This is not the first time Students & Scholars Against Corporate Misbehavior (SACOM) reports on the violations of basic workers rights found at Walmart and Disney supplier factories, and International Council of Toy Industries (ICTI) certified factories. It is a big shame that these organizations, given the enormous amount of resources they have, do not perform effectively to monitor their suppliers and certified factories, and actually, by being incompetent in monitoring and helping factories to improve, they allow abuse of workers rights to continue, or even worse still, become a normal and commonplace practice.

In the past six months, SACOM researchers have paid several visits to two factories, Sunny Toys (Shenzhen) Co. Ltd. and Dongguan Crown-Ace Toys Company Ltd.,which are both certified by ICTI, and producing for Disney and Walmart. Unsurprisingly, in the supply chain of Walmart and Disney, SACOM found the following violations of basic workers rights:

excessive overtime up to 160 hours a month, with overnight work, more than four times of the limit stipulated in the Chinese Labour Law

– no overtime premium

no rest day in a whole month, or only 1 or 2 days in a month

– forced and unfair deduction for housing and food from workers not living in dormitory

– punitive fines

– lack of proper social insurance for workers

– sex discrimination in recruitment

– basic health and safety problems

– ineffective worker representative mechanism or union

– child worker

– deceptions in audits

The above are in blatant violations of the labour laws in China. They are also systematic management issues which led SACOM to wonder, what Walmart, Disney and ICTI have been doing in their corporate social responsibility program to monitor these factories? The companies arrange audits to monitor their supply chains, but the quality of these audits are highly questionable and unable to discover the violations happening to workers in reality.

On 10 July 2010, it was reported in the South China Morning Post that, the Vice President of ICTI CARE Foundation’s Asian operations, spoke at a seminar that “bribery and wages are not the only problems…We have found child labour cases every month.” However, when SACOM and Stop Toying Around wrote to the governance board of the foundation, asking for more relevant information on the bribery, wage and child labour issues, ICTI refused to provide concrete figures about the violations it has found. The information is also missing in its recently published biannual report. SACOM regrets the lack of transparency of ICTI and its attempt to cover up the real magnitude of the labour rights violations in toy industry in China.

Full report is available here.