Workers that pay to work and cannot quit? Jane Turnbull shares an overview of bonded labor and what this means for the outdoor industry’s supply chains.

Can you begin by describing what bonded labor is?

Bonded labor occurs when people give their services as payment against a debt or obligation, without repayment terms being clearly stated. It can start out as a job application, but once people begin to work, there is now a debt to repay. Migrant workers are especially at risk from bonded labor.

The civil society organization Verité explains that workers leave home, often from conditions of real poverty, for a job and a better life. This makes them susceptible to being manipulated by recruiters and middlemen who charge hidden fees such as for transportation and living expenses etc. These costs are not always fully disclosed to the worker, and they often soon discover that the pay will not in fact cover these debts.

Foreign migrant workers can end up selling assets and paying anywhere between 4 000 – 9 000 USD to acquire these jobs. And once they start work, they in essence provide unpaid labor to repay debts for upwards of nine months or sometimes more. Furthermore, they can be at risk of having their passports taken from them, subsequently leaving them with no control over their situation, whilst working and living conditions can be poor and the debt even added to.

Which industries are at risk of using bonded labor?

Many industries are at risk – migrant workers produce the food we eat and the products we buy. This includes the textile sector and indeed the outdoor industry. Furthermore, the risk is present throughout the various tiers of the supply chain, including Tier 1 factories, Tier 2 mills and beyond.

This issue is endemic and global, in poor and rich nation alike. Factories and industries in countries with limited or expensive labor pools, will send out requests to third-party labor brokers for workers from surrounding countries to satisfy local labor shortages and prices. Agencies in these countries will then recruit migrant workers to meet costs and supply.

What are the challenges in addressing this issue?

They are numerous, complex and if I may say so frustrating. Countries such as Taiwan, for example, continue to allow broker fees to be charged each month to workers, making it extremely hard when brands try to discuss issues of fair wages and worker fees. They are simply told by factories that the fees are legal and therefore non-negotiable.

Similarly, many workers take jobs willingly, making it difficult to find out exactly what they voluntarily agreed to. Tracking down the actual employment agreements is one matter but gathering details of fees paid by migrants for employment remains very difficult. Even when workers are faced with illegal fees, it is understood that they can be asked to sign affidavits stating they have been charged the correct legal fees, lest they be sent back to their country of origin with no employment, yet still with the burden to repay any loans they have taken out. This leaves a great many aspects to try and get clarity on to push for change.

In addition to principles of fairness and social justice, there is clearly a business case for addressing bonded labor, correct?

Certainly. Beyond not wanting to be a part of an unfair and in extreme cases, cruel system of exploitation, there is the commercial risk perspective. NGOs and indeed governments are becoming increasingly aware of this problem and rightly so. Being found to have exploited workers in your supply chain is bad on every level and brands need to be more aware of the prevalence of this issue and the risks they are facing, because they are very real. It is no longer enough to say that there are policies in place; genuine action and progress will increasingly need to be demonstrated to assure that due diligence has been done.

What actions has EOG taken, and what is next?

Right from the start, we have been clear that there is no quick fix to this. There are so many grey areas, and any widespread success will likely require political change. But we can make a difference within our own industry’s supply chains, which one hopes will contribute further to the political landscape. Brands can play a key role in driving progress, and this starts with awareness. Begin with the employees of these factories, take time to see it from their perspective, they are people like you and I, who deserve to be paid a living wage for the work they do. These people skillfully sew products, glue on shoe soles and mill components; put these employees at the center of any approach to due diligence. From this, adopt responsible purchasing practices and work closely with suppliers, choose those who have the same vision and work with portfolio companies to leverage change.

The EOG is currently working with a strong coalition of outdoor brands who came to us to help effect change and we are whole heartedly committed to supporting such work and this contributing to meaningful wider change.

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