The recruitment fees imposed on foreign oil palm plantation workers was an issue looked into by the Roundtable on Sustainable Palm Oil’s (RSPO) independent verification assessment team.

SDP said the board made the decision to reimburse all its current and former foreign workers who were employed on or after Nov 1, 2018. It said the recruitment fees has been reimbursed for all current migrant workers beginning Feb 17 this year.

SDP noted such recruitment fees are unreported payments charged by agents, sub-agents or other third parties to its foreign workers in countries of origin, in contravention of SDP’s zero recruitment fee policy.

Local legal counsels have been appointed at all countries that SDP has sourced from to facilitate recruitment fee remediation payments to eligible former workers.

Activists say such payments may result in debt bondage as workers have to pay off the debt. Debt bondage has been identified by the International Labour Organization as an indicator of forced labour.

The company did not disclose the number of foreign workers who were reimbursed but earlier reports indicated it would involve about 19,500 workers.

Established in 2004, RSPO promotes the growth and use of sustainable palm oil products through global standards and multi-stakeholder governance.

“In light of the fees foreign workers have had to pay to a variety of third parties, unknown to us and despite the existence of the zero-fee policy, SDP has revised and developed a more robust system covering the entire process of appointing recruitment agents,” the company said.

SDP added it does not tolerate any and all forms of forced or bonded labour, slavery, human trafficking, and/or sexual exploitation.

“SDP ensures that its workforce is hired ethically and responsibly according to commitments outlined in the company’s human rights charter.”

The company said it would be delighted to share its methodology and learnings, to help all foreign workers in the industry who are suffering the scourge of debt bondage, having paid recruitment fees to agents or sub-agents.

“To ensure that we make every effort to eliminate debt bondage, SDP introduced our enhanced Responsible Recruitment Procedure (RRP) in August 2021. This was developed in partnership with independent specialists,” it said.

The setting aside of the RM82 million was mentioned in an appendix attached with a letter sent by SDP group managing director Helmy Othman Basha to RSPO CEO Joseph D’Cruz on Nov 17, that was made available to the media.

The RSPO had required SDP to complete an action plan over the next six months to address the weaknesses identified in its existing systems and processes.

The sustainable palm oil organisation said its secretariat instructed SDP to do this on Nov 14 following the completion of its independent verification assessment of the plantation’s Malaysian operations.

RSPO had undertaken the assessment following the US Customs and Border Protection’s withhold release order on all palm oil and products containing palm oil produced by SDP on Dec 30, 2020.

In the letter, Helmy said SDP was pleased that the RSPO recognised many of the recent revisions, changes and improvements it had instituted to protect the health, safety and well-being of the workforce.

However, he said SDP was surprised to learn RSPO’s assessment team had “identified violations of critical RSPO standards”, specifically in relation to the payment by workers of unreported recruitment fees and the retention of passports, amongst others.

He claimed this conclusion does not reflect the current state of SDP’s operations, as the comprehensive suite of reforms it had adopted meet and exceed established labour standards.

“Unfortunately, the assessment team’s findings do not reflect the substantial revisions, improvements and modifications that have been implemented by SDP during the past year.

He also said processes regarding the retention of passports have been enhanced from the provision of communal personal lockers to provide secure individual lockers for all workers to store their personal documents, including passports, and “thus (we) do not retain worker passports”.

To ensure that these changes are institutionalised and sustainable, Helmy said SDP has also embarked on wide-scale continuous improvement efforts, including regular trainings and awareness initiatives, coupled with internal audits, verification exercises, the establishment of grievance channels and regular surveys of workers.

Through these changes, SDP believes it can address swiftly any isolated instances of forced labour that may occur in its operations, he said.

“We are also mindful of our responsibilities as a founding member of the RSPO and the world’s largest producer of certified sustainable palm oil.

“We believe the measures we have adopted are the gold standard for the industry,” Helmy told the RSPO.