Rich Companies, Poor Workers: The US-Haiti Connection

Multinational Monitor, April 1996

Port-au-Prince, Haiti-Quality Garments S.A., a clothing contractor in the SONAPI Industrial Park, is typical of assembly plants in Port-au-Prince. The factory is hot, dimly lit, crowded. The air is heavy with dust and lint. There is no ventilation to speak of. Piles of material-scraps of pajamas, dresses, skirt hems-clutter every aisle and every corner. The workers have sad, tired faces. They hunch over antiquated sewing machines, some more than 20 years old, sewing "Kelly Reed" dresses to be sold in Kmart and other products destined for U.S. retailers.

The workers at Quality Garments work eight to 10 hours per day, Monday through Saturday. When the company has orders to fill, they are required to work Sundays as well. Last August, several workers reported that they had worked seven Sundays in a row-in other words, more than 50 days straight without a day off, up to 70 hours per week-during the hottest season of the year. Asked if this schedule created a problem for the employees or the factory as a whole, plant manager Raymond DuPoux, says, "The problem is mine, because I can't go to the beach. So I have problems with my wife."

For their labor, the workers are in many cases paid as little as 15 gourdes per day, or 12 cents per hour, well below the legal minimum wage of 30 cents per hour. The workers are paid on a piece-rate system, and production quotas are raised to the point where the majority of workers have no hope of meeting them. For example, one experienced worker says she is supposed to sew seams on 204 pairs of children's pajamas in a day, for which she would be paid $2.67; in 8 hours, however, she is only able to complete 144 pairs for which she is paid $1.87. In Creole, this system is referred to as "sa ou fe, se li ou we," or, roughly translated, "what you do is what you get."

The average worker at Quality Garments earns about $1.67 per day, 73 cents less per day than the minimum wage. The company pays straight time on weekends, not time-and-a-half as Haitian law requires. Transportation for most workers costs between 40 and 53 cents per day, and lunch-a small plate of rice and beans and a glass of juice-costs 47 cents. This means that the average worker takes home between 67 cents and $1 per day, or between 8 and 13 cents for every hour of work. This comes to less than $6 for a standard work-week, which provides less than 25 percent of the minimum needs of a family of five.

It was precisely to eliminate such abuses that then-Haitian President Jean-Bertrand Aristide raised the minimum wage from $1 (15 gourdes) per day to $2.40 (36 gourdes) per day on May 4, 1995. In his decree, President Aristide specifically banned the sort of piece-rate abuses that are common at Quality Garments and factories like it. The law requires employers to ensure that piece-rate workers earn at least the minimum wage by paying "make-up"-the difference between their piece-rate pay for the day and the daily minimum wage.

At Quality Garments, however, it seems that the rule of law is taken lightly. There is a large sign on the wall next to the plant's time clock which, translated into English, reads,

"Effective Friday, March 17, 1995, there will be no more 'make-up' at this factory. Here we only want workers who are willing to work for their money."

A pattern of abuses

Quality Garments is not unique. Such wanton disregard for the law is common among factory owners in Haiti.

More than half of the approximately 50 assembly plants producing in Haiti for the U.S. market are paying less than the legal minimum wage, including the following (all of which were paying according to the "sa ou fe, se li ou we" piece rate system):

* Seamfast Manufacturing produces dresses for Ventura Ltd. under the "Ventura" label, sold at Kmart and J.C. Penney, and for Universal Manufacturing, a subsidiary of Kingley Corp., under the "Kelly Reed" and "Kelly Reed Woman" labels, sold exclusively at Kmart. Wages at the plant are among the lowest in Haiti. One woman with three years experience reports earning 87 cents for eight hours of work cutting dress material.

Abraham Felix, the owner of the plant, says one of the main problems facing the company is that "the workers can't work effectively, because they don't eat enough."

* Chancerelles S.A., a subsidiary of Fine Form of Brooklyn, New York, produces bras and underpants for Elsie Undergarments of Hialeah, Florida. The garments are sold under the "Shuly's" and "Elsie" labels at J.C. Penney and smaller retailers. Asked if the company was paying the minimum wage, John Whistler, the U.S. director of the plant, says, "Yes, yes. It's the law. You have to pay them whether they do the work or not." Workers at the plant say they make an average of $1.73 to $1.80 per day, and are often shortchanged on payday.

The supervisors, especially chief supervisor Franck Charles, verbally abuse the workers on a regular basis, calling them "bitch," "whore," "shit" and "dog," among other names.

Whistler, though, says the supervisors "empathize with the people too much."

* National Sewing Contractors produces Disney pajamas under contract with L.V. Myles. The company also produces girls' clothes for Popsicle Playwear of New York, sold under the "Sister Sister" label at Wal-Mart, Kmart, J.C. Penney and Kids R Us. Wages at the plant vary widely, with some workers making as little as $1 for eight hours of work-12 cents per hour.

The owner of the plant, Charles Chevalier Jr., is openly nostalgic for the days of the Duvalier dictatorship, when workers who attempted to organize were routinely murdered by state-sponsored death squads. "Jean-Claude [Baby Doc] Duvalier was a great man compared to these ...," he said recently in an interview with labor researcher Marcelo Hoffman. "I mean, his administration was good compared to what's happening now."

Like most factory owners who pay less than the minimum wage, Chevalier insists that he abides by the labor code. "Haitians do not work for less than the minimum wage," he said. "Even if they tell you so, they're Iying."

* Excel Apparel Exports, jointly owned and operated with Kellwood Co., produces women's underwear for the Hanes division of Sara Lee Corp., under the "Hanes Her Way" label, sold at Wal-Mart. The plant also produces women's slips sold at Dillard Department Stores and night wear for Movie Star, to be sold at Sears and Bradlees. Many workers earn less than $1.33 per day and the company raises its quotas at will. Before President Aristide raised the minimum wage, the quota for a typical operation-sewing waistbands on underpants-was 360 pieces per day. Now the quota is 840 pieces-a 133 percent increase. The workers did not have the right to object to the speed-up; they do not even have the right to speak to one another at work.

* Alpha Sewing produces industrial gloves for Ansell Edmont of Coshocton, Ohio, which is owned by Ansell International of Lilburn, Georgia, which in turn is owned by Pacific Dunlop Ltd. of Melbourne, Australia. Ansell Edmont boasts in its promotional literature that it is the world's largest manufacturer of safety gloves and protective clothing, but the workers at Alpha Sewing do not have even the most basic safety protection. They produce Ansell Edmont's "Vinyl-Impregnated Super-Flexible STD" gloves with bare hands; polyvinyl chloride (PVC), the chemical that toughens the glove, also takes off layers of skin. And the dust from the production of the "Vinyl-Coated Super Comfort SeamsRite" gloves causes respiratory problems for many workers.

Hours at the plant are from 6 a.m. to 5:30 p.m., Monday through Saturday, and often from 6 a.m. to 3:30 p.m. on Sunday as well-a 78-hour work week. Approximately 75 percent of the workers make less than the minimum wage. In April 1995, a worker who refused to work on Sunday so that he could go to church was fired. When he returned to pick up his severance pay, the manager called the UN police and reported a burglar on the premises. The UN police arrived and promptly handcuffed the worker. After protests from the other employees, the UN police finally let the worker go. The next day, management began firing all those workers who had protested the arrest.

Alpha Sewing is owned by the Apaid family, led by Andre Apaid, a notorious Duvalierist. When asked at a business conference in Miami soon after the coup in 1991 what he would do if President Aristide returned to Haiti, Apaid replied vehemently, "I'd strangle him!" At the time, Apaid was heading up the United States Agency for International Development's (U.S. AID's) PROMINEX business promotion project, a $12.7 million program to encourage U.S. and Canadian firms to move their businesses to Haiti.

U.S. tax dollars at work

U.S. AID, the main U.S. agency in Haiti dealing with V economic issues, allocated $215 million in 1995 specifically on aid and economic development to Haiti. Of this, $8 million has been committed to the Program for the Recovery of the Economy in Transition (PRET), which provides direct assistance to U.S. and Haitian businesses-by sponsoring conferences, guiding tours of U.S. businesspeople and establishing a network of business contacts.

The U.S. government has shown an aggressive commitment to court U.S. businesses to invest in Haiti, but it has shown no commitment to the workers who produce for those U.S. companies. According to a U.S. AID status report, the first of PRET's three main objectives is to "promote a sound legal and regulatory environment for private enterprise to recover and prosper." But Lawrence Crandall head of the U.S. AID mission in Haiti, said recently in an interview that violations of the minimum wage law were not the responsibility of the agency, and that U.S. AID "has no position" on the wage issue.

In fact, for several years, U.S. AID has actively and consistently opposed any increase in the minimum wage. In June 1991, when President Aristide was proposing raising the minimum wage from 15 gourdes to 25 gourdes per day, (which at the 1991 exchange rate represented an increase from $1.76 to $2.94 per day, or from 22 cents to 37 cents per hour), the agency wrote in a project paper that "wage systems should not be the forum for welfare and social programs," and that Haiti should not jeopardize its main "comparative advantage," which the report termed "its highly productive, low-cost labor force."

U.S. AID maintained its opposition to raising the minimum wage after the military coup of September 30, 1991 ended President Aristide's attempts to implement his proposals.

On October 15, 1994, the day President Aristide returned to Haiti, Brian Atwood, the administrator of U.S. AID, was asked at a news conference whether or not U.S. AID favored a wage increase. Atwood replied, "I don't think that the economy is ready ... for such measures." Atwood did not mention the fact that Article 137 of the Haitian Labor Code requires the minimum wage to be raised every time inflation totals more than 10 percent for the year, as it has for the past six consecutive years.

It seems that U.S. AID's pressure has paid off. As late as April 30, 1995, the day before he was scheduled to announce a new minimum wage, President Aristide argued in a speech to peasant leaders at the National Palace that, taking inflation into account, the minimum wage would have to be raised to at least 45 gourdes simply to bring it to 1991 levels. Given the fast-rising cost of living, he added, even 75 gourdes was not enough for a family to live on. But after several days of behind-the-scenes lobbying-in which the role of U.S. AID and the U.S. Embassy is unclear-President Aristide was pressured into accepting a compromise minimum wage of 36 gourdes.

Because of rising consumer prices, the new wage of 36 gourdes (US$2.40) per day (30 cents per hour) is worth less in real terms than the old minimum wage of 15 gourdes was worth in 1990. In other words, even after the recent increase, minimum wage workers in Haiti have less buying power now than they did in 1990, before President Aristide's election. And since Oct. 1, 1980, when Baby Doc Duvalier first set the minimum wage at 13.20 gourdes, the real value of the minimum wage has declined by almost 50 percent.

The daily struggle to survive

As Haitian factory owners and U.S. corporations profit from the low wages, Haitian workers struggle every day just to feed themselves and their families. A wage-earner in Haiti typically supports more than five people, and the minimum wage simply does not cover the basic expenses of such a family. The typical diet for minimum wage workers consists largely of rice and cornmeal and beans; vegetables are rare, and meat is an unheard-of luxury.

Workers in Port-au-Prince estimate that to satisfy the most basic nutritional needs of their family, they need to spend $1.67 per day. In addition, workers pay 40 to 67 cents per day for transportation, depending on how far away they live from their workplace, and 47 cents for a small lunch. To rent a small one- or two-room shack in a slum in Port-au-Prince costs between $100 and $133 for a six-month period. To send a child to the cheapest schools costs between $60 and $133 per year, depending on the school and the age of the child. Thus, to satisfy minimum needs for food, shelter, and education, a family in Port-au-Prince must spend-at the very least-$24.20 per week.

However, a minimum-wage worker working 8 hours per day, 6 days a week in Haiti earns $14.40 per week. In other words, a full-time minimum-wage salary provides less than 60 percent of a family's basic needs. A salary of $1 per day, common in apparel plants producing for U.S. companies, provides less than 25 percent of a family's basic needs.

Many workers say that they are not able to make ends meet and are falling deeper and deeper into debt, which compounds their problems. Food vendors on the street outside many factories will sell on credit, but at a premium of 20 to 25 percent. A five-pound sack of rice, for example, sells for $1.47 cash, and $1.87 on credit. Money-lenders in poor neighborhoods-Haitian workers do not have access to banks-generally charge a rate of 25 to 50 percent interest per two-week period.

The economic situation is becoming increasingly desperate for workers in Haiti. Many face a real risk of starvation if they lose their jobs, and are therefore compelled to do whatever their boss asks of them, which for many women involves sexual favors. In interviews with women workers in Cite Soleil, an enormous slum in Port-au-Prince, a Columbia University anthropologist found that roughly 17 percent of female factory workers in her survey had been forced to have sex with their bosses, on penalty of termination if they refused.

Many families in Cite Soleil have taken to selling the last of their worldly belongings-chairs, cooking utensils, plates and bowls, beds and children's shoes-simply in order to survive.

Eric Verhoogen is a labor researcher with the New York-based National Labor Committee Education Fund in Support of Worker and Human Rights in Central America.