Press Releases

March 03, 2015

Organizations Seek Stronger Labor Protections, Corporate Responsibility in Palm Oil Industry

Unprecedented coalition of human rights and environmental groups release recommendations for companies to eradicate labor abuses in supply chain

Washington, D.C. – The growing global demand for palm oil has contributed to systemic human rights abuses of workers, including children, and requires stronger labor protections throughout the industry’s supply chain. Today, an unprecedented and diverse alliance of international human rights and environmental organizations released Free and Fair Labor in Palm Oil Production: Principles and Implementation Guidance. This guide is the first of its kind and details comprehensive recommendations to implement fair labor practices in the palm oil sector.  

"Malaysia’s palm oil industry is heavily dependent upon the labor of migrant workers, but many of these workers fall prey to serious exploitation at the hands of their employers or recruitment agencies,” said Glorene Das, Executive Director of Tenaganita, a Malaysian NGO that campaigns for the rights of migrant workers, laborers and women. “The Malaysian palm oil growers and government must work to bring the industry working standards in line with Free and Fair Labor Principles for all workers, including the most vulnerable. They can begin with reforming common industry practices like unethical recruitment, withholding of identity documents, and low wages that put workers at undue risk of forced labor and, at the same time ensure that child labor is excluded from the industry."

In less than two decades palm oil production has quintupled, making it the most widely traded and used edible vegetable oil; it is now found in one of every two products sold in Western grocery stores. Roughly 85 percent of palm oil is grown in Malaysia and Indonesia, employing 3.5 million workers in the region. To keep up with the rising demand and competitive global commodity prices, the industry has relied on keeping labor costs low. Extreme labor abuses, including use of forced and child labor, have proven to be all too common.

"For many years I have witnessed the exploitation and unfair treatment of palm oil laborers in Indonesia,” said Herwin Nasution, longtime plantation labor organizer and executive director of Indonesian labor organization Oppuk. “The Fair Labor Principles outline what palm oil companies must do to uphold the rights of plantation laborers who have been abused too often by the state and their employers. We call on our government to prevent, investigate, punish, and redress these abuses through effective policies, legislation, regulations, and adjudication, and we call on all palm oil producers, their buyers, and investors to adopt and implement the Fair Labor Principles."

Many companies have already committed to sourcing responsible palm oil by 2015 out of concern for controversies taking place in their supply chains. As their deadline quickly approaches, the outlined recommendations offer a detailed set of guidelines to help companies, consumer brands, investors and stakeholders reach those commitments by eliminating forced labor and exploitation in their supply chains and improving the rights and wages of workers. Practices associated with forced labor in the industry have included debt bondage, confiscation of passports, physical confinement, withholding of wages, false terms of employment, and threats of physical and sexual violence.

“Globally respected companies increasingly recognize that the use of forced and child labor to produce key ingredients like palm oil is an unacceptable business practice that risks damaging their brand and shareholder value,” commented Lucia von Reusner, shareholder advocate for Green Century Capital Management, which manages responsible and diversified fossil fuel-free mutual funds.

The principles and guidelines were based on the International Labor Organization’s core conventions and the UN Guiding Principles on Business and Human Rights.  Among the recommendations:

-        Eliminate all forms of forced or compulsory labor;

-        Abolish the worst forms of child labor;

-        Respect freedom of association and the right to collective bargaining;

-        Provide adequate protective equipment free of cost;

-        Provide adequate housing, water, medical, educational and welfare amenities;

-        Ban all highly hazardous pesticides including persistent, carcinogenic and endocrine disrupting pesticides;

-        Commit to reasonable working hours and progress toward payment of a living wage;

-        Practice ethical recruitment with no fees for workers or seizure of identity documents;

-        Establish a legitimate, accessible, and transparent grievance mechanism, consistent with the UN Guiding Principles on Business and Human Rights; and

-        Commit to meaningful transparency and disclosure of all plantation processes.

The guide was developed by a forum of experts comprised of NGOs, workers organizations, representatives of unions, investors and philanthropic organizations from the United States, Europe, Malaysia, and Indonesia. Partner organizations include: Federasi Serikat Perkerja Minamas, Finnwatch, Firestone Agricultural Workers Union of Liberia, Forest Peoples Programme, General Agriculture and Allied Workers Union of Liberia, Humanity United, HUTAN, Interfaith Center on Corporate Responsibility, International Labor Rights Forum, Land Empowerment Animals People, Link-AR Borneo, MONDIAAL-FNV, Malaysian Palm Oil NGO Coalition, OPPUK, Oxfam, Pesticide Action Network Asia and the Pacific, Rainforest Action Network, Sabah Environmental Protection Association, Sawit Watch, SERBUNDO, Serikat Buruh Medan Independen, Serikat Buruh Mandiri Indonesia, Tenaganita, Trade Union Care Center, Verité, and Walk Free, as well as advisory support from CERES.