Labour abuse occurring in Malaysian tech factories: Verte

One in three migrant workers of the Malaysian electronic industry has been found to be working in a condition of forced labour, according to new research.

A study (PDF) by US-based NGO Verte — funded by the US Department of Labor — found that 28 percent of all workers in the study sample of 501 electronic workers were found to be in situations of modern-day slave labour producing electronic products, including semiconductors, computer peripherals, and consumer electronics.

"These results suggest that forced labor is present in the Malaysian electronics industry in more than isolated incidents, and can indeed be characterised as widespread," the report said.

The electronics sector is Malaysia's leading manufacturing industry and economy, contributing to 32.8 percent of exports and 27.2 percent of employment in 2013.

The report showed that one key factor that has contributed to the forced labour conditions was that 92 percent of all migrant workers surveyed paid recruitment fees in order to get their jobs. These amounts paid were often equivalent to one month's wages, and exceeded legal and industry standards.

Additionally, 77 percent of workers who were charged fees had to borrow money in order to pay for them. As a result, 92 percent reported that they felt compelled to work overtime hours to pay off their debt, despite a majority of respondents reporting that they had to pay a bribe and have been threatened with detention, physical harm, or general intimidation.

Verte also found that forced labour was closely linked to deceptive recruitment, where 25 percent of migrant workers were deceived about their wages, hours, and overtime requirements.

The country of origin of the migrants that were found to be in forced labour positions were Indonesia, Nepal, Bangladesh, the Philippines, Vietnam, India, Cambodia, and Thailand.

They noted that some of the world's largest tech companies from the US, Japan, Europe, Taiwan, and South Korea have factories in Malaysia.

Factories in China owned by Samsung and Apple have previously been scrutinised for putting employees through similar conditions.

Samsung has also been sued over poor working conditions in Brazil.

Electronics company Flextronics has previously expressed that it prefers manufacturing in Malaysia than in China due to lower tax and stricter intellectual property protection regimes.