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Serious violations of workers' rights in Nicaragua's Export Processing Zones

ICFTU Online..., 202/991027/DD. 27 October 1999

Brussels October 27 1999 (ICFTU OnLine): Nicaragua workers in multinational companies in the country's export processing zones (EPZs) are being ill-treated, physically harassed and sexually abused by management. Anyone trying to form unions to protect the workers is likely to be threatened, fired and blacklisted, says the new ICFTU report published today to complement the World Trade Organisation's report on Nicaragua's trade policy.

The ICFTU report's findings clearly demonstrate how the country is promoting an aggressive export policy at the expense of the rights of their working population. As these zones are set to expand, the abuse of Nicaraguan workers' rights will increase, says the ICFTU.

One of the main EPZs, Las Mercedes, which houses 19 factories employing a total of 135,000 people is ringed by barbed wire and patrolled by armed guards. Many of the factories are Taiwanese- US- or South Korean-owned, and produce clothing for export to the US. Here the workers work long hours in poor conditions, have to meet strict production quotas, and are paid below the legal minimum wage.

While the government has ratified the two main ILO Conventions 87 and 98 which guarantee workers the right to form unions and to engage in collective bargaining, and has set up inspection offices within the zones, the violations of workers' rights continue. Companies have made some moves to pay the legally-stipulated minimum, but when workers in one factory, the Chih Hsing factory, owned by the Taiwanese consortium Nien Hsing tried to negotiate a collective agreement, the company threatened to close down the factory and the Chentex factory which it also owned within the zone. When the union had been registered in July this year, the company had immediately illegally fired 12 union members, including the entire union executive.

Workers at the Chentex, which supplies US retailer JC Penney, were fired in 1997 when they spoke on the US television programme `Hard Copy' about conditions in the factory. It appears that the Ministry of Labour was collaborating with the Chentex management - it informed them when the union was being formed, during the early stages of the legal recognition process in 1998, so that the company could fire the unionists before the union had legal status.


Although Nicaragua has ratified ILO Conventions 100 and 111 outlawing discrimination, discrimination against women workers persists. They receive lower pay for the same work as men, and make up the majority of workers in the traditionally low-paid education, textile and health service sectors.

There is also discrimination against the country's indigenous population, and in 1996 the government awarded a long-term timber concession to a Korean firm on land claimed by an Amerindian tribe called the Awas Tingni. The tribe successfully sued the government and won its case but the Korean firm's business was bought by a domestic company in 1998, and so the logging on the Awas Tingni's land is continuing.

Child labour

Child labour is on the increase in Nicaragua, because of rural poverty, poor education, and lack of enforcement to ensure that underage children (under 14) are not working. A report published in September 1998 by the Nicaraguan Commission against Child Labour concluded that over 160,000 children under 17 were working, 140,000 of them in the countryside, harvesting export crops such as coffee, cotton, bananas, tobacco and rice.

Most children working in agriculture are aged 14 or under, and children as young as 10 often work for less than $1.00 a day on banana and coffee plantations; in fact UNICEF has said that 20% of children aged 6 to 9 are at work. This provides clear evidence that child labour is extensively used in the export agribusiness.

To remedy the situation, the government has recently committed itself (in theory) to participating in the ILO's International Programme for the Elimination of Child Labour.


The ICFTU says that the WTO should remind the Nicaraguan government that at the two WTO Ministerial meetings it gave a commitment to respect core labour standards. The WTO should request the ILO to intensify its work with the government and report back on progress to adhere to core labour standards at the next WTO trade policy review, says the ICFTU.

Note: The ICFTU will be present at the Seattle WTO Ministerial, where it will be arguing the case for linking labour standards and trade to prevent further exploitation of workers.

The Nicaragua report is on this website.

International Confederation of Free Trade Unions (ICFTU)
Boulevard Emile Jacqmain 155, B - 1210 Brussels, Belgium. For more information please contact: Luc Demaret on: 00 322 224 0212 - press@icftu.org