Briefing on forced labour - a special focus on Malaysia

Briefing on forced labour a special focus on
Malaysia
Ethical Trading Initiative
8 Coldbath Square
London EC1R 5HE
United Kingdom
t +44 (0) 20 7841 5180
[email protected]
www.ethicaltrade.org
Briefing on forced labour -a special focus on Malaysiawith focus on Malaysia. Last
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Briefing on forced labour of workers: focus on Malaysia
Contents
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2
3
4
5
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Introduction
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1.1 Background
2
1.2 Purpose of this document
2
1.3 How this document has been written
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What is it and how bad is it?
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2.1 Understanding forced and bonded labour
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2.2 How do I recognise, identify and understand bonded labour in the supply chain?
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Are there particular countries, industries or workers more vulnerable to bonded labour?
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3.1 Migrant workers: from spring onions in Spalding to sandals in Shenzhen
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3.2 Special concerns regarding bonded women and child workers
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Malaysia: a case of concern for ETI members
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4.1 Typical violations of migrant workers’ rights
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4.2 Levy on migrant workers
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4.3 Systemic issues facing migrant workers in Malaysia
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4.4 What actions are being taken/recommended to address these issues?
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4.5 Engaging with local stakeholders
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4.6 Case study: one ETI member’s experience
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Recommendations for action
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5.1 Recommendations for ETI members
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5.2 Recommendations for ETI members regarding Malaysia
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Useful resources and/or organisations
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1. Introduction
1.1 Background
ETI members are aware of cases of forced labour in their supply chains and the
incidence appears to be growing. The ETI Secretariat has received press queries
about members’ awareness of and response to this issue throughout 2008. One
example has been the use of forced and bonded labour of South Asian and SouthEast Asian workers in Malaysia. As a result, the ETI has prepared this short briefing
which focuses on Malaysia. This note will be revised following further discussion and
experience. .
1.2 Purpose of this document
The purpose of this document is to:
Brief members on the scale of this issue and its possible relevance to
members’ own supply chains.
Describe the nature of the exploitation and how it occurs
Enable members to investigate the issue in their supply chains
Encourage members to find further information from other sources
Provide references and contact details for further information.
1.3 How this document has been written
The ETI Secretariat has put this briefing together from available, secondary sources,
not from primary research. All relevant information is referenced so that members
can investigate further. The ETI Secretariat holds detailed further information with
regard to the situation of migrant workers in Malaysia.
2. What is it and how bad is it?
2.1 Understanding forced and bonded labour
ETI members should look to the International Labour Organisation (ILO) when
seeking to understand the meaning of forced and bonded labour. The ILO’s definition
of forced labour is as follows:
Work or service is exacted under the menace of a penalty and
The work is undertaken involuntarily
Bonded labour is defined as when:
A person pledges his/her labour (or that of someone under his/her control) as
a means of repayment for a loan and
Where the value of their work is invariably greater than the original sum of
money borrowed.
The international law that defined bonded labour made a clear distinction between a
worker who takes credit to be repaid with labour on fixed repayment terms and
subject to reasonable interest rates (not bonded labour), and one whose repayment
terms are either not specified or not followed (bonded labour)1. In the latter case, the
worker is completely at the mercy of the employer, since their loan or interest can be
increased without any notice. Often costs may be added for transport, food or fuel.
For example, cases of such practices were found with some UK gangmasters.
From the ILO perspective, while not all slave labour is forced labour, bonded labour
is always considered forced labour. As a result, ETI members suspecting bonded
labour in supply chains should follow ILO guidance on forced labour2. The ILO
UN Supplementary Convention on the Abolition of Slavery, the Slave Trade and institutions and practices
similar to Slavery, 1956.
1
2
See most recent ILO advice November 2008: Combating Forced Labour: A Handbook for Employers
and Businesses
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estimates that nearly eight million people are working in forced labour conditions
worldwide – this excludes commercial sexual exploitation and state-organised forced
labour (such as in Burma/Myanmar). Around 2.5 million of those are in forced labour
situations as a result of people trafficking.
2.2 How do I recognise, identify and understand forced labour in the
supply chain?
The ILO gives clear guidance on how to identify forced labour in practice. Reading
these indicators tells us what mechanisms employers use to coerce workers into
bonded labour. They can also help us understand the situation of bonded labourers
and exactly how the exploitation occurs. ETI members can use this guidance when
visiting, assessing, auditing or researching worksites or information on working
practices:
Identifying forced labour: how workers arrive in a forced labour situation, and
how they are kept there3
Evidence of lack of consent to work (ie involuntary work):
Deception or false promises about types and terms of work
Withholding and/or non-payment of wages
Retention of identity documents or other valuable personal possessions
Induced indebtedness (by falsification of accounts; inflated prices; reduced
value of goods or services produced; excessive interest charges etc)
Psychological compulsion (ie an order to work backed up by the credible
threat of a penalty for non-compliance)
Sale of person into the ownership of another
Physical confinement in the work location
Physical abduction or kidnapping
Birth/descent into slave or bonded status
Evidence of the threat of a penalty involves the actual presence or credible
threat of:
Financial penalties
Dismissal from current employment
Exclusion from future employment
Denunciation to authorities (police, immigration etc) and deportation
Removal of rights or privileges
Shift to even worse working conditions
Deprivation of food, shelter or other necessities
Sexual violence
Physical violence against worker or family or close associates
Imprisonment or other physical confinement
Loss of social status
Exclusion from community or social life
Threat of supernatural retaliation
3. Are there particular countries, industries or workers more
vulnerable to forced labour?
The ILO publishes a global report on forced labour every four years, the most recent
of which was in 2005. It notes that forced labour is present in some form on all
continents, in almost all countries, and in every kind of economy. And while
traditionally, forced and bonded labour has been especially prevalent in agriculture
http://www.ilo.org/sapfl/News/lang--en/WCMS_099621/index.htm
3
Guidance taken verbatim from Global Alliance against Forced Labour, ILO, 2005
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and domestic service, the ILO report goes on to describe how new forms of forced
labour are now reaching into new areas of the economy, also across all countries.
ETI members should be aware of this information, and be vigilant to the appearance
of bonded labour in supply chains.
3.1 Migrant workers: From spring onions in Spalding to sandals in Shenzhen
ETI members should note that in terms of categories of workers, migrant
workers represent a large number of these newer victims of forced labour
across the world. Migrant labour is on the increase, and therefore will also be
increasingly prevalent in members supply chains. Worldwide there are an
estimated 81 million economically active immigrant workers who are estimated
to spend 87% of their wages in the country where they work.
Migrant labour is common in manufacturing and in agriculture, so vigilance is needed
across the supply chain. An Eastern European worker picking spring onions in
Spalding who has been required to hand in a passport is in the same situation as a
Chinese migrant worker making sandals in Shenzhen who has handed in an ID card
and paid a deposit. Both are bonded labourers, and they may also be victims of
people trafficking.
Migrant workers can be extremely dependent on their employer: for work,
accommodation, food, transport and even language. They can be tied to their
employer by financial commitments, promises made to community members or
traffickers, or even by law as is the case in Malaysia and Dubai. They may be
undocumented or be working illegally, and fearful of their employer or agent reporting
them to immigration authorities.
3.2 Special concerns regarding bonded women and child workers
Women represent 56% of forced labourers (again, excluding state-imposed forced
labour). Women and children’s labour may sometimes be bonded together with male
members of their family. Where this is the case, the women and/or children may be
ignorant of any terms of the ‘contract’ under which they are working. Women workers
are also more vulnerable than their male colleagues to threats of violence and sexual
violence.
4. MALAYSIA: A CASE OF CONCERN FOR ETI MEMBERS
The International Labour Organisation, the International Textile Garment and Leather
Workers Federation (ITGLWF) and ETI members have all raised the issue of
particular problems regarding migrant workers in Malaysia.
The Malaysian Government figures for 2007 state a presence of 2.04 million foreign
workers and a further 1.2 million undocumented (‘illegal’) workers. This represents
approximately 18% of the country’s 11million workers. The majority of documented
foreign workers come from Indonesia, (1.15million), followed by Bangladesh, Nepal,
India, Vietnam and Burma/Myanmar.4
4.1 Typical violations of migrant workers’ rights
Reported in Malaysian newspaper ‘The Star’, February 2008.
http://communicatinglabourrights.wordpress.com/2008/02/20/malaysia-crackdown-on-agencies-which-ill-treatforeign-workers/
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A conference regarding migrant workers in Malaysia was held in February 08,
attended by a variety of stakeholders from the Malaysian government, trade unions,
NGOs and the ILO. Discussions and subsequent reports from the conference have
given a clear picture of the problems that such workers are facing. Typical violations
include:
deception about contract conditions in sending country
substitution of contract once in destination country
charging of additional/ higher costs to worker than agreed
withholding ID
withholding salary
non-payment of salary
lower salary than sector standard or collective agreement, no provision of
other sector standards (overtime, day off, paid holidays, health coverage etc.)
deduction of levy, food, accommodation, bribes for law enforcement officials
& RELA
confinement in sub-standard accommodation on employers' premises
no access to communication
utilization of underage migrant workers (below 18 years in hazardous sectors)
4.2 Levy on migrant workers
Members have raised the issue of a levy which the Malaysian government collects on
certain categories of foreign workers (skilled, semi-skilled or unskilled workers in
manufacturing, construction, service and plantation sectors). 5 The levy was
designed to discourage employment of foreign workers but in practice, there are
millions of foreign workers from several countries as listed above.
In large firms, some employers pay the levy. However, in small or informal settings,
the levy is often passed onto workers (for example as deductions from wages, where
it can represent a high proportion of workers’ wages), or workers are employed
illegally. ETI’s understanding of the law is that the employer should pay the levy and
we have written to the High Commission seeking formal response on this matter.
The law also binds workers to their employers, creating a situation of forced labour.
Under circumstances where workers have no flexibility of employment, it is also hard
for unions to organise as workers have no leverage.
4.3 Systemic issues facing migrant workers in Malaysia
However, violations against migrant workers go far beyond the levy issue. There are
prevailing problems in the whole system of use of migrant workers in Malaysia which
include institutionalized policies and practices of the Malaysian Government and a
lack of will on the part of some actors to enforce existing formal protections for
migrant workers.
Systemic issues were outlined as follows at the recent multi-stakeholder conference
mentioned above6:
the problematic role of the sponsorship system of work permits and
immigration law in suppressing migrant workers
employers undercut labour conditions with compliant migrant workers.
Xenophobia then ensues towards all migrant workers, also impacting on
national trade unions ability to act on behalf of migrant workers
5
For official information on these rules and those for foreign workers in other South East Asian countries, see
the Association of South East Asian Nations website at http://www.aseansec.org/8821.htm
6
Conference reports and more detailed information will be available from ETI Secretariat when released.
Briefing on forced labour -a special focus on Malaysiawith focus on Malaysia. Last
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those formal labour rights which do exist for migrant workers are negated by
out-sourcing recruitment and thereby obscuring the employment relationship
no effective right to organize
no effective access to justice or redress
absence of due process guarantees and penalties for undocumented migrant
workers which amount to disproportionate, cruel and humiliating punishment
Use of Ikatan Relawan Rakyat Malaysia (‘People’s Volunteer Corps,
known as RELA) against migrant workers
RELA is a volunteer force which carries arms and has the right to raid and arrest
migrant workers anywhere in Malaysia. They have recently taken over the running of
Malaysian deportation centres. RELA is paid per migrant worker apprehended, and
respond instantly to calls from employers. There is extensive documentation by the
press and national and international human rights organisations regarding RELA
brutality. These include reports of burning down of migrant workers premises, killings,
rapes and theft of migrant workers' property.
4.4 What actions are being taken and/or recommended to address these
issues?
Malaysian trade unions, civil society groups and NGOs have been campaigning with
employers, workers and government on these issues. They try to inform workers in
their home countries and in Malaysia that it is their employer’s duty to pay the levy.
They inform workers about the risks of illegal work and the almost total lack of any
support for ‘illegal’ workers. They lobby the government to abolish the levy and allow
workers to register their employment with the government at a national level, rather
than with an individual employer. They also work to combat the discrimination and
stigma which is the norm for foreign workers in Malaysia. The Johor Textile and
Garment Workers’ Union has pushed for better conditions for foreign workers and for
national workers.
4.5 Engaging with local stakeholders
A number of ILO counterparts and stakeholders in Malaysia are interested in stronger
enforcement of existing protection measures in Malaysian legislation. This includes
labour legislation, not currently implemented for migrant workers, reform of
immigration law and of other provisions that effectively authorize or condone
violations, as outlined above. This work currently involves national advocacy,
stakeholder consultations and dialogue with the government.
Local stakeholders are also interested in stronger implementation of ethical trade
measures in Malaysia alongside international partners, including developing
guidelines for effective workplace monitoring which does not exclude migrant
workers. This initiative is being supported by the ILO at a regional level. ETI
members wishing to engage with local stakeholders on this matter should refer to the
ETI Secretariat who will use membership contacts to seek appropriate partners on
the ground.
4.6 Case study: one ETI member’s experience
One ETI member visited a factory in Malaysia in September 2005, and found severe
irregularities in the employment of foreign workers. The factory concerned hampered
efforts at further research and interviews with workers, but did conduct their own
research. Despite the circumstances, the factory’s own research yielded the following
information:
Levy paid by workers represented a third of their gross salary
Some workers repaying debt, in some cases up to 50% of gross salary
Interest
ratelabour
on debt
as high
as 42%
compoundfocus
interest
per annum
Briefing
on forced
-a special
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on Malaysiawith
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Living wage not paid
updated December 2008
Workers tied to factory, which also holds their passports
Some workers did not understand terms of contract or nature of deductions
5. Recommendations for action
5.1 Recommendations for ETI members
MIGRANT WORKERS
ETI members are already familiar with the issues around temporary and migrant
labour. This has been well documented in ETI work to date, particularly from the
Temporary Labour Working Group and ETI Impact Assessment. Company members
are encouraged to use this guidance to ensure they are aware of the presence of
migrant workers in their supply chains, and handle them appropriately. Neil Kearney
of the ITGLWF suggests that trade unions need to do more to ensure the integration
of immigrant workers. This can be by recruiting them into membership, including
them in union activities and governance and insist on their full equality.7
BONDED LABOURERS
Bear in mind bonded workers’ specific vulnerabilities.
Investigate the issues in relevant supply chains
Seek appropriate help if unsure how to proceed to remedy any problems.
Train staff in contact with worksites on the situation of bonded labour and how
to address it.
Use the guidance outlined in Section 2.2 above and supporting documents at
the back of this briefing. Note the ILO Handbook offers detailed assistance for
auditors. Members are advised to Incorporate such advice it into all
monitoring measures and using it in training of relevant staff.
Share any issues or learning with other members and the Secretariat. Often
issues are systemic and best addressed collectively, as in the Malaysian
case.
5.2 Actions for ETI and members regarding Malaysia
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Collective representation by ETI's tri-partite members to the Malaysian
government and relevant Malaysian employer's associations
Issue this document and any other relevant guidance to all those who conduct
monitoring in supply chains, highlighting how to include migrant workers and
what issues to look for
Company members should conduct training on the above for buyers,
suppliers and any agents or monitoring agencies they use
Company members should ensure buyers have access to worksites as a
condition in their contracts with suppliers
ETI's trade union and NGO members should raise awareness about the
situation of migrant workers in Malaysia with their members, affiliates,
partners and the public.
ETI Secretariat to convene workshops on this issue to raise awareness
inviting ILO and other experts. Build a body of expertise on this issue.
‘A worker is a worker regardless of origin’, ITGLWF press release, 27 January 2007
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ETI members should consider addition of elements of ILO conventions
pertaining to migrant workers’ rights in ETI Base Code and other relevant ETI
documents.
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6. Useful resources and/or organisations
Organisation
Anti-Slavery
International
ILO
Publication
Website address
st
Forced labour in the 21 Century www.antislavery.org/homepage/
resources/PDF/PDFforcedlabou
r.htm
Special Action Programme to
http://www.ilo.org/sapfl/News/lan
Combat Forced Labour:
g--en/WCMS_099621/index.htm
Combating Forced Labour: A
Handbook for Employers and
Businesses
Manual on how to monitor the
recruitment of migrant workers
ILO
www.ilo.org/sapfl/Informationres
ources/ILOPublications/lang-en/docName-WCMS_081894/index.htm
www.ilo.org/sapfl/Informationres
ources/ILOPublications/lang-en/docName-WCMS_081882/index.htm
ILO
Global alliance against forced
labour (Forced labour report
2005)
Impactt Limited
Progress not perfection (see
migrant workers case study, p
23)
www.impacttlimited.com/wpcontent/uploads/2007/11/impact
t-10th-anniversary-report-casestudies-migrant-labourers.pdf
ITGLWF
Press releases on forced and
bonded labour
Developing a Comprehensive
Policy Framework for Migrant
Labour
18-19 February 2008
Kuala Lumpur, Malaysia.
www.itglwf.org
Malaysian Bar
Association
Migrant Forum
in Asia
Conference papers
(forthcoming) of this conference
organized by the Malaysian Bar
Association in cooperation with
other national stakeholders, incl.
trade unions and government
Ministries of Human Resources,
Health, Immigration, supported
by the ILO.
Various updates and resources
re migrant workers in Asia
www.mfasia.org
ETI is grateful to Pins Brown for drafting this guidance and would welcome any
comments for future additions.
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