Ethical Analysis of Foreign Labor Use

Gather the facts: The company utilizes cheap, foreign labor to produce its product. Up to this point the company has worked with a distributor and therefore has not been exposed to the production methods utilized in manufacture of their product. Felipe aims to save the company money by eliminating the distributor’s approximately 30% mark-up, and coordinating with the factories himself. In his travels to the South China factories Felipe sees working conditions that appear to be unsatisfactory according to basic human rights standards. The issues include, child labor, overly demanding work schedules, movement restrictions while working, and inadequate equipment to satisfy health and safety standards, non-regulated work environments, and depraved living conditions supported by the factory. Felipe’s peer group and management team have established a paradigm based on industry norms that accept the working conditions as typical and acceptable. In addressing his concerns, his supervisor makes it clear that while minor improvements were permissible, any changes jeopardizing profits were unacceptable. Clarify Assumptions: The management must have some knowledge of the working conditions but due to financial pressures and industry norms does not consider the situation unethical. Or some do consider it unethical but do not feel confident in speaking up; either way no-one has insisted on re-evaluating the process due to ethical issues. The company could not make an equivalent profit margin if conditions were changed in the factory. For the workers this was a good work opportunity and wanted the work. The workers chose to live in the factory owned housing complex. The factory owned housing is provided for free or is at least provided at a rate below the worker’s income. So the assumption is that the factory workers are not paying back to the company in the form of rent the equivalent of what they are earning from the company in salary. Felipe does have some leverage