Clothing retailer Gap Inc. said on Wednesday that forced labor, child labor, paying below minimum wage, physical punishment and coercion are some of the widespread workers' rights violations occurring at many of its factories worldwide.
The San Francisco-based retailer -- whose outlets include the Gap, Old Navy and Banana Republic chains -- acknowledged some of the worst abuse cases found among the 3,000 factories around the world that make its products.
The worst and most persistent of the violations led Gap to terminate business with 136 factories in 2003, Gap said in its first-ever social responsibility report. The company issued the report on Wednesday to coincide with its annual meeting.
The report, hailed as the first of its kind, highlights the company's efforts to improve garment factory conditions and labor standards, and counteract its reputation as an employer of sweatshop labor.
The most common violations included health and safety problems, breaches of local law, faulty age documentation, excessive hours and unclear wage statements.
"These are common occurrences in the garment industry," said Bruce Raynor, president of UNITE, the union for clothing and textile workers.
Raynor and other labor activists said Gap was taking a clear step in the direction of correcting some of these conditions.
"This company is trying to use its sourcing power to improve working conditions and labor rights, and that's really what we ask of giant retailers," Raynor said. "By no means do I say there are not problems in Gap factories. There are many. But there have been some concrete, constructive steps taken."
A group of shareholders that collaborated with Gap -- including the Interfaith Center on Corporate Responsibility, Domini Social Investments, As You Sow Foundation, Calvert Group, and the Center for Reflection, Education and Action -- said it pressured the company to undertake the project two years ago.
"Gap did not just decide to do this out of altruism," said Conrad MacKerron, director of As You Sow's corporate responsibility program.
Currently there is no generally accepted reporting format for supply chain compliance. The group hopes the Gap report will serve as a model format for other companies to adapt and improve upon.
"Our mission is to take these codes of conduct that companies say is protecting workers and make them show us it's working and to what extent. This gives the public a real glimpse into the complexity of compliance," MacKerron said.
Like most major U.S. apparel companies, Gap sells branded goods produced by third-party manufacturers. Gap, the No. 1 U.S. specialty apparel retailer, uses 3,000 factories in about 50 countries, mostly developing nations.
In 1996 it developed a Code of Vendor Conduct prohibiting child labor, forced labor and discrimination, and protecting freedom of association and other rights. Its vendor compliance officers try to visit and evaluate every factory, every year.
"Few factories, if any, are in full compliance all of the time," Gap's report said.
Gap's report includes a chart showing the frequency of various types of violations by region. It said some types of violations, such as freedom of association and discrimination, are especially difficult to uncover and prove. It believes these violations are more widespread than its data suggest.
"The fact that they have 464 factories in China, a country where workers are not allowed to organize in independent unions, means probably the majority of goods continue to be made in conditions that violate international workers rights," said Medea Benjamin, founding director of Global Exchange, a San Francisco-based activist group that has campaigned against alleged sweatshop employers and specifically against Gap.
"I give Gap very high marks for trying, and putting out the report. But when you realize so much of the production is in China, and so much more will be (after 2005), it's almost a joke to talk about social responsibility," Benjamin said.
Of the 136 factories that were terminated in 2003 for serious or excessive breaches, greater China and Southeast Asia each had 42, the Indian subcontinent had 31, and Europe, including Russia, had nine.
The garment industry is bracing for 2005, when quotas on apparel and textiles among World Trade Organization member nations will expire. China is expected to become the global powerhouse of production because there will be no limit on the extent to which importers can take advantage of its low costs.