DIBRUGARH, Nov 7 - In a major blow to the tea industry, particularly the Amalgamated Plantations Private Limited (APPL) and World Bank group, the Compliance Advisor Ombudsman (CAO), which holds the World Bank Group accountable to its own policies, has found that low wages and poor working conditions on APPL plantations do not protect and promote the health of workers, and thus do not provide a way out of poverty.
A report published today by Compliance Advisor Ombudsman (CAO) has provided the findings of compliance investigation into International Finance Corporation’s investment in Amalgamated Plantations Private Limited (APPL), the second-largest producer and supplier of tea in India.
The World Bank Group’s private sector arm, the International Finance Corporation (IFC), joined Tata Global Beverages in 2009, investing $7.8 million for a 19.9% stake in the newly- formed APPL. Tata, renowned for its high ethical standards, retained a 49.6% stake. The project aimed to preserve over 30,000 jobs and to implement an employee-share-ownership programme, offering workers the opportunity to make decisions in the company and share its profits. The APPL project affects about 1,55,000 people, including 30,000 tea plantation workers and their families.
In response to reports from workers on violation of wage and labour laws, restrictions on freedom of association, poor hygiene and health, hazardous conditions for pesticide sprayers and concerns with the share programme, three Assam NGOs – Promotion and Advancement of Justice, Harmony and Rights of Adivasis (PAJHRA), Peoples’ Action for Development (PAD) and Diocesan Board of Social Service (DBSSO) filed a complaint in 2013 with the World Bank’s Compliance Advisor Ombudsman (CAO) – the independent grievance office which holds the World Bank Group accountable to its own policies. After a three-year investigation, the CAO’s final report was released today.
“The findings have confirmed claims of several NGOs, plantation workers and their trade unions, who have been raising issues of Fundamental Rights violations in the plantations by the employers. The report shows how the World Bank group and APPL repeatedly failed to fulfil their obligations,” said Wilfred Topno, Director of Peoples’ Action for Development (PAD), one of three organisations that lodged complaint with the CAO on behalf of the workers.
“The majority of Assam tea garden workers belong to Adivasi (indigenous) communities who were forcibly brought from Central India under British colonial rule. These workers and their families depend on the plantations for their livelihood and almost all other aspects of their life. Under the Plantations Labour Act, 1951, employers are responsible for providing workers with welfare services, including housing, healthcare, adequate water and educational facilities. But these laws are hardly adhered to by the employers,” said Stephen Ekka, Director of PAJHRA, said.
The CAO report has found a clear relationship between poor living conditions in the plantations and workers’ susceptibility to disease. It referred to several studies which found a high incidence of anaemia and infectious diseases among the Assam tea garden workers, often attributed to poor sanitation, drinking water and housing facilities. Yet, the investigation found that the World Bank had failed ‘to respond systematically to issues regarding housing and living conditions’ or to correct serious lapses in the use of pesticides, with the result that workers have been exposed to extremely hazardous chemicals.
Jayshree Satpute, co-founder of Nazdeek, an organisation supporting the complainants expressed serious concern that APPL continued to breach a number of national laws, like the Minimum Wages Act, 1948, which is critical to ensuring protection for marginalised tea workers. “Providing workers with living wages is integral to lifting them from poverty,” she said.
The investigation has cited low wages as a factor that has contributed to workers’ acute malnutrition and exposure to disease. In particular, it quoted a 2014 report commissioned by Tata, which found daily wages at the time to be so low that workers were unable to afford even basic nutritional requirements.
Tea workers in Assam are currently paid a cash wage of Rs 126 per day (around £1.5). Wages in the Assam tea sector are set through “collective bargaining” between a group of employer associations (CCPA) and the Assam Chah Mazdoor Sangha (ACMS), a union affiliated with the Congress party that, until recently, governed the State.
Workers have raised concerns for years that ACMS is in collusion with tea plantation managements. Many feel that ACMS has consistently undermined their interests in collective bargaining agreements, while APPL’s work quotas have compelled workers to enlist the support of their children to earn a full day’s wage.
Under its policies, the World Bank Group was required to pro-actively ensure that APPL complied with standards on freedom of association and child labour. However, the investigation found that it “overly relied” on APPL’s participation in external certification programmes, particularly SA8000 certification and the Ethical Tea Partnership monitoring programme, as evidence of compliance. This was problematic given child labour was known to be prevalent in India’s agricultural sector, including on tea plantations, and the “robustness” of certification processes had been called into question.
The investigation found that Tata and the World Bank group failed to consult workers in a manner and language appropriate to their low levels of literacy and status as indigenous people. In particular, it raised concern about the misleading way in which shares were explained: “the share programme was presented to the workers in an overtly positive way, with limited discussion of the risks of participation.”
In fact, six years on, many workers who felt pressured into buying shares still do not know how the programme works and where to get more information. Throughout the project, the report found that workers were not provided an effective way to register their grievances and no attempts were made to address fears of retaliation from managements in case they spoke out.
“The World Bank group has an excellent opportunity here to set a leadership example for the rest of the Assam tea industry,” said Anirudha Nagar, South Asia Director of Accountability Counsel, an organisation supporting the complainants.
“It must ensure workers are properly consulted while moving forward, including on the nature of shares, to ensure its investment has an empowering social impact,” Nagar added.