Outside Business Journal

Patagonia Found ‘Modern Slavery’ in Its Supply Chain; Shares New Standards to Combat Human Trafficking

Among other things, Patagonia learned that some its suppliers in Taiwan were using labor brokers to bring in cheap, and potentially forced, migrant workers

David Clucas

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Patagonia isn’t mincing words when it comes to admitting this past mistake.

“In 2011, we quite frankly discovered modern slavery in our supply chain,” said Adam Fetcher, the company’s director of global communications. “The results startled us.”

Among other things, Patagonia learned that some of its suppliers in Taiwan were using labor brokers to bring in cheap—and potentially forced—migrant workers. To make matters worse, the brokers would charge the workers exorbitant “fees” for their services, which took the workers as many as two years to pay off. With most labor contracts lasting only three years, workers would then return home, having to start the process all over again with the same fees.

“Paying that kind of money for a factory job is an almost impossible burden for workers already struggling to make a living,” Patagonia officials said. “It creates a form of indentured servitude that could also qualify, less politely, as modern-day slavery.”

To put it simply, the cheap overseas foreign labor that so many outdoor brands rely on for manufacturing is now itself seeking even cheaper foreign migrant labor from poorer surrounding nations. And it isn’t a pretty picture.

“It turns out, this is an issue plaguing manufacturers of all kinds in many industries, and for Patagonia, it became an urgent priority to fix it,” Fetcher said.

On Wednesday, Patagonia released the findings from its audit along with a 46-page Migrant Worker Employment Standards and Implementation Guidance report that it encourages the rest of the industry to adopt.

“Workers shall not be subject to any form of forced, compulsory, bonded, or indentured labor,” the guidelines stated. “All work must be voluntary and workers must be free to terminate their employment at any time, without penalty. Prison labor shall not be used. Migrant workers (or their family members) shall not be threatened with denunciation to authorities to coerce them into taking up employment or preventing them from voluntarily terminating their employment, at any time, without penalty.”

The new policies mandate that the factory itself must pay any labor broker fees (which cannot be passed onto a worker), or hire directly without the use of labor brokers. Patagonia began employing its new standards for its Taiwanese suppliers on June 1 and will require that the factories pay back previously affected workers.

“This applies to all Patagonia suppliers that employ migrant contract workers, their sub-contractors, and their next-tier suppliers producing goods for Patagonia or for use in Patagonia products. It also applies to service providers including third party labor brokers,” the guidelines stated.

Fetcher says Patagonia officials plan to conduct audits for compliance with the standards, but acknowledges that the mission is “a work in progress, no question.”

Patagonia partnered with Verité — an NGO dedicated to ensuring people around the world work under safe, fair and legal conditions — to conduct its migrant worker assessments with four of its suppliers in Taiwan.

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