Breaking the Chain
Words by Erik Hoffner
It’s difficult to face the reality that there are 40 million people living in slavery throughout the world. That’s more enslaved people today than in 1860, the date at which most Americans believe the practice to have been at its peak, soon to be ended with slavery’s official abolition in the US.
It is true that slavery has been outlawed by most countries. It is considered immoral and anachronistic globally. It has even been legislated against by the 1956 United Nations convention that abolishes it (and similar practices) and the International Labor Organization (ILO)’s protocol on forced labor, the latter organization defining forced labor as “work or service which is exacted from any person under the menace of any penalty and for which the said person has not offered himself voluntarily.”
And yet, from forced labor to child labor, debt bondage, sex trafficking, and forced marriage (it’s been reported that women and girls account for 71 percent of modern slavery’s victims), slavery and other directly analogous conditions persist. The fact that slavery remains entrenched in the global economy is perhaps the most startling fact of all, with 16 million forced laborers caught up in the supply chains of products ranging from Starbucks coffee to luxury handbags by Prada.
This phenomenon is widespread and global, but to get specific, take the case of Malaysia, a country that has ratified the ILO’s Forced Labor Convention of 1930, whose constitution prohibits forced labor, and whose penal code outlaws “unlawful compulsory labor.” Despite this, the practice is alive and well—as evidenced by a recent confidential investigation shared with Atmos by Transparentem, a nonprofit watchdog of labor and environmental abuses in global supply chains, which found the problem to be rampant within the nation’s garment industry.
If laws are in place to protect Malaysian citizens, how has this practice become so entrenched? To begin with, the investigation found that it’s not actually Malaysian citizens who are caught in the chains of forced labor but rather vulnerable migrants from other corners of Southeast Asia seeking higher wages in a foreign land.
Deceived and in Debt
In search of economic opportunities far from home, workers from 15 countries in South and Southeast Asia come to Malaysia, lured by recruiters promising a better life through a guaranteed job in the country’s sprawling garment industry. Five factories in peninsular Malaysia—Whitex Garments, Perindustrian Shunhon, Honsin Apparel, Knit Textile Manufacturing, and SP Garments (which supply global brands including Asics, Brooks, Fruit of the Loom, Manchester United, Nike, Target, and Under Armour, among others)—were investigated for Transparentem’s report.
Guaranteed is the key word in this context, since these workers, primarily from Bangladesh, Indonesia, and Nepal, arrive after having arranged their jobs through recruiters, often unscrupulous dealers who represent the first rung in the forced labor ladder.
While one typically thinks of a recruiter as a person who connects willing workers with needful employers, among the agents feeding migrant laborers to Malaysian factories, the opposite is true. Like a coyote smuggling people across a border, most recruiters actually charge workers a fee—but not before lying about their eventual salaries, working conditions, and even the nature of their jobs.
Eighty nine percent of migrant workers interviewed during Transparentem’s nearly two-year undercover investigation reported paying recruitment fees to be placed at one of the five Malaysian factories at the center of the investigation. These fees were not nominal or in line with the amount of effort required to move paperwork through various government and corporate channels; rather, they ranged from $745 to $4,356, high sums for people coming from countries like Nepal and Bangladesh, where per capita annual incomes are $790 and $1,470, respectively.
In the cases of those interviewed, payment of these fees was often only made possible by taking out loans or selling cattle or land back home, with repayment typically taking a number of years. In some cases, the fee represented more than a year’s wages at the destination factory.
Most Nepalese workers borrowed money from local merchants to pay the fee, almost 20 percent were loaned money by relatives or friends, and some even took out bank loans. One worker reported that he’d still not fully repaid the recruiter after returning to Nepal and had resorted to begging. It’s worth bearing in mind that while recruiters are independent operators, the factories also benefit from this system by keeping their recruitment costs low.
What workers interviewed for the report found when arriving in Malaysia was the next rung of the ladder: broken promises, starting with lower wages than had been discussed. Sixty percent of the migrant workers reported that they were deceived about their salaries, about the kind of work they would be doing, and other undisclosed realities like regular and arbitrary salary deductions.
“The money that I make here I could have made at home,” one worker told the investigators, regarding the higher salaries promised by the recruiters.
This situation is rampant and well documented: The Nepalese government published a report in 2018 identifying the main reason its citizens became trafficking victims as false promises of a good job and a good salary. The ILO reported in 2016 that 46 percent of Bangladeshi migrant workers they interviewed received less pay than promised.
The astronomical recruitment fees plus the reality of lower-than-expected pay gives little hope of building a solid financial future, but migrant workers in these factories also find their paychecks slimmed by employers who extract funds monthly to pay the government tax for their hiring of foreign workers, plus the cost of their insurance, accommodations, and uniforms. An extra insult is the regular fines deducted from worker salaries (from $12 to $36 in one factory’s case) for failing to make production quotas, breaking tools or machinery, or otherwise “making mistakes.”
Workers also reported suffering abuse on the factory floor (including verbal and physical attacks) and massively overcrowded and unsanitary living conditions supplied by the factory owners that failed to provide adequate shelter from the elements: Crowded into rooms holding up to 24 people and often touching each other in their sleep, interviewees also reported being assailed by rain, wind, and bedbugs.
Forced labor doesn’t just translate to a lack of freedom for those caught in its chain, either. Often its victims have their futures stolen when they become ill from work environments laden with toxic chemicals, as a 2017 Transparentem investigation of tanneries supplying leather to shoe and handbag manufacturers like Clarks, Sears, and Kate Spade found. Workers were reported laboring barefoot on wet floors among barrels of chemicals, living in houses on stilts that totter above creeks rank with tannery pollution and raw sewage, tasting chemical brews in drums that process leather to test for proper salt levels, and the list goes on.
No Latitude to Leave
Perhaps the most egregious link in these companies’ forced labor chain is the retention of foreign workers’ passports. Seventy five percent of the factory workers surveyed reported that they did not have access to their passports, their most important personal document, which guarantees their right of passage to, if not the protection of their home nation. Interviewed workers reported having to pay huge deposits to recover their passports in order to return home for any reason—whether to have a break, visit family, or even, presumably, for bereavement. The sums ranged all the way up to $237, three months’ salary at the minimum wage levels reported in this part of Malaysia.
Even the US State Department is concerned about this situation, having noted that Malaysian law actually allows employers to retain workers’ passports and that it’s difficult to determine whether they have gained consent. The UN documented in 2015 that this practice in Malaysia contributes to human trafficking, and the ILO identifies it as a hallmark of forced labor. As one worker interviewed by the team remarked: “The day I came here, they took [it] from me at the airport and I have not seen my passport since…if it got wet or not, even if it exists or not, I don’t know.”
With all these factors taken together, this practice can be called “debt bondage,” defined by the US State Department as a type of coercion manifested by networks of traffickers, recruiters, and employers both in workers’ country of origin and their destination nation, wherein workers are caught in a system of “charging workers recruitment fees and exorbitant interest rates, making it difficult if not impossible, to pay off the debt.” Such circumstances may occur, the report continues, “in the context of employment-based temporary work programs in which a worker’s legal status in the destination country is tied to the employer so workers fear seeking redress.”
Dismantling the System
Rather than turning its findings straight over to the press and leading a withering assault by activists and social media warriors vowing boycotts, in April 2018, Transparentem provided its findings to 23 companies that market products derived directly or indirectly from the five Malaysian clothing factories. Fifteen of them agreed to help remediate the situation by first arranging follow-up audits and assessments before developing action plans. These corporations received commitments to address the forced labor problem from all of the factories except SP Garments.
At three of the factories, buyers and suppliers negotiated the return of workers’ passports and won provisions for keeping these documents safe, like having secure lockers. Five workers at one factory who received access to their documentation immediately ceased working and departed. By late 2018, the global brands also received commitments from four of the factories to reimburse recruitment fees, a figure exceeding $1.7 million. SP Garments, however, has so far taken no action. Outcomes like these provide hope that global brands will begin policing their own supply chains independently and that factory owners will proactively improve their practices.
“At the moment, the changes that we have seen at four out of five factories have been significant, and that has meant a little bit of justice for nearly 3,000 workers. But ‘eternal vigilance is the price of liberty,’ as the great abolitionist Wendell Phillips said,” responded founder and president of Transparentem Benjamin Skinner when asked for comment by Atmos. “By new industry agreements and by recognition of past wrongs, brands, retailers, and suppliers have asserted their responsibility for the treatment of upstream workers...we, too, as consumers have a collective responsibility to recognize that consumption involves moral choice.”
And while consumers can take action to demand transparency and be more mindful of the companies whose products they buy, corporations need to be more proactive, rather than reactive, when their supply chains are shown to be tainted. Although it’s easy for them to identify and halt the practice in so-called “tier one” factories that churn out branded products, it can be much harder to police their supply chain at the subcontracted raw materials level.
Ignorance is not an excuse when it comes to ethical business practices, though, and companies can gain both incentive and support from NGOs like Transparentem or consultants including Verisk that alert clients to slavery risks in their supply chains. Governments also play a key support role, ranging from new laws like the UK’s Modern Slavery Act to the US State Department’s continual action on the issue via its regular Trafficking in Persons Report. Additionally, the Australian government just announced a 10-year, multi-million dollar anti-trafficking strategy between itself and a number of Southeast Asian nations that aims to help firms in countries like Malaysia root out supply-chain slavery.
Against the backdrop of increased global migration due to climate change, economic disparity, and a lack of opportunity in many countries, this issue requires action on all fronts to ensure that our world continues to progressively raise living standards and the overall freedom of each and every human—and especially to ensure that all nations continue working to break slavery’s chains.
PHOTOGRAPHS COURTESY TRANSPARENTEM