"Starbucks and Nestlé face scrutiny over labor practices in China" 3 December 2024

“Ghost” coffee farms in Starbucks’s and Nestlé’s supply chains in China are overworking farmers and allowing underaged labor, China Labor Watch has found.

Coffee farms in Starbucks’ and Nestlé’s supply chains in China are not living up to the multinationals’ ethical standards, sometimes using children as workers, excessive hours and lax safety standards to meet their targets, according to a report by China Labor Watch.

The investigation, covering 26 farms that form part of the Starbucks and Nestlé supply chains, is the latest example of the challenges that big international companies face in monitoring labor standards in China.

China Labor Watch said its investigators saw malpractice mostly on “ghost farms,” often family-run plots of land that informally supply the larger estates where standards have been verified by Starbucks or Nestlé.

Farmworkers are paid according to weight picked, meaning they often work from dawn to dusk, seven days a week, during harvests to earn as much as possible during peak season, investigators found.

...This directly violates Starbucks’ and Nestlé’s standards that limit the working week to 48 hours.

Farmers ... reported not having sick leave or paid vacations, as required by Starbucks. Many said they did not have formal employment contracts or health insurance.

Protective equipment such as gloves is not provided and injuries are common...

... researchers saw two instances of children under 16 picking coffee or helping with sorting work.

Nestlé said farms must comply fully with local laws and Nestlé’s responsible sourcing requirements, as enforced by unannounced visits and third-party monitoring. "We take these allegations very seriously and have contacted our suppliers to investigate carefully and if necessary, take corrective action," said a statement sent by Claudia Afonso, senior corporate spokesperson at Nestlé.

"We have been working with coffee farmers in China since the 1980s and our efforts to sustainably develop the coffee industry in the Yunnan province have been recognized by local governments and coffee farmers," Nestlé’s spokesperson said.

... Starbucks said it prohibits farms from informal supply arrangements and uses regular audits by an outside verification ... The company is "committed to investigating thoroughly" once it receives full details of the allegations, Marc Birtel, director of international communications, said in an emailed statement.”

Birtel said Starbucks’ supplier agreements "mandate that all farms maintain detailed records of their coffee production and purchases.”