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Children Exploited by Kathie Lee/Wal-Mart

April 29, 1996  |  Share

Democratic Policy Committee Congressional Hearings
Chaired by
The Honorable George Miller

"The Power of Consumer Choice:
Can It Change Corporate Behavior on Labor and the Environment"

Testimony of Charles Kernaghan
National Labor Committee



Children Exploited by Kathie Lee/Wal-Mart

In 1995, Kathie Lee clothing was produced at the Global Fashion plant in Choloma, Honduras. The clothing was exported to the U.S. for sale exclusively at Wal-Mart. At the time the Kathie Lee clothing was being produced, I estimate that over ten percent-approximately 100-of the workers employed at Global Fashion were young teenaged girls, thirteen, fourteen and fifteen years old.

Conditions at the Global Fashion factory were not good. Thirteen year old girls were forced-along with everyone else-to work extraordinarily long overtime hours, most frequently from 7:30 in the morning to 9:00 at night, Monday through Friday. Occasionally, these young women were obligated to work, sewing Kathie Lee clothing, straight through the night until 5:00 a.m. the next morning. A 75-hour work week was not uncommon.

Because of the forced overtime to meet the rush to complete orders, the children were not permitted to attend night school, where from 6:00 p.m. to 10:00 p.m. they could have been studying to complete their grammar school educations.

Along with the minors, pregnant women were also forced to work these grueling shifts, on their feet 15 ½ hours, often in extreme heat pressing Kathie Lee clothing in preparation for export to the U.S. As you can imagine, mothers employed at Global Fashion, working these 75-hour weeks, had no time to be with their children.

Like many assembly plants offshore, Global Fashion was and is a humiliating place to work. The women-about 80 percent of the sewers are women, the majority of them very young-need to raise their hand to receive permission to use the bathrooms, which are kept locked. Bathroom privileges are limited to two visits per day, once in the morning and once in the afternoon. It is prohibited for the women to speak with each other during work. The women are physically searched on the way into the factory since the company does not want them bringing in candy or snacks, which they say will stain the fabric, or impede the girls' concentration on their work. There is a lot of screaming by the supervisors for the women to work faster and faster.

Nor do the women at Global Fashion earn enough to support themselves and their children. The base wage at Global Fashion was $0.31 an hour; however, with an "attendance bonus" included, the hourly rate averaged $0.39. Working a full 44-hour work week, the women earned $17.18, or $74.45 per month, which, according to Honduran human rights organizations, provides only 25 percent of the basic cost of living for a poor family.

These women are being unjustly exploited. At Global Fashion, 65 women on a production line sewed 800 pairs of Kathie Lee pants in eight hours. These Kathie Lee pants then sold at Wal-mart for $19.96. This means that in a single day, the 65 women sewed $15,968-worth of Kathie Lee pants (800 x $19.96 = $15,968), while receiving collectively only $203 in wages ($0.39/hour x 8 = $3.12; $3.12 x 65 = $202.80.) The wages left behind at Global Fashion by Kathie Lee and Wal-Mart amount to only one percent of the sales price of the garment. For each $19.96 pair of Kathie Lee pants the women sew, they received only 25 cents in wages!

The women told me that they are frequently shortchanged of their proper overtime pay, as well as on their maternity benefits. The mothers working at Global Fashion do not make enough to feed their children properly. Meat or chicken is definitely outside what they can afford. Infants are fed sugar water since milk is too expensive.

And even these pitifully low wages are being driven down by inflation. Honduras suffers the worst inflation in Central America. In 1994, inflation ran at 28.9 percent while in 1995 it was 26 percent. As a consequence, real purchasing power of maquila wages in Honduras has been seriously undermined. At the same time that inflation has slashed real wages, a  44 percent currency devaluation has made it cheaper for U.S. companies to contract Honduran labor. (From the beginning of 1994 to the present, the lempira has dropped in value from 6.20 lempiras to the U.S. $1.00 to 10.98 lempiras to the dollar.)

Nor does Global Fashion provide its workers with health care, despite the fact that for $0.03 or $0.04 an hour, the company could provide its employees and their children with entirely free health coverage, including all medical consultations, medicines and full hospitalization. (Available through the public Social Security Institute, which costs the employer 7 percent of payroll.)

Further, Article 142 of the Honduran Labor Code stipulates that factories must provide supervised day care facilities for all employees' children three years of age and older. Global Fashion has no day care facilities.

Global Fashion has hired at least four armed guards, who are used to intimidate the young women. Every attempt by the young women to meet to learn their legal rights is disrupted. Every attempt by the women to organize themselves to defend their most basic human rights has been met with threats and illegal firings.

Such violations of children's and women's rights are not just limited to Global Fashion or to Honduras. It has been demonstrated again and again that similar conditions prevail in assembly plants across Central America, Asia and beyond.

Recently, Wal-Mart said it confirmed our findings and would "blacklist" Global Fashion. But this is no solution. The solution is not in taking Kathie Lee work out of Honduras. These young women need jobs, just as the U.S. people do. But these jobs must respect basic internationally recognized human and workers' rights.

We call upon Kathie Lee and Wal-Mart to clean up these sweatshop conditions.

What a profound difference it would make in the lives of tens of thousands of poor, struggling families if Kathie Lee and Wal-Mart stated publicly that never again would Kathie Lee clothing be made by exploited children or by women whose basic rights are violated.

Kathie Lee and Wal-Mart could move the entire industry to set new human rights standards, if she and Wal-Mart would agree to independent human rights monitors having access to all offshore plants which produce clothing for Kathie Lee and Wal-Mart.





Wendy Diaz with co-workers


Wendy Diaz
Testimony during Press Conference with 
Congressman George Miller
May 29, 1996

My name is Wendy Diaz.  I am from Honduras.  I'm 15 years old.  I was born January 24, 1981.  I started working at Global Fashion when I was 13 years old.

Last year, up to December, I worked on Kathie Lee pants.  At Global Fashion there are about 100 minors like me--13, 14, 15 years old--some even 12.  On the Kathie Lee pants we were forced to work, almost every day, from 8 a.m. to 9 p.m.  On Saturday we worked to 5 p.m.  Sometimes they kept us all night long working, until 6:30 a.m.  This happened a lot with the Kathie Lee pants.  The compañeras of the packing department almost always work these hours.  Working all these hours I made at most 240 lempiras a week, which I am told is about $21.86 U.S.  My base wage is 3.34 lempiras--which is 31 U.S. cents.  No one can survive on these wages.

The treatment at Global Fashion is very bad.  The supervisors insult us and yell at us to work faster.  Sometimes they throw the garment in your face, or grab and shove you.  They make you work very fast, and if you make the production quota one day then they just increase it the next day.

The plant is hot, like an oven.  They keep the bathroom locked, and you need permission and can only use it twice a day.  We are not allowed to talk at work; if they see us talking, they punish us.

Even the pregnant women they abuse.  They send them to the pressing department where they have to work on their feet 12 or 13 hours a day in tremendous heat ironing.  This is a tactic the company uses to force them to quit, since working like that, their feet swell up and when they can't stand it any more they have to leave.  This way the company doesn't have to pay maternity benefits.

Sometimes the managers touch the girls.  Pretending it's a joke they touch our legs or buttocks.  Many of us would like to go to night school--but we can't, because they always force us to work overtime.

We have no health care, nor does the company pay sick days, or vacation.  North Americans from a U.S. company visited the plant several times, but they never spoke with the workers.

Every one in the plant is very young, the majority are 16-17 years old.  I suppose the Koreans don't want to hire older people because they wouldn't take the abuse.

Most girls in the plant are afraid.  After we met with Charlie and Barbara the company threatened us with firing.  They fired a number and said they would fire all of us if we tried to organize.

The manager called us together, all the workers in the plant, and told us they would not accept a union at Global Fashion.  Anyone involved would be fired immediately.  The company hires spies to report on our meetings.  Since last November, when a group of 40 of us started a meeting, the company threw out all but five of us.

When we leave work at 9 p.m., it is very dangerous.  We leave in groups, almost running to our houses, since there is a lot of crime and it is pitch dark and there is no transportation.

I'm an orphan.  I live in a one room home with 11 people.  I have to work to help three small brothers.

Right now we are making clothing for Eddie Bauer and J. Crew.  There are still a lot of minors working in the factory.

If I could talk with Kathie Lee I would ask her to help us, to end all the maltreatment, so that they would stop yelling at us and hitting us, and so they would let us go to night school and let us organize to protect our rights.  We would like Kathie Lee to return her work to our factory, only under better conditions.  Also we need a just wage.  Please help us.





Wal-Mart Stores
702 Southwest 8th Street
Bentonville, AR 72716-8001
Tel: 501-273
Fax: 501-273-4053


1995 Sales (1/31/1996 fiscal year end):  $93,627,000,000 ($93.6 billion) 
1995 Profits:  $2,740,000,000 ($2.7 billion) 
Chief Executive Officer:  David D. Glass
1994 Compensation 1/31/1995 fiscal year end):  $1,060,532
1992-94 3-year Total Compensation:  $3,102,618 
Top Five Executives  
1994 Compensation:  $3,628,518 
1992-94 3-year Total Compensation:  $10,289,635 

Wal-Mart is the world's largest retailer and the 4th largest company in the United States (based on sales), behind only General Motors, Ford and Exxon. It has over 2,000 stores in the U.S., 123 stores in Canada, 96 units in Mexico and three clubs in Hong Kong, with units set to open in Argentina, Brazil and China in fiscal 1996. During the last quarter of 1995 alone, the company reported profits of $1 billion, the highest ever for a retailer. The families of the company's founder, San Walton, are collectively worth $24.1 billion (Source: Forbes, 1994).

Quotes from the 1995 annual report:

"Very simply, throughout the Wal-Mart organization, we believe that our job is to buy for our customers, not just sell to them"and we apply our considerable strengths to get the best value for you"Store signs call attention to price cuts brought about by aggressive buying and smart distribution."

"We're fairly direct about asking for our customers' opinions. Our best research is often what Associates learn when they ask the customers whether they are finding what they want, whether we're treating them well and how we can serve them better"Once a month, every month, we recap what customers are telling us and look for opportunities to put their comments into practice."

"Giving Back to the Community"Community service is part of the mindset of Wal-Mart Associates. They are people who want to be involved in their communities, who take the idea of customer service beyond the store into community live""




Kathie Lee Gifford
ABC - Live with Regis and Kathie Lee
7 Lincoln Square
New York, NY 10023
Tel: 212-456-7777

Excerpts from 1995 Kellwood Annual Report:

"Over three years ago, Kathie Lee Gifford joined forces with our subsidiary Halmode Apparel as spokeswoman to promote the company's Plaza South Department store dress line. After much success with the Plaza South program, the multi-talented celebrity and television personality, Kathie Lee, and Halmode's management determined the timing and demographics were right to develop a Kathie Lee Collection for the mass market."

"In February [1995], her new collection was introduced. Today the Kathie Lee line is sold exclusively in over 2,100 Wal-Mart Stores through a licensing program. Halmode designs and produces the dresses, pant suits, skirts, rompers, and maternities for the Kathie Lee program to insure the various product categories created for the Kathie Lee line coordinate and deliver the quality and value Halmode, Kathie Lee and Wal-Mart are known for."

Excerpt from Women's Wear Daily, August 25, 1995:

"The success of Kellwood's Kathie Lee women's apparel line, sold exclusively at Wal-Mart Stores, is expected to propel Wal-Mart into the top three on Kellwood's customer list-with sales to the mass merchant of approximately $100 million this year."

""Further exuding enthusiasm for the Kathie Lee Collection"Kellwood officials described the results at retail as 'phenomenal.' "Wal-Mart's introduction of the Kathie Lee line in February was the 'most successful launch of a celebrity name in the country""






Kathie Lee Sweatshops Campaign Page

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