Dimas Renaldi G.

Dini Prayita

Reguler 23

Gap’s Labor Problems

Saip an: Is This US A? ?
GAP’s History
Founded in 1969 by Donald Fisher and
Doris Fisher, a small clothing store near
San Francisco State University
By 1971, Fisher operating six Gap stores
In 1983, Millard Drexler taking over as the
new president of the Gap while Fisher
became Chief Executive Officer
In 1995, Fisher retired as CEO and Drexler
took over as CEO, which by then had 1,348
stores
September 2002, Drexler retired and
replaced by Pressler, the company
Gap’s Company Profile
Gap, Inc. Is a chain of retail stores, including :
Gap
Banana Republic
Old Navy
Gap International
GapKids
BabyGap
In January 2004 Gap reported fiscal year profits
of $1.03 billion on sales of $15.85 billion
Almost all Gap Merchandise is made under
contract for Gap by some 3,000 supplier
factories that owned and operated by foreigners
in 50 countries
Gap’s Labor problems in saipan
Since 1995 Gap had faced labor problems in the
factories that supplied its clothes
In 1999, Global Exchange, Sweatshop Watch,
and the AFL-CIO Union of Needletrades
Industrial and Textile Employees filed a class
action lawsuit against Gap ad 17 other retailers
on 50,000 workers in factories in Saipan
Saipan is the largest of 14 island that together
make up the Commontwealth of the Northen
Mariana Island (CNMI).
In 1975, the CNMI became a U.S. Territory and
its 15,000 inhabitants became U.S. citizens
Gap’s Labor problems in saipan
In 1996, the population of CNMI
exploded to 70,000. over half were
foreign workers on temporary visas who
had migrated to Saipan to work in one
of the many factories that foreign
companies had built on Saipan to make
clothes and other products for U.S.
Companies
The garments and other products that
made in Saipan could be advertised as
being “Made in the USA”
Gap’s Labor problems in saipan
Workers condition in the Saipan’s factory :
Mostly Women, were recruited by private
agencies in China, Bangladesh, Korea
Paid $3 an hour
Workers had to sign contracts promising to pay
the recruiting agency an average “fee” of
$5,000 that would be deducted from their
weekly paychecks
Promising not to participate in political or
religious activities, not to marry, not to ask
salary increases, not to look for alternative
employment, not to participate in any union
Gap’s Labor problems in saipan
Some violation conditions of U.S. Labor
laws in Saipan :
Workes should pay $200 per month for poor
food and housing in factory-owned
shantylike barracks that were dirty, lacked
clean drinking water and hot water, had
exposed electrical wiring, and had filthy and
inoperable toilets.
Violating U.S health and safety laws :
Blocked exits, fire hazards, unsanitary
restroom, and exposed electrical wiring
Gap’s Labor problems in saipan
GAP inc factories violation in Human
Rights:
– “off the Clock” hours,
– not paid when overtime,
– unsaved work condition,
– exorbitant  job-recruitment fees,
– illegal threats of deportation and,
– rules prohibiting  having children or
marrying.
GAP Response of Labor case in Saipan:
v In 2001, GAP implemented guidelines to better protect foreign
contract workers in the approximately five percent of Gap Inc
approved factories that employ them worldwide.
v employment contracts be written in the workers' native
languages and that workers must be paid at least the local
minimum wage.
v Factory management must allow workers to control their own
travel documents and wages.
v Workers must be free to leave the factory and return home at
any time.
v management must agree to assume a proportionate amount of
the returning workers' debt.
v GAP Inc vendor Compliance Officers (VCOs) regularly monitor
compliance with these standards in garment factories that
employ foreign contract workers.
v GAP agreed to contribute a certain amount to a fund of $20
million to be used to compensate workers and to pay an
Conclusion & Solution
GAP could use the label “Made in USA” or
“Made Northern Mariana Island (USA)”.
Gap should be responsible morally for the
way its suppliers treated their workers.
In this case, GAP must give responsibility
to the treatment of factories to their
workers.
GAP should controlling & monitoring the
supplier factories.
Gap should give a warning or punishment
to the sweatshop factory, for preventing
the sweatshop cases would happen again