Hanes gets child-labor report

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Hanes gets child-labor report
It says it will investigate charges, fix any problems with supplier
By Richard Craver
Friday, October 27, 2006

                                              A human-rights group made child-labor allegations yesterday
                                              against a Bangladesh apparel manufacturer that is a contract
                                              supplier to Hanesbrands Inc. and other U.S. and European

                                              The National Labor Committee, based in New York, said that
                                              the manufacturer, Harvest Rich Ltd., has used at least 200
                                              children, some as young as 11, to sew garments at its
                                              complex for up to 20 hours a day for peak production. The
                                              children are paid as low as 6 1/2 cents a day.

A human-rights group says that Harvest Rich   The group sent a letter Monday to Hanesbrands detailing its
Ltd. in Bangladesh, which supplies goods to   concerns about the Harvest Rich plant. The group's report
Hanesbrands, Inc., treats these underage
workers inhumanely.
                                              can be found at www.nlcnet.org/live. It said that U.S.
(Photo Courtesy of the National Labor         Customs shipping records show that Harvest Rich makes
Committee)                                    men's briefs for Hanesbrands.

Hanesbrands' Christopher Fox, the vice president for corporate social responsibility, responded in a
letter Wednesday, saying that "we take these allegations very seriously and will be continuing to
investigate them thoroughly".

That includes sending senior-level personnel to inspect the Harvest Rich plant and its processes.

"The claims you make in your report and your letter to Mr. (Lee) Chaden outline conduct that we
are categorically opposed to," Fox wrote. Chaden is Hanesbrands' chairman. "We would welcome
the opportunity to confidentially review in detail the evidence you have gathered."

Hanesbrands commented further yesterday.

"These are all open issues, and we need to finish the investigation and get a clear picture of what is
going on with these discrepancies before discussing any potential repercussions," said Matt Hall, a
company spokesman. "We have global business standards for our suppliers that we demand they
follow for compliance that includes under-age labor, mistreatment of employees and appropriate
working hours and pay.

"We've had senior management in the building several times in the past year, and they indicate
they have not seen anything of the nature of these allegations. There also has been five extensive
audits of the facility in the past year, and the results of those audits have not revealed anything of
the nature of these allegations."

The human-rights group is the same organization that exposed in 1996 the use of child labor in
Honduras for the Kathie Lee Gifford clothing line sold at Wal-Mart Stores Inc. The scandal erupting
from that revelation contributed to the ending of most child labor in garment plants making
product for the U.S. market.

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According to the group, other contract customers of Harvest Rich include Wal-Mart, J.C. Penney
Co., Target Corp. and Reebok Inc.

Harvest Rich, which has about 2,500 employees, operates six production divisions at the plant.
Harvest Rich officials could not be reached for comment.

The human-rights group said that Harvest Rich has threatened to file a lawsuit and has said that
the accusations are not true.

Charles Kernaghan, the director of the National Labor Committee, said that his group has been
monitoring the plant since mid-June.

"The children report being routinely slapped and beaten, sometimes fallen down from exhaustion,
forced to work 12 to 14 hours a day, even some all-night, 19- to 20-hour shifts, often seven days a
week," the group said. The child laborers were interviewed with parents present, the group said.

"We're shocked this is happening again just 10 years after the Kathie Lee Gifford scandal,"
Kernaghan said. "Because we saw child laborers going into other nearby plants, we thought it was
very critical to point this out to put an end to it because it gets started again.

"We know Hanesbrands is taking this very seriously, and we're counting on it to do the right thing."

The group wants the U.S. companies to not only insist that Harvest Rich cease using child labor,
but also pay a monthly stipend to replace the children's wages, and to cover necessary school
expenses. "It will cost the giant U.S. companies less than $70 a month per child to do the right
thing," the group said.

Harvest Rich has been certified by the U.S. apparel industry's Worldwide Responsible Apparel
Production monitoring group. Fox wrote that extensive audits done by independent organizations,
including an unannounced audit last week, "has not revealed the conduct you allege."

But Kernaghan said that Harvest Rich typically moves the child laborers to fire escapes, rooftops or
sends the children home at inspection times.

Hanesbrands announced yesterday that it plans to buy a sewing plant in Chonburi, Thailand, for an
undisclosed amount. The 93,000-square-foot plant, with about 1,600 employees, will become the
first Asian sewing plant owned by the company. It will assemble bras for the U.S. market.

Richard Noll, the chief executive of Hanesbrands, said that the plant purchase is part of its effort to
"quickly develop a greater presence for our supply chain in Asia."

• Richard Craver can be reached at 727-7376 or at rcraver@wsjournal.com

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