Date of publication: September 13, 2005
Source: Reuters
LOS ANGELES (Reuters) - Workers in six countries filed a class-action lawsuit against Wal-Mart Stores Inc. on Tuesday, claiming the world's largest retailer overlooks sweatshop conditions at toy and clothing factories from China to Nicaragua.
The suit, filed in California state court in Los Angeles, lists as plaintiffs 15 workers in Bangladesh, Swaziland, Indonesia, China and Nicaragua. They claim they were paid below minimum wage, forced to work unpaid overtime and in some cases even endured beatings by supervisors.
The lawsuit also lists four California plaintiffs, including two unionized workers at Kroger Co. unit Ralph's and Safeway Inc. grocery stores, who claim Wal-Mart's entry into Southern California forced their employers to reduce pay and benefits.
The suit could cover anywhere from 100,000 to 500,000 workers, according to attorney Terry Collingsworth of the International Labor Rights Fund, which represents the plaintiffs. Wal-Mart's potential liability could be in the hundreds of millions of dollars, he said.
Beth Keck, a spokeswoman for Wal-Mart's international operations, said the retailer had not been formally served with the lawsuit, but had received a copy from journalists who obtained it from the lawyers involved.
``It's really too early for us to be able to say anything about this particular complaint,'' Keck said. ``It involves a number of companies and manufacturers and we're just beginning our research to learn more.
We're just at that beginning research phase.''
ALWAYS LOW PRICES
Wal-Mart became the world's largest retailer by buying cheap, foreign-made goods and selling them to consumers at rock-bottom prices every day.
Critics, however, say that low-price obsession has pressured store managers to overwork nonunion employees and the retailer has been hit with dozens of lawsuits claiming violations of wage-and-hour laws.
The company has also been the target of discrimination lawsuits. Last year, a judge said a lawsuit that charges the company discriminated against women in pay, promotions and training could proceed as a class action. That suit, the largest workplace bias lawsuit in U.S. history, covers as many as 1.6 million current and former female U.S. employees.
The mounting litigation has taken a toll on Wal-Mart's reputation and the Bentonville, Arkansas-based company has responded with a national advertising campaign aimed at repairing the image of its 5,100-store empire.
According to Tuesday's complaint, Wal-Mart breached its own agreement with foreign suppliers in its failure to monitor factory working conditions.
``Investigation after investigation of Wal-Mart's operations and suppliers reveal that Wal-Mart is an unrepentant and recidivist violator of human rights,'' the lawsuit said.
The plaintiffs allege Wal-Mart's ``vast economic power'' allows it to impose price and time requirements on supplier factories that result in sweatshop conditions.
The retailer ``knew or reasonably should have known that its suppliers would violate'' worker's rights, but continues to do business with those factories, the lawsuit said.
Wal-Mart's Keck declined to comment on the company's factory policies because of the pending lawsuit. In a statement on its Web site regarding sweatshop allegations -- though not specifically this lawsuit -- Wal-Mart said it ``strives to do business only with factories run legally and ethically'' and that it ``is helping to improve working conditions and create economic opportunity for workers around the world.''
Violations alleged to have occurred in Wal-Mart supplier factories include withheld pay, poor working conditions, reprisal firings for labor union activity and beatings.
In a Bangladeshi dress factory, a pregnant seamstress who paused on the production line was ``kicked hard in her stomach'' by her supervisor, according to the lawsuit. Another was slapped in the face with pants whenever she was unable to meet a quota of 120 pairs per hour.
In Indonesia, one worker in a facility producing ``George'' label clothing for Wal-Mart regularly saw company representatives visit the factory and overheard her supervisor saying ``with Wal-Mart, we cannot have overtime (pay).''
The foreign plaintiffs are seeking a jury trial, compensatory damages and injunctive relief. Lawyers for the workers said their clients could not seek redress in their home countries because of corruption, the lack of independent judiciaries and for fear of reprisals.