KUALA LUMPUR, Malaysia (July 2): Following a report alleging irregularities, Malaysian palm oil major IOI Corp stated on Friday that it will undertake an audit to assess the compliance of its labor regulations and working conditions at its plantations. Finnwatch, headquartered in Helsinki, published a report on Wednesday saying that Indian migrant employees at an IOI estate are subjected to poor living circumstances, are charged excessive recruitment costs, and are paid less than the minimum wage.
The IOI stated that it took the conclusions of the report seriously and that it would try to enhance the application of its labor regulations and working conditions.
“Within the next several months, IOI will be subjected to an audit overseen by one of our main clients and helped by a recognized international labour rights consulting organization,” the company said in a stock exchange filing. The customer and consultancy business were not identified.
The audit will look for any non-compliance with the company’s labor policies or bad working conditions for its 16,000 Malaysian employees, according to the corporation.
The announcement came a week after IOI stated it would cooperate with any probe after US Customs and Border Protection (CBP) said it was investigating the firm over allegations of forced labor in a letter to an activist.
The corporation refuted Finnwatch’s claim that employees were required to pay recruitment costs. Workers had instead paid “illegal payments” to unknown persons in their home country, according to the report, which are outside of IOI’s control and should not be treated as such fees.
Before implementing a no-recruitment-costs policy in 2017, IOI emphasized its intention to give ex-gratia payments to workers who had been paid the fees. The 918 workers who were qualified for the payment had been reimbursed by June, according to the report.
It stated that workers were guaranteed the minimum pay and that it had published a guideline to allow them to verify their working hours and compute their wages in a transparent manner./n
