While completing this week's forum, I decided to research Coca Cola and labor law violations. What I found was disturbing reports of violations and even covert murdering of unionized workers -I will get into that later. Labor laws are definitely necessary and for developing countries I think strict labor laws are necessary, but what is even more important is that they are enforced. Strict labor laws are legislated to protect workers. Often that means better wages, improved working conditions, possibly insurance, safety considerations, and time off. For larger companies, like Coca Cola, I believe a larger responsibility and larger operating costs are implicit to stricter labor laws.
It is indubitably management's responsibility to search out the best location for business. That's a no brainer, right? However, management should not solely rely on strict labor laws to be the determining factor in the decision to operate within a particular region.
For instance, the market, culture, demand, and infrastructure are just a few to consider. Environmental regulations can also drive businesses out from other countries. Referenceforbusiness.com suggests that environmental regulation can have an impact on the business and the local community surrounding the prospective location.
The buzz about closing loopholes in current legislation has been tossed around Washington D.C. a lot since 2012. However, not a lot has been done about it until recently. Lach (2012), an editor at the Center for American Progress finds that labor costs are the main issue of why corporations are outsourcing jobs. The interesting twist is that foreign countries' costs are rising compared to the United States. So the loophole that is often abused is becoming less attractive. Washington D.C. is attuned to this trend and it appears a degree of energy is being put towards improving the U.S. tax code. According to U.S. Senator...