November 17, 2014

Labor Exploitation and Human Rights Abuses within the Palm Oil Sector

Workshop builds consensus for a common set of palm oil labor principles for companies, certifiers and governments 

Kuala Lumpur, Malaysia – This week, a group of international NGOs convened with dozens of representatives from labor unions, worker advocacy and human rights organizations from across Indonesia and Malaysia in Kuala Lumpur, Malaysia, for the second Palm Oil Labor Principles Workshop. The purpose of the workshop is to build consensus for a widely agreed upon standard for fair labor principles in the palm oil sector. When complete, this detailed set of standards will be delivered as a set of recommendations to help guide companies, plantation certification bodies and government regulators towards eliminating the systemic abuses currently rife throughout the palm oil industry.

The workshop occurred in advance of the annual meeting of the Roundtable on Sustainable Palm Oil (RSPO), taking place November 17-20 in Malaysia.

Key issues to be addressed in the fair labor principles include:

  • Elimination of all forms of forced or compulsory labor.
  • Abolishment of the worst forms of child labor
  • Respect freedom of association and the right to collective bargaining.
  • Provide all workers adequate protective equipment free of cost.
  • Provision of adequate housing, water, medical, educational and welfare amenities and protective equipment free of cost for all workers.
  • Ban of toxic, bio-accumulative pesticides, including all pesticides that are classified as World Health Organisation Class 1A or 1B, or that are listed by the Stockholm or Rotterdam Conventions, and Paraquat.
  • Commitment 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.
  • Establishment of a legitimate, accessible, and transparent grievance mechanism, consistent with international best practices
  • Commitment to meaningful transparency and disclosure of all plantation processes

Background on palm oil sector

  • In less than two decades palm oil production has nearly quadrupled to 55 million metric tons to become the world’s most widely traded and used edible vegetable oil.
  • As global demand for palm oil has skyrocketed, so has the need for large numbers of laborers on plantations. This has resulted in widespread exploitation of workers and a reliance on forced and child labor.
  • Despite serious exploitation of workers, global controversy surrounding palm oil production to date has largely focused on the commodity’s links to deforestation and climate change.
  • Unlike many other globally traded commodities that have received civil society attention, such as coffee, cotton or farmed shrimp, palm oil supply chains are often more complex and far less transparent.

Palm oil production in Malaysia and Indonesia

  • The palm oil industry is one of the most significant employers in Malaysia and Indonesia, where 85 percent of the world’s palm oil is grown, and employing as many as 3.5 million workers.
  • The US has recently downgraded Malaysia to the lowest ranking in its annual human trafficking report, relegating the Southeast Asian nation to the same category as Zimbabwe, North Korea and Saudi Arabia.
  • Many of the workers on palm oil plantations are recruited, often with unethical and misleading practices, from the most vulnerable and marginalized populations, such as migrant workers or Indigenous communities, and have little or no access to political recourse.
  •  A lack of documentation of labor conditions as well as geographic isolation of many plantations further enables exploitation of workers and exacerbates the vulnerabilities of already marginalized populations.
  • Over 3,000 protestors peacefully marched through the streets of Medan, North Sumatra and surrounded the site of the RSPO Roundtable meetings last year with a loud and colorful rally bringing attention to this pervasive but often overlooked issue. Representatives of the demonstrators were allowed into the building to deliver a set of demands to the leadership of the RSPO.

Company response

  • Over the past 18 months, there has been a proliferation of no-deforestation, no-peat, no-exploitation commitments from major corporations in the palm oil industry, such as Wilmar and Cargill.
  • Egregious labor conditions continue to be exposed, even on RSPO certified plantations.
  • Recent findings by the NGO Finnwatch shows RSPO member IOI Group to be paying wages below the minimum wage, seizing workers’ passports and preventing workers from joining unions.
  • Other reports in the past year have found human trafficking, child labor and debt bondage of laborers employed by RSPO members and working on RSPO certified operations. 

Quotes from participating organizations on the workshop:

  • RAN: “As more and more major players in the palm oil industry grapple with implementation of their recent No Exploitation, No Deforestation, No Peatlands commitments, it is imperative that labor voices are included as critical stakeholders in the process,” said Robin Averbeck, senior forest campaigner with Rainforest Action Network. “It is past time companies take responsibility and do the hard work necessary to eliminate the pervasive labor abuses in their palm oil supply chains.”
  • Oppuk: “For many years I have witnessed the exploitation and unfair treatment of palm oil laborers,” said Herwin Nasution, longtime plantation labor organizer and Executive Director of Indonesian labor organization Oppuk. “The Fair Labor Principles Document under development is receiving a deep assessment from main stakeholders including trade unions, local NGOs, national NGOs and international NGOs. I look forward to these principles being implemented by oil palm companies throughout their supply chains in order to improve the lives of plantation laborers who have been abused too often by the state and their employers.” 
  • Sawit Watch: “Millions of workers across Indonesia and Malaysia continue to suffer under brutal and unacceptable conditions on palm oil plantations and these principle go farther than any standards yet to address these problems adequately,” said Jefri Saragih, Executive Director of Sawit Watch.

Participating organizations included:

  • Pesticide Action Network Asia & the Pacific (PANAP)
  • Tenaganita
  • Oppuk
  • Sawit Watch
  • Grassroots
  • Rainforest Action Network (RAN)
  • Verite
  • International Labor Rights Forum (ILRF)
  • International Center on Corporate Responsibility (ICCR)
  • Solidarity Center
  • Walk Free
  • JATAN
  • With support by Humanity United

For more on other reports about unjust labor practices in the palm oil sector, please see the following: