Vision: April 2012

Verité Up Close:
To Avoid Big Problems, Take Care of the Small Ones

(or How to Avoid a Riot)

by Jon Pitoniak, Reports Department Manager

For employers to avoid big problems, they need to take care of the ‘small’ ones. 
 
Over the last several years, Verité has been in too many overseas factories where unresolved worker complaints and poor communication resulted in labor unrest and, often, violence. From Central America to Southeast Asia, worker discontent with holiday pay or even the quality of food in the cafeteria intensifies into something far worse. We’ve witnessed riot police, armed groups of thugs, arrests, beatings and hundreds of workers losing their jobs as these conflicts escalate. 
 
One thing we’ve learned from these incidents is that small things matter. Seemingly ‘minor’ concerns among workers can quickly explode into violent conflicts. Unrest escalates when workers lack an adequate outlet to lodge a grievance; when management is defensive about worker complaints, or refuses to listen to them at all; and when systems for worker-management communication are fundamentally flawed.
 
These ‘small’ problems simply do not have to get to the point where tear gas and batons are the perceived solution. 
A fair, transparent, effective and anonymous grievance mechanism is a good start. All too often, Verité visits a factory and finds a pile of complaint letters in a dusty suggestion box or an abusive supervisor who doesn’t tolerate complaints. If workers’ voices are not heard, even on seemingly minor issues, they rightfully become discontented. Making workers wait weeks for a response to a problem (or never getting back to them at all) is counter-productive. In our experience, once workers become alienated from management and sense that discussion is pointless, problems are magnified and it becomes much more difficult to regain trust.
 
Businesses need to create multiple communication channels for workers. A policy handbook, worker-chosen representatives, regular training, frequent worker-management meetings, committees, union representatives, posting updated notices and other open forums for feedback are ways workers can communicate their concerns. These can be supplemented with channels like hotlines, email, texting and suggestion boxes that guarantee anonymity for more serious problems. One or two of these methods generally aren’t enough; effectiveness requires multiple feedback and complaint outlets and the clear identification of members of management who are designated to respond to and correct problems.
 
Supervisors and management must ensure that they are not perceived to be above the system. An individual manager’s emotions cannot dictate a response to worker problems or feedback, and cannot get in the way of reasonable, meaningful dialogue. Verité has delivered training on conflict resolution and positive management techniques to help supervisors deal with difficult workplace issues, and in some cases difficult workers as well.
 
Listening to workers, understanding and validating their concerns, and following up to resolve issues are the best ways to avoid big problems. This can happen through a union, a worker committee, the collective bargaining process, or even something less formal. Verité has seen these methods work at so many factories and farms, and we have also seen the consequences when these steps are not taken. Improving worker-management communication and dialogue is not easy. It takes time, effort, and commitment from both sides. But nobody wants to see the police called to a factory to quell a riot, meaning an up-front investment in time and effort can easily pay for itself.  

From the Field:
Delhi Roundtable to Combat Human Trafficking Co-hosted by Verité and the Institute for Human Rights and Business

by Philip Hunter, Program Specialist

Over the last few years, Verité has done a great deal to promote safe migration and responsible recruitment of migrant workers in global supply chains. This work has shone a spotlight on the role of private employment agencies and labor brokers in recruitment systems, focusing on the twin risks of forced labor and human trafficking that can be introduced by unscrupulous brokers seeking to benefit from the vulnerability of labor migrants.
 
This work has resulted in the publication of research and an open-source fair hiring toolkit for brands and supply-chain employers; and, more recently, has seen the launch of a new ethical framework for cross-border recruitment, jointly published with the ManpowerGroup in February of this year. The ethical framework, and Verité’s broader efforts within this field, aims to change the way the recruitment industry tackles forced labor and trafficking, working together with other stakeholders and the industry itself. It promotes a system whereby responsible firms in different countries and at different stages of the recruitment pipeline can selectively partner with one another to uphold ethical standards in the movement of workers, reinforce good practices, and marginalize and exclude “bad actors”.
 
As part of this engagement, Verité has also been involved in direct outreach and awareness raising. Last month, on March 13th, we co-hosted with the UK-based Institute for Human Rights and Business a multi-stakeholder roundtable on responsible recruitment and fair hiring to combat human trafficking in South Asia. This event brought together senior representatives of global brands, the recruitment industry in the region, local and international NGOs, and international organizations like the ILO. It offered the opportunity for participants to explore the challenges, risks and human rights responsibilities surrounding the recruitment of South Asian migrant workers for overseas employment, and to discuss ways that business and other stakeholders can ensure responsible practices to combat abuses in supply chains.
 
The roundtable – which was held under the auspices of a project funded by the UK’s Department for International Development – was a complete success. Dialogue on the key challenges and vulnerabilities faced by migrants was informed and wide-ranging, touching on the key problems of fee charging, risks of debt bondage and restrictions on workers’ freedom of movement. Presentations and interventions by participating brands (like Next and Coca Cola) and recruitment agencies and associations (like the Manpower Group and the Indian Staffing Federation) were inspired, with both focused on how they are “raising their game” against human trafficking and addressing the many challenges that lie before them, not least in scaling up their engagement.
 
Participants also heard from the IHRB on its Dhaka Principles for Migration with Dignity, which present business with a guide to best practices for labor migration; and Verité on its Fair Hiring Toolkit and the above-mentioned Ethical Framework for Cross-Border Labor Recruitment. Taken together, these initiatives represent a broad framework of action to promote due diligence and extend labor and human rights protections to some of the most vulnerable workers in the global economy.
 
In the final session of the day, participants were asked to work together to generate a series of recommendations for the various stakeholders in the room. These recommendations were designed to inform ILO dialogue with the Government of India and other constituents in the country, and to guide the next steps of engagement by the stakeholders themselves. The wide-ranging recommendations were addressed to brands, the recruitment industry, governments, NGOs and international organizations:
 
 
To Brands:
  1. Promote a joint brand-supplier dialogue about the use of recruitment agencies.
  2. Create a common platform to call for higher standards of mutual accountability.
  3. Exercise your lobbying voice with government for better regulation and enforcement within the recruitment industry.
  4. Shift from looking at “business risk” to talking first and foremost about “human risk”.
  5. Invest in more awareness-raising and better training for brokers. 
To the Recruitment Industry:
  1. Final accountability for the recruitment of the worker should rest with the front-end recruitment agency because it is so difficult to map the labor chain down to sub-broker level.
  2. There is a need for a regional association or coalition of recruitment associations (e.g. bringing together the Indian Staffing Federation, the Bangladesh Association of International Recruiting Agencies and the Nepal Association of Foreign Employment Agencies) so that they cannot be played off each other by brands or employers. 
To Governments:
  1. Fulfill international and domestic obligations.
  2. Strengthen the judicial system to ensure migrant workers have access to legal remedy.
  3. Provide enhanced information to companies regarding their human rights responsibilities and a call for greater disclosure and transparency by companies about the use of labor brokers. 
To Civil Society:
  1. Promote more effective information dissemination to the worker through better use of technology and improved input into the education system.
  2. Place greater emphasis on root cause analysis of workers’ (especially women’s) vulnerability to trafficking coupled with a greater push for investigation and prosecution.
  3. Advance capacity building for migrant worker organizations to raise awareness of rights and risks.
  4. Trade unions should play a stronger role in mechanisms for redress across sending and receiving countries.
  5. The civil society sector should be more formalized with stronger accountability and communication systems to allow for more effective advocacy and engagement with government. 
To International Organizations:
  1. Identify and map what international organizations are doing in the anti-trafficking arena.
  2. Push for greater ratification of ILO Convention 181 on Private Employment Agencies, and better enforcement of obligations and legislation at the national level.
  3. Advocate for a new ILO convention on labor migration – the current suite of relevant conventions is too complicated and diffuse.
  4. Bring in other international players, for example the World Trade Organization and International Finance Institutions to push for conditionality regarding safe migration and anti-trafficking measures in loans and trade agreements.
  5. Fewer meetings and more action, including promotional activities to make ILO more accessible to external stakeholders. 
For more information on the roundtable and the issues it addressed, please do not hesitate to contact us.

 

What We're Talking About:
The Fishing Industry's Cruelest Catch

by E. Benjamin Skinner for BloombergBusinessweek

Former indentured worker Yusril, 28, fishing on a small boat on the Java Sea

Verité has for years explored the link between labor migration, debt-bondage and modern-day slavery. Noted journalist Ben Skinner – author of the monumental book A Crime So Monstrous – has connected these conditions to the seafood that enters the United States, and may end up on your dinner table. His story of slavery in the fishing industry reminds us of two essential facts: forced labor can be present in any industry, any business sector and any country – even New Zealand territorial waters; and tracing a product to a workplace where people are enslaved requires effort. 

And yet our mandate is simple: we must look for slavery and resolve it wherever we find it. We have the knowledge and tools to do so. 

On March 25, 2011, Yusril became a slave. That afternoon he went to the East Jakarta offices of Indah Megah Sari (IMS), an agency that hires crews to work on foreign fishing vessels. He was offered a job on the Melilla 203, a South Korea-flagged ship that trawls in the waters off New Zealand. “Hurry up,” said the agent, holding a pen over a thick stack of contracts in a windowless conference room with water-stained walls. Waving at a pile of green Indonesian passports of other prospective fishermen, he added: “You really can’t waste time reading this. There are a lot of others waiting, and the plane leaves tomorrow.”

Yusril is 28, with brooding looks and a swagger that belies his slight frame. (Yusril asked that his real name not be used out of concern for his safety.) He was desperate for the promised monthly salary of $260, plus bonuses, for unloading fish. His wife was eight months pregnant, and he had put his name on a waiting list for the job nine months earlier. After taking a daylong bus ride to Jakarta, he had given the agent a $225 fee he borrowed from his brother-in-law. The agent rushed him through signing the contracts, at least one of which was in English, which Yusril does not read.

The terms of the first contract, the “real” one, would later haunt him. In it, IMS spelled out terms with no rights. In addition to the agent’s commission, Yusril would surrender 30 percent of his salary, which IMS would hold unless the work was completed. He would be paid nothing for the first three months, and if the job were not finished to the fishing company’s satisfaction, Yusril would be sent home and charged more than $1,000 for the airfare. The meaning of “satisfactory” was left vague. The contract said only that Yusril would have to work whatever hours the boat operators demanded.

Latest News:
Will it Be Different This Time?

by Dan Viederman, CEO, for Reuters

Every few years brings us another sweatshop offender. In the 1990s it was Disney, and then Nike and Gap. The 2000s brought us Wal-Mart. The past few weeks Apple has been in the crosshairs.

One question is of paramount importance: How can we use this current public conversation to finally drive a different outcome? What must companies do so that 15 years after Kathie Lee Gifford tearfully became the first sweatshop poster child, workers who make and grow products for global consumers are paid fairly, protected from danger and free to advocate for themselves without fear of reprisal?

The good news is that these years of effort have created robust experience from which to identify what has gone wrong. The fundamental driver of “sweatshops” is that multinationals do not place value on good working conditions in their supply chains. This does not mean that a company doesn’t care about how those workers are treated, or that the company intends to act unethically or exploitatively. To the contrary, big companies require good conditions through vendor standards and “codes of conduct.” They build corporate responsibility departments whose staff have budgets to reduce the risk of bad working conditions at supplier factories and farms. But their work is much like the arcade game Whac-A-Mole: A problem arises in one factory that they take steps to fix, while other problems fester and ultimately break through the surface elsewhere.

For this to change, companies have to resolve the ways in which their business decisions actually drive irresponsible performance among their suppliers. Companies frequently speak with two voices when they talk to suppliers. Procurement officers responsible for ordering something from a supplier expect delivery of a quality good at a cheap price on a tight time frame. Corporate responsibility professionals embody the expectations that all those other business needs will be met, but in a responsible manner. Yet that responsibility gets ignored when a company makes last-minute design changes or increases order size. The supplier will still deliver a quality product on time, but will do so by keeping his employees at work overnight or for days on end. Without the ability to negotiate a higher price at the last minute, the supplier can’t pay the workers for their overtime without taking a loss himself. Thus responsibility is sacrificed by a company’s business decisions.

Instead, companies must learn to speak to their suppliers with one voice and reinforce that voice with action. Suppliers should get positive incentives in the form of higher prices, financial bonuses, long-term contracts or other benefits for maintaining good working conditions. In-house procurement and supply chain staff should be compensated more highly if they place orders with responsible suppliers. Taking these steps would allow businesses to integrate social responsibility with other business requirements like quality, price and delivery.

Workers must be part of this conversation as well. Line workers and harvesters are the best source of information about working conditions, no matter the industry. Only a worker can tell corporations with accuracy whether or not she is being paid according to her contract, whether she considers her work hours to be excessive, whether she is provided with drinking water and toilets during her long days, and whether she has been harassed or fired for “associating freely” by joining a union. By working with trade unions and NGOs, companies will learn what the reality is at their suppliers, providing an early warning when things go awry and a constituency that can help improve conditions.

To hold themselves accountable, companies need to communicate publicly what has changed as a result of their social responsibility efforts. Our recent survey of corporate responsibility reports captures a mind-numbing array of activities, but no analysis of what has been achieved. To its credit, Apple has demonstrated that communicating achievement is possible. The company remains the only multinational to quantify the impact of its supply chain social responsibility in dollar value for workers — disclosing that $6.7 million was returned to migrant workers who had been overcharged by unscrupulous labor contractors. This kind of disclosure leaves no doubt about its impact and stands in contrast to the usual corporate responsibility communication.
Fifteen years into the modern anti-sweatshop movement, poor conditions persist. It is time for companies and their suppliers to structure their business relationships so that good working conditions can be secured. The workers who make their products will benefit substantially if they do.