Mr. Chairman, members of the Committee, I appreciate the opportunity to testify at this very important hearing regarding worker rights standards in the global economy.

 

The U.S.-Jordan Free Trade Agreement went into effect in December, 2001.  Over the next five years, apparel exports from Jordan to the U.S. soared by 2,300 percent, growing from $52.1 million in 2000 to $1.2 billion in 2006.

 

The U.S.-Jordan Free Trade Agreement was reported to be a model agreement, since for the first time, worker rights standards and environmental protections were included in the core of the agreement.

 

Yet something went terribly wrong, as the U.S.-Jordan Free Trade Agreement quickly descended into Human Trafficking and involuntary servitude.  At least 36,149 foreign guest workers are employed in Jordan’s 114 garment factories, at least 90 percent of which are foreign-owned, mostly by Asian investors.  The guest workers come from Bangladesh, China, Sri Lanka and India.

 

Bangladeshi guest workers had to pay $1,000 to $3,000 each to unscrupulous manpower agencies in Bangladesh to purchase a two-to-three-year contract to work in Jordan.  This is an enormous amount of money in Bangladesh, and as poor workers, they had to borrow the money on the informal market at exorbitant interest rates of five to ten percent per month.

 

From the minute they took the loans, these workers were in a trap, and a race against time to pay off their large debts.  But the workers were promised that they would be able to earn $134.28 a month for regular hours and up to $250 a month with overtime.  All housing, food and medical care would be free.  The workers were told they would live well, “like they do in the West.” They would get at least one day off a week, sick days, vacation time and national holidays.

 

But there was a catch:  The contract tied the guest workers to just one factory, prohibiting them from working elsewhere.

 

One hundred and fifteen workers from Bangladesh purchased contracts to work at the Al Shahaed Garment factory in Irbid, Jordan. 

 

Upon their arrival at the airport, management immediately confiscated their passports.  Nor were the workers provided with residency permits, without which they could not go out on the street without fear of being detained by the police for lack of the proper papers.

 

Once in the Al Shahaed factory, the workers found themselves forced to work shifts of 15, 38, 48 and even 72 hours straight, often going two or three days without sleep.  They worked seven days a week.  Workers who fell asleep at their sewing machines would be slapped and punched.  Instead of being paid the $250 a month that the ad promised, the workers earned two cents an hour, or $2.31 for a 98-hour workweek.  Workers who asked for their legal wages could be imprisoned up to three days without food.  Workers who criticized the food the company provided were beaten with sticks and belts.  Twenty-eight workers had to share one small 12-by-12-foot dorm room, which had access to running water only every third day.  These workers sewed clothing for Wal-Mart. 

 

When, in desperation, the workers demanded their legal wages, they were forcibly deported and returned to Bangladesh without their back wages.  Many of these workers are now hiding in Dhaka City and peddling bicycle rickshaws to survive.  They cannot return to their home villages because they have no possible way to pay off the mounting debt they incurred to go to Jordan in the first place.

 

At the Western factory, also in Irbid and producing clothing for Wal-Mart, Bangladeshi guest workers who were trafficked to Jordan faced much the same fate.  They too were stripped of their passports and forced to work 16 to 20 hours a day, seven days a week.  Despite working 109 hours a week, the workers routinely went for months without being paid.  In the first four months of 2006, the Western workers were not paid a single cent in wages.  There are also credible of reports of sexual abuse, including the rape of a sixteen year-old girl.  Workers who asked for their wages would be beaten and threatened with forcible deportation.

 

At the Al Safa factory in the Al Hassan Industrial Estate, a young Bangladeshi woman no more than 20 years of age hung herself after being raped by a factory manager.  This happened in February 2005.  She hang herself in a bathroom using her scarf.  Her body was not immediately returned to Bangladesh, but rather, remained at the local morgue for several months.  In this factory, they sewed clothing for the Gloria Vanderbilt label.

 

The National Labor Committee released our report on Jordan in May 2006.  By July 2006, Jordan’s Trade Minister at the time, Mr. Sharif Al Zuibi, declared:  “Our inspection regime may have failed us and may have failed us miserably.” Jordan’s labor department had just 88 labor inspectors to oversee 98,000 business operations.  The primary role of the labor department inspectors was to issue work permits to foreign guest workers.  By law, Jordan’s unions were not permitted to organize foreign workers.

 

Acting quickly, the Jordanian Government to date has closed at least ten of the worst garment factories and relocated over 1,000 workers to better factories.  Across Jordan, especially in the 59 larger direct contract factories, conditions have improved.  Guest workers passports have been returned and most workers now have their necessary residency permit.  At most, workers are toiling 11 hours a day and not the 15-plus-hour shifts that were routine in the past.  Most workers are being paid at least the legal minimum wage.  Factory conditions and treatment have improved.

 

However, problems continue in some of the 55 smaller subcontract factories in Jordan.

 

In the Concord Garment factory in Cyber City Industrial Park near Irbid, 350 workers have not been paid for the last three months, despite the fact that they are forced to work 15  to 16 hours a day, from 8:00 a.m. to 11:00 p.m. or 12:00 midnight, seven days a week.  Women workers report being cursed at, slapped and punched by factory managers.  There is no heat or hot water in the dorm, and even the toilets lack running water several days a week.  Many of the workers are falling ill.  If any worker asks for their legal rights, they will be immediately attacked, beaten and deported.  Nor has management returned the workers’ passports or issued their necessary work permits.

 

At the Classic Fashion factory in Jordan, 500 workers are required to work seven days a week, putting in routine 14-hour shifts from 7:30 a.m. to 9:30 p.m.  As a result, the workers are sick and exhausted  There are no sick days and management provides no medical care.  This factory produces for Jones Apparel, the Gloria Vanderbilt label.

 

At the Hussein Jordan Garment factory in the Al Hassan Industrial City, the workers are being forced to work 10 regular hours rather than the legal eight hours.  If workers arrive one minute late to the factory, they are beaten.  Nor have these workers received their passports and residency permits.  They are being paid below the legal minimum wage and the factory is illegally charging workers for food and medical care.  All overtime is obligatory and sick days and national holidays are not respected.  The Hussein Jordan factory produces for Victoria’s Secret.

 

On balance however, much has improved in Jordan’s garment industry, and the government is seriously responding to reports of continued violations.  But must remains still to be done.  The guest workers are still denied the freedom of association and the right to organize.

 

We do not know of a single prosecution of factory owners for human trafficking and holding tens of thousands of workers under conditions of involuntary servitude.

 

Nor do we know of any case where the foreign guest workers were paid the outstanding back wages legally due them.  But there is hope that the significant improvements will continue.

 

A second concrete example I want to raise is that of the Kaisi Metals factory in Guangzhou in the south of China, where 600 to 700 workers toil under dangerous and illegal conditions producing furniture parts for export to U.S. companies.  Among those companies is the Knape & Vogt Manufacturing Company—located in Grand Rapids, Michigan—which imported $10.4 million-worth of goods from the Kaisi factory in a recent three-month period.  Every single labor law in China is routinely violated at the Kaisi factory, along with the International Labor Organization’s core worker rights standards, while the U.S. companies sourcing production there say and do nothing.

 

Grueling, exhausting, numbing, dangerous and poorly paid would be the only way to  describe the workday at the Kaisi Metals factory.  Kaisi workers are routinely forced to toil 14 ½ to 15 ½ hours a day, from 8:00 a.m. to 10:30 or 11:30 p.m., often seven days a week.  It is not uncommon for the workers to be at the factory 100 hours a week, while toiling 80 or more hours.

 

Workers are paid on a piece rate basis.  It is standard for management to arbitrarily set wildly excessive production goals requiring workers to complete 7,780 to 11,830 pieces in a day, which is 640 to 980 operations an hour—or one piece every four to six seconds—for which they are paid an astounding six-hundredths of a cent per piece.  The work pace is brutal, relentless and dangerous.

 

Workers are paid below the legal minimum wage and cheated of their overtime premium, earning less than half of what they are legally owed.  Workers are paid just $24.33 for a 77-hour work week, and 32 cents an hour.  The workers should be earning at least $52.56.  The current minimum wage is 58 cents an hour.

 

It is a dreary life for the 600 to 700 workers at the Kaisi factory, who are housed in primitive over-crowded company dorms located on the seventh floor of the factory.  Each room measures 11 feet by 24 feet and its walls are lined with double-level metal bunk beds.  There is no other furniture, not even a bureau, a table or chair.  Six to eight workers share each room.  For privacy, the workers drape old sheets and plastic over the openings to their bunks.  There is a tiny bathroom, which the workers say is filthy.  There is no hot water and any workers who want to bathe during the winter must walk down four flights of stairs to fetch hot water in a small plastic bucket and return to their dorm room for a sponge bath.  The dorms are very over-crowded and the air reeks of perspiration and sweaty feet.

 

Married couples must live “off campus” under equally deplorable conditions, since they are able to afford only the smallest, most primitive one-room apartments.  Zhu Shenghong, who lost three fingers at the Kaisi factory, lives in a single room with his wife.  Their only furniture consists of a bed, which is broken, a few primitive wooden tables and three tiny chairs Zhu made himself before he was injured, using scraps of wood he picked up on the street.  They cannot afford a television.  The toilet is an outhouse, and the kitchen is in a hallway partitioned with some planks of wood. Zhu and his wife often cook with wood, largely subsisting on turnips.  This is all that two people, both working in export factories, can afford.

 

Much worse still is the fact that the Kaisi factory is a dangerous place to work, where scores of young people have been seriously injured, and some maimed for life.

 

Dai Kehong was just 24 years old when both his hands were crushed while working on a punch press molding machine producing furniture parts for export to U.S. companies.  It happened at 9:00 p.m. when Dai was 13 hours into his routine 15 ½ hour shift.  Dai’s right hand is mangled and deformed, with only the thumb and forefinger remaining, but frozen in place.  His left hand was also crushed and frozen into a claw, as he is unable to bend or straighten any of his fingers.  He has no ability to use either hand and will need an artificial limb.

 

On September 29, 2006, Zhao Chengquang’s left hand was crushed while he was working on an order for the U.S. Knape & Vogt company.  His stool suddenly slid out from under him leaving his left hand caught in the machine.  His hand was crushed, severing two fingers with the knuckles and a large part of his left hand.

 

In September 2006 alone, five Kaisi factory workers were seriously injured, resulting in the loss of at least six fingers.

 

In direct violation of China’s laws, the Kaisi factory failed to inscribe its workers in the mandatory national work injury insurance program, which is China’s equivalent of Worker Compensation.  Kaisi management also failed to report these serious work injuries to the local authorities.  The Kaisi factory refused to pay anywhere near the full compensation these injured workers were legally owed.  Management is even refusing to pay for Dai Kehong’s artificial limb.

 

U.S. companies could never tolerate such abusive treatment of their products and have gone out of their way to work with the Kaisi factory to bring their contractor into compliance with international packing specs so that their products will not be damaged en route to the U.S.  Knape & Vogt spent one year working with its contractors in China spelling out acceptable criteria that its packing must meet and demanding that each package pass rigorous tests before shipment.

 

At the same time, the U.S. companies stood by and did not say a word as scores of young workers were injured and maimed due to dangerous working conditions.  Nor did the companies sourcing production at the Kaisi factory utter a single word to protest the seven day, 80-hour work weeks, or the fact that workers were being paid below the legal minimum wage and cheated of their overtime premium while working on their goods.  Nothing was done to bring the primitive dorm conditions up to a level of acceptable decency.

 

In fact, the companies give every indication that they care much more about their products than about the human beings in China who make them.

 

This is just one example—and there are hundreds—of how easily the paper-thin labor laws in China are flaunted by the multinational corporations with complete impunity.  Here too, the voluntary corporate codes of conduct and private monitoring schemes have failed completely—and with such tragic results for the workers.

 

Senator Dorgan, I believe that the Decent Working Conditions and Fair Competition Act, which you and your colleagues recently introduced in the U.S. Senate, is the single most important action that can be taken to end the race to the bottom in the global economy.  Once passed, this legislation will reward decent U.S. companies which are striving to adhere to the law.  Worker rights standards in China, Bangladesh and other countries across the world will be raised, improving conditions for tens of millions of working people.  Your legislation will for the first time also create a level playing field for American workers to compete fairly in the global economy.

 

Thank you for allowing me the opportunity to testify on this critical issue, of raising standards in the global economy rather than lowering them.