Dyson shares with Malaysian supplier, Reuters raises concerns over migrant workers

By A. Ananthalakshmi and Liz Lee

JOHOR BAHRU, Malaysia (Reuters) – Dyson’s new Singapore-based short-distance car is a boom town built around its business: Malaysia’s largest industrial area, ATA IMS Bhd.

ATA, one of Malaysia’s leading electronics manufacturing service providers, was successful at Dyson in high-end vacuum cleaners and air purifiers, supplying parts to a company that earned 80% of its revenue.

Ten current and former ATA executives and a former ATA executive say the growth has seen an unseen cost: most migrant workers worked up to 15 hours a day, often required to skip days off to keep up with demand, and trained. to hide real working and living conditions from labor inspectors and Dysoni.

In interviews over the past two months, staff also said the ATA, which is one of Dyson’s largest global contract manufacturing analysts, hired thousands of foreigners without a work permit.

Following questions from Reuters on November 18, Dyson said last month that he would withdraw from his business https://www.reuters.com/business/exclusive-dyson-terminates-relationship-with-malaysian-supplier-ata-over-labour- 2021 -11-25 Six months after ATA, citing the latest independent audit of employee conditions and allegations made by an unidentified informant.

The ATA said in a statement that it had been inspected by the Responsible Business Alliance (RBA) to conduct factory audits of electronics companies. The RBA hires third-party auditors for audits. He declined to comment.

On Nov. 29, the ATA said it had seen a summary of Dyson’s audit, which found poor living conditions, concerns about revenge and unpaid grants, among other things. He described the findings as “undecided” and said they were looking into them. Reuters has not seen the audit.

The ATA declined to comment, citing Reuters in its latest public statement.

Dyson said Tuesday he would not comment because the allegations were related to the ATA.

Malaysia said on Wednesday that it would charge the ATA for complaints received through https://www.reuters.com/business/malaysia-charge-dyson-supplier-ata-over-labour-complaints-minister-2021-12-01. and department. He did not say what the charges or complaints were about or whether they were related to employee allegations or about Dyson plants.

The country’s human resources minister, M. Saravanan, said allegations of forced labor against Malaysian companies were undermining the confidence of foreign investors in the products manufactured there. Earlier he said the government was investigating Dyson’s decision https://www.reuters.com/markets/europe/analysts-see-years-losses-malaysias-ata-after-major-client-dyson-cuts-ties-2021- 11 -26 Distribution with ATA.

Following Dyson’s move, ATA shares fell 60%. Some analysts have questioned https://www.reuters.com/markets/europe/malaysias-ata-falls-analyst-airs-concern-after-dyson-rift-2021-11-30 ATA’s ability to attract new customers, and on Nov. 29, he planned to reduce the company’s revenue and cost reductions.

With Dyson’s departure, six employees and shopkeepers interviewed at the Johor Bahru Industrial said they feared losing their livelihood.

“There are no longer any job guarantees here,” said an ATA employee who was out of work wearing his factory blue royal shirt on Sunday. Like others, he asked not to be identified for fear of being retaliated against.

The ATA officially employs about 8,000 people, although the four former ATA staff and executives until recently had a staff of 17,000, including the unauthorized. Most of the 17,000 were from Bangladesh and Nepal, according to staff and executive.

RECORD TICKETS

ATA plants are concentrated in the industrial parks of the Johor Bahru suburbs, 30 minutes from Dyson-based Singapore.

The ATA earned $ 4.2 billion ringgit ($ 991.74 million) at the end of March. Dyson, owned by British millionaire James Dyson, raised nearly $ 800 million.

Analysts say the increase in the Malaysian study could increase production costs and hinder investors. The U.S. has banned six Malaysian companies in the past two years on charges of forced labor.

“The cost will certainly go up because there is a lot more attention to be paid, not only to hiring, but also to staff accommodation. The implications are significantly higher labor costs,” said Vincent Khook, Malaysian head of research at UOB Kay Hian. .

Malaysia, which makes everything from iPhone components to semiconductors, is dependent on electrical and electronic manufacturing especially for exports and economic growth. Between January and October 2021, these products accounted for 36% of total exports.

Foreigners make up about 10% of Malaysia’s workforce -1.48 million – according to government figures, although this percentage is higher in the manufacturing sector. The government and labor groups estimate millions more undocumented migrants.

“WE NEED YOUR COOPERATION”

Until recently, ATA audits revealed no problems, according to ATA and Dyson. A 2020 audit gave ATA a perfect score in terms of working conditions, the ATA said in May. Dyson did not confirm that score.

Employees told Reuters that ATA officials had taught factory workers what to say to inspectors. The two were told by officials that if they told the truth about the working conditions, Dyson would cut orders with the ATA.

In July, an ATA official told employees of a WhatsApp group that inspectors did not work on Sundays and did not work more than three hours a day. The monitor did not respond to repeated Reuters calls. According to staff and payroll brakes seen by Reuters, workers worked regularly on Sundays and worked overtime for up to six hours.

“We need your cooperation. Please inform all staff.

Workers also said the plant had been cleaned and safety equipment had been distributed prior to inspections, and that unauthorized workers had been asked to stay away.

When he was visited by Dyson officials, the ATA stopped work on Sunday and reduced overtime, staff said. ATA and Dyson declined to comment.

TEST US

The U.S. Customs and Border Protection (CBP) opened an investigation into the ATA in April for questioning over unethical hiring practices and poor working and living conditions, according to Andy Hall, an independent labor rights activist. He showed a letter to Reuters on April 19 from the agency reporting the investigation. CBP has no comment.

Nepalese Dhan Kumar Limbu, 32, said people who worked with Hall contacted him in April as part of an ATA investigation, and Limbu said he shared details about their working and living conditions with them. Hall confirmed Limbur’s account.

Limbu said ATA officials took him to a police station in June, where he was questioned about sharing information with activists, after which he was beaten by police. He fled Malaysia and is now back in Nepal. Limbu told Reuters that he had informed Dyson’s lawyers about the working conditions of the ATA in an October 1 interview.

Dyson did not identify the complainant by name, but told Reuters last month: “We immediately commissioned an international law firm to conduct a full investigation and provided assistance to the complainant to assist in the investigation.” Dyson did not say which company he kept.

The ATA also hired a law firm to investigate Limbur’s claims and said in a statement last week that preliminary findings indicate that “the allegations may be unjustified.” Police said https://www.reuters.com/world/asia-pacific/malaysia-police-look-into-claim-ata-whistleblower-beaten-by-police-2021-11-27 won Limbu.

Staff said the ATA began making some changes since the allegations were first reported in May, when https://www.reuters.com/article/us-malaysia-labour-ata-idUSKCN2D21D2 publicly denied the allegations. The company returned 7,000 ringgit to some employees in July for paying them to work brokers in their home countries, according to Limbu, other employees seen by Reuters and payroll.

The ATA also stopped employing unauthorized foreign workers and closed a crowded room of 60 people, the staff said.

Limbu and other employees interviewed by Reuters said Dyson should stay put to ensure that the working and living conditions of migrant workers improved.

“My intention was to share information to improve staff conditions and get days off. But now with Dyson’s decision, people will lose their jobs,” Limbu said.