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22 Aug 2023

Taiwan: Vietnamese workers pay high recruitment fees, while remediation falls short despite zero-fee recruitment policies, incl. cos. comments

On 13th June 2022, The Diplomat reported that migrant workers employed by manufacturers in Taiwan supplying to major European multinationals paid extortionate recruitment fees and experienced other labour rights violations, including withheld passports and fines. The author interviewed twenty Vietnamese workers and collected data from a further nine. At the time of writing, none of the workers had had their recruitment fees reimbursed.

In February 2023, Le Monde published an article on the story, naming the two suppliers where the abuse was occurring as Chin Poon Industrial and Shinkong Synthetic Fibers. The article explores how multinational companies buying from these suppliers addressed the problem. The relationship between the suppliers and buyers was outlined in a later article published in August 2023, which noted that Chin Pool Industrial supplies car parts to Bosch, Hella, General Motors, Opel, Magna, Visteon, and Continental. Shinkong Synthetic Fibers supplies plastics to Continental and Niagara Bottling, who makes bottles for companies including Walmart. DSM and Dupont also sourced from Shinkong until the end of 2022. The author notes that all companies, apart from Opel, Magna, and Visteon, told The Diplomat they commit to zero-tolerance recruitment.

The February article notes workers employed by Chin Poon Industrial paid high recruitment fees and received punitive fines, among other labour rights impacts. Bosch stated that it ‘committed to addressing the problem’; Bosch and Continental promised to approach the supplier; and Magna and Visteon did not. CIP then started reimbursing the migrant workers based on the nationality of the worker.

Vietnamese employees of Shinkong Synthetic Fibers spoke of high recruitment fees, fines, deductions, retention of ID papers, tight curfews and other forced labour risks. The buyers promised to address the issue with their supplier. The article notes that conditions have since improved, although workers did not have their recruitment fees reimbursed. DSM stopped sourcing from the supplier; and Walmart and Niagara Bottling actively investigated the allegations. In February, the supplier agreed to reimburse all workers for their recruitment fees.

The article also analyses conditions in the glass supplier Hwa Hsia Glass, which suppliers to companies such as L’Oreal and Veritiv. Workers experienced labour rights abuse including the payment of high recruitment fees, passport confiscation, fines, and intimidation. When reached for comment, the supplier told the authors that passports had been returned, overtime was paid, ethical recruitment was the company’s policy, and fines were minimal. L’Oreal cut ties with the supplier and helped the workers by conducting future audits on the supplier to continue to monitor conditions and provide remedy.

In August 2023, The Diplomat published an article following up on the case. It found Shinkong Synthetic Fibers and Chin Poon Industrial had ‘reimbursed over $2.5 million in total to migrant employees for fees paid to recruiters in Vietnam and Thailand’. However, migrants were paid only between 20% - 60% of their recruitment costs, thus going against the zero-recruitment fee policies of many of the companies buying from those suppliers.

Hella said that fees for which there is written evidence for were reimbursed; Opel said it was in full support and alignment with the RBA standards; Bosch claimed that Chin Poon Industrial complies with RBA standards; and General Motors said that it was working with suppliers to reach a resolution. CPI stated that its zero-fee policy for new recruits from 2023 complies with RBA; while SSFC noted that "it will pay for the fees that are charged legally in the worker’s home country as listed in the worker’s Wage Agreement[...]".

The author reached out to all suppliers, investors, and buyers for comment.