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Working Off the Clock and Its Impact

Author

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  • Muhammad Faraz
  • Aamir Shamsi
  • Rizwana Bashir

Abstract

Textile is one of the largest export and source of foreign exchange in Pakistan. For the last two decades, Textile sector is serving as the backbone for Pakistan economy. Several foreign retailers including Target, Jessie Penny, Wal-Mart, and Kohl’s are outsourcing textile and garments from Pakistan. Along with the quality, these retailers are highly concerned with the ethical and social issues of their suppliers, including child labor, forced labor, compensation, working hours and environment health, and safety. My current study is an applied research, based on the problem, regarding the working hours and its proper management in textile factories, mismanagement of which lead to serious issues during social and ethical standard audits. Repetition of which may consequent in termination of business with suppliers and factories. The research hypothesis is that working off the clock will lead to overtime premium not paid and double book record keeping. As far as ethical and social compliance (SC) is concerned both overtime premiums not paid and double book records are critical issues during SC audit. A sample of 40 suppliers (factories SC audit reports) of Pakistan was randomly selected working with foreign buyers. Secondary data were used to verify the findings based on Audits finding conducted by different third party during a period of 2 years, i.e. Feb., 2010 to Jan., 2012. The results and research findings reflect that during the last 2 years (Nov., 2010 to Oct., 2012) out of 40 factories audit reports 25 factories (62.5 %) were found having working off the clock that also lead to overtime premium not paid. However, double book records were not witnessed in all 40 factories SC audit reports as parallel (falsified) records were not maintained by any factories. The above findings will help the suppliers, factories, and buyers to develop a proactive approach (on buyers end) and proper production planning (on suppliers and factories end) to avoid critical issues and smooth business activities. Copyright Springer Science+Business Media Dordrecht 2014

Suggested Citation

  • Muhammad Faraz & Aamir Shamsi & Rizwana Bashir, 2014. "Working Off the Clock and Its Impact," Journal of Business Ethics, Springer, vol. 122(3), pages 395-403, July.
    • Handle: RePEc:kap:jbuset:v:122:y:2014:i:3:p:395-403
    DOI: 10.1007/s10551-013-1765-4
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    References listed on IDEAS

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    1. Rauscher, K.J. & Runyan, C.W. & Schulman, M.D. & Bowling, J.M., 2008. "US child labor violations in the retail and service industries: Findings from a national survey of working adolescents," American Journal of Public Health, American Public Health Association, vol. 98(9), pages 1693-1699.
    2. Annette BERNHARDT & Siobhán McGRATH & James DeFILIPPIS, 2008. "The state of worker protections in the United States: Unregulated work in New York City," International Labour Review, International Labour Organization, vol. 147(2-3), pages 135-162, June.
    3. Senghaas-Knobloch Eva, 2004. "Auftrag und Möglichkeiten der Internationalen Arbeitsorganisation (ILO) unter den Bedingungen der Globalisierung," Arbeit, De Gruyter, vol. 13(3), pages 236-247, September.
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