The Perfect Scam
In an obscure corner of the Port of Miami, a floodlight haze surrounds a huge tiki hut, where two men from a faraway land sit at a picnic table and contemplate their so-called lives. Directly before them tennis players swat balls on an illuminated court and nearby, dance music blasts from a set of speakers at a party on the wooden deck of the Leiv Eiriksson Center for seamen. These South Asian seafarers -- one short, one tall, and both with thick black mustaches -- are accustomed to being on the margins of good times. They live in a unique form of servitude that they have escaped for the night. Although they speak freely, they want to remain anonymous. "Give us French names," says the short one, with a laugh. Call him Jacques; his cohort shall be François.
Fate brought them here. So did Destiny, the Carnival cruise ship. The big boat also delivered the dozens of partiers gathered around the center's hexagonal tables and purple sun umbrellas. The revelers are all members of the vessel's 1050-strong crew: busboys, bellhops, mechanics, nurses, day-care workers, gift shop managers ... the list goes on. François and Jacques are cooks who, along with janitors, suffer the worst of Carnival Cruise Lines' low pay, excessive hours, and generally miserable working conditions. Normally Destiny docks here at its home port for about eight hours before departing with about 2600 passengers for another weeklong Caribbean tour. But because the four-year-old, $400 million ship is undergoing maintenance, the workers are in port for seven days.
Usually at this hour Jacques would be in the midst of his fourteen-hour workday, which begins at 4:00 a.m., when he rolls out of a double bunk bed after only three or four hours of sleep in a windowless cabin below the water level. During the half-hour it takes him to get ready for the day, he showers and shaves in a bathroom shared with a roommate and two men from an adjacent cabin. Then he dresses and heads to work on the third deck. He does so without breakfast, because ship rules prohibit crew members from keeping food in their cabins, and the staff dining room is closed until 6:00 a.m. His supervisors don't allow him to eat on the job. "Of course we feel hungry!" he comments.
Next Jacques begins preparing ingredients for the breakfast buffet. He fetches loads of meat, eggs, vegetables, bread, and other items, then begins a dizzying rush of slicing, chopping, boiling, simmering, and frying. He moves from the kitchen's 90-degree heat into the freezer and back. He must deliver his creations to the main passenger galley by 6:00 a.m., when vacationers begin lining up for the breakfast buffet. Then he races back down to the prep kitchen and repeats the drill. At 10:00 a.m. the buffet line closes, and Jacques is finally allowed to eat. He then heads to his cabin for some desperately needed sleep. When insomnia hits, which is often because his biological clock is screwed up, he watches TV or reads. By 3:00 p.m. he must return to the kitchen for an eight-hour dinner shift. At 11:30 p.m. he descends again to the crew mess hall for his second and last meal of the day. Then it's off to his bunk.
Jacques, who recently began his fifth year with Carnival, does this seven days per week, nine months at a stretch. For the 98 hours he clocks weekly, he earns $150. That translates to approximately $1.50 an hour, about one-fourth the average wage of a burger flipper at a fast-food joint. François's schedule is similar, except his fifteen-hour shift begins at 7:00 a.m. and ends at 10:30 p.m., with a half hour off for lunch. François, who will complete his fifth year with Carnival in March, earns about $150 for his 105-hour week, or $1.45 an hour. That will amount to $6500 over the course of his ten-month contract. Like Jacques he communicates with his family by spending a small fortune calling from pay phones while in port.
Jacques and François say they have subjected themselves to this life -- they call it a nightmare -- for five years because their families at home depend on the income. Jacques supports not only his wife and their three-year-old son, but also his mother, brother, and sister. François, who holds a business degree from a university in his country, could not find sufficient work there to support his parents, his wife, and their two-year-old child before shipping out. Quitting is not an option. "We have to do it," Jacques says, impatiently, gravely. "We can't help it. We can't say no to our families. If we lose the job, what they going to do?"
A fellow cook, a gangly blond man from an Eastern European country, comes by and sits down at the picnic table. Call him Ivan. He earns roughly the same as the other two, $550 per month, far below the U.S. poverty level. The threat of returning to an economic disaster area back home keeps him and other workers on Carnival's parsimonious payroll. "The company will say, 'If you don't like [the salary] you can go,'" he observes. "It's like blackmail." Then he stands and walks toward the party.
During the past two months New Times interviewed twenty Carnival workers, including the three cooks, and reviewed court testimony from dozens of others. Most complained of shifts up to sixteen hours long, seven-day work weeks, no days off for several months, and wages far below legal American standards. Many have lost hope of job advancement after several years of service. Other amenities most U.S. citizens take for granted, like sick pay, vacations, and retirement benefits, the crew members say, are insufficient or nonexistent. Some, especially black workers from Caribbean islands, contend they are targets of bigotry.
Fueled by maritime tradition, federal legislation, and U.S. Supreme Court rulings, Carnival Corporation's revenues swelled from $45 million in the Seventies to $3.5 billion, resulting in a $1 billion profit, in 1999. You might think such a company, which is based in the United States and peddles a week or two of luxury on the seas, would pay its employees salaries above the national poverty level. But it doesn't. Indeed it is possible Carnival and other U.S.-based cruise companies violate a chapter of federal labor law that specifies employees must be paid while in U.S. waters, according to a top-ranking official at the U.S. Labor Department interviewed by New Times.
Like most American companies that operate commercial vessels, Carnival registers its ships in foreign countries, where there is an endless supply of workers willing to toil long hours for a pittance, and few labor unions to get in the way. "You still have circumstances in agriculture and in some sweatshop industries where people will bring foreign workers into the United States expressly for the purpose of having a slave workforce. But there's no way you can do it in compliance with the law," says Peter Rutledge, a staffer of the U.S. House Education and the Workforce Committee. "What's different about the cruise industry is you have the same kind of exploitative conditions going on, but they are all lawful."
Carnival, whose subsidiaries operate a total of 45 cruise ships worldwide, has yet to respond to a request New Times made last November to tour Destiny or another of the fourteen craft called "fun ships." Regarding inquiries about working conditions, public-relations director Jennifer de la Cruz insisted on receiving faxed questions, but then failed to reply to several of the most controversial queries. She did not respond to several phone calls seeking follow-up comment. "Shipboard employees' workload is usually limited to an average of ten hours a day," according to Carnival's written response, which came from the desk of de la Cruz's assistant Irene Lui. But the company doesn't disclose its salaries. "Shipboard positions are very sought after in employees' home countries because, although the hours are long, the pay is attractive."
Until this century ships usually flew the flag of the country where their owners lived. Had that custom survived, many seafarers would today be protected by the labor laws of industrialized nations. Instead another tradition has flourished. "Being a seaman was always considered to be a terrible job," says Bob Jarvis, maritime law professor at Nova Southeastern University in Fort Lauderdale. "There's been a long history in this industry of paying workers very, very badly. It's the reason that so few Americans want to be seamen ... because being a seaman is incredibly difficult, dangerous, hard work.... Your home is your workplace, and it's a very demanding workplace because if a fire breaks out or the weather changes ... you are living in these very cramped quarters and you're always on call. It's just not a very good life. Most people do it for a relatively short amount of time if they have any other options."
To some bedraggled mariners it must have seemed this would change in 1938, when Congress passed the U.S. Fair Labor Standards Act, one of the pillars of workers' rights in this nation. But the legislation provided exemptions that allowed vessel owners to avoid paying seamen minimum wage or overtime. Lawmakers and shipping companies held that these exceptions were necessary, among other reasons, to ensure the economic viability of the marine industry. "That tradition comes from hundreds of years ago," explains Jarvis. "American ship owners did not want to pay overtime under any circumstances. They wanted to simply say to the crew member: 'We're paying you ten dollars a day and your day is as long as the captain decides it needs to be.'"
In the late Forties the United States government helped spawn an American-owned, foreign-flagged merchant marine by selling cargo and troop-transport ships to privately held corporations. As American unions organized and won pay raises in the Fifties, shipping companies accelerated the rush toward foreign flags, sometimes termed flags of convenience. The U.S. military, which relied on commercial vessels during wartime and was interested in preserving American ownership, approved of the trend. "One problem in the U.S. is that in time of war we do not have enough navy ships," Jarvis says. "When the American ship owners said, 'We're going to get out of the business or you're going to let us flag foreign,' the Defense Department said, 'As long as you have ships that we can grab in time of war, we don't care if you flag them U.S. or you flag them foreign....' The U.S. ship owners said, 'We have got to get out from under the U.S. flag because it is becoming even more expensive.'" Jarvis says it is typically at least 50 percent more expensive to operate a U.S.-flagged vessel than one with a flag of convenience, mainly because of labor costs.
In 1961 Congress extended minimum-wage requirements to cover seamen on vessels registered in the United States. But the lawmakers left intact the exemption for foreign ships. The U.S. Supreme Court reinforced the flag of convenience system in 1963, when the justices decided this nation's labor laws, including the right to organize, do not apply to foreign cargo vessels engaging in American commerce, even if the owners are from the United States.
By ensuring cheap labor and the absence of union rights, U.S. authorities provided the foundation on which Carnival and others would build billion-dollar empires during the next three decades. Despite repeated attempts by crusading lawmakers, Congress has refused to throw a line to cruise workers left adrift. The last rescue attempt foundered in 1993, when a Republican-controlled Congress rejected legislation introduced by Rep. William Clay (D-Mo.) to extend U.S. labor laws to foreign-flagged vessels, such as Carnival's, that regularly engage in U.S. commerce. The Coast Guard and Department of Justice, which currently monitor foreign vessels' adherence to American environmental regulations, would have been responsible for enforcement.
"The bulk of the lobbying against the bill came from the cruise ship industry," recalls Peter Rutledge, a former Clay aide. "You can operate huge cargo ships now with seven or eight people. But you can't operate a cruise ship without stewards to take care of your passengers. So [cruise ships] have much higher labor costs than the merchant side of the industry." Rutledge thinks it is unlikely any member of Congress would reintroduce a similar bill unless Democrats regain control of the House of Representatives in November.
Although the U.S. government cleared the way for cruise lines to pay ultralow wages, the companies may not avoid federal scrutiny forever. New Times has discovered that Carnival and its competitors may regularly violate a provision of the Fair Labor Standards Act that has never been applied to cruise ship workers. Following the letter of the law could cost the company millions of dollars. (Carnival did not respond to a written question about the measure.)
Rick Brennan, deputy director of enforcement at the U.S. Labor Department's wage and hour division in Washington, D.C., believes minimum-wage laws should apply to shipboard personnel engaged in domestic work, like cooking and cleaning rooms, when their vessel is in U.S. waters. "A cruise company that has offices in the United States and in effect meets the tests of an employer in the United States is going to have some employees covered by minimum wage and overtime [rules] in this cruise ship operation," he says, adding that he is speaking hypothetically, because the Labor Department has received no complaints regarding this issue and has therefore not investigated.
The issue comes down to the definition of seaman in the Fair Labor Standards Act, Brennan says. The law allows Carnival and others to ignore U.S. minimum wage and overtime rules for many of its shipboard personnel, most of the time. But it doesn't always allow such brazenness. "Only the seamen (those involved in navigation or supporting navigators) on a [foreign-flagged] vessel literally come within the scope of that exemption," Brennan emphasizes. Bellhops, busboys, and most cooks, therefore, are not covered. "Employees there for the convenience and leisure activities of the paying customers," Brennan adds, "should be viewed under the wage-hour law as any other employee entitled to minimum wage and overtime for the period that they would be in the United States."
Bob Jarvis is not surprised at the Labor Department's interpretation. "There's this feeling that Carnival and other foreign-flagged cruise ship companies that really derive almost all of their revenue from American passengers are not playing fair, because they are not subject to the same U.S. laws that other U.S. companies are subject to," he says. "I think the Labor Department has always been interested in finding ways to make the cruise ship industry toe the line and have the same sort of obligations that other companies in this country have."
Yet Jarvis believes Labor Department lawyers would be reluctant to pursue a case unless Congress passes legislation like the Clay bill. Why? Because Carnival lawyers would sue, and the U.S. Supreme Court would back them up, he predicts. "I think the court would say, 'It's not our job to figure that out, it's Congress's job.' They would point to the Clay bill. They would say, 'Look, this issue was in front of Congress very recently, Congress decided the law was fine the way it was and didn't change it. So if Congress doesn't think the law should be changed, who are we to think it should be changed?'"
Although the Supreme Court has never considered the issue of wage and hour rules for this special breed of laborers, it has decided cases involving compensation for injured cruise ship workers. In a 1969 decision the court upheld the right of injured seafarers to sue their American employers in U.S. courts, even if the ship in question is foreign flagged. The ruling has been upheld several times since.
One thing is clear: Carnival's itineraries ensure its vessels spend little time in U.S. territory before heading out to sea. For example Destiny arrives at the Port of Miami at 8:00 a.m. on Sunday and departs at 4:00 p.m. Receiving the U.S. minimum wage just one day per week would increase a cruise ship worker's income about $45 per month, which would be enough to feed one of Jacques or François's unemployed relatives for several weeks.
Unfortunately Jacques and François are in good company. In interview after interview, Carnival workers tell similarly grim tales. Andre (an alias) works 70 hours per week as a janitor, cleaning guest cabins, hallways, dining areas, you name it. An energetic 27-year-old from Saint Vincent, his salary is $452 per month, or about $1.60 per hour for the duration of his nine-month contract. Although he's been working for Carnival five years, his pay recently was reduced by $80 per month. "They chopped it down," he fumes. Andre is not sure what prompted the reduction, but he thinks his supervisors would brand him a troublemaker if he complained. Morale is low among his fellow islanders. "We work really hard, mon," he says in his Antillean brogue. "A lot of people saying they're going home [after their contract ends] and no comin' back, mon."
Andre's compatriot Yves, who earns a $240 per month salary and another $400 in tips as a bellman, sometimes thinks about quitting. "Lot of craaazy things goin' on," he says angrily. "We are black. Sometimes there is some kind of discrimination onboard." For example he claims some light-skinned security guards act like prison wardens. "As soon as we put on reggae music [in the crew bar], the guards come and turn it off," he says. "They come and treat us like we're in jail or something. We're not making any trouble." Guards also hassle him when he is off-duty and passing through the hotel portion of the ship. "If I stand too long in the public area, the security guard come along and ask, 'What you doin'?' A lot of bullshit goin' on," he concludes. "You have some crew members who don't like black people. You expect it from the passengers, but not from the crew. You have to unite when you're on a ship."
The pay is so lousy that some employees seek out additional jobs, prolonging their already lengthy workdays. For instance, after his eight-hour shift, which stretches from 10:00 p.m. to 6:00 a.m., Yves moonlights as a janitor several days per week. Carnival's written response explains the arrangement this way: "This would be very similar to employees here in the U.S. taking on a part-time evening or weekend job to supplement their full-time jobs. While this allows them to earn additional income, it is left solely to the employees' discretion, and Carnival is not involved in these actions."
Carnival also saves money by cutting workers' pay when they are on sick leave. In 1997 Alberto Garcia, a native of the Dominican Republic, was earning $500 per month working twelve-hour days (about $16 per day) as a maintenance man on Imagination. That year he hurt his lower back while hauling a line used to attach the ship to a Port of Miami pier. He went to the infirmary, where a doctor gave him some painkillers and sent him back to work. Although he was in extreme pain, Garcia says his supervisor told him he would be sent home if he requested medical leave. Fearing for his job, he toughed it out for another year as the agony increased.
In December 1998 Carnival doctors finally recommended time off. As stipulated in his contract, the company reduced Garcia's salary to $12 per day. He underwent surgery for a herniated disk this past August. A friend put him in touch with maritime lawyer Charles Lipcon, who is suing Carnival for damages and lost wages. "It is the modus operandi of Carnival doctors not to tell the workers exactly what [ailment] they have," notes Marco Barbosa, a private investigator who works with Lipcon.
In its brief written response, Carnival acknowledges sending some injured workers to their home countries, adding "they are provided with a daily stipend to cover their out-of-pocket room-and-board expenses."
Workers typically shell out hundreds of dollars before they can even start their cruise ship careers. Carnival has contracts with employment agencies around the world that charge new hires up to $1500 for job placement. In addition recruits must pay the equivalent of one-way airfare from their home country to the port of their assigned ships. A Paradise cook from India, who asked to remain anonymous, says he gave a Bombay agency $2000, which included airfare. That sum, much of which he borrowed from relatives, is almost a third of the $7000 he will make during his current ten-month contract. The man, who supports five people including his wife and four-year-old son, has not received a promotion in five years. (Carnival usually returns the agency payment and airfare after several years of service -- without interest -- workers report.)
The cruise company also requires staff members who interact with passengers -- waiters, busboys, and bellhops -- to pay a $50 deposit for their uniforms. "It's a big robbery, mon," protests Pierre, another Caribbean islander, who began working for Carnival in 1994 as a $360-per-month snack bar attendant. "This is a very thinking company," he observes.
And the company employs one more method to keep labor costs low and workers hustling: getting customers to shell out tips. Large numbers of personnel receive a minimal base wage and must depend on the kindness of strangers. Take Pierre, for instance. He's currently one of about 80 busboys on Destiny (and has not been promoted in four years). He can earn as much as $500 per week in tips, he says. Carnival's contribution is only $45 per month, less than he earned many years ago cutting sugar cane in Barbados. During the ship's weeklong maintenance, he received only that base pay. (Under U.S. law even tipped personnel, on land of course, are entitled to the minimum wage of $5.15 per hour.) "It is quite a system," Bob Jarvis marvels. "And it is all perfectly legal and extremely lucrative."
It may be legal, but it's not moral, says Maria Jimenez, an Episcopal minister at the Seaman's Church Institute of Florida. She operates Seafarers' House, which provides counseling and other services for cruise ship workers. "They're in bad shape," she says of the hundreds of crew members she meets each year. "This is the only chance they think they have to fulfill their dream of making some money. And though they end up receiving dollars, that doesn't justify [a cruise ship company] not protecting their rights.... They have needs, and an American company needs to respond to those needs, like recreation, proper rest, and food. Not just to get the most out of them because they are cheap and in need. That's taking advantage [of them]."
Jimenez continues: "I have developed an appreciation for what these men and women give us, contribute to our economy, our welfare. The people on the cruise ships provide for our entertainment.... So they serve our needs, and we are morally obliged to give something in return."
The International Transport Workers Federation, an organization representing five million trade union members worldwide, is trying to reward the cruise ship workers with union rights. "We want to drive these ships back to a U.S. flag," says Tony Sasso, a federation member who inspects labor conditions on commercial vessels in South Florida. "But more realistically we are trying to get some of these companies under an ITF-approved collective bargaining agreement." So far Royal Caribbean Cruises, Ltd., is the only American-based cruise ship corporation to accept such an accord, he says. Sasso adds Carnival won't allow him onboard to inspect working conditions. "Carnival is the big nut to crack," he says.
"You go on a U.S.-flagged ship," he continues, "you might work eight to twelve hours, and you get overtime after that. You normally work twelve hours a day, and you get three or four hours of overtime a day. You have certain rules about how much sleep you got to get and how much ... you can do before you get a rest period. It's traditional and it's Coast Guard-[required]. But [Carnival] doesn't fall under all those rules. Why do you think they go and flag these things in the Bahamas and Liberia and Cyprus and wherever else? Because they don't have to abide by rules and labor standards that any decent people would consider."
That argument doesn't float with Carnival, Jarvis comments. "In fairness to Carnival and all the other cruise lines, how could they justify paying [workers] more when they have stockholders who are going to say, 'Now let's get this straight. You didn't have to pay them this much but you did and our dividends and our profits are not as great?'" he wonders. "That is the problem that corporations always face. They are answerable to stockholders, and stockholders are only interested in one thing: maximizing profit."
Back at the tiki hut, François and Jacques have lost interest in the festivities. It is now about 10:00 p.m., roughly the time they would be finishing up their fourteen- to sixteen-hour kitchen stints. They believe Carnival has the means to treat its workers better. "Carnival is a very rich company," Jacques says sadly. "But most of the crew members are not happy with Carnival. Maybe in the officers' section they are. They enjoy life."
After years of toil in Carnival's kitchens, Jacques and François think they deserve promotions to another, less hellish department. But they have lost all hope of reassignment to positions with more reasonable schedules. "We are trying to go outside the galley but nobody wants to come in," François says. The reason is simple, adds Jacques: "Because nobody like to work as a cook, for low salary and long hours."
Because Carnival tends to deploy workers to different ships when it renews contracts, the pair likely will split up when François's current contract expires this spring. "Maybe we won't see each other again," François laments. The cooks think their employer designed the ship-rotation system to keep employees from forming too much camaraderie, which might lay groundwork for union organizing. "There is no possibility of [forming] a union on the ship," François adds. "Nobody's going to attempt that. Somebody attempt to talk like that, he'll be fired." Jacques concurs: "They'll just send him a [termination] letter and that's it."
And so ends a rare night out for Jacques and François. They walk from the tiki hut, stroll along the perimeter of the party without stopping, and begin the fifteen-minute hike back to their Destiny. "It's impossible to keep doing this," sighs François. And yet somehow he and thousands of other Carnival workers do.
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