Labor Groups Criticize Disney Over Worker Conditions at Chinese Suppliers Disney, set to open a $5.5 billion theme park in mainland China on Thursday, said it took any violation of labor regulations 'seriously' and that it would investigate any allegations against its suppliers.

By Reuters

entrepreneur daily

This story originally appeared on Reuters

Reuters | Mario Anzuoni

China-based labor groups have criticized Walt Disney Co. over conditions at a small number of its local suppliers, highlighting issues such as low wages, high rates of injury and health risks from exposure to chemicals and dust.

Disney, set to open a $5.5 billion theme park in mainland China on Thursday, said it took any violation of labor regulations "seriously" and that it would investigate any allegations against its suppliers.

A report from Hong-Kong based advocacy group Students & Scholars Against Corporate Misbehavior said it had investigated that some workers at eight Disney suppliers were forced to work long hours and paid wages below the minimum legally allowed. Injury levels were also high because of old machinery and a lack of training or protective equipment.

In a separate report, China Labor Watch cited issues at two other factories, including low wages, exposure to chemicals and ineffective audits of working conditions by clients.

A Disney spokeswoman said in emailed comments that the firm takes "seriously claims of labor standards violations against the independent facilities producing Disney-branded products".

"It is our practice to thoroughly investigate those allegations and assist facilities in remediation efforts and comply with local regulations."

Disney is not the first global name to come be criticized for worker conditions in China: iPhone maker Apple Inc. has been singled out on several occasions over supplier issues in the country.

Both SACOM and China Labor Watch pointed out their investigations, which involved working undercover at the factories, had only covered a fraction of suppliers to Disney, which raked in $52.5 billion last year worldwide, including $4.5 billion from consumer products.

SACOM said it has found that the supplier companies withheld full overtime payments, fined workers for taking leave, and often employed staff without an official contract, which it said was a "breach of law".

The group also criticized Disney for lax oversight of the supplier factories and for third-party inspections being flagged in advance. The factories made products such as branded bags, hair clips and mugs.

"Knowing the time and subject of the audit, the factories were able to hide things in advance, and the genuine labor conditions could not be uncovered," SACOM said.

Disney is making a big bet on China with its Shanghai park, its first in mainland China, and already contends with challenges from popular local cartoons to a sometimes hostile reception from Chinese business rivals and state media.

(Reporting by Adam Jourdan; Editing by Christopher Cushing)

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Related Topics

Devices

Get a 15-inch MacBook Pro for Less Than $375

Save on this refurbished MacBook Pro for a limited time.

Business Ideas

55 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business Solutions

Stay Organized with This Task Management Tool, on Sale for $30

A Study Planr Pro subscription is just $30 for life.

Business News

Here Are 3 Strategies Startup Founders Can Use to Approach High-Impact Disputes

The $7 billion "buy now, pay later" startup Klarna recently faced a public board spat. Here are three strategies to approach conflict within a business.

Data & Recovery

Get 2TB of Cloud Storage with PhotoSphere for Just $280 for a Limited Time

Easily store and access photos, videos, and other files spread across your work devices.

Thought Leaders

10 Simple, Productive Activities You Can Do When You Aren't Motivated to Work

Quick note: This article is birthed out of the urge to do something productive when I am not in a working mood. It can also inspire you on simple yet productive things to do when you're not motivated to work.