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Child Labor and Supply Chains

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Your daily reminder how western corporations use supply chains use by turning their heads away from child labor while claiming no responsibility for the working conditions of the goods that enter their products. The hideously awful palm oil industry, responsible for massive deforestation and tropical ecological disasters, also relies heavily on exploitable labor. Two plantations, certified as sustainable and that contract with PepsiCo, are awful. The plantations are owned by an Indonesian company that has a western CEO named Mark Wakeford, who claims they are following Indonesian law. But….

Indofood allegedly relies heavily on casual and other precarious forms of labor on its plantations.

Of the 41 workers interviewed, 20 were employed as either casual workers, limited-duration contract workers or so-called “kernet” workers, informal workers who have no direct employment relationship with the company.

“These [casual and kernet] workers had no job security, earned as little as half or less the pay than permanent workers, sometimes paid for their own safety equipment and health care, and faced increased health and safety risks,” the report said.

Indofood itself has admitted that half of its workers are employed on a casual basis. The company does not, however, report on the presence or number of kernet workers on its plantations.

Indofood allegedly sets unrealistically high daily quotas for its employees, forcing them to enlist the help of these informal kernet workers.

According to the report, plantation workers often engage the help of kernet workers in order to meet their quotas. These kernet workers are allegedly often children or employees’ wives.

One of the kernet workers interviewed for the report was a 13-year-old boy. He said he’d stopped attending school so he could earn some money on the plantation.

At least three harvesters told researchers that their daily quota was 2 or more tons of fresh fruit bunches per day. “To achieve their quota, harvesters must often walk long distances, particularly during the low-yield season, to cut and collect the necessary amount of fruit bunches,” the report said. One harvester said he had to collect between 140 and 160 fruit bunches per day, each weighing between 30 and 45 pounds.

Indofood is also accused in the report of keeping its workers at “unethically low wages,” paying both permanent and casual workers below the district’s minimum wage.

Casual and kernet workers reported regularly making between 20 percent and 75 percent less than the district monthly minimum wage.

One harvester said he paid a 16-year-old kernet worker just $1.50 a day plus food and cigarettes. (The district minimum wage is $6.10 per day.)

“What kind of adult person would want to get paid that much? [But] that’s how much I can afford,” the harvester is quoted as saying.

Though no evidence was found of Indofood directly hiring child laborers, at least three children under the age of 17 were allegedly found working as kernet workers.

A fourth boy, a 19-year-old kernet worker, said he’d been working at the plantation since he was 12. Several harvesters also said they’d hired children to help them on the job.

According to the International Labour Organization, working in agriculture is one of the “worst forms of child labor,” as it exposes children to extreme hazards, such as dangerous tools and harmful pesticides.

Workers on the plantations were exposed to hazardous chemicals, including paraquat, a toxic herbicide banned in many Western countries.

The report alleges workers were often not provided with adequate health care and safety equipment despite this exposure.

Casual and kernet workers reported having no health insurance and limited access to the on-site company clinic. The company allegedly did not provide any protective gear to kernet workers.

Maybe this company is following Indonesian law in the strictest sense, but like corporations everywhere, will seek to get around the law as often as possible. It might not be directly employing child labor but it’s contracting out for child laborers and doesn’t monitor this. OK. This is why I say again and again that codes of conduct and declarations of sustainability from outside organizations simply are nothing more than window dressing on an exploitative system. If we don’t want our Cheetos made from child labor, we have to force Pepsi to be responsible for everything that happens in its supply chain. If we don’t want workers being exposed to paraquat, we have to force Pepsi to be responsible for everything in its supply chain. Legal responsibility has to be the standard. We can enforce codes and laws on what gets imported into the United States. We have done it and continue to do so.

Part of this process will include opening supply chains to public scrutiny. That’s what GoodWeave International CEO Nina Smith calls for in her essay on ending child labor in the supply chains.

The solution to the problem is clear: companies must deploy deep supply chain investigation and remediation. But there is a distinction between ensuring an absence of child labor from production sites, and stopping child labor altogether. To eradicate the problem, we must change the social norms and other conditions that foment exploitation. By opening their supply chains to full mapping and accountability for all producers, industry can take a huge step in achieving both.

Taking this step is good for business. Selling child-labor-free products can lead to higher margins, increased product quality, and more stable sources of supply. Irene Quarshie, Target’s Vice President of Product Quality and Responsible Sourcing, reports: “By supporting GoodWeave’s mission, our guests can buy…a rug at Target and know they’re playing a part in eliminating child labor in the rug industry, and educating thousands of children in India. That’s a really big deal, and something we’re very proud of.”

I frequently visit GoodWeave’s Hamro Ghar (Our Home) rehabilitation center in Nepal for rescued child laborers, where 46 children are now in residence. The stories of their experience with abuse play out every day, all over the world. Their circumstances are the direct outcome of corrupt producers literally stealing labor—to the tune of $150 billion in annual profits. We cannot chase down and punish every perpetrator, but we can take their profits away by cutting them out of the market.

This clearly has to be part of the solution. Cutting them out of the market is the goal and we do that by not allowing their products to be sold in the United States unless they can be certified as not made with child labor. I think that punishing perpetrators can be done, through court cases within the United States and other nations with even more leeway for lawsuits around human rights, but that’s the ultimate step. Stopping the sale of these products in the United States should be a top priority for everyone who thinks child labor is a terrible thing and must end.

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  • DrDick

    Outsourcing and subcontracting have always been about maximizing profits while maintaining plausible deniability for labor abuses and minimizing other costs.

    • Cash & Cable

      So you’re saying the goal is to move those abuses . . . “out of sight”?

      • infovore

        No, they’re to be moved “out of mind”. The “out of sight” part is just a means to an end.

        • Cash & Cable

          I’m not sure you got the reference.

    • dp

      Correct, but legal deniability also. The ultimate goal should be to eliminate the legal fiction of subcontracting labor, both abroad and here in the US.

  • Cash & Cable

    My response to people who point to voluntary codes of conduct is always the same: “Great, then those companies will find it easier and cheaper to adjust to regulation. They’ll have an economic advantage over those companies that are currently cutting corners to earn larger profits.”

    • cpinva

      do you take pictures, of the look on their face when you say that? you should. :)

  • cpinva

    “What kind of adult person would want to get paid that much? [But] that’s how much I can afford,” the harvester is quoted as saying.”

    then this person has no business being in business. if the only way you’re able to make a profit, is to rely on breaking every rule, then you shouldn’t be allowed to continue in business. not only does it harm those being directly exploited, but it creates downward pressure on every other person/company in the business. to compete, they either have to accept lower eps, or resort to violating the rules themselves, to level the playing field.

    • Bill Murray

      Isn’t the harvester hiring the child labor to meet his quota out of his own pocket, so to fulfill an unrealistic quota the person doing the harvesting hires a helper? The problem is Indofood and their quotas that necessitate more labor than one person can provide.

      • And I am sure Indofood has a cap on how much it will pay the farmer, and PepsiCo a cap on how much it will pay Indofood, making hiring adult labor impossible.

  • Since these corporations write our trade laws, I find the whole ‘not our problem’ defense to be dubious at best. They write these laws to benefit their bottom lines, and their bottom lines are conditional on utilizing child/slave labor that can’t be utilized in the U.S.

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