Fair Labor Finds a Home in the Dominican Republic, but is Haiti Still Left Behind?

In writing about college apparel company Knights Apparel’s sweatshop-free approach to manufacturing, the New York Times reports that the company’s model factory in the Dominican Republic pays workers a living wage, respects overtime hours and allows workers to organize freely.  Based on a study done by a workers’ rights group that calculated the living costs for a family of four in the Dominican Republic, the factory has pledged to pay employees nearly three and a half times the prevailing minimum wage. Knights has emerged as the industry leader in fair labor garments, surpassing Nike as the No. 1 college supplier of garments and cooperates closely with the Worker Rights Consortium, a group of 186 universities that press factories making college-logo apparel to treat workers fairly.

While Knights is clearly emerging as a recent leader, it is not the first to operate a “fair labor” garment factory in the Dominican Republic. An earlier predecessor is Grupo M, which pledged to pay workers double the minimum wage as early as 2000 by working with the Fair Labor Association. Grupo M claimed that it was still competitive, despite higher pay rates, because its workers produced more goods of higher quality, because of better pay, health, training and investments in technology. However, at the same time the company gushed about lifting its employees out of poverty, a reforestation, and $12 million plant to purify detergent- and dye-laden water, it was busy abusing its Haitian workforce next door.

In August 2003 Grupo M opened two facilities in the new free trade zone, employing around 1,000 workers. According to the International Federation of Free Trade Unions, Grupo M’s Haitian employees were made to work at high speed for long hours in terrible conditions and paid extremely low wages with no overtime; protests were met with mass firings and militiamen from northern Haiti’s “rebel army.” In the face of continued resistance, Grupo M’s chief executive officer, Fernando Capellán, threatened to relocate.

Manufacturers have clearly found the Dominican Republic a more desirable location for fair trade investments. This is initially a surprising revelation, given the development of free trade zones in Haiti through favorable US legislation and Haiti’s status as a most-favored nation, allowing the country to sell very cheap garments made from Asian imported fabrics. Haiti’s labor force has been pinpointed as offering the cheapest labor in the whole American continent (US$ 0.49/hour), far cheaper than the Dominican Republic (US$ 1.65), Nicaragua (US$ 0.92) and even China (between US$ 0.68 and 0.88/hour).

However, doing business in an impoverished nation has its price.  Even Knights initially considered opening the factory in Haiti, but was dissuaded by the country’s poor infrastructure. Other efforts to create “model factories” have been stunted by Haiti’s low skill workforce. Despite the absence of a living wage factory, Haiti’s manufacturing sector continues to run under two fair labor programs, the Fair Labor Association, and the International Labor Organization’s (ILO) Better Work program. Both programs receive much of their funding from private retailers such as Sears, Wal-Mart, and Levi Strauss and both lack public transparency (absence of factory name and brand name in reporting). With the infrastructural damage from the earthquake, monitoring has been difficult, especially for the Better Work Program after the ILO’s headquarters were destroyed in the quake.

While continued investment in Haiti flows under the Haitian Hemispheric Opportunity through Partnership Encouragement (HOPE) Act and HOPE II, entered into force in October 2008 (extended preferences to 2018), the future of Haitian workers remains uncertain. The Right Respect has joined with the Workers Rights Consortium and The Institute for Justice and Democracy for Haiti to create a fully transparent factory monitoring system, with the ultimate goal to push manufacturers and retailers to demand better wages and worker’s rights in Haiti. We hope you will follow our efforts to empower Haitian workers in their struggle for fair wages and true economic development.

Discussion

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• From Greg Andrews at 12:54 pm on August 2, 2010:

  

  Thanks for a great article. We are the Haiti Advocacy Committee here in Manchester, CT and have been working toward education in an effort to support Haitians and Haiti’s self sufficiency through agriculture development. Recently I came across an article by AP journalist Jonathan M. Katz, that exposed Preval’s lowering the textile minimum wage from the $.60/hr. down to approx. &.48/hr. due to pressure from businesses. I contacted Gail Strickler, the Assistant U.S. Trade Rep for Textiles two weeks ago and discussed the wage discrepancy. She called it a two-tiered wage whose first tier is enacted during worker training. I asked her if she knew if a Haitian could live on those wages and if her organization had done a wage price study. She did not and they had not, so she referred my query to the World Bank and the IDB. I called both agencies today and in both cases the only people who could answer my question were out. Hmm. At any rate from what your article is showing concerning lack of public transparency in monitoring ILO and FLA “oversight”, one wonders if HOPE II might be an Orwellian moniker for business as usual. Thanks again for the info and keep up the good work. peace