Malaysia: Indonesian workers on palm oil plantations allegedly supplying multinational brands report rights violations, incl. poverty wages, gender discrimination & precarious conditions; incl. cos. responses & non-response
A report published by Koalisi Buruh Migran Berdaulat, a coalition of civil society organisations based in Indonesia, examines the working conditions of Indonesian workers on palm oil plantations in Sabah, Malaysia.
The study focuses on three plantations where researchers conducted interviews with 26 workers and carried out field visits. The report aims to assess the living conditions of migrant workers and their families in these plantations in order to propose an appropriate living wage.
It highlights numerous labour rights abuses allegedly endured by workers, including:
- Expired documentation that has not been renewed by plantation management, according to the workers.
- Fewer than 50% of workers reportedly have formal employment contracts.
- Workers said they have to purchase their own work equipment, costs which are deducted from their wages.
- Gender-based wage disparities, with female workers reportedly earning less than male workers.
- Over 50% of workers said to be earning below the legal minimum wage, not being compensated for overtime and having their wages deducted for sick days.
- Basic necessities, such as water, food, transportation, electricity, healthcare, housing, and children’s education are reported to be inadequate or unaffordable.
On palm oil plantations, workers and their families work hard, but it is the palm oil companies and the government who make the profits. This situation leaves workers in debt and passes poverty on to their children.Migran Berdaulat, "Living Wage for Migrant Workers in the Palm Oil Plantations in Sabah, Malaysia"
The report argues that both the wages paid and the minimum wage fall significantly below what constitutes a living wage for palm oil plantation workers. Allegedly, these wages are insufficient to cover basic living expenses, as workers struggle to afford essential necessities—even when factoring in the reduced housing costs, since many workers receive housing provided by the companies.
We are calling for greater justice, better working conditions, and a fairer environment for all workers in the palm oil industry by promoting fairer pay and more humane working conditions.Migran Berdaulat, "Living Wage for Migrant Workers in the Palm Oil Plantations in Sabah, Malaysia"
According to the investigation, palm oil from one of the plantations identified in the report as "Mojokuto" is allegedly linked to the supply chains of FGV Holdings Berhad and Teck Guan Perdana. The report further alleges that it is highly likely that palm oil from all three plantations ultimately enters the supply chains of major global companies, including Nestlé, Barry Callebaut, Unilever, Cargill, PepsiCo, and BASF.
In July 2025, the Business & Human Rights Resource Centre invited the reported buyers to respond to the allegations outlined in the report. It received responses from FGV Holdings Berhad, Teck Guan Perdana, Nestlé, Barry Callebaut, Unilever, Cargill and BASF. PepsiCo did not respond.