Cheap labour and lower manufacturing costs are driving companies to open branch offices in other jurisdictions, including China, India, Eastern Europe and the Middle East. But the labour standards there are often very different from those in most Western countries, posing problems for organizations and their HR departments. Some American companies have come under attack for operating sweatshops in other countries, while others have found the standards of privacy differ greatly from one country to another. Social and cultural norms can also affect how HR professionals do their jobs in other countries.
Balancing safety and profit in China
Despite China’s 2002 Worker Safety Law and the State Administration for Worker Safety (SAWS), “conditions in many state-owned factories in China are still poor,” according to the article “Staying Safe Overseas” on Manufacturing.net’s website. “Workers do not wear protective clothing, gloves, face masks or eye protection; air conditioning is mostly non-existent and lighting is poor.” The article states that safety enforcement is becoming more important since many Chinese companies are realizing that “providing health-care benefits and safety supplies and training, and preventing occupational diseases, can lead to a more efficient workforce.” But as more workers in China become aware of their rights, “they are demanding safety equipment and training. In developing nations, employers then have to balance what is needed against what is affordable.”
Adopting North American culture
One of the challenges of hiring employees in another country can include the gap in cultural standards. This New York Times article, “Indian Companies Are Adding Western Flavor,” examines how some software and consulting companies are training workers in India to learn what it describes as “global-employee skills.” Training courses teach Indian employees “how to speak on a conference call, how to address colleagues (as Mr. or Ms.) and how to sip wine properly.” As more jobs move to India, these courses are becoming more common. Although many Indian employees are fluent in English, “most lack the sophistication needed to flourish in a global business setting,” the article states. “It is particularly imperative for employees of software companies to appear culturally seamless with Americans. American clients account for more than two-thirds of India’s software and services export revenues.”
Culture can compromise security
This article, “Offshore security can be compromised by cultural differences,” states that companies outsourcing work to countries such as India and China should look closely at the impact cultural differences have on security issues. The article states that “standards of privacy are often looser in India because, for instance, reading someone else’s e-mail would not be considered much of an intrusion there.” And when it comes to protecting corporate data, “companies that outsource operations overseas are advised to train local staff to adhere to the company’s global privacy standards and to check into the risk of government interception of sensitive confidential information.”
India lacks privacy protection
Another article, from the University of California’s Business Law Journal, “Outsourcing to India by U.S. and E.U. Companies,” warns of similar privacy issues. “Currently, no data privacy protection legislation of any kind exists in India. Therefore, American outsourcers rely upon contractual obligations and the internal security measures taken by Indian service providers for protecting non-public information.” The article adds that employees of service providers in India “have access to extensive personal information about customers of American companies. This includes credit card numbers, social security numbers, driver’s license numbers, dates of birth and other important personal information that has the potential for misuse.”
Ann Macaulay is a freelance editor and regular contributor to Canadian HR Reporter. Her Web Sight column appears regularly in the CloseUp section.