Find below Channel 4 News (UK) exclusive story (7 minute video also available at https://www.youtube.com/watch?v=lyYeaBu2Jvk) on how the UK National Health Service (NHS) has been forced to scrap how it sources medical gloves after Supermax Malaysia glove company and its UK subsidiary were accused of modern slavery.
Whilst there have been considerable improvements at Supermax facilities (see below and attached), this case and our legal challenge to the UK Department of Health here has exposed continued poor procurement practices and complicity in modern slavery by the UK government .
See also below official press release (embargoed since 29th November 2022) from Wilsons Solicitors on the case settlement.
Channel 4 News Exclusive 1 Dec 2022: Department of Health forced to scrap how it sources medical gloves for NHS after supplier accused of modern slavery
7m
By Simon Israel
The Department of Health has been forced to scrap the way it sources medical gloves for the NHS – after its buyers paid millions to a supplier accused of modern slavery.
It follows a landmark legal case which challenged the government’s decision to include the Malaysian glove manufacturer Supermax as an approved NHS supplier, despite long standing claims of labour abuses at the company’s factories in Malaysia.
Full story available on Youtube or at https://www.channel4.com/news/department-of-health-forced-to-scrap-how-it-sources-medical-gloves-for-nhs-after-supplier-accused-of-modern-slavery
PRESS RELEASE (EMBARGOED): 29 November 2022
The NGO All the Citizens, represented by Wilson Solicitors LLP, have settled their claim in the High Court to challenge the Government’s procurement processes in relation to modern slavery.
In May this year the High Court granted permission for All the Citizens to proceed with a legal challenge to the Government’s procurement decision last year with the PPE supplier Supermax Healthcare Limited, the UK-based subsidiary of the Malaysian Supermax Corporation – one of the world’s largest rubber glove manufacturers. The judge’s order set out that there was an arguable claim of a grave breach of public law obligations. Workers at Supermax factories have detailed experiences of debt bondage, physical abuse and forced labour over the last few years at Supermax factories.
The decision made in December 2021 by NHS Supply Chain was part of a tender process worth £6 billion of UK taxpayer money. The decision to award a place to Supermax came despite the US banning imports from the Malaysian glove manufacturer, following an investigation which identified 10 out of 11 forced labour indicators present within the operations and practices of the Supermax Corporation. In reality it appears the authorities went ahead with their decision to continue business with Supermax Healthcare Limited without awaiting the further evidence requested from the company after the US bans.
Officials at the UK’s Department for Business, Energy and Industrial Strategy (“BEIS”) had also launched an investigation into Supermax after the issue was raised in the House of Lords in October 2021. Wilson Solicitors LLP had also written to the UK authorities since March 2021, notifying them of the use of forced labour in Malaysian glove factories and particularly issues at the Supermax Corporation. We outlined domestic and international laws which specifically prohibit the use of modern slavery in the Government’s supply chains and yet their subsequent actions appear to fall well short of these.
Proceedings were issued by Wilson Solicitors LLP on behalf of All the Citizens in January this year. NHS Supply Chain had responded by outlining future plans for audits of Supermax, however that did not replace their legal duties for appropriate due diligence before making the decision to award. At the core of the case is that these authorities failed to verify the information provided by the company in relation to its modern slavery standards in the face of mounting evidence against it. These actions undermine the authorities claim that they take issues of forced labour seriously within their procurement processes.
The authorities have now agreed to provide an undertaking that no orders for gloves will be placed with Supermax under the disputed agreement decision. They will conduct and new procurement exercise for PPE gloves and the award criteria for the new framework agreement will include updated requirements relating to labour standards and modern slavery, such as the provision of a recent audit covering a bidder’s entire supply chain which must assess risk across the ILO’s eleven indicators of forced labour. Suppliers will be unconditionally appointed to the new framework only if they are assessed as “low” risk across all eleven indicators.
Nusrat Uddin and Danny Bayraktarova, the solicitors in this matter, said:
We expected that the due diligence, monitoring and enforcement mechanisms would ensure that serious concerns around labour standards, would be effectively addressed. We have not been satisfied by the government authorities’ position that there were ‘no substantiated allegations’ against their suppliers, despite the widespread media coverage of the issues and the US import bans. The approach of the UK authorities in comparison to the US has fallen short. The legal requirements are clear that there should be real verification of suppliers before the award stage, but this was not met by the UK authorities in this case. We are proud to have represented the workers and All the Citizens to successfully bring the first legal challenge in the English courts to consider issues of modern slavery in the Government’s own public procurement processes.
Clara Maguire of All the Citizens said:
We are extremely pleased with the outcome. This is a win for all of those concerned with the government’s practices in relation to PPE procurement throughout the pandemic and even before. And particularly for the workers, who have endured these appalling conditions in order to support the global community of medical professionals through the pandemic.
It’s crucial that courts recognise the role that organisations like outs play in holding the state to account and exposing issues such as those raised in this case. Without this there would not be any challenge to such arguably unlawful actions of the state and the flagrant misuse of public funds.
Andy Hall, an independent and British migrant worker rights activist, who first exposed systemic forced labour issues in the Malaysian gloves industry said:
I first discovered rampant forced labour and exploitation of migrant workers toiling away in medical gloves factories in Malaysia and Thailand in 2014. Then in 2018. I started exposing this abuse more frequently in the media and also alerting authorities across the world buying this products, and engaging investors also. The fact that it has taken this long for the UK government to acknowledge serious forced labour allegations and improve their procurement standards is a damning indictment of the UK’s 3rd world and complicit approach to modern slavery prevention in their public procurement supply chains. Today we indeed see a welcome development, thanks to the tireless work of lawyers and campaigners. But it has taken far too long for the UK government to finally act.
Malaysia’s Supermax glove company committed to combat debt bondage, expands scope of remediation payment KUALA LUMPUR, February 08, 2022
Press statement available at https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3231432
| Supermax committed to combat debt bondage, expands scope of remediation payment KUALA LUMPUR, February 08, 2022 – Supermax Corporation Berhad (“Supermax” or the “Company”) which has a Zero Cost Recruitment Policy has recently rolled out a new and comprehensive Foreign Worker Management Policy (the “Policy”) to strengthen its Human Resources management and migrant workers policies and practices. As part of this new policy implementation, Supermax has now expanded the remediation scope to include former direct hire and contract workers who have left the Company before 1 October 2019. |
| These new initiatives and revised eligibility criteria for remediation have been agreed upon after seeking views and advice from a reputable international consulting firm as well as through ongoing engagement and dialogue with Mr Andy Hall, a migrant worker rights specialist. Supermax has also engaged an international consulting firm to continue to assess and advise on the payout to all our current and former workers as well as to track and locate these workers that have returned to their home countries. Supermax is committed to ensure all former workers receive their remediation payment including those in the expanded scope.In efforts to ensure that all entitled former workers receive their remediation payments, notices will be published in the newspapers of respective foreign worker origin countries and outreach activities will be conducted with a six (6) month window period starting February 2022 until July 2022 to reach out to as many former workers as possible.The Company will set up a sinking fund to ensure that it remediates these former workers and all other eligible workers according to the revised eligibility criteria for remediation. The sinking fund shall be reviewed accordingly when it depletes and shall be governed by an advisory committee consisting of management, consultants and independent migrant worker rights specialist Andy Hall.The Company has also implemented a one off RM5,000 ex-gratia payment to all its workers and shall add a further element of interest on the amount of past recruitment related fees and costs paid by workers. The Company is pleased to announce the completion of these payments to its current active workers on 7 February 2022. Former workers will also be receiving the same payout starting February 2022 until July 2022.To date, Supermax have paid out a total of RM25.67 million in remediation covering past recruitment fees, ex-gratia and other related costs to its workers. |
Supermax is continuously making efforts to elevate its human resource practices to be more aligned with International Labour Organization (ILO) standards. The Company has implemented a Zero Cost Recruitment Policy and adopted an equal pay and benefit structure for foreign workers here in Malaysia. The Company has also proactively raised its minimum wage to RM1,400 for workers across all categories. The process of implementation of the policies are currently progressing in stages and in accordance to guidelines of Covid-19 SOPs.
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About Supermax Group
The Supermax Group was founded 1987 as a trading business distributing latex gloves. Building its first manufacturing facility in 1989 the company now has 18 manufacturing facilities worldwide and now commands a significant market share in the highly-competitive U.S. dental market. Supermax is committed to research and development as well as product innovation. The company strives for the pursuit of quality and excellence.
Media contact:
SMARTLIY CONSULTANCY SDN BHD
IRENE YEOH
Tel: +6012-386 8873
Email address: irene@smartliy.com
Andy Hall<andyjhall1979@gmail.com>
Sat, 5 Feb 2022 at 10:28
Subject: Malaysia’s Supermax Glove company, under US forced labour ban, to reimburse its workers as new industry precedent setting standards on remediation laid down
Malaysia’s Supermax Glove company, under US forced labour ban, to reimburse its workers as new industry precedent setting standards on remediation laid down
Malaysia’s Supermax group of glove companies is setting more industry precedent standards on foreign worker modern slavery remediation in it’s attempts to reform its work and living practices. This comes after years of serious rights abuses suffered by workers at the company and in its subsidiaries operations (Supermax case study summarised below in media links).
This also follows on from the previous pledges (attached company statement) announced by the company in early January 2022 of non discrimination in terms and conditions of employment between foreign and local workers, an increase in minimum wage to 1400RM per month, improvements to workers living and working conditions and worker management policy revamps.
Yesterday (4 Feb 2022) the company announced it has agreed to pay (on 7/8 Feb in this month’s salary payment) a 2% lump sum interest/inflation amount on workers past recruitment fee reimbursements, already paid in full to all direct hire and subcontracted workers during 2020/2021. This is interest/inflation on previously paid 5,479RM (Nepali) to 18,601RM (Bangaldeshi) recruitment fee reimbursement amounts. In addition, an ex gratia 5,000RM payment was yesterday announced by the company to be paid to every worker in the coming days. See attached letters shared with us by workers yesterday as evidence of the interest and ex gratia payment amounts for both Bangladeshi and Nepali workers.
Workers also report rumours that the previous 1st Oct 2019 eligibility date for former Supermax workers to receive their recruitment fees and ex gratia payment has been scrapped in what would be an industry first, so all workers who have worked at Supermax will now be eligible for all compensation and remediation payments. This would contrast with the policies/practices of most other glove companies in Malaysia that have arbitrarily set a cut off date for workers to receive remediation as January 2019 or even later. Hope Supermax confirms this policy soon too!
Let’s hope other gloves company and industry actors in Malaysia follow the precedents now being set by Supermax in continuing to try to remediate modern slavery (in particular debt bondage from recruitment fees) more effectively than in the past, and that these companies also ensure such terrible forced labour practices do not occur again in the future.
See below news links and my previous statement on this issue from 3rd January 2022.
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Public Services and Procurement Canada Media Release to Terminate Contract following forced labour allegations: Update on contracts with Supermax Healthcare Canada – January 19, 2022https://www.tpsgc-pwgsc.gc.ca/medias-media/actualites-news/supermax-update-eng.html
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CBC News Analysis on how Canada and UK failing to prevent good produced by forced labour coming into their markets, well written!
Politics: Canada terminates $222M Supermax PPE contract following forced labour probe
https://www.cbc.ca/news/politics/malaysia-nitrile-gloves-supermax-contract-terminated-1.6319190 (see also Jan 18, 2022 Business: Canada ends contract with Malaysia’s Supermax over labour allegations https://www.reuters.com/business/canada-ends-contract-with-malaysias-supermax-over-labour-allegations-2022-01-18/)
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Statement Attributable to Andy Hall, independent migrant worker rights specialist, in response to 3rd Jan 2022 Supermax statement to Bursa Malaysia entitled ‘Supermax Rolls Out New Foreign Worker Management Policy To Strengthen Its Human Resource And Migrant Workers Practices’
On 20th October 2021, the US Customs and Border Protection Department (CBP) issued forced labour related trade enforcement sanctions against one of Malaysia’s largest gloves producers, Supermax Corporation Bhd, and against all of its subsidiaries.
These sanctions were imposed following CBPs acceptance of my complaint against Supermax concerning worker allegations of systematic forced labour conditions in February 2021.
In November 2021, it was reported that Canadian authorities followed CBP’s enforcement action against Supermax by also announcing further import of gloves from the company would be put on hold as a result of the ongoing forced labour allegations.
Supermax is one of the world’s largest gloves manufacturers and has been a leading supplier of gloves to hospitals around the world during the COVID19 pandemic. Supermax is also notably one of the largest suppliers of gloves to the UK’s National Health Service (NHS).
Despite CBP forced labour trade enforcement sanctions still in place against Supermax, its UK subsidiary Supermax Healthcare Limited is still included in a list of potential bidders for an ongoing £6 billion tender to supply the UK medical examination gloves and surgical gloves.
Regular, irregular, directly hired and outsourced foreign workers at Supermax had up until the end of 2021 reported to me and my team appalling conditions of systemic forced labour at the company’s various workplaces.
Debt bondage from recruitment fees, a total inability to leave their factory compounds between March 2020 and late 2021, unlawful deductions from their meagre salaries, cramped living conditions, physical and mental abuse, and much more. Many of the abuses workers reported were clear indicators of systemic forced labour.
I have previously engaged Malaysian authorities on the appalling conditions of work and living alleged by workers at Supermax without any success and without any response.
In October 2021, I welcomed CBP’s decision to ban the import of Supermax’s products into the U.S. and stated that I hoped this forced labour related trade enforcement action against the company would lead to a swift change in the abusive living and work conditions faced by the company’s workers in Malaysia.
I also at that time encouraged other law enforcement authorities around the world to follow the approach of the CBP in taking similar trade enforcement action against Supermax and the many other companies like Supermax in Malaysia and around the world that continue to subject foreign workers to systemic forced labour.
These companies, including most importantly in Malaysia those in the gloves, palm oil, furniture, garment, electronics and electrical sectors, continue to profit from systemic forced labour with little to no government oversight by local Malaysian authorities
In the past few months, foreign workers currently employed by Supermax companies in Malaysia, and those workers that have returned to their countries of origin, have however passed reliable information to me and my team on many of the issues or improvements reported in Supermax’s statement to Bursa Malaysia today (attached and available at
https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3223610).
Most importantly, these workers have indeed reported remediation of their past recruitment fees has been made, ongoing improvements are currently being implemented to their dire living conditions, and since the end of 2021, an increase in the minimum wage paid to workers at the factory to RM1, 400 per month has been applied (n.b. the current minimum wage set by the Malaysian government is only RM1, 200 per month).
Although there is no evidence available yet to suggest that these improvements have been verified by an independent and reputable third party as being applied to all Supermax workers across all of its facilities, they are indeed welcome and positive developments that have indeed been confirmed as genuine improvements by many workers also.
Supermax notably mentioned in its statement to Bursa Malaysia today also that it “may be among, if not the first in the industry to adopt an equal pay and benefit structure for foreign workers here in Malaysia. This would mean both local and foreign workers… are now on equal footing when receiving pay and benefits.”
This is a welcome development as many leading companies in Malaysia, including Supermax’s industry peers in the gloves sector, still apply different remuneration standards when paying their foreign workers. This is mainly due to the fact foreign workers in Malaysia and in the glove industry are unrepresented by any trade union and are vulnerable and easily exploitable.
Foreign workers in Malaysia as a rule are not adequately compensated or fairly paid in comparison to their local counterparts performing the same role with the same job expectations. This is despite the fact that
in many cases foreign workers are placed in jobs which locals shun as too dirty, demanding and dangerous.
This prevalent unfair and discriminatory behaviour in terms of renumeration is illegal both under Malaysian law (Employment Act 1955 Section 60)
and according to international standards. The recent Industrial Court award in favour of a group of foreign workers against Goodyear Malaysia states clearly that discrimination of employment practices when applied to foreign workers, whether union members or not, are not allowed under the laws of Malaysia as well as according to international standards.
Whilst welcoming the positive developments highlighted in Supermax’s statement to Bursa Malaysia today, that still need to be verified by an independent and reputable third party, concern remains for the well-being and protection of outsourced workers at the company and the poor living conditions workers continue to endure as the company’s improvements continue.
Also notable is the current lack of accountability in ensuring officials and managers of Supermax that have committed gross human rights violations against the company’s foreign workforce are prosecuted for these abuses to ensure justice and adherence to the rule of law into the future.
Finally, workers at Supermax have endured appalling conditions of work and living for many years and this situation of acute modern slavery must be adequately remediated.
Supermax management as well as its investors, buyers and procurers of its products should take note of the need for adequate and swift remediation for all current and former workers, including particularly in relation to remediating the large amounts of money paid by workers in the past as fines or punishments imposed unfairly and arbitrarily upon them.
The full and prompt remediation of recruitment fees and other costs for workers who previously left the company and have not yet been remediated also needs to be considered and applied.
Malaysia’s governance of migrant workers and forced labour issues continues to be amongst the worst in the world. Malaysia’s management of migrant workers, a crucial part of its economy and labour intensive export production, continues to be undeveloped, with systemic corruption and little to no respect for the rule of law.
The international community of both governments, buyers, brands and investors should urgently take action also to ensure the Malaysian government and its private sector employers and companies start to take the systemic forced labour present throughout the workplaces across the nation more seriously.
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