The term "sweating" originated in the late 1800's, due to the contracting system. The garment industry is like a pyramid with the contractors in the middle. Retailers are on top and garment workers are at the bottom of the pyramid. The pyramid has retailers on top, followed by manufacturers, then contractors or sub-contractors and finally, garment workers. The retailers set a low price, which they are willing to pay to the manufactures, and then the manufactures demand a lower price from factories. As a result, the factories are forced to "sweat" profits out of the garment workers in order to keep up with demands (Crisis or Opportunity).
According to Sweatshop Watch, a sweatshop is " a workplace that violates the law and where workers are subject to: extreme exploitation, poor working conditions, arbitrary discipline, such as verbal and physical abuse, and [where supervisors provoke] fear and intimidation." There are curtain characteristics that mark a garment factory as a sweatshop. These characteristics are if a factory is/has a fire hazard, electrical hazard, safety hazard, health hazard, structural dangers, wage violations, child labor, industrial homework, registration violations, and tax irregularities (Levine p.142-3). No one characteristic is common to a sweatshop, but instead a sweatshop has several of these characteristics.
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