Eye on Firms That Use 'Cheap Labor' Abroad

This summer, Reebok International began selling soccer balls with a different sort of guarantee on the box. The Boston-based company warranted that they were made without child labor.

Reebok's move is part of a growing effort by multinational corporations to blunt criticism that they are exploiting foreign workers - particularly children. Surveys show up to 70 percent of American consumers say they won't buy products made under unsafe or unfair working conditions.

This latest bid to win public approval for goods produced in overseas factories, is an independent certification process being backed by such brand-name companies as Avon, Toys R US, and OTTO-Versand, a large German catalogue company, that owns Speigel and Addidas.

The Council on Economic Priorities, a nonprofit think tank in New York, will begin lining up companies and organizations in January to do the certifying. A manufacturer will get a human rights seal of approval if it complies with a set of standards set by a group of multinational companies, labor unions, and human rights groups such as Amnesty International. Companies who will pay for the certification service, says Eileen Kohl Kaufman, the program director.

Certification means that a company can tell its customers that its products, including the parts made by subcontractors, meet a new standard, called Social Accountability 8000 (or SA8000). The standard includes:

* A ban on the use of children under 15. If a young worker is in school, his or her combined work, school, and transportation time can't exceed 10 hours.

* The company won't use forced labor or require workers to leave their identity papers or a "deposit" with the employer. Workers will have the right to form and join trade unions. If unions are banned, it will find a "parallel" alternative.

* Employees won't be required to work in excess of 48 hours per week on a regular basis. Overtime won't exceed 12 hours per employee per week except in short-term business circumstances.

* Wages will at least meet a country's minimum standard and must "be sufficient to meet basic needs of personnel and to provide some discretionary income."

To ensure that companies are meeting these standards, their work practices will be monitored by independent for-profit companies, such as accounting firms, or SGS-International Certification Services, a Swiss company that makes sure corporate products meet quality standards. This summer, the CEP group conducted four trial audits in New York, Pennsylvania, Mexico and Honduras.

This effort is significantly more advanced than the efforts of a group of apparel executives and labor leaders who were brought together by the White House 15 months ago as a Task Force on Sweatshops. "They are having a lot of trouble deciding how they want to go forward," says Kaufman.

According to Kevin Danaher, co-founder of Global Exchange, a human rights group in San Francisco, the task force "right from the get-go has been a PR effort." For example, he says they have tried to avoid tackling the wage issue. "Our person went to a task force meeting to testify and they cut her off three times when she talked about wages. The man in charge said, 'We decided not to talk about wages.' You can't avoid that issue."

The task force, however, says it is making progress as it tries to figure out how to implement a code of conduct. "We have some details we have to work out, it's not easy," says Linda Golodner, the co-chair of the task force and the President of the National Consumers League. "It's a big deal and everyone wants to do it right."

How human rights organizations perceive both efforts is important, because they are often instrumental in shaping public opinion. For example, the National Labor Committee (NLC), which made its name in El Salvador, worked with the television show "Hard Copy" on a three-part series on sweatshops in Nicaragua. The series, which ran this week, illustrated how Wal-Mart, K-mart and J.C. Penney pay their workers from 10 cents per hour to 24 cents per hour.

HUMAN rights groups applaud the concept of setting auditable standards. "The more monitoring the better," says Jeff Ballinger, the director of Press for Change, a human rights monitoring group. "If something is a whitewash it will show. I'm anxious to see some of this get started."

But companies are also aware that they might get a marketing edge with better labor practices. Reebok, for example, is running ads in soccer publications about its new balls. And, yesterday, it sent out a press release that 40 children in Pakistan started school as a result of a $50,000 contribution it made. The children had been stitching soccer balls."