There are more than one thousand toy manufacturers in China. From to May to July 2015, CLW conducted in-depth investigation into five major factories: Foshan Nanhai Mattel Diecast Company, Jetta (Guangzhou) Industries, Combine Will (Dongguan) Industrial Company, Winson (Taiqiang) Precision Manufacturing (Shenzhen) Company, and Dongguan Zhenyang Toy Company. Altogether, the factories employ over 20,000 workers. CLW’s investigators were sent into each of the factories to carry out undercover research as frontline production workers. Some of these plant have been investigated by CLW in past years, which enabled a comparison of working conditions over time (see pages 8, 10 of PDF report).
The Other Side of the Fairy Tales
When instances like those described above of rights violations and worker strikes occur in toy factories, brand companies typically deny any relationship to the injustice and push responsibility onto their supplier factories.
Thus is the state of toy product supply chains. Brands demand the best quality, the fastest production time, and the lowest costs, with no regard for how their demands affect the lives of workers. The ethical purchasing standards flaunted by brand companies are simply a marketing tool. In two decades of toy production in China, poor working conditions have not fundamentally improved. The results of CLW’s 2015 investigation, summarized below in a table, demonstrate the severity of the problem.
At Mattel’s Shenzhen-based supplier plant Winson, if a worker does 110 hours of overtime a month, working on 40,320 toys, she will earn $0.016 per toy. The classic Mattel toy brand Rock ‘Em Sock ‘Em, which was being produced at Winson during this investigation, retailed on Amazon at $30 in October 2015. This means that each Winson worker earns only 0.05% the market value of the Rock ‘Em Sock ‘Em toy. Workers produce nonstop. Young workers sacrifice their youth and health, and working parents often only have a chance to see their families and children once a year. Despite such sacrifice, a worker earns only 1/2000 the value of a toy she produces.
While workers struggle year after year to survive, the corporations above them exploit workers’ labor to enlarge the fortunes of shareholders and executives. In 2014, Disney’s revenue and profit reached $48.81 billion and $7.5 billion, respectively. That same year Disney CEO Robert Iger’s total compensation of $43.7 million made him the 12th highest paid CEO in America, according to The New York Times. This means that a Chinese worker making Disney’s toys would need to work 11 hours a day, six days a week for 7,011 years to earn the annual compensation of Disney’s CEO. For Mattel and Hasbro, the comparable figures are 1,534 and 2,466 years, respectively.
Limited Improvements in Working Conditions
Moreover, management will use the reduction of overtime hours—and thus overtime pay—to punish workers.
Furthermore, according to this year’s investigative findings, six categories of working conditions at Winson have actually deteriorated. For example, whereas in 2013 Winson would not hire anyone older than 40, this age discrimination has become even more severe with the upper age limit set to 30; Winson also hires discriminatorily based on gender. Fire safety at Winson is a major problem. CLW’s investigation discovered that a major fire occurred at Winson in May 2015, burning out an entire production workshop.
Fundamental Reform in Toy Factories
- Reduce the use of temporary workers to less than 10% of total workforce;
- Workers’ base wages should be increased significantly above the local minimum wage so that workers are not dependent on long overtime hours;
- Production schedules should be adjusted so as to ensure that overtime work is strictly voluntary;
- Resignation should not require “application” and resigning workers should receive due wages upon exit from the factory;
- All activities that are a mandatory requirement or duty of a job should be compensated (including group meetings, training, and required on-boarding procedures);
- Provide workers with more spacious and hygienic housing;
- Ensure that workers receive pre-job that is 1) in accordance with legal requirements and 2) sufficient to educate them on all chemicals or procedures which could pose a risk to their short- and long-term health;
- Other legal violations mentioned in this report should be remedied;
- Let workers elect enterprise-level union representatives that can actually represent worker interests.
ENDNOTES FOR EXECUTIVE SUMMARY
 HKTDC Research, “中国玩具市场概况”, 24 July 2015, http://china-trade-research.hktdc.com/business-news/article/%E4%B8%AD%E5%9B%BD%E6%B6%88%E8%B4%B9%E5%B8%82%E5%9C%BA/%E4%B8%AD%E5%9B%BD%E7%8E%A9%E5%85%B7%E5%B8%82%E5%9C%BA%E6%A6%82%E5%86%B5/ccm/sc/1/1X000000/1X002MRF.htm
 U.S. Department of Commerce Industry Report: Dolls, Toys, Games, and Children’s Vehicles NAICS Code 33993, http//www.toyassociation.org/app_themes/tia/pdfs/facts/2012toyoutlook.pdf
 Chinese law stipulates that workers must be paid overtime wages for time worked in excess of 40 hours a week and that weekend overtime be paid at a double-time rate. Factories typically run a 5-day workweek comprised of 8-hour workdays with overtime on Saturdays paid at a double-time rate. But at Winson and Jetta, despite its workers doing the same long overtime hours as other factories, management intentionally uses a different time recording method to “divert” normally paid working time to Saturdays, thus reducing work paid at a double-time rate.
 For example, at Mattel’s Shenzhen-based supplier plant Winson, one production line maintained a daily quota of 1,600 toys, and each worker on the line will work on each of the 1,600 toys. Working six days a week, 4.2 weeks a month (assuming a 30-day month), a Winson worker will be expected to produce 40,320 toys per month. The worker’s base monthly wage (i.e., before overtime) is the local minimum wage of 2,030 RMB ($319). After adding in all other high-season remuneration, including overtime, and before taking deductions, a worker’s income may reach 4,060 RMB ($638) per month—this assumes 110 hours of overtime. If we divide monthly income (4,060 RMB) by the number of toys produced (40,320), we reach the conclusion that each Winson worker earns 0.100069 RMB ($0.016) per toy.
 Highest-Paid Chiefs in 2014, The New York Times, http://www.nytimes.com/interactive/2015/05/14/business/executive-compensation.html