The COVID-19 pandemic and resulting ‘lockdowns’ have seen people turning to their smartphones and computers to work and communicate more than ever. Yet the disruption caused to global supply chains has meant those hardest hit are the factory workers who make these and other products we rely on every day.
Conditions that already left workers vulnerable to serious human rights abuses such as forced labour are only exacerbated by this instability. Migrant workers in particular contend with cramped living, working, and travel arrangements, and may already be vulnerable to exploitation through severe debt.
These workers may also face excessive overtime as companies seek to address both staff and product shortages. As companies grapple with the challenge of managing their supply chains in the aftershocks of the pandemic, it has become all the more important to consider who is making their products, and whether companies are equipped to tackle increased forced labour risks.
KnowTheChain has evaluated the 49 largest ICT companies globally on their efforts to address forced labour and human trafficking in their supply chains. This is the third KnowTheChain benchmark on the ICT sector, after reports in 2016 and 2018. However, the sector’s average score remains low at 30/100, while three quarters of companies scored below 50/100, showing that all companies need to do more to tackle forced labour.
The typical company discloses steps such as a supplier code of conduct addressing forced labour, training for procurement staff and suppliers on forced labour, a policy prohibiting recruitment fees, an audit process for monitoring labour conditions at suppliers, and a grievance mechanism for suppliers’ workers. However, as found by previous ICT benchmarks, company action is particularly lacking in the areas of ‘worker voice’ and recruitment – areas with great impact on workers’ lives, with risks all tech companies need to consider.
Recent reports show that forced labour is pervasive in tech supply chains. Migrant workers are reported to have been charged excessive fees to secure a job in a Malaysian electronics factory – fees that reach the equivalent of approximately 4-5 months’ worth of their wages, leaving them trapped in situations of debt. In addition, more than a quarter of the companies KnowTheChain assessed have been linked to allegations of forced labour of ethnic minorities ‘transferred’ to factories across China.
There are some positive signs of companies taking action to protect workers. It is encouraging that 73% of companies assessed disclose a policy prohibiting worker-paid recruitment fees in their supply chains. Moreover, it is welcome that companies benchmarked in both 2018 and 2020 have shown progress on this essential step towards tackling exploitation – with six companies adopting no-fee policies since 2018, and five companies reporting that fees have been reimbursed to workers since 2018.
However, a gap between policy and practice remains. While a majority of companies have a no-fee recruitment policy, only 13 out of 49 disclose evidence that workers have had their recruitment fees paid back, and no company sets out a comprehensive process to prevent workers being charged fees in the first place.
Further, the sector scored an average of 12/100 on the theme of ‘worker voice’, which looks at how companies seek to ensure that supply chain workers understand and are able to exercise their rights. Most notably, every company scored zero on their efforts to support workers’ right to organize and collectively bargain for better working conditions, which is essential in order to challenge and prevent abuse.
These findings show that the ICT sector is still not doing enough to protect workers in their supply chains from forced labour, with important gaps between policy and practice. Companies and investors must address these risks to make the tech industry fit for a post-pandemic ‘new normal’ and to make the ethos of ‘building back better’ a reality for everyone.