Click Here to download CLW's statement
Click Here to download PUMA's statement
Click Here for access to CLW's report, “PUMA's Failure in CSR – Suppliers' Critical Conditions.”
China Labor Watch, August 11th, 2008 – On June 18th , 2008, PUMA released a public statement primarily in response to CLW's report, “PUMA's Failure in CSR – Suppliers' Critical Conditions.” While claiming to take the report very seriously, in its response, PUMA denied and refused to address many of the report's findings. CLW disagrees with PUMA's explanations and compose a statement in the following:
Surpassing Factory
• PUMA suggests that Dongguan Surpassing has never employed more than 7,000 employees in the last three years. However, the factory's homepage states that the number of workers at Surpassing has increased to 9,000 workers. Moreover, two CLW investigators who have entered the factory as regular workers were told by the factory management that the number of workers is about 10,000.
For reference, please visit the webpage with Surpassing's information posted by Surpassing:
http://www5.jobcn.com/Person/Companycontent.jsp?ComID=380336
• PUMA suggests that the majority of recently hired workers entered the factory without any recommendations or references. During an interview with workers, CLW acquired a n application form that requires workers to be referred by a current employee (See Attachments).
Translate:
At present, ___________ team________ refers ___________ to enter the factory (Female, born in ____Year_____ Month ________Day,________ Province _______ County, matches with our factory's recruitment requirements, hope all high level supervisors approve the hire and assign her to _____group. Thank you!
Application Date: ______Year______ Month_____ Day
Referrer: _____________
Referrer Application Date: ______Year ______Month _____Day
• PUMA suggests that excessive overtime was unfounded at Surpassing. Surpassing provided time records and workers' signatures that prove the factory's overtime operation has received workers' consent and workers are not punished for denying overtime. According to the two CLW investigators working at Surpassing, as well as other workers they have reached out to, none have been asked to sign an overtime application form. Preserving double books and fake documents to deceive clients is a very common practice at the factory. CLW also disagrees with PUMA's action of contacting the factory in advance about audits. We believe that such behavior that grants the factory time for onsite preparation and education to workers about the “appropriate behaviors” when receiving clients goes against the very purpose of factory audits, which is to maintain a fair and ethical workplace. Workers interviews conducted by CLW are performed independently; workers did not receive any “education” from a third party.
• PUMA suggests that the penalty of 43.35 USD fine for not working overtime was unfounded. Both CLW and PUMA agreed that many workers are not familiar with the factory's wage calculation method. In other words, the calculation method contains a certain level of ambiguity. Hence, CLW wonders whether the ambiguity is intentionally used to hide the fact of fines.
• PUMA suggests that the claim that 80 workers had to share one shower was unfounded. Since PUMA stated that it takes the report on Surpassing seriously, CLW strongly recommends that a through reading of PUMA's report be taken. On CLW's report, it describes, “ Public restroom and bathroom are installed at each end of the hallway on each floor. Inside each bathroom and restroom are 23 compartments, thus in other words, only 23 people are able to take shower or use the restroom” (PUMA's Failure in CSR, pg. 9). CLW has clearly described that there are shower rooms with 23 compartments on each floor (23 shower compartments X 3 Shower rooms = 69 showers).
• PUMA suggests that majority of the workers are satisfied with the canteen food. CLW highly doubts that anyone would be satisfied with food mixed with insects. CLW also finds it shocking that anyone would be satisfied after purchasing factory canteen food that is more expensive than the market price. For instance, “ Soy milk and congee cost $0.22 (1.5 RMB) per cup or bowl compare to the market price outside which soy milk costs $0.07 (0.5 RMB)/cup and congee costs about $0.14 (1 RMB)/bowl” (PUMA's Failure in CSR, pg. 9). Because Surpassing had already been informed by PUMA about the audit, CLW suspects that workers had been educated in advance to not reveal the truth.
• PUMA suggests that 90 percent of the chemicals used in the factory are water-based and ventilation in general is good. Since the content of chemicals can be dispersed in the air, CLW strongly suggests that Surpassing equip workers with safety equipments.
• PUMA suggests that Surpassing has acquired an ISO 14001 system and has both internal and external audits for environmental performance. During the meeting with PUMA on June 20 th , 2008, PUMA admitted that there are some workers who dump the waste water into the sewer. Hence, we strongly recommend that an accessible way be introduced to encourage workers to discharge in the correct ways.
• PUMA suggests that 100 percent of the employees have work injury (Accident) insurance and 50 percent have social insurance. CLW does acknowledge that Surpassing provides workplace accident insurance to workers, though not all workers enjoy pension. In terms of pension, to avoid additional cost (to purchase pension, factory has to pay 80 RMB per worker), the factory only purchases it for workers who request for the benefit.
• PUMA suggests that workers find it difficult to resign and has encouraged the company to implement a new resignation procedure. CLW takes into account PUMA's effort and hopes that workers will benefit from the new procedure.
CLW hopes that PUMA would truly commit to coordination with the factory management to eliminate existing problems.
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Kontakt :
Ulf Santjer
Corporate Communications
PUMA AG
+49 9132 81 2489
Ulf.Santjer@puma.com
Statement responding to the article „Eyeing Companies“
(Wirtschaftswoche, 16.06.2008) and
„PUMA's Failure in CSR – Suppliers' Critical Conditions“
(China Labor Watch)
Herzogenaurach, June 18, 2008 – On June 16, 2008, US-non-governmental organisation China Labor Watch (CLW) published the report “PUMA's Failure in CSR – Suppliers' Critical Conditions”. The report makes allegations against PUMA relating to poor working conditions in one of PUMA's supplier factories Dongguan Surpassing Shoes in China . CLW claims that workers are being forced to work overtime, do not have social insurance, etc. German weekly business magazine “Wirtschaftswoche” reported exclusively about the factory and the poor conditions based on the CLW report on June 16, 2008.
PUMA took the report very seriously and two employees from the PUMA S.A.F.E. team went to visit the factory Dongguan Surpassing and investigated if the allegations were founded on June 17, 2008. Based on these investigations PUMA came to the conclusion that the allegations as well as the facts are either incorrect and false or exaggerated.
• CLW claims that during peak seasons in the summer months Dongguan employs roughly 10,000 people. This is false. The factory employs currently – the month of June is a peak month – 6,100 people and had never more than 7,000 employees in the last three years.
• The report claims that new workers need to have a referrer from an old worker. This allegation of discrimination is also incorrect. The majority of recently hired workers joined the factory without any recommendations or references.
• CLW claims that workers would be forced to work excessive overtime – up to twelve hours per day and during nights on Saturdays. This allegation is also untrue and unfounded. The factory management confirmed and time records proved that the maximum working time in the factory is eleven hours. All workers had signed overtime application forms in advance and they were not punished if they refused to work overtime. According to management and workers who had been interviewed by PUMA employees, confirmed that overnight work stopped after January 1, 2007.
• CLW claims that workers in Dongguan work up to 41,5 hours of overtime per week. Investigations by PUMA showed that workers work up to a maximum of three hours overtime per day and a maximum of 23 hours overtime per week. One day per week is labour-free. PUMA is now implementing a new forecast system to improve the overtime situation in the factories.
• CLW claimed that workers had to pay a fine of 43.35 USD if they refused to work overtime. PUMA did not find any evidence of that.
• CLW claimed that up to 80 workers had to share one shower, which is incorrect. The dormitory has 69 showers for up to 400 workers. This means that on average there is one shower for six to seven workers.
• CLW claims that insects can be found in the canteen food. PUMA found out that the majority of the workers is satisfied with the food.
• CLW claims that there are high risk working conditions in the factory. A chemical smell would make workers feel uncomfortable and disgusted and factory management would not enforce workers to wear safety equipment. In fact, 90 percent of the chemicals used in the factory are water-based and ventilation in general is good. But it seems that the factory does not have adequate air quality testing for the chemicals used at the workplace. The factory management has promised to contact people from Center for Disease Control for a testing within a month. As for the personal protective equipment used at workplace, workers are equipped but we also observed that some workers are not wearing the equipment unless told by managers or supervisors. The factory management agreed to train workers more on workplace protection.
• CLW claims that waste is not being disposed of ethically. Waste such as paint and glue are dumped into the sewer. In fact, the factory has got an ISO 14001 system and has both, internal and external audits for environmental performance. Some workers thought water-based ink, which is of white colour, is harmless waste, so they wash the printing board and the waste water goes into the drains directly. The factory, however, has an in-house waste water treatment plant. All waste water goes into the treatment center before final discharge. There is no pollution issue.
• CLW claims that workers find it difficult to resign. PUMA found out that the workers indeed complain about difficulties when resigning from their jobs. Most of the supervisors want to keep experienced workers. After PUMA pointed this issue out in May, the factory has implemented a new procedure since June 1, 2008. Workers can now resign directly through HR instead through their direct supervisors. This change was confirmed by workers in the interviews at workplace.
• Furthermore, CLW claims that workers at Dongguan do not have health, accident nor social insurance. In fact, 100 percent of the employees have accident insurance and 50 percent have social insurance. The factory is working on a 100 percent coverage with social insurance.
PUMA concludes that the majority of the allegations by CLW against PUMA is wrong and untenable. PUMA works constantly on eliminating potential problems together with the factory management.
PUMA invited CLW to a dialogue in order to discuss these allegations. The dialogue took place on June 20 and results will be published shortly.
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