be implemented in full.
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� The ICTI - COBP does not play the role of setting OSH standards for the toy
industry. No program is defined to guide the industry in implementing the labor
and OSH principles. More importantly, the ICTI should take the lead in turning
the industry towards a worker-oriented approach to the implementation of labor
and OSH principles. The principle of workers' participation and workers'
education should be integrated in such an approach.
� The codes of conduct of all four toy companies as well as the ICTI - COBP
commit to comply with national labor laws. The spirit of workers' participation
that underlies the Chinese Labor Law should be upheld in the local application of
these codes. Programs on workers' monitoring and workers' education should be
properly drawn in the implementation program of these companies and
institutional codes in mainland China.
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V. Concluding Remarks
This report has illustrated the following issues regarding the toy industry:
1. Hasbro, McDonald’s, Mattel and Disney, are selling their toy products by
sub-contracting production to toy companies and operation facilities in mainland
China, many of them are owned by Hong Kong toy companies.
2. The four trans-national toy companies dominate the global toy industry. The
measures taken up by the four giants to stay competitive in the global market,
namely price to the bottom, just-in-time delivery and inventory control, are found
to be adversely affecting the working ass well as safety and health conditions of
the mainland workers of their suppliers.
3. The findings of this research raise serious doubts on the effective implementation
and monitoring of the company code of conduct or ethical business principles of
Hasbro, McDonald’s, Mattel and Disney at the supplier level. The four companies
have weak codes on safety and health.
4. To improve the working conditions at the supplier level, the four companies
should take the lead in re-engineering their global sourcing practices towards one
that sustains code implementation and one that respects the labor rights of the
production workers.
5. To improve the safety and health issues, it is important that workers be involved
and education and training be given.
The Hong Kong Christian Industrial Committee demands that, both the toy companies
and their suppliers,
1. Develop both long and short term plan of corrective actions, to address and
eventually eliminate the occupational safety and health hazards found at the work
place.
2. Comply with the Chinese Labor Law and improve the working conditions of toy
workers.
3. Set up occupational safety and health committees with workers representation and
participation at the factory level to monitor the safety and health conditions in the
manufactures of toys.
4. That the Toy Manufacturers' Association and the Hong Kong Toy Council develop
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a plan of occupational safety and health education that aims at improving the
consciousness of toy workers towards safety and health issues, as well as their
legal rights. Such a platform should be open to NGO participation.
Mr. Alan Hassenfeld, Chairman and CEO of Hasbro Inc., said in the World Economic
Forum’s Annual Meeting at Davos in 2001, “With the internet and globalization,
everybody is able to find out what is wrong with your business. So if you have
something to hide you’d better correct it really quickly.” We totally agree with Mr.
Hassenfeld’s words as well as his openness in accepting, de facto, the monitoring of
multinational companies by the mutli-stakeholders.
It is time for the four toy giants, namely Hasbro, McDonald’s, Mattel and Disney to
move beyond rhetoric. They should take the lead to create a more hospitable
environment for the implementation of their codes at the supplier level. They should
involve not only the suppliers, but workers and local labor groups in a
multi-stakeholder approach in improving the working as well as safety and health
conditions and consciousness of toy workers in mainland China.
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Appendix
Questionnaire on the Occupational Safety and Health Conditions and
Consciousness of Toy Workers in Foreign Invested Enterprises in Mainland
China
Hong Kong Christian Industrial Committee
August to October 2001
Part One - Personal Particulars
Name of interviewee:
Sex:
Date of Birth:
Name of factory worked in:
Date of employment:
Department worked in:
Employed as:
Duration of employment:
Monthly wages:
No of working hours a week:
Part Two - OSH conditions at the work place (according to department)`
Molding Department
� Is there any occupational training on machine operation upon employment?
� Is there any written safety instruction on the machine you operate? Do you
understand it?
� Is the molding machine a one-button or two-button operation?
� Is the work place noisy when machines are in operation? Are you provided with
ear protective equipment? Do they work?
� Are you aware of cases of machine injury? Does the department keep a record on
that?
� Does work place have a high dust level? Is there a ventilation system? Does it
work?
Spraying Department
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� How much do you know about the chemical paints you are using? Can you tell the
hazards of these chemicals?
� Are you informed or trained about what chemicals are used and what are their
hazards?
� Do you wear any personal protective equipment when you spray paints? Does the
paint get into any parts of your body during work?
� How do you cleanse the paint that gets onto your body? Do you use thinner or
other solvents? Can you tell their names?
� Can you describe the smell of the chemical paints you use? Do you wear any mask?
What of masks?
� Is there a ventilation system at the work place? Is it effective to lessen the
chemical smell at the work place?
� How long have you worked at this department? Have you ever developed the
following illnesses: allergy, skin diseases, respiratory problems, dizziness?
� Are you aware of cases of occupational diseases related to chemical poisoning in
this department?
Assembly Department
� Were you given occupational training when you were employed?
� How long do you have to stand during work in a day? Are there any break other
than the two lunch breaks?
� Which part(s) of your body has developed sickness or suffered from injuries since
working in this department? What kind of body exercises/muscles movement
does your job require you to perform?
� How noisy is the work place? Are you provided with personal protective
equipment?
� Does your job require you to touch chemicals? Do you know the chemicals or
solvent you are using? Do you wear any protective gloves?
� How much do you understand the hazards of the following chemicals: thinner,
acetone, benzene?
� Is the work place dusty? Is there a ventilation system installed? How effective is
it?
� What is the daily production quota in this department during peak season? What
happen if you fail to beat the quota? Have you developed any stress-related
illnesses?
Sewing department
� Have you received any occupational training before or after employment?
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� How long do you have to sit working a day? Is there any break besides the two
lunch breaks?
� Which part(s) of your body has developed sickness or suffered from injuries since
working in this department? What kind of body exercises/muscles movement
does your job require you to perform?
� Is it too dark or too bright at your work place? Do you have any eye or body stress
after a day's work?
� What is the daily production quota in this department during peak season? What
happen if you fail to beat the quota? Have you developed any stress-related
illnesses?
General OSH conditions
� Are there fire rehearsals at the work place and in the dormitories? How often?
� Do you know how to get to the fire exits when a there is a fire?
� How high is the temperature at your work place? Can you get access to water and
drinking water during work?
� Are you aware that chemicals or flammable materials are stocked at the work
place or in the dormitories?
� What do you think is the biggest hazard(s) at your work place?
� Do you have an OSH department or committee in this factory?
The OSH related policy of the factory
� Does the management provide body check-up for employees? How often?
� Does the management pay for injuries or occupational diseases related to work?
In full payment?
� Are workers in this factory insured on occupational diseases and injuries?
� Does the management sign contract and give a copy to workers?
Part Three - OSH consciousness of workers
� Do you think the personal protective equipment provided by the factory is
adequate or working? Why is it not working?
� Do you wear protective provisions during work? If not, why?
� If you feel sick, what do you do? How much is the body sickness related to work?
� Can you tell the minimum wage and the maximum working hours of the city/town
you are working in?
� If you have acquired occupational diseases or injuries, do you know how much
compensation you are liable to get according to law?
� Have you heard of the Labour Law?
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� Have you heard of the Regulation on the Labour Protection of Female Workers?
� Have you heard of the Law on the Protection of Teenagers?
� Have you heard of code of conduct?
� Do you want to get more information or training on OSH issues related to your
work?
End
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