Increasing Shareholder Wealth

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to reduce labor costs is the utilization
of “sweatshop” labor. A sweatshop is a manufacturing facility that operates
below minimum standards of safety and/or wages and benefits. Sweatshops
flourished in the United States in the late 1800s and early 1900s.
This paper will examine the re-emergence of sweatshop manufacturing in
the U.S. and abroad, and its impact on how manufacturers do business. Two U.S.
corporations will be discussed in detail. And the issue of utilizing low cost
labor domestically and offshore, including arguments for against this practice,
will be discussed.

ISSUE BACKGROUND

Since, by definition, sweatshops violate the basic rights of workers, a
brief discussion of the history of the labor movement is a necessary element in
understanding the use of sweatshops. This section is intended to give a brief
outline of some of the events leading to worker's rights laws. The following
information was excerpted from NBC News Online.

June 3, 1900

Garment workers ...

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Avenue.

June 25, 1938

President Franklin Roosevelt signs the Fair Labor Standards Act (FLSA) — also
known as the federal wage and hour law — guaranteeing a minimum hourly wage of
25 cents. The law is enforced by the Department of Labor's Wage and Hour
Division and sets the federal minimum wage
and overtime requirements. It also prohibits child labor and requires employers
to keep adequate time and payroll records. In 1996, the FLSA covers more than
110 million workers.

1958

The largest nationwide ILGWU strike in union history occurs, with 100,000 union
members walking out of factories. They win new concessions, including more
holidays and higher ...

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