As was mentioned earlier, the Zhongshan Branch of the Pou Yuen Shoe conglomerate is made up of six or seven factories employing 37,000 workers. Nearby Pou Yuen factories I and II is located a separate unnumbered plant where New Balance sneakers are being produced. Pou Yuen factories I and II produce for Reebok. The Pou Yuen conglomerate promotes itself as the "model" factory in China.
There are approximately 4,000 workers, the vast majority of them single women between 18 and 26 years old, though there are some 15 year olds there, who are employed illegally. Almost all the workers are migrants from rural provinces. Export assembly factories in China rarely if ever hire anyone over 25 years of age. By the time the factory workers reach 25, they are worn out and exhausted from all the grueling overtime hours, and are replaced by younger women.
The workday at the Pou Yuen plant starts at 7:00 a.m. with a half-hour of compulsory exercise.
The standard shift is:
The workers interviewed explained that overtime hours from 6:00 to 9:00 or 10:00 p.m. were very common, even a daily occurrence. The workers reported that they received one or two days off a month. No one ever receives more than four days off in a month, and that much only during slack periods.
So the workers are in the factory for up to 15 hours a day, seven days a week. Under this schedule they would be at the factory 105 hours a week. But on average, they are at the factory 14½ hours a day, while paid for 12 hours; 6½ days a week, totaling 94½ hours, while being paid for 78 of those hours.
However, hours and wages do vary from department to department in the same factory, which is huge, employing several thousand people.
Some workers in the sole section reported that they were working from 7:00 a.m. to 7:30 p.m. with 1½ hours off for lunch. So they were working 10½ hours a day, 6 or 7 days a week.
Overtime work at Pou Yuen far exceeded what is legally allowed in China, where, by law, overtime is limited to 36 hours a month, or 9 overtime hours a week on top of the regular 40-hour workweek.
So the legal limit permissible is 49 hours of work per week, yet at the Pou Yuen factory, women are working 78 hours a week assembling New Balance sneakers. They are being forced to work 29 hours more each week than is legal, exceeding the limit by 60 percent.
The way Pou Yuen and New Balance can get around the law is by applying a flexible hourly system that is based upon a year rather than the week. During slack periods when there are few or no New Balance orders, many workers may be without work for an entire month. The workers can remain in the dorms and eat, but they are not paid. Those hours can then be worked at any time of year without being recorded as overtime, even if the worker is working 12½ hour shifts seven days a week.
With the permission and collaboration of the local government, Pou Yuen and New Balance have come up with the ultimate contingency workforce, flexible enough to keep thousands of workers on hand, as if in storage at a minimal cost to the company and yet ready to respond at a moment's notice when New Balance and the whims of the marketplace dictate, by working a 78 hour workweek. Better yet, these excessive hours do not even have to be recorded or paid as overtime.
Hourly wage rates at Pou Yuen ranged from 14 to 24 cents an hour, the average wage being 19 cents an hour. Weekly wages ranged from $11.12 to $16.68 for a 68 to 78 hour workweek.
After deductions for living expenses, temporary residency and work permits, etc., the workers report they earn between 400 rmb and 500 rmb ($48.19 - $72.29 U.S.) per month on average.
Average New Balance / Pou Yuen Wage
Almost everyone at Pou Yuen factory making New Balance sneakers is paid according to a piece rate system which none of the workers understand. They have no idea what the piece rate is per unit or how it is calculated at the end of the month. And then there are numerous deductions from their wages, including:
New Balance uses the piece rate system to drive the women to work harder, but since no one understands how their wages are calculated, the workers feel mistreated and cheated. Nonetheless, they have no choice but to work harder each month to see if they can earn a few extra pennies.
Not only do the workers not understand how their wages are calculated, but wage rates tend to vary and wildly fluctuate from month to month.
Our Lives Are Meaningless
Once at the factory, the young women who come here from rural areas full of hope are quickly disillusioned, as they find themselves working grueling overtime hours six and seven days a week.
The workers explained to the interviewers that "once you are in the production line working, your hands and eyes cannot stop for a minute." You do the same operation over and over again, a thousand times a day, day in and day out, for more than 12 hours a day. One women said, "My whole life is only work, and it is meaningless. There are no promotions in the factory."
All the workers agreed that their working life is "hard and backbreaking." They were also angry that when they were lined up to be selected by Pou Yuen management to participate in a new training program, they felt that they were "slaves in a slave market, where the nicest looking women are the ones chosen."
When several of the women were told what New Balance sneakers sell for in the United States, they responded: "It's so unfair! We are so helpless!"
The Pou Yuen American Leather Factory is a newer, smaller facility across the street from the Pou Yuen Footwear Factory that is producing for New Balance.
At the time that the researchers visited this factory in June, there were 400 to 500 workers and the factory was just starting up. The workers were producing uppers for New Balance. But this factory may evolve into one of several Pou Yuen materials plants which supply components for further processing to several Pou Yuen factories producing not only for New Balance but also Timberland, Reebok and other brands.
The regular shift at the Pou Yuen American Leather Factory in June was from 7:00 a.m. to 5:30 p.m., six days a week, with 1½ hours off for lunch. Sometimes there was overtime work until 9:00 p.m. An overtime premium of 12 cents an hour was paid on top of the standard piece or hourly rate. Hourly employees said they could earn up to 22½ cents an hour. There were fines of 10 rmb if you reported late to work and 20 rmb if you lost your factory ID card.
The workers' major complaint was the presence of "leather dust" so thick in the factory air that they could "barely stand it anymore." No protective equipment was provided to the workers by the factory.