The announcement by the United States Customs and Border Protection (CBP) on Sept 30 that palm oil and palm oil products from Felda Global Ventures (FGV) are now subject to a Withhold Release Order (WRO) caught Malaysia by surprise.
"The WRO is the result of a year-long investigation that revealed forced labour indicators including abuse of vulnerability, deception, restriction of movement, isolation, physical and sexual violence, intimidation and threats, retention of identity documents, withholding of wages, debt bondage, abusive working and living conditions, and excessive overtime. The investigation also raised concerns that forced child labour is potentially being used in FGV's palm oil production process," said CBP.
Prior to this, the US CBP had already received a petition submitted by a coalition of non-governmental organisations last year containing allegations against FGV, citing a number of sources, including an article in The Wall Street Journal on July 26, 2015.
But let's hear out FGV first. In response, FGV has had to re-highlight and reiterate the remedial and corrective actions it's been taking ever since the issue of forced labour emerged in public discourse. These include:
• Effective this year, FGV recruits its migrant workers mainly from India and Indonesia through legal channels and processes recognised and approved by the authorities of Malaysia and the source countries;
• The non-practice of retaining workers' passports is bolstered by the installation of 32,250 safety boxes throughout all its 68 complexes as an option for migrant workers to keep their passports safely;
• Adequate housing. Over the past three years, FGV has invested approximately RM350 million to upgrade housing facilities for workers in its plantations all over the country;
• The provision of healthcare benefits, which cover annual expenses for outpatient care and an unlimited allocation for inpatient treatment; and
• The Fair Labour Association membership. FGV is implementing a comprehensive action plan comprising initiatives to strengthen labour practices, as well as grievance mechanisms.
Although FGV's export share to the US and Canada is only five per cent, what ultimately matters is not just the economic and financial costs, but ramifications to its image with the eventual knock-on effect on Felda itself and its smallholders.
Such allegations should be meticulously audited and verified based on the evidence by a third party, appointed by CBP (with the consent of the NGOs concerned) and FGV. Up to now, it's hard to conclusively establish these claims.
Should CBP reject the request by FGV to disclose the report made by the US-based NGOs, the imposition of the WRO could be deemed unfair and discriminatory as the evidential basis of the decision to issue the WRO can't be objectively determined.
What else could FGV do to allay concerns and "salvage" its reputation? FGV should go on a public relations blitz to explain the state of its foreign workers in the plantations.
CBP officials and the NGOs should be invited to see for themselves the progress and improvements made to address the flaws in the labour procurement as well as treatment of foreign workers in FGV plantations.
Finally, the Plantation Industries and Commodities Ministry, together with the International Trade and Industry Ministry, should reach out to their US counterparts and work towards resolving the issue.
It is therefore commendable that Plantation Industries and Commodities Minister Khairuddin Razali is planning to submit a report on the labour situation in the Malaysian oil palm plantation sector to the US Labour Department and other international organisations.
Perhaps there should be a call also for an independent and neutral arbitration body that could adjudicate on the matter if a resolution is not forthcoming with a decision that's binding. Otherwise, Malaysia would perceive the action of imposing the WRO as based on bias and ulterior motive (like the agenda of lobbyists, rival interests, ideologues) and not evidence-based.
The writer is head of Social, Law and Human Rights at EMIR Research
The views expressed in this article are the author's own and do not necessarily reflect those of the New Straits Times