Coffee represents Guatemala’s largest export—valued at over USD $1.1 billion in 2012—with the United States as its leading importer, meaning prominent brands source significantly from the country. The Guatemalan agricultural sector constitutes its largest source of employment, with coffee as the country’s most important crop—providing employment for 90,000 small coffee farmers and 473,000 workers (seven percent of the workforce). Many of these workers, however, are from marginalized populations; the vast majority are indigenous with low levels of education, and many are women and children. Almost half of all coffee sector workers obtained their jobs through labor brokers, which Verité and others have demonstrated is an indicator of risk for forced labor. We conclude that migrant coffee workers in Guatemala, a sector of importance to Western brands, face a high degree of vulnerability to exploitation.
With generous support from Keurig Green Mountain, Inc., and the U.S. Department of State’s Bureau of Democracy, Human Rights and Labor; Verité will carry out a two-year project on Improving Supply Chain Transparency, Monitoring, and Accountability in Guatemala’s Coffee Sector in partnership with REACH (Research-Education-Action-Change), a Guatemala-based NGO working on human and labor rights issues throughout the Americas. This project will build on progress made through a Keurig-funded project in Guatemala initiated in March 2015.
From 2008-2012, Verité and REACH carried out in-depth research in the Guatemalan coffee sector for the U.S. Department of Labor, finding that 44 percent of the 372 coffee sector workers interviewed obtained their jobs through labor brokers. Data collected indicates that workers hired by labor brokers reported earning approximately 25 percent less than workers who obtained employment directly with the farms.
Verité has long identified exploitative brokers and unethical recruitment as two of the main factors that increase workers’ risk to labor abuses. Verité has found that traditional audit approaches—the one-day audits carried out by most large-scale auditors—are ineffective in detecting labor abuses related to third-party labor recruiters. This is especially true in the agricultural sector, where there is little visibility into product or labor supply chains, and where auditors and labor inspectors find it difficult to gain access to workers managed by brokers, who in many cases work in separate locations. In order for companies to effectively address recruitment-related abuses, they must gain an understanding of their product and labor supply chains and develop systems to obtain information on high-risk labor brokers.
To address this risk, Verité is partnering with Keurig and REACH to improve monitoring and accountability in labor recruitment in the Guatemalan coffee sector. The project comprises:
- a baseline assessment of recruitment conditions in the coffee sector, along with workers’ needs;
- a mapping of Keurig’s supply chain;
- trainings for workers, government officials, local NGO representatives, and coffee producers, traders and brands;
- and the development of a Grievance Reporting and Information Dissemination (GRID) system to improve transparency regarding labor broker practices.
This new initiative builds upon Verité’s years of experience researching labor practices in the agricultural supply chain and working in partnership with companies to promote fair labor in industries such as coffee, cocoa, cotton, tobacco, fisheries and palm oil. Our aim is that companies in the Guatemalan coffee supply chain will use the information collected through this project to ensure that their supply chains are free from exploitative labor broker practices that can expose them to legal and reputational risk.
For more information, please contact Program Director, Quinn Kepes.