An overview of forced labour of migrant workers in the Malaysian electronics industry.

By Ruwadzano Makumbe

Malaysia is a highly industrialized country and it has a strong investment-friendly environment that attracts capital investments from the USA, Japan, Taiwan and Europe (WTEC Hyper-Librarian, 1997). Despite it having a state controlled system, it has a free trade policy that allows 100% foreign ownership. The Malaysian economy is mainly characterized by manufacturing, agriculture and tourism and through its development strategy ‘Vision2020’, the government aims to develop ‘accelerated industrial restructuring, technological upgrading, human resource development and industrial linking’ (WTEC Hyper-Librarian, 1997). In support of this vision there are eleven Free Trade Zones that focus on electronics: Batu Berendam, Ulu Klang, Bayan Lepas, Prai, Technology Park, Kulim Hi-Tech Park, Shah Alam, and Subang Hi-Tech Park (WTEC Hyper-Librarian, 1997). Furthermore, the Malaysian Technology Development Corporation (MTDC) also facilitates the growth of the electronics industry through providing capital to companies that are interested in investing in Malaysia as well as Malaysian companies that are involved in this industry (Malaysian Technology Development Corporation, 2017). This promotes a competitive culture, which claims to enhance the quality of products and also partners’ commitments to contribute to Vision 2020 (WTEC Hyper-Librarian, 1997). In March 2017 Malaysia launched a Digital Free Trade Zone, which is meant to facilitate foreign trade in Malaysia (Malaysia Digital Economy Corporation (MDEC), 2017) and the government continues to probe foreign and local investment in the electronics industry. Evidently, Malaysia has strong foreign investors such as Intel which assembles Pentium chips (essential computer parts) and conducts packaging research and development, Motorola, a successful mobile phone company, is another principal investor (WTEC Hyper-Librarian, 1997).

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The normalization of forced labour in the electronics industry

In this overview l seek to give a detailed description of the problem and also highlight the factors that have contributed to its development and acculturation in the electronics industry. The international human rights regime defines forced labour in Convention 29 of the International Labor Organization (ILO), as “all work or service which is exacted from any person under the menace of any penalty and for which the said person has not offered himself voluntarily” (ILO Convention 29, 1930). Under domestic law, the Malaysian Constitution outlaws slavery, and explicitly prohibits all forms of forced labor, except that which may be provided by law as a form of compulsory service for national purposes, and work incidental to the serving of a sentence of imprisonment (Consitution of Malaysia, n.d.). In addition to this framework, in 2007 Malaysia adopted a law that prohibits human trafficking, (Government of Malaysia: Anti-trafficking in persons (Amendment) Act, 2007) and an amendment in 2010 goes even further by making specific reference to the protection of foreign workers (Government of Malaysia: Anti-trafficking in persons (Amendment) Act, 2010). This clearly shows that there is a working framework guarding against forced labour in Malaysia.

However, to understand the human rights problem of forced labour of migrant workers in the electronics industry in Malaysia, it is crucial to put into perspective what is meant by forced labour in that context.

Forced labour in Global Production Networks is not necessarily workers that are informal, coerced and shackled but have entered into some form of ‘contract’ to provide their labour in return for payment, normally for the short-term. However, these workers are either deceived about the nature of work, pay, and other conditions and are often bonded through debt owed to recruiters or employers. A defining characteristic of forced labour is the inability of workers to exit their ‘contract’.” (Raj-Reichert, 2016, p. 9)

As illustrated above, over the years Malaysia has developed into one of the largest manufacturing hubs for electronics worldwide, especially for major international corporations (IB Times, 2014). This makes it a highly attractive destination for migrant workers and as such it is identified as a major destination country (Ismail, et al., 2017, p. 213). Malaysia produces 30% of all the micro-processors sold worldwide  (Abdullah & Chan, 1998, p. 2). This also means that there is immense pressure from international corporations on manufacturing firms and factories to maximize production and to also meet the quality standards required (Raj-Reichert, 2016). Resultantly, a ripple effect is created, which means that the lowest possible expenses have to be incurred and these are felt by workers, who receive unfair wages and experience generally unfair labour practices  (Raj-Reichert, 2016, p. 9). In most cases, due to the vulnerable circumstances that migrant workers find themselves in, they provide the best labour at a very low cost, thus meeting the needs of the industry (Phillips & Mires, 2015). Malaysia attracts thousands of migrant workers each year from Bangladesh, India, Indonesia, Nepal, Vietnam, Myanmar and other countries, and there is an estimated work-force of four million migrant workers in Malaysia (The Guardian, 2014). This mass exploitation of workers, in my view, is cause for concern and requires attention under the human rights scope. In the majority of the countries where the workers are migrating from there are push factors (unfavorable conditions that force outward migration) that such as economic instability and conflict. These factors force them to migrate to Malaysia in the hope that they will find better employment as well as opportunities to improve their families’ standards of life (Verite, 2014). Such prospects very rarely come true as forced labour is hidden but natural in the electronics industry, such that when migrant workers are recruited they are not given a true picture of the type of employment they will be getting into, the amount of money they will be earning and also the conditions of their employment. Philips and Mieres (2015, p. 246) highlight that these systems are inherently exploitative and their existence is heavily dependent on such exploitation. There are varied conditions which have made it possible for forced labour to be widespread in the electronics industry and these set the root causes and also somewhat provide avenues for solutions to this problem (Verite, 2014, pp. 10-15).

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One of the conditions is that the entire recruitment process is deceptive, going far beyond the non-disclosure of the conditions of employment (Ismail, et al., 2017, pp. 212-213). It goes further to demand exorbitant recruitment fees from the workers, subjects the migrant workers to poor living conditions and also retention of passports by the recruiting agents or the employers, thereby restricting and trapping the workers to their employment contacts (Raj-Reichert, 2016, p. 10). Thus, when the workers are going through the recruitment processes they are required to pay recruitment fees and in most cases many migrant workers borrow the money in the hope that they will be able to pay it back once they start working (Verite, 2014, p. 10). This puts them in a vulnerable position as they are in debt which inevitably takes away their option to reject the conditions of employment that they are subjected to (McGrath, 2013). To pay the debt, they end up working overtime for very little wage and in most cases under unsafe conditions (Raj-Reichert, 2016, p. 10). Another condition is that migrant workers are forced to be heavily dependent on their employers and recruitment agencies as they are the ones providing them accommodation (Verite, 2014). This means that the livelihoods of migrant workers are entirely tied to their employment contracts. Many have reported that they live under appalling conditions without proper sanitation, which makes them susceptible to diseases and infections (Verite, 2014, p. 42). This is worsened by the fact that employers and agencies hold the passports of migrant workers so that they cannot leave employment whenever they want, limiting their movement in Malaysia (Verite, 2014, p. 11). In a study conducted by a social auditor, Verite, 94% of the interviewed workers had their passports taken away (Raj-Reichert, 2016, p. 10). This was aggravated by the introduction of a new policy by the Malaysian government in 2013. This policy allowed the employers to collect per capita levy (a tax that is levied by a taxing authority on every adult residing in the authority’s jurisdiction) directly from their workers (Verite, 2014, p. 12). It also meant that workers could not leave their employment as they would have to pay the levy in a lump sum. This is impossible for most, leaving them no choice but to endure the harsh labour conditions (Verite, 2014, p. 12).

Conclusion

All these factors clearly indicate how the electronics industry is structurally exploitative and oppressive of migrant workers. There are no means to protect migrants from such exploitation (Verite, 2014). Research has shown that because these migrant workers are not shackled or brought into the workforce against their will it is difficult to pressurize the system to protect workers (Raj-Reichert, 2016). Rather the contract of employment takes precedence as it binds both the worker and the employer. This highlights the complexity of this problem in Malaysia, as it is not only natural but systemic (Verite, 2014).  There is therefore an urgent need for the government to restructure the recruitment system and introduce policies aimed towards the protection of labour rights and migrant rights as provided by the international human rights regime.

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Bibliography

Malaysia with Regions by FreeVectorMaps.com

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[1] Per capita levy refers to a tax that is levied by a taxing authority on every adult residing in the authority’s jurisdiction.

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