Rubber gloves used in Australia’s fight against coronavirus could be produced by slave labour, corporate watchdogs warn, after the United States banned imports of products from the world’s largest manufacturer.
Key points:
- The pandemic has seen a huge boost in demand for rubber gloves from Malaysia, which is the world’s largest producer
- Australian journalists facing jail in Malaysia were investigating mistreatment of migrant workers
- Observers say companies in Australia’s healthcare sector are among the worst when it comes to supply chain transparency
Malaysia’s Top Glove, which is estimated to produce one in five gloves globally, had a detention order imposed on its products by US Customs and Border Protection (CBP) on July 15.
This means its products will be detained by US authorities until Top Glove either exports the shipment from American soil or can demonstrate that the merchandise was not produced with forced labour.
A spokesperson for the CBP told the ABC the decision was “based on reasonable evidence of forced labour in the manufacturing process”.
“The evidence reveals multiple International Labour Organization (ILO) indicators of forced labour, including debt bondage, excessive overtime, retention of identification documents, and abusive working and living conditions,” they said.
In a statement responding to the detention order, Top Glove said it had “already resolved” alleged labour violations against migrant workers at its facilities.
“There is a possibility this may be related to foreign labour issues, which we have already resolved, save for one more issue with regard to retrospective payment of recruitment fees by our workers to agents prior to January 2019, without our knowledge,” the company said.
A widely reported form of labour violation in Malaysia is the charging of extortionate recruitment fees by middlemen, which watchdogs say leads to bonded labour — the most common form of modern slavery — as workers are forced to use modest salaries to pay back the fees over long periods of time.
Top Glove said it had paid back all recruitment fees to employees “over the past few months”.
“We believe it is in the best interests of all parties to come to a solution expeditiously so that our disposable gloves can reach the parties that need it the most, during this COVID-19 time,” the company said.
Top Glove did not respond to the ABC’s request for comment.
Amy Sinclair, regional representative in Australia for the Business & Human Rights Resource Centre, said: “This really should be a very live issue for Australian companies who are importing from Malaysia, where we know that there are issues and we know there is a history of poor practices.”
‘The world relies on Malaysia’
The COVID-19 pandemic has seen an unprecedented surge in demand for personal protection equipment (PPE), particularly from Malaysia, which is thought to produce upwards of 60 per cent of the world’s gloves.
In March, the US embassy in Kuala Lumpur declared that “the world relies on Malaysia in the fight against COVID-19”.
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Top Glove’s revenue has skyrocketed as a result, reporting an incredible 366 per cent jump in net profit for the third quarter of 2020.
The company last month lauded “unparalleled growth” and its “most outstanding performance yet”, with executive director Lim Cheong Guan telling reporters that: “The best is yet to come.”
But there are indications that boosted production has taken a toll on workers.
An investigation by local news outlet Malaysiakini, released in early May, found that Top Glove was operating an initiative called Heroes for COVID-19, whereby workers were encouraged to spend up to four hours on their days off packing rubber gloves to meet demand.
“I don’t feel like a hero at all,” one worker, who said they had worked 14 days straight, told Malaysiakini.
A separate investigation by the UK’s Channel 4 found that Top Glove workers were being paid less than $2-an-hour to work 12-hour shifts, 6 days a week.
Finnish Member of European Parliament Heidi Hautala and six other MEPs wrote to the EU’s Commissioner for Trade in late May over “systemic and documented forced labour concerns” in Malaysia’s glove-making industry.
“Illegal recruitment fees, long hours, low pay, passport confiscation and squalid, overcrowded accommodation are commonplace,” Ms Hautala wrote.
“These rubber glove factories are working overtime right now to meet the vast amount of supply that the world needs,” said Brian Yap of Amnesty International Malaysia.
“The companies and the government must ensure that these workers, who are doing a very important job, are protected from injury and disease.”
Longstanding concerns over abuse of workers in Malaysia
Abuses in the glove manufacturing industry in Malaysia have been widely documented long before COVID-19.
An ABC investigation in 2018 found overcrowded worker accommodation and allegations of excessive overtime, salary deductions, large recruitment fees and workers having their passports locked up at Top Glove, which employs more than 11,000 workers from poorer countries.
“Passports being withheld — it happens across the board,” Mr Yap of Amnesty told the ABC.
“I think technically it’s illegal to do that as an employer, but it’s a widely open and accepted practice.”
The Government of Mahathir Mohamad, elected in 2018, had vowed to improve conditions for migrant workers in Malaysia.
But the toppling of Mr Mahathir and a securitised response to COVID-19 have seen crackdowns against undocumented migrants, including mass arrests.
The treatment of migrant workers in Malaysia was the focus of a recent Al Jazeera documentary, which provoked an angry response from the Malaysian Government and could see five Australian journalists charged.
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Australia’s Modern Slavery Act
Unlike the US, Australia does not require importers to prove there is no forced labour in their supply chain.
Nevertheless, a spokesperson for the Australian Border Force told the ABC: “The Government is concerned by allegations of modern slavery relating to the manufacture of personal protective equipment, including rubber gloves.”
“Australia is taking a global leadership role in addressing modern slavery risks in international supply chains through our Modern Slavery Act 2018,” they said.
“Under the Act, entities based or operating in Australia which have an annual consolidated revenue of more than $100 million are required to report on their actions to assess and address possible modern slavery risks in their supply chains. This may include modern slavery risks related to the purchase of PPE.”
The Law Council of Australia has previously criticised the Act, arguing it may be too weak to have any impact on the practice.
“It’s weak because it doesn’t have financial penalties,” Ms Sinclair of the Business & Human Rights Resource Centre said.
“But it is a quite significant first step and it does force companies to look at their supply chains and what the potential risks to workers are.”
Companies required to report under the Act have been given an extension due to coronavirus and are not expected to submit their reporting until March.
Border Force issued an information sheet for businesses in April, detailing “how to reduce the risk of vulnerable workers in their operations and supply chains becoming exposed to modern slavery”.
It has stopped short of banning the import of products suspected to have been manufactured with forced labour, however.
The US CBP spokesperson, meanwhile, told the ABC that: “Imported goods produced with forced labour can present health and safety risks for US consumers.”
They said the detention order against Top Glove was sending a “clear and direct message to US importers that the illicit, inhumane and exploitative practices of modern day slavery will not be tolerated in US supply chains”.
“CBP continues to work extremely hard … to ensure that personal protective equipment, medical devices and pharmaceuticals related to the COVID-19 response are cleared for entry as expeditiously as possible, while verifying that those goods are authorised and safe for use,” they said.
Health sector ‘one of the worst’ for ethical supply chain
In March, the World Health Organization (WHO) said that to meet global demand, manufacturing of PPE would have to be increased by 40 per cent.
“Industry and governments must act quickly to boost supply, ease export restrictions and put measures in place to stop speculation and hoarding. We can’t stop COVID-19 without protecting health workers first,” said WHO director-general Dr Tedros Adhanom Ghebreyesus.
“Without secure supply chains, the risk to healthcare workers around the world is real,” he said.
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Robyn Parkin of Ethical Partners Fund Management told the ABC that while ensuring there is adequate PPE for medical workers is important, the healthcare sector often lacks appropriate concern for the wellbeing of workers responsible for manufacturing the goods overseas.
“We have also done a lot of research on the attention to modern slavery across the ASX as a whole, and surprisingly, as a sector, the health sector is amongst the worst for disclosure and transparency,” she said.
Australia’s Department of Health did not respond to the ABC’s inquiries about the quantity of rubber gloves purchased by the Commonwealth Government and whether Top Glove products were among those purchased.
“It’s really critical at this time [that] efforts to protect all workers are redoubled,” Ms Sinclair said.
“Companies should be ensuring that rigorous checks are still being taken, that they are checking what their suppliers are doing, and that they are using their leverage to encourage their suppliers to prioritise health and safety at this time.”
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