Employment Relations in a Global Supply Chain

Abstract

Global supply chain has increased as a way to enhance competitive advantages of multinational companies

(MNCs). It allowed MNCs to effectively utilize inexpensive labor in the third-world countries, however, this

process of globalization is uneven and is contributing to sharper inequalities in income and wealth between

countries. In this paper we examine the way a leading US-based, global apparel firm applies its labor code of

practice to two prime contractors located in South Korea. We investigate the content of the code, the mechanisms

used in implementing the code, and the way behavior associated with the code relates to ER more generally. We

find evidence for relational contracting and high compliance by the two Korean contractor plants in regard to the

global firms code of labor practices. ER patterns in the plants are similar and related to implementation of the

global firms labor practices code. However, they are not completely uniform. This is explained by variations in

workplace dependence on the global corporation and the history and current approaches of contractor

management.