Member Article

Samsung: an empire built on modern slavery

Over recent years, Apple and Samsung, the two largest smartphone suppliers in the world, have been under increasing scrutiny and pressure regarding their labor practices. While both firms have similar PR strategies, consisting in showing cooperation with Western watchdog associations and launching highly-publicized audits, Samsung seems to be also shifting its civil engineering business towards countries which are known to be less picky on working conditions.

After several reported stories (1) about exhausted slave workers on Iphone/Ipad production lines, Apple realized the damage that could be dealt to its image and took the matter very seriously, on the PR side. Despite pledges not only to carve out any such practices from its own structure, but also from its entire production network, an undercover BBC documentary in China showed, at the end of 2014, Chinese workers too weak to feed themselves, after 16-hour days. The number of reported cases of exhausted workforce within Apple made journalists, watchdogs and investigators wonder if similar cases could be found elsewhere. And indeed, the industry is rife with such practices. An American and Australian NGO report (2) in 2014 stated “Interest has been spurred on by the ascendency of global brands like Apple, Microsoft and Samsung, combined with growing public concern about exploitation and child labor in Chinese electronics factories, as well as fears about the use of conflict minerals sourced from the Democratic Republic of Congo (DRC).”

Quite logically, investigation journalists turned towards Apple’s largest competitor: Samsung. There again, cases quickly multiplied: exhausting (3) rates and rhythms of work, improper (4) working conditions, restricting liberties, harassment, until physical beating (5).

The problem is that these companies will simply not put an end to these practices: it would be industrial suicide. These companies survive and thrive in the ultra-competitive market precisely by crushing costs. Reducing productivity would quickly lead to a downfall on the market, so they will not consent to it. They can only make the practices less visible. The first step to do so is outsourcing. By improving in-house working conditions, the company improves its image as an employer attached to its workforce’s well-being; while all the exhausting work is done outside the company. This way, the customer can claim having neither knowledge nor responsibility when cases of malpractice comes out. This technique was derived from the US military policy (which received much attention during the Abu Ghraib prison crisis (6)), which recommended the outsourcing of “politically risky” activities to private security companies. The manufacturer then acts as a marketing proxy for the brand. In the 2014 report by NGOs Not for Sale (7) and Baptist World Aid (8), Nokia came out as the only manufacturer which had jumped the gap into supplying companies to ascertain that workers making its products were given enough to live on. After failing (9) to resort to this screening technique in 2012, Samsung quickly got in line and made sure the dodgy business didn’t happen under its own name again.

The second step is show very active diligence in hunting down such cases, but only the ones which have been detected by whistle-blowing associations, so as not to feed the enemy’s fire. When a documentary gets aired, or a case gets reported, the brand then launches highly-publicized internal audits, so as to position on the workers’ rights defender’s side, and not on the industrial profiteer’s side. In recent years, the most controversial brands (Microsoft, McDonald’s Apple, Samsung and many other majors) have launched high-profile in-house and outhouse investigation, under the formal term of Supplier Responsibility (10), officially pushing them towards more transparency and western-standard working conditions and even pressure them to go green (11), in a last-ditch effort to take the appearance of a positive influence.

The third step is to move its business to places where less attention is paid to worker’s rights. This technique is also derived from the military: from 2002 to 2012, US political inmates stripped of their civil and fundamental human rights were kept off the mainland in the infamous Guantanamo detention facility, so that their treatment be kept away from Western eyes. Samsung is opting for this strategy, by focusing its civil engineering commercial efforts in the Middle-East and Persian Gulf. After supplying (12) the Qatar Gas Transport company with 25 liquid natural gas carriers in 2007, developing (13) the Doha subway system in 2013, winning a 2-billion dollar deal (14) to build a power plant in 2015, Samsung is currently in talks with Nasser bin Ali Al Mawlawi (president of Ashghal (15)– the public works authority) to be selected for the Idris project, to further develop the wastewater management system in the southern part of Doha. Given Qatar’s poor reputation of workers’ rights observance, is highly unlikely that any investigation channels or news reporter will be invited to visit the underground work zone, to measure working conditions. Since Western countries have become tighter playgrounds, the mechanical consequence is the shifting of business where more industrial leeway is available.

The law is toothless for the international worker, by which we mean the workforce used and moved by global employers. Using international mobility for workers is often indulged by companies precisely to escape the grip of national labor regulations. In 2014, Ryanair was fined (16) over 10 million dollars for having hired French employees under Irish contracts. By doing so, workers were two countries away from the regulatory powers they were administratively linked to, thereby preventing any effective control and stripping them of any actual protection. Despite growing international pressure, and public protests in Europe and the US which jeopardize brand names and their ability to do business, many western companies still do business with foreign companies, the practices of which sway between slightly politically incorrect our outright slavery (17).

1. http://www.huffingtonpost.com/carl-gibson/how-the-iphone_b_5800262.html
2. http://www.idigitaltimes.com/your-smartphone-created-slave-labor-among-major-tech-companies-only-nokia-can-prove-its-factory
3. http://www.theregister.co.uk/2012/11/30/samsung_pledges_fix_china_factories/
4. http://www.zdnet.com/article/samsung-is-sued-over-poor-working-conditions-in-brazil/
5. http://www.zdnet.com/article/samsung-is-sued-over-poor-working-conditions-in-brazil/
6. http://www.newyorker.com/magazine/2004/05/10/torture-at-abu-ghraib
7. https://notforsalecampaign.org/about/
8. https://www.baptistworldaid.org.au/assets/BehindtheBarcode/Electronics-Industry-Trends-Report-Australia.pdf
9. http://forums.theregister.co.uk/forum/1/2012/09/05/samsung_accused_child_labor/
10. https://www.apple.com/supplier-responsibility/progress-report/
11. http://www.supplymanagement.com/news/2015/apple-pushes-suppliers-to-switch-to-green-power
12. http://www.qatargas.com/English/MediaCenter/news/Pages/ConstructionofthefirstQ-Max.aspx
13. http://www.thenational.ae/business/industry-insights/economics/south-koreas-samsung-c-t-digs-deep-into-expertise-for-qatar-metro-project
14. http://www.power-technology.com/news/newssamsung-ct-wins-18bn-epc-contract-for-combined-cycle-power-plant-in-qatar-4635319
15. http://www.ashghal.gov.qa/en/Pages/default.aspx
16. http://www.dailymail.co.uk/news/article-2441765/Ryanair-fined-8-3m-employing-French-workers-Irish-contracts.html
17. http://www.dailymail.co.uk/news/article-2441765/Ryanair-fined-8-3m-employing-French-workers-Irish-contracts.html

This was posted in Bdaily's Members' News section by Benjamin Collins .