Defense Management

Industry Practices Can Help Military Exchanges Better Assure That Their Goods Are Not Made by Child or Forced Labor Gao ID: GAO-02-256 January 31, 2002

The military exchanges operate retail stores similar to department stores in more than 1,500 locations worldwide. The exchanges stock merchandise from many sources, including name-brand companies, brokers and importers, and overseas firms. Reports of worker rights abuses, such as child labor and forced overtime, and antilabor practices have led human rights groups and the press to scrutinize working conditions in overseas factories. GAO found that the military exchanges are not as proactive as private sector companies in determining working conditions at the overseas factories that manufacture their private label merchandise. Moreover, the exchanges have not sought to verify that overseas factories comply with labor laws and regulations. A single industrywide standard for working conditions at overseas factories was not considered practical by the 10 retailers GAO contacted. However, these retailers have taken the following three steps to ensure that goods are not produced by child or forced labor: (1) developing workplace codes of conduct that reflect their expectations of suppliers; (2) disseminating information on fair and safe labor conditions and educating their employees, suppliers, and factory workers on them; and (3) using their own employees or contractors to regularly inspect factories to ensure that their codes of conduct are upheld.


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