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Disney Cuts Ties with a Chinese Toymaker After Allegations of Labor Standards Violations

Nov 30, 2016

Walt Disney (dis) has severed ties with one Chinese toy manufacturer making products featuring its characters over reported violations of labor standards, and warned another about issues with its factories.

The revelations came in a public note addressing concerns over working conditions in factories licensed by Disney to make branded toys and other products, reports Bloomberg. The facilities in question had been pinpointed by the New York-based labor rights group China Labor Watch in June, according to Disney.

"Our investigation has revealed that Dongguan Qing Xi Juantiway Plastic Factory failed to remediate hiring and human resource issues identified during an investigation of the facility last year," the entertainment conglomerate's note read. It said that the company had revoked the toy maker's license to manufacture branded products on its behalf, because it "failed to correct important issues in a timely manner."

A separate licensee, the Lam Sun Toy Limited Company, was named by Disney in the note for "failing to meet expectations regarding accurate record keeping, health, fire safety and human resources practices." Disney added that, unless the factory improves in these areas effectively, it too would no longer be authorized to make products carrying the Disney brand.

Multinational corporations have long faced pressure to improve conditions in overseas factories to which they have outsourced manufacturing. Watchdogs like China Labor Watch have regularly criticized top retail brands for failing to provide or enforce adequate protection for laborers in outsource facilities.

For more on Disney in China, watch Fortune's video:

Disney has been trying to monitor workplace conditions at its contractors in accordance with its International Labor Standards program since 1996, according to Bloomberg.

Neither China Labor Watch nor Walt Disney immediately responded to Fortune’s request for further comment.

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