FABIO TEIXEIRA reports for Thomson Reuters Foundation…
Rio de Janeiro, Brazil
Thomson Reuters Foundation
Major businesses in Brazil are using court injunctions to avoid being named and shamed on the country’s slave labour “dirty list” – a practice that prosecutors and judges said weakened a key tool designed to stop companies profiting from slavery.
A dozen firms that were found by the government to have engaged in slave labour have gone to court to halt a two-year inclusion on the list while they appeal the decision, records obtained exclusively by the Thomson Reuters Foundation revealed.
Brazilian workers give a colour on a piece of leather which will be used as leather to make shoes during a shoe-making process at a factory in Novo Hamburgo in the state of Rio Grande do Sul on 5th August, 2010. PICTURE: REUTERS/Nacho Doce/File Photo
Blacklisted companies are blocked from receiving state loans and have restrictions placed on their sales, while the list is also used by private banks to gauge credit risk and by global buyers concerned about their supply chains, legal experts said.
If after two years, a company can demonstrate that has taken steps to improve working conditions, it is removed from the list – which currently features about 186 companies and individuals.
JBS Aves, a unit of the world’s top meatpacker JBS SA, orange juice giant Citrosuco, and fashion brand Fabula Confecçao e Comercio de Roupas were among the 12 companies uncovered by a request via Brazil’s Access of Information Law.
Others included Rumo Malha Paulista, a logistics company, and Spal Industria Brasileira de Bebidas, a local maker of Coca Cola. All the companies revealed through the request said they never used slave labour and their inclusion was a mistake.
It is the first time such information has been revealed but the total number of slavery-related injunctions granted over the past 15 years is unclear.
While there was no suggestion of wrongdoing, more firms found to have used slave labour were likely to follow suit and seek injunctions rather than two years in limbo and having to show improvements, said labour prosecutor Catarina von Zuben.
“Those with vast economic resources to pay for great lawyers will come out on top,” said von Zuben, head of the National Coordinating Office for Fight Against Modern Slavery in Brazil (CONAETE) – a network that includes several labour prosecutors.
“If I were an international buyer, I’d be very concerned,” she said, referring to the fact that injunctions mean some companies are never publicly exposed over slave labour findings.
Workers clean the floor at the 26th International Automobile Trade Show in Sao Paulo, on 25th October, 2010. PICTURE: REUTERS/Paulo Whitaker
WHY DO EMPLOYERS FEAR BRAZIL’S SLAVERY ‘DIRTY LIST’?
Brazil’s “dirty list” of employers that have engaged in slave labour is considered one the country’s best tools in its efforts to end slave labour. When last published, in April, it had about 186 names. The list is under scrutiny as major firms have been found to have used legal means to avoid being put on it. Here are some answers about how the list works.
What is the “dirty list”?
It is a registry of employers that have been found by the government to have engaged in slave labour. It gives transparency to a decision already reached by the Brazilian state. Created in 2004, it has been hailed by the United Nations as a key tool in Brazil’s anti-slavery drive.
Who makes the “dirty list”?
The list is edited by the Division of Inspection for the Eradication of Slave Labor (DETRAE), a state body staffed by labour inspectors.
How does a company get added to it?
If a labour inspector fines someone for employing slave labour, it starts an internal government procedure where the employer can defend himself. After all possibility of appeal is exhausted, if the employer is found guilty, his name or the name of his firm is added to the list.
What happens after a name is added?
It will stay on the list for two years. During that time, labour inspectors will monitor the employer to see if labour conditions have improved.
How often is the list published?
Government guidelines state it can be updated at anytime, but it must be published at least every six months.
Do people on the list face jail time?
Being on the list does not mean the employer has been found guilty of slave labour in a criminal court. In Brazil the judiciary and the executive branches are independent and can reach different conclusions. A person found guilty of engaging in slave labour faces up to eight years in jail.
Why is the “dirty list” feared by employers?
Beyond having their brand or names associated with slave labour, employers on the list have their access to credit lines by state banks restricted. Private banks also use it to gauge credit risk. International buyers concerned with their supply chain also look up names on the list.
Is there a way to avoid the list?
A government guideline from 2016 established that a employer may strike a deal with the government by agreeing to a series of obligations. Employers that reach a deal are put on a separate monitoring list. Being named on this list does not carry the same consequences as being on the “dirty list”. Firms on the monitoring list can request the removal of their names from it after a year instead of the two years from the “dirty list.”
Sources: Brazil’s government, Thomson Reuters Foundation.
Brazil’s labour secretariat, which is responsible for the “dirty list”, declined an interview request about the findings.
In a statement, the secretariat said that the injunctions are judicial decisions that will be obeyed “with no judgment about the merit of any of them”.
A state labour inspector – speaking on condition of anonymity as he was not authorised to speak to the media – said he thought that such court rulings undermined the work of his department.
“Labour inspectors know that a large company may not enter [the list]…and that if it does, it will stay there only for a short period.”
In Brazil, slavery is defined as forced labour – but this also covers debt bondage, degrading work conditions, long hours that pose a health risk, and work that violates human dignity.
About 370,000 people in Brazil – a country of about 210 million – are modern-day slaves, according to the Global Slavery Index by the Australian human rights group Walk Free Foundation.
The “dirty list” was launched in 2004 and has been hailed by the United Nations as a key tool in Brazil’s anti-slavery drive.
Some of the 12 firms with injunctions said they did not believe the conditions faced by their workers was slavery; others said they should not have been held responsible as the workers were not directly employed by them but by suppliers.
Applying for injunctions, several of the companies said they were not given the right to challenge the initial decision, and that to be added to the list without the right to appeal would cause irreparable financial damage, according to the documents.
Fabula, which is owned by Grupo Soma, a company with 4,000-odd employees, said it found its inclusion “unfair” but was negotiating with the government to get off the “dirty list”.
The arrangement would see Fabula commission an independent audit of its supply chain and create a compliance department reporting directly to the chief executive of Grupo Soma, among other measures, its statement said in response to the findings.
“The majority of those obligations are already in practice since 2017, by the company’s own imitative,” Fabula said in the statement. “[The deal] should be signed in the coming weeks.”
It was unclear whether the other 11 companies had agreed to change their business practices when applying for an injunction.
Federal judge Charles de Moraes, who approved Fabula’s appeal, said the firm would be added to the list if they did not deliver on their pledges to improve their anti-slavery efforts.
“[If the deal is off] no doubt about it: the injunction falls.”
In the court documents, some judges said they were concerned about the financial consequences of placing a firm on the list.
Granting an injunction to JBS Aves in November 2017, labour judge Janice Bastos said it was “necessary to act with caution” as adding the company to the list could negatively affect both the firm and its staff. She declined to comment on her ruling.
Luciano Frota, a labour judge and member of the National Council of Justice – a state body – said companies had the “right to resort to court”, but that he was concerned about the number of injunctions that had been granted regarding the list.
The CNJ recently announced that all new labour judges must attend a class on slave labour, and Frota said the council was working to make all judges more aware about the “importance of the dirty list” as the extent of their knowledge was unclear.
“We must know how much court decisions may be weakening this valuable instrument,” said Frota, who heads the council’s committee on slave labour.
“We need to have the judiciary committed to what the Brazilian state is committed…the fight against slave labour.”
The issue of slave labour injunctions being granted to companies is set to be discussed at a hearing in the Senate next month about Brazil’s efforts to combat modern-day slavery.
Senator Paulo Paim, who heads the Senate’s human rights commission, said the granting of injunctions was part of a broader trend of “weakening” the list – referring also to a lack of funding for labour inspectors to travel and do field work.
The Labor Inspection Secretariat is in a “calamitous” state, several top state officials told Congress in April.
“It’s not just injunctions. The government does not invest in labour inspections, [inspectors] have no money to go to areas where slavery probably is. The structure is pitiful”, said Paim.
Legislative attempts to strengthen the list, such as a bill put forward by Paim that would ban public contracts being given to blacklisted companies, were shelved last year, he added.
“It all points towards a weakening of the dirty list.”
