Did Dreams Come True? Workers still live in fear of occupational injury

Workplace Injury Still Found in Chinese Supplier to Disney and Tesco

A Chinese factory that supplies products to Disney and Tesco were found to have violated local labor laws due to its practices such as forcing employees to work excessive amount of overtime with a serious lack of workplace security.

• Employees are required to work for 13.5 hours per day during peak seasons between January and February. Employees are at the factory for at least 96 hours per week while working for at least 81 hours with mandatory overtime on Saturdays and sometimes on Sundays.
• Overtime work hours per month are more than 100 hours and up to 130 hours which well exceed the permissible overtime hours stipulated by the 1995 Labor Law in China.
• Employees are paid as low as $0.66/hour.
• In the Yiuwah factory, machines are not subject to regular maintenance.
• CLW found a case of work-related injury. In March 2010, an employee wounded her finger when operating a machine and the distal phalanx of her finger was crushed. The employee did not receive proper medical treatments for the crush injury.
• The factory does not educate employees on occupational health and safety.
• The factory withholds employees’ ID cards for 3 days upon recruitment in direct violation of Chinese law.
• Many workers at the factory do not have social insurance.

Through in-depth investigations of labor practices, China Labor Watch (CLW) found a series of labor rights violation at the factory, Yiuwah Stationary. Investigators of CLW found a lack of compliance with pertinent Chinese labor laws at the factory on aspects of excessive overtime hours, a serious lack of workplace safety, ignorance of occupational health, and a lack of training and health examination. Some of the practices fail to meet the ethical standards adopted by Disney and Tesco.

Based in Guangdong Province, China, Yiuwah Stationary is a supplier factory of Walt Disney Company, Tesco PLC and other companies. It produces paper goods such as greeting cards, notebooks, posters and calendars and exports it products to Europe, Americas and Asia.

Contact: China Labor Watch 212.247.2212

Executive Summary

After conducting a follow-up investigation of Yiuwah Stationary through offsite interviews, China Labor Watch (CLW) found a lack of compliance with pertinent Chinese labor laws on issues including overtime hours, social insurances and workplace safety. CLW urges Yiuwah Stationary and companies which outsource to Yiuwah, such as Walt Disney Company and Tesco PLC, to further implement effective remediation plans to address these issues.

This investigation report is a summary of follow-up of an initial investigation conducted in April 2009. In response to a deadly accident where an under-aged laborer was crushed to death while operating a cutting machine on April 5, 2009, CLW conducted an in-depth investigation of Yiuwah Stationary’s labor practices. In that investigation, CLW found that child labor is a widespread problem and that ignorance of work safety creates huge risks to occupational health and safety. Additionally, workers face inhumane treatments concerning excessive work hours, extremely low salaries and poor accommodation conditions. After the publication of the report, CLW wrote open letters to Disney and Tesco respectively. Tesco did not respond. Disney investigated working conditions in Yiuwah and reported progress of improvements through open letters. According to the findings of CLW’s follow-up in-depth investigations, Disney’s remediation plan has made noticeable progress and yet has also failed in many ways.

Through offsite interviews with workers of Yiuwah Stationary, CLW found

• The employer retains workers’ ID cards for 3 days upon recruitment; in direct violation of Chinese law.
• No health examination or effective training was provided before workers were assigned to posts requiring workers to operate machines or face occupational hazards.
• During peak seasons between January and February, employees are at the factory for at least 96 hours per week while working for at least 81 hours with mandatory overtime on Saturdays and sometimes on Sundays.
• Employees are paid as low as $0.66/hour.
• Many workers do not have social insurance.
• Maternity leave is sometimes denied.
• A case of workplace injury was found during the investigation.
• Machines are not subject to regular maintenance.
• Dormitory conditions are poor, with each room housing 10-14 workers on average.
• Approval for resignation can be delayed for up to 2 months during peak seasons.

In comparison with working conditions found by CLW in April 2009, improvements were made regarding age limits, the signing process of labor contracts, overtime wages, working overtime on holidays, paid annual leave and refunds of monthly meal plans. However, Yiuwah did not effectively address the problem of workplace safety, which was a direct cause of the deadly accident of April 2009. In addition to a lack of workplace safety, conditions regarding excessive overtime hours, low salaries and poor dormitory conditions were not improved. Many of the practices do not conform to pertinent labor laws in China, nor do they conform to the ethical standards adopted by Disney or Tesco. CLW urges Disney and Tesco, in collaboration with Yiuwah, to further implement effective remediation of non-compliance and unsatisfactory working conditions.