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Abstract

The response to COVID-19 generated an unprecedented global demand for medical equipment and personal protective equipment (PPE). This article explores how states have exercised their leverage and used regulatory tools to address human and labour rights violations, mainly forced labour, when procuring PPE. In particular, it analyses three tools used before and during the COVID-19 pandemic: trade import restrictions, transparency in supply chain regulation and public procurement processes. These tools are explored in relation to three states: the US, the UK and Sweden. This article argues that no single system currently provides a comprehensive and adequate response to human rights abuses in public supply chains, but that a combination of all of them in some form could provide the basis for a more effective and resilient approach – not only during a crisis, but also in the longer term, and may prove more capable to address systemic abuse.

Keywords

COVID-19 labour exploitation public procurement supply chain trade import ban PPE

From early in 2020, COVID-19 generated an unprecedented global demand for medical equipment and supplies. As more became known of how to treat patients and protect the public from the effects of the pandemic, governments and the private sector in all parts of the world scrambled and competed with one another to secure huge volumes of equipment, including personal protective equipment (PPE), such as protective gloves, masks, aprons and medical gowns, as quickly and cheaply as possible (Burki, 2020). While states and businesses were faced with the practical challenges to secure high volumes of PPE with the right specifications on cost, speed and quality, human and labour rights risks in the supply chain often took the backseat.

The pandemic put under increased spotlight the connection between PPE production and forced labour, with both the media and non-governmental organisations (NGOs) raising awareness of labour abuse, including forced labour, in the supply chain. Two main high-risk issues that received considerable public attention were the use of vulnerable migrant workers in Malaysia, which supplied the majority of rubber gloves during the pandemic (Bhutta et al., 2021), and a high dependence on procurement of PPE equipment such as masks and aprons from China, some of which are produced using state-imposed forced labour of Uyghur workers in Xinjiang or other provinces (British Medical Association, 2021).

This article conceptualises a framework to articulate government leverage over their supply chain in order to address human rights violations in the context of global production of goods. Against the background of COVID-19, this article analyses three approaches used by states to address human rights and labour violations, mainly forced labour, in the context of the procurement of PPE: zero-tolerance, light-touch and direct engagement. Each of the approaches rely more heavily – although not exclusively – on a regulatory tool: trade restrictions, transparency regulation and public procurement processes respectively. The approaches and tools are analysed as applied by three states: the US, the UK and Sweden.

In the US, the federal government has a zero-tolerance approach to human and labour rights abuse in global supply chains, which it enforces through public procurement provisions to some degree, but mostly trade regulations and import bans. In the UK, a light-touch approach predominates, and the regulatory framework to combat modern slavery in supply chains is advanced primarily through requirements for greater transparency and public disclosure, emphasising the need to demonstrate due diligence in public and private supply chains. In Sweden, direct engagement with suppliers takes place through public procurement processes by contracting authorities at municipal level, focusing on progressive, long-term improvement.

The article argues that through these approaches, states push, pull and dance with suppliers to address the risks of labour abuse in their own supply chains. By discussing the strengths and weaknesses of each approach, this article proposes that this push, pull and dance will achieve better results if it is done more comprehensively, by combining the strengths of each, while emphasising the need for meaningful involvement of those affected by business operations, notably workers and their representatives.

The following sections present the methodology for this article; discuss the nature of labour exploitation in global health supply chains and the impact of COVID-19 on working conditions, with a particular focus on Malaysia and China; analyse the three approaches identified; and discuss the limits of these approaches taken in isolation, providing suggestions for a more comprehensive approach moving forward.

Methodology and limitations

This article provides a theoretical contribution to the debate on how to address human rights violations in global supply chains. It relies on desk-based research of academic literature from the fields of business and human rights, public procurement and international trade, complemented by grey literature sources in relation to the abuses under consideration.

The article identifies three different approaches to exercising leverage on global supply chains: zero-tolerance, light-touch and engagement through the use of three related regulatory tools: import bans, transparency and disclosure legislation, and public procurement processes. It examines the implementation of these tools by three states – the US, the UK and Sweden – in the context of allegations of forced labour in the supply chains of PPE, and in particular in Malaysia and China, both before and after the Covid-19 pandemic. The three states chosen for this analysis regularly engage with a combination of the regulatory tools identified, but overall rely more heavily on one of them, depending on the general approach they adopt towards human rights risks in global supply chains. They have been selected because of their public commitment to addressing human and labour rights abuses in global supply chains and the level of development and practice of their approaches, having arguably demonstrated leadership in these areas.

The comparison drawn by this article is not without limitations. A most salient one is that, in practice, the implementation of the three regulatory tools under examination involves different public sector bodies with varying degrees of influence. While trade restrictions are implemented on a national (federal) level, transparency and disclosure requirements are imposed at national level, but expected to be monitored and scrutinised at local level and by individual public bodies. Most public procurement processes, in turn, work at a regional, subregional or local level; they may be managed by public buyers individually or in collaboration with others, through consortia. Additionally, each of the public bodies under review in this article faces different constraints in terms of function, resources and expertise, and has different leverage or capacity to work directly with the different entities involved in global supply chains, from direct suppliers to manufacturers in Malaysia and China. While these differences may make direct comparison difficult, there is value in examining these approaches alongside one another and considering to what extent each can achieve their common goal, namely to address human and labour rights risks in global supply chains. This article does so by highlighting the benefits and drawbacks of each in order to build a more comprehensive framework for exercising state leverage in supply chains and addressing human rights violations.

In analysing these approaches, this article focuses the abuse of migrant workers in Malaysian rubber gloves factories and the use of state-sponsored forced labour in the Chinese province of Xinjiang. While they are examples of great harm, it is important to acknowledge that they are not isolated cases. In fact, there is a number of other states where PPE has traditionally been produced, including Eastern Europe, Turkey, Bangladesh, India, Vietnam, Thailand, Mexico and Brazil, all of which are also known to have high risks of labour exploitation and are overall associated with poor working conditions (British Medical Association, 2011; Trueba et al., 2021). The two cases under examination, however, have been chosen because they are among those that received most public attention during and after the response to the pandemic, as well as because each of the three states responded to them, albeit, as it will be seen, in different ways.

Labour exploitation in the production of PPE

The issue of labour exploitation in global supply chains, including in the production of goods related to the health sector, had been known long before the COVID pandemic (Jaekel and Santhakuma, 2015; Hugues et al., 2019; Ethical Trading Initiative and Pakistan Institute for Labour Education and Research, 2020; Hughes et al., 2023; ILO, 2020a). As a result of failures in governance and human and labour rights protection, negligent and abusive employment practices and poor business models, unfair and fraudulent labour recruitment practices, abusive working conditions, excessive working hours, and inadequate health, safety and security measures have been causing harm to millions of workers worldwide. The lack of, or failures to implement, laws and policies to protect workers from human and labour rights violations is even greater where migrants, women and ethnic minorities comprise the main workforce (ILO, 2020b, British Medical Association 2021; Bhutta et al., 2021). In particular, migrant workers are often excluded from labour rights protections and denied the right or opportunity to voice grievances or have access to remedy or justice for human rights abuses and violations (David et al., 2019).

However, little attention had been paid to the production of PPE before the pandemic, ‘partly due to the relatively low public profile of intermediate goods and partly because the practices of government procurement have received far less critical attention than the sourcing for consumer goods by brands’ (Hughes et al., 2023: 133). The urgent need for PPE caused by the pandemic, however, brought renewed attention to human and labour rights abuses in these supply chain (Reuters, 2020a; New York Times, 2020; BBC World Service, 2021; CBS Canada, 2021; Hughes et al. 2023), while also amplifying and exacerbating them (ILO, 2020; Trautrims et al., 2020; Pinnington et al., 2021). During initial lockdowns, workers were quarantined in their living quarters with no ability for safe distancing, they had no wages or access to food, were denied health treatment, and their families back home lost out on their remittances (ILO, 2020b). Once factories returned to full production, there were cuts in wages to make up for financial losses during lockdowns, workers were made to work excessive hours, while also expected to continue working and living in unsafe and unhealthy environments (ibid). In some cases, migrant workers were repatriated involuntarily without being paid wages they were owed. They found themselves saddled with debts they could not repay due to exorbitant recruitment fee costs they had paid to secure their jobs and were denied the ability to return to their jobs for which they had been contracted (ILO, 2020b, British Medical Association 2021; Bhutta et al., 2021; BBC World Service, 2021; CBS Canada, 2021). Therefore, workers that were already vulnerable to the risks of labour exploitation before 2020 became even more vulnerable during the pandemic (Trautrims et al., 2020: 1069; Bhutta et al., 2021). Two particular cases of human and labour rights abuse came to prominence during the pandemic: the conditions of migrant workers in Malaysian rubber glove factories and the use of state-sponsored forced labour in Xinjiang, China.

Already in 2016, Dr Mahmood Bhutta, a surgeon in the UK NHS and co-founder of the British Medical Association's Medical Fair and Ethical Trade Group, called attention to the conditions in which workers produced around 150 billion pairs of gloves per year, with a market value of over 5 billion USD, nearly exclusively for the medical sector (Bhutta and Santhakumar, 2016: 3). At that time, Malaysia produced around two-thirds of all disposable gloves, with Thailand as the second largest supplier (ibid:4). In Malaysian manufacturing industries, labour rights abuses were then, and remain, endemic because of their high reliance on vulnerable migrant workers from South and East Asia (ibid:8). In the production of gloves, workers have not only been subjected to forced labour risks, but also occupational health and safety risks, such as exposure to chemical products, risk of fire, noise-induced hearing loss, physical injuries and lung diseases (Bhutta and Santhakumar, 2016; Hughes et al., 2023).

In China, the lack of independent trade union representation and abusive working conditions involved in the production of a wide range of goods, including face masks, are well documented (Amnesty International, 2013; Berliner et al., 2015; Global Slavery Index, 2021). Since 2019, the international community has been increasingly concerned with allegations of state-imposed forced labour in the Xinjiang province, as part of a wider policy of repression of fundamental freedoms of the Muslim Uyghur community (Joint Statement to the UN Human Rights Council, 2019; UN Office of the Higher Commissioner for Human Rights, 2021 and 2022).

The next section sets out the context for procurement of PPE during the COVID-19 pandemic and explores how each of the three states under consideration reacted to these realities.

Addressing labour abuse in public supply chains before, during and after the COVID-19 pandemic

When purchasing goods to provide public services, the state shares a double burden of responsibility – to guarantee not only the rights of the end users of its goods and services – its own taxpayers and citizens – but also those of people involved in their production and delivery processes of the goods and services, such as supply chain workers (Outhwaite and Martin-Ortega, 2016; Martin-Ortega and Methven O’Brien, 2019; Methven-O’Brien and Martin-Ortega, 2020). Private sector suppliers to public bodies, in turn, carry the responsibility to respect human rights in their own operations and supply chains, with an obligation to demonstrate that they have conducted human rights due diligence in their supply chains, and to remedy harm as and where it is found (UN Human Rights Council, 2011).

The COVID-19 pandemic, however, exposed the stark contradiction between protecting public health and disregarding the suffering of workers who produce protective health equipment. Especially in the first months of the global health emergency, public buyers had to procure protective equipment very quickly in the face of ruthless competition (Trautrims et al., 2020: 1068–1069). The recognition of the importance of PPE for use in hospitals, care homes and in public spaces prompted a crisis in supply chains and an unprecedented focus on procurement (European Commission, 2020; WHO, 2020). Governments prioritised timely supply by resorting to emergency procurement processes, often lacking adequate safeguards, and by suspending import tariffs on those and other goods needed in the context of response to health crisis (for the UK for example, UK National Audit Office, 2020a and 2020b). Public buyers faced extreme market conditions in which prices were changing by the hour, where traders and intermediaries multiplied and many offered their services without having previous experience on supplying such products and with no guaranteed assurance of quality or even delivery (ibid). Not only were states competing with one another to buy equipment, but within states, health authorities were competing with one another in a chaotic scramble to purchase PPE (Vecchi et al., 2020). Costs soared and the race to procure huge volumes at great speed, meeting the right quality standards, generated a procurement crisis (British Medical Association, 2021). Most governments prioritised the health of their populations, disregarding the impact and potential harm on the workers producing health protective equipment. It was only after the security of supply was stabilised that some states brought ethical considerations back into focus. Only some public authorities responded differently, strengthening previously weak or ineffective due diligence systems, or putting new measures in place in partnership with others, as analysed below.

Among the states which took action to address these human rights, risks in their supply chains were the US, the UK and Sweden. They relied in three different approaches to exercising leverage on global supply chains: zero-tolerance, light-touch and engagement, which they articulated through different regulatory tools, relying more heavily in one of them for each approach: import bans, transparency and disclosure legislation, and public procurement processes, respectively. The remainder of this section examines the three approaches and implementation of the regulatory tools in the context of allegations of forced labour in the supply chains of PPE, and in particular in Malaysia and China, both before and after the Covid-19 pandemic.

Zero-tolerance

Some states approach human and labour rights risks, especially forced labour, through a zero-tolerance approach, effectively prohibiting the entry into a state of those goods whose production is allegedly linked to similar abuses. The main regulatory tool to enforce this approach is import bans, although public procurement requirements can also be used for this aim.

Import bans have been recommended by international bodies and have been adopted by several different states and regional bodies, especially in relation to goods produced in Xinjiang. For example, already in 2011, the UN Committee on the Rights of the Child recommended introducing import restrictions for those goods allegedly produced with child labour (e.g. UN Committee on the Rights of the Child (CRC), 2011a para. 23, 2011b para. 20, 2012 para. 27(b)). In September 2022, the European Commission published a legislative proposal to ban the marketing of goods imported or produced in the European made with forced labour (European Commission, 2022), following pressure from the European Parliament and civil society organisations (European Parliament, 2010 and 2020). In the UK, a Bill to import products made by forced labour in the Xinjiang Uyghur Autonomous Region was introduced to Parliament in 2022, but did not progress further (UK Parliament, 2022).

The leading country for this approach is the USA, which has adopted it both in its public contracting and trade regulations (Bradbury, 2008; Robitaille 2022; Amanze and Eyo, 2022). Regulating public contracts by federal agencies, the Federal Acquisition Regulation (FAR) contains a provision prohibiting the acquisition of products produced by forced or indentured child labour (Subpart 22.15), introduced in 1999 (US Executive Order 13126, 1999), and a provision on combatting trafficking in persons (Subpart 22.17), introduced in 2006 (Combatting Trafficking in Persons, 71 Fed. Reg. 20, 301-303, 2006 and Clause 52.222-50- FAR Interim Rule and Revised Rule, 2007). Under Subpart 22.15, to be awarded a federal contract, companies must confirm they will not sell a product on the US Bureau of International Labor Affairs (ILAB) List of Products Produced by Forced or Indentured Child Labor. As of September 2022, 159 goods from 78 states and areas are included in this List (US Department of Labour, 2022). If contractors do supply products on the List, they must certify that they have made a good faith effort to determine whether forced or indentured child labour was used to produce the items supplied. Subpart 22.17, in turn, prohibits federal government contractors from engaging in a series of practices during the performance of the contract, including human trafficking, procuring commercial sex acts, use of forced labour and practices related to abusive and fraudulent labour recruitment. The burden to assess and monitor these risks falls to public procurement officials (Casey et al., 2022) which have to rely on their contractors to provide information in good faith (Robitaille, 2022). Failures to enforce the FAR provisions in government contracts have weakened the efficacy of the zero-tolerance approach through public procurement.

On the other hand, trade restrictions impose a zero-tolerance approach by preventing certain goods to enter a national market, which therefore results preventing them from entering the public procurement process. The U.S. approach to trade restrictions related to human rights dates back to 1930, when the US Trade Act Section 307 was introduced to prohibit the import of goods made wholly or in part by forced labour. Originally, the import ban was only enforced if the product was already available in the U.S. market in quantities high enough to meet consumptive demand, but this was amended in 2015 with the Trade Facilitation and Trade Enforcement Act. The import ban is enforced by the Customs and Border Protection (CBP), the largest agency in the US Department of Homeland Security. There are two main ways in which Section 307 is applied. If conclusive evidence is provided on the use of forced labour, a CBP Commissioner publishes a formal finding, and the importer has 3 months to prove the contrary, failing which the goods are seized (U.S. Customs and Border Protection, 2016). If incidence of forced labour can be proved ‘reasonably but not conclusively’, the Commissioner can issue ‘Withhold Release Orders’ (WROs) instead, to detain goods at the border pending further investigation. In this case, the importer can either re-export the goods elsewhere, or provide satisfactory evidence that forced labour was not used. If this is not satisfactory, the goods will be excluded (ibid). WROs can be applied for specific manufacturers, or for a category of goods produced in a specific location, state or region. This trade regulation was hardly used until 2016, when the above-mentioned Trade Facilitation and Trade Enforcement Act came into force, followed by the creation of a Forced Labour Division in 2018 (US Customs and Border Protection, 2019; Casey et al., 2022: 2; Gianopoulus, 2021: 16, 17, 24, International Labour Rights Forum, 2020). These reforms were aimed at U.S. officials being able to ‘motivate private sector entities to conduct due diligence, address forced labor violations, and implement safeguards against the risk of forced labor’ (Gianopoulus, 2021: 30).

When COVID-19 struck the US, the state was quickly faced with shortage of medical supplies, due to its heavy reliance on imports (Patel et al., 2017; Sadiq & Kessa, 2020: 637). As a consequence, federal government, states, local governments and hospitals had to compete between each other to ensure sufficient stock of the necessary supplies (Atkinson et al., 2020: 630; Vecci et al., 2020: 644). The way in which import bans and WROs concerning PPE supplies manufactured in Malaysia and China were approached reflects this situation of emergency. For example, the first company to be approved following an ‘emergency approval process for Chinese PPE suppliers’ by the US Food and Drug Administration in April had been previously linked to Uyghur forced labour (Vice News, 2020; Xiuzhong Xu, 2020). At the same time, in March 2020, a WRO issued a year earlier against a Malaysian manufacturer of disposable rubber gloves, WRP Asia Pacific, was removed (U.S. Customs and Border Protection, 2020). To support this, new information allegedly showed that, as result of ‘continuous communication’ between CBP and the manufacturer, the latter was ‘no longer producing the rubber gloves under forced labor conditions’ (U.S. Customs and Border Protection, 2020). However, the process for revoking the WRO was not clear, leaving US embassy officials at a loss to explain the reasoning behind it (U.S. Customs and Border Protection, 2020; Voa News, 2020). Given its coincidence with the beginning of the pandemic, and the fact that forced labour risks remained high, this decision was regarded as ‘suspicious’ (Barnett et al. 2021: 1).

A few months after the onset of the pandemic, the approach taken by the US Government changed. In July 2020, a WRO was issued against two subsidiaries of Malaysia's Top Glove, the world's largest rubber glove manufacturer, citing forced labour, including debt bondage (Reuters, 2020b). This WRO is notable because it remained in place despite the substantial demand for gloves during the pandemic (Vanpeperstraete 2021: 15; Pietropaoli et al., 2021: 6). In fact, it was followed by a formal finding of forced labour in March 2021, leading to the seizing of gloves produced by the company, which was only modified in September 2021 after reviewing the documents provided by Top Glove (US Custom and Border Protection, 2021a, 2021b).

Addressing specifically the forced labour reports in Xinyang, in 2021, the US passed the Uyghur Forced Labor Prevention Act (UFLPA), which adds to Section 307 of the Tariff Act of 1930. The Act, which came into effect in June 2022, regulates the import of goods from the Xinjiang Uyghur Autonomous Region in China. Under it, suppliers must prove that any goods which have been mined, produced, or manufactured, both wholly or in part, in the region are free from forced labour. If they cannot do so, their goods are prohibited from entering the US. CBP can exempt suppliers from this regulation only if it determines that the importer has complied with specified conditions and that there is clear and convincing evidence that the goods were not produced using forced labour. To assist the trade community with their new obligations, an importer guidance was released by CBP (US Customs and Border Protection, UFLPA Operational Guidance for Importers, 2023).

The UFLPA has had a rapid uptake, with approximately $500 million in detained shipments, which account for almost half of those detained in 2022, even though the law was only in effect for the last quarter of the fiscal year (Bloomberg Law, 2022). As indicated in the latest CBP budget, the enforcement of the UFLPA will continue to be a priority for the agency in 2023 (Ibid, and see U.S. Customs and Border Protection, 2022).

The potential impact of the U.S. bans can be observed in the above-mentioned case against Top Glove's subsidiaries. Only 2 weeks after the WRO had been issued, Top Globe agreed to provide retrospective payments for migrant recruitment fees amounting to over $30 million (Pietropaoli et al., 2021: 7; Vanpeperstraete, 2021: 15; Voa News, 2020). Similar payback schemes have since been adopted by three more Malaysian glove producers, despite not having experienced WROs of their own (ibid). This has led some labour rights advocates to argue that the US measures were in fact having the intended impact and prompted action for fear that future sanctions may be applied to those not yet on the ILAB List of Products Produced by Forced or Indentured Child Labor (Pietropaoli et al. 2021: 7).

Taken as a whole, however, the use of WROs has been inconsistent and characterised by a lack of transparency and communication regarding the rationale and evidentiary standards for applying, modifying and lifting the measure (Casey et al., 2022: 2; Gianopoulus 2021: 16–17,24; International Labour Rights Forum, 2020; Vanpeperstraete, 2021: 4; Pietropaoli et al., 2021: 4). This, in turn, makes it harder to judge their real impact (Pietropaoli et al., 2021: 1). At the same time, when issuing WROs, CBP does not recommend any specific follow-up action to be taken. Instead, it only requests proof that forced labour is not present, or that the company has implemented remediation plans (Pietropaopli et al., 2021: 6). In the above-mentioned case of WRP Asia Pacific, for example, CBP had only suggested that WRP ‘adjust its manufacturing and labor practices to ensure compliance with international labor standards’, but it did not specify any steps it may wish to take (Giaonpoulus, 2021: 16, 28). Without requirements to remediate the harm, it is difficult to see what the real impact this has on the workers that are subject to exploitation (Pietropaopli et al., 2021: 3). Lastly, in the US, there is no prohibition on redirecting goods that are stopped at the border to other jurisdictions. This not only undermines the punitive impact of the sanction and displaces the problem elsewhere, but it also fails to tackle systemic issues that are often widely prevalent in production zones and states.

Light-touch

A light-touch approach is based on ‘nudging’ businesses and public buyers to address the human rights risks in their supply chain. This has been done mainly through transparency and disclosure regulation but also through public procurement regimes and practice.

Governments following this approach have often adopted transparency in supply chain regulations, which create obligations for private sector companies to publicly disclose their efforts to identify, prevent and mitigate risks in their supply chain, without requiring them to take any specific action in this regard. These regulations cover a wide range of risks, ranging from minerals used in armed conflicts (US Dodd Frank Act, Section 1502, 2010; EU Conflict Minerals Regulation, 2017) to the use of human trafficking, forced and child labour in commercial supply chains (California Transparency in Supply Chains Act, 2010; UK Modern Slavery Act, 2015; Australia Modern Slavery Act, 2018; New South Wales Modern Slavery Act, 2018; Canada Fighting Against Forced Labour and Child Labour in Supply Chains Act 2023), or a more broad range of non-financial information relating to human rights, social issues, environmental aspects and corruption (e.g. EU Non-Financial Reporting Directive, 2014 and Corporate Sustainability Reporting Directive, 2022). This type of legislation can be contrasted with human rights due diligence regulation, which is more stringent, and requires companies to substantively demonstrate the measures they are taking to avoid, as well as address human rights violations (France Duty of Vigilance Law, 2017, The Netherlands Child Labour Due Diligence Law, 2022, Norway Transparency in Supply Chain Act, 2022 and Germany Supply Chain Due Diligence Act, 2023 and EU Draft Directive on Corporate Sustainability Due Diligence, 2022).

The UK has followed this approach, focusing on promoting transparency, public reporting and good practice through guidelines, without increasing regulatory burdens for substantive action to address human and labour rights risks in its supply chains. The UK Modern Slavery Act (MSA) 2015 contains a Transparency in Supply Chains Clause (Section 54) which requires all commercial entities operating in the UK with a turnover of £36m to produce an annual public statement setting out the steps they are taking to prevent modern slavery from occurring in their supply chains. The Act does not envisage financial penalties for failure to comply, nor a process to address persistent poor performance. Therefore, while the MSA introduces a reporting obligation, it does not require substantive action from businesses: while these can actively engage to address the human and labour rights risks in their supply chains, they are not compelled to do so under the Act (Martin-Ortega, 2017; Martin-Ortega, 2022). Such light-touch approach is based on the assumption that civil society organisations will hold companies accountable, and that leadership for good reporting and ethical practices amongst businesses will be rewarded by public recognition, with no need for sanctions (ibid). Analysis of the implementation of the Act and corporate practice to date has challenged this assumption and shown that transparency regulation alone without strong enforcement powers and substantive requirements can only have limited impact on working conditions (Amnesty International et al., 2018; CORE, 2016; Business & Human Rights Resource Centre, 2016, 2017 and 2018). The Independent Review of the MSA also showed that this light-touch approach to have had very limited impact in driving businesses to ensure better labour practices in high-risk supply chains (UK Government, 2019).

A similar stance can be found in the Government's approach to public procurement, which overall nudges public bodies to take action to prevent human and labour rights risks in their supply chain, while not obliging them to do so in any specific way. The guiding philosophy of this light-touch approach is to ‘lead by example’, but refrain from penalising those who do not follow (Martin-Ortega, 2017). In 2019, the Government published Procurement Policy Note (PPN) 05/19, ‘Tackling Modern Slavery in Government Supply Chains’. The main obligation introduced by the PPN is for relevant bodies – Central Government Departments, their Executive Agencies and Non Departmental Public Bodies – to use a Guidance under the same name (UK Government Commercial Function, 2019) to ‘identify and manage risks in both existing contracts and new procurement activity’ (para. 4). The Guidance, however, only provides ‘best practice guidance and tools’ for public bodies, with examples of how they can and should address modern slavery risks in their supply chains throughout the procurement process, but without requiring them to take any specific action (ibid:2,7). The only requirement that resonates throughout the Guidance is that of proportionality, meaning that public bodies should not impose ‘unnecessary burdens’ on suppliers (ibid: 7, 10). The Guidance recognises that modern slavery […] is reliant on effective supplier relationship management’, and that ‘positive, proactive and collaborative engagement […] is critical’ to address it (ibid:14). To support public buyers in their assessment of and engagement with suppliers, in 2019, the Government has introduced the Modern Slavery Assessment Tool (MSAT). The MSAT includes questions on how suppliers manage modern slavery risks and provides ‘automated recommendations’ on how they can improve their actions, that public buyers can access and engage suppliers on (UK Government Commercial Function, 2019: 23). Once again, however, deciding whether to use the MSAT is left to the discretion of each public authority: public buyers are not obliged, but only ‘encouraged’ to use it (MSAT). Furthermore, while the MSA does not apply to public bodies, an increasing number of public sector entities has chosen to develop modern slavery policies and report on their efforts to prevent labour exploitation in their supply chains (Martin-Ortega, 2017). In 2020, following an independent review of the legislation (UK Government, 2019), the UK Government to make a public commitment to extend the obligation to produce a modern slavery statement to all public sector bodies (within the financial turnover threshold) and took the step to ‘walk the talk’ on its own legislation, resulting in its first Modern Slavery Statement covering the whole of Government (UK Government, Modern Slavery Statement, 2020).

The only mandatory provision for public buyers regarding potential suppliers involved in human rights violations in their supply chains is the obligation to exclude those that have been convicted of slavery, servitude, forced or compulsory labour child labour or an offence in human trafficking and other forms of trafficking in human beings within the last 5 years from the procurement process (UK Public Contracts Regulation 2015, Regulation 57(2)) (UK Government Commercial Function, 2019: 2). However, the efficacy of these mandatory exclusions has been challenged due to the rarity of convictions for these crimes (Martin-Ortega, 2017; Methven O'Brien and Martin-Ortega, 2020). If there is indication or even evidence of these offences, but no conviction, exclusion of the bidders is still discretionary. Public procurement regulation does not even require public buyers to exclude suppliers not compliant with their reporting obligations under the MSA; this may be grounds for discretionary exclusion, but it is left to the public buyers to decide whether to apply it or not (UK Government Commercial Function, 2019: 10; UK Government Commercial Function, 2023: 15).

This light-touch approach was also reflected in the context of health procurement more specifically even before the Covid-19 pandemic. The Ethical Procurement for Health (EPH) workbook produced by the Department of Health with the British Medical Association, among others, to provide practical guidance for organisations in the health and social care sector to embed labour standards considerations into their procurement and supplier management activities, in 2017, provides ‘practical guidance’ to introduce human and labour rights considerations into procurement (British Medical Association, 2017: 5). The workbook states that the EPH framework ‘allows organisations to set their own pace and objectives, as appropriate to its nature, scale an resources’ (ibid:6). Rather than mandating any specific approach, its main principle is that ‘an organisation commits to embedding ethical procurement in some manner’ (ibid). It should be noted that this tool was complemented by a more hands-on, incentive-based approach in the form of the Labour Standards Assurance System (LSAS), which was a contractual requirement for several health product categories (ibid:7). The LSAS therefore attempted to combine both light-touch and direct engagement approaches, but as discussed in the next section, it did not succeed in its aim and had been abandoned.

To face the Covid-19 crisis, in the UK, emergency procurement processes were adopted – including granting contracts without competitive tender (UK National Audit Office, 2022). In this context of emergency, the UK Government deprioritised actions to tackle modern slavery. For example, companies were granted a 6-month reprieve in publishing their modern slavery statements under the MSA (ibid). Since decisions on how to address human and labour rights in supply chains were overall left to the discretion of public authorities, it is likely that these took the backseat, potentially increasing the risk that such abuse is found in its supply chains (Pinnington et al., 2021: 3). In fact, UK national media reported as early as April 2020 that there was a risk of UK health authorities sourcing gloves from companies repeatedly accused of using ‘slave-like conditions’ in their factories and claimed the Government had been aware of this already in November 2019 (The Guardian, 2020b; The Independent, 2020). While, as mentioned above, the USA imposed an import ban on Top Glove, an media article reports that UK imports from the same company increased by 314% between January and July 2020 (the Guardian 2020c). A growing number of reports were published about the continued practice of sourcing from suppliers known to be associated with forced labour, including in China (UK House of Commons, 2021).

In the course of the pandemic, the UK Government continued with its approach based on guidance and voluntary action. In 2020, it stated that, if ‘relevant and proportionate’, new contract clauses will be introduced to ‘prevent instances of modern slavery’ (UK Department of Health and Social Care, 2020: para 5–7) and in 2021, it commissioned a new ‘guidance to assist PPE suppliers understand best practice measures’ to address modern slavery in their supply chains (Impactt, 2021: 5).

One of the only exceptions in this context can be found in its approach to the situation in Xinjiang, which it committed to respond to already in the pandemic (‌UK Government, 2021). In this context, new measures were announced in December 2021, and a Private Members Bill on Import of Products of Forced Labour from Xinjiang (Prohibition) was presented in Parliament in May 2022, although, as already noted in the previous section, it did not proceed.

In 2023, a new Public Procurement Notice and related guidance on ‘Tackling Modern Slavery in Government Supply Chains’ were introduced, with mention of PPE and rubber gloves in Malaysia, respectively, as high risk for modern slavery (para. 5; p. 7) The updated documents, however, did not substantially change the Government's light-touch approach, nudging public buyers and suppliers to take action without explicitly obliging them to do so.

Direct engagement

The third approach to addressing human and labour rights in global supply chains relies on public procurement practice and systems to drive cooperation among contracting authorities, providing suppliers with incentives and tools to drive incremental change where there are known human and labour rights risks. This system was attempted in the UK to some extent through a LSAS, which was an important toolkit for NHS Supply Chain, the largest supplier of goods to the UK's National Health Service (NHS). It involved contract requirements for suppliers and continuous improvement to secure and maintain contracts. The system was criticised as ineffective even before Covid-19, and attempts have been made at redesigning it (Bhutta and Santhakumar 2016; Trueba et al. 2021; Bhutta et al. 2021; Hughes et al. 2023). However, the most prominent examples of this approach can be found in Sweden.

In Sweden, 21 county councils and regions, responsible for public healthcare, have collaborated to identify and address human rights risks in their supply chains since 2010 (Göthberg, 2019: 166). Their model comprises three main elements: (a) standardised human rights requirements for suppliers; (b) a division of responsibility among the councils to exercise human rights due diligence and oversee follow-up measures; and (c) sharing costs and non-financial resources, such as staff time and capacity building (ibid:168). The model applies to eight spend categories, selected because of their high procurement volume, higher human rights and environmental risks, and which include disposable surgical products and gloves (ibid:170; Sjöström and Scott Jakobsson, 2016: 17; Göthberg, 2019: 170). The requirements for suppliers are set out in a Code of Conduct, which incorporates the Universal Declaration of Human Rights, the ILO Core Conventions and the UN Convention on the Rights of the Child (Art 32). They include expectations to uphold national legislation on labour rights and environmental protection in the state of productions, as well as the UN Convention against Corruption (Region Stockholm, 2013). The Code is embedded in all invitations to tender for contracts, and there are supplementary contract clauses that strengthen these provisions once the suppliers have been selected, including sanctions for non-compliance.

This approach is based on the principle that bidders should not be excluded from tendering at the early stages if they do not meet these criteria at the outset. Instead, the preference is to work with suppliers over time to improve their due diligence practices. Once awarded a contract, suppliers must detail how they meet the Code requirements through a self-assessment questionnaire. Importantly, they are required to demonstrate that they have procedures based on the UNGPs’ human rights due diligence to monitor the conditions in which the goods and services are produced and delivered (Göthberg, 2019: 173). The councils, supported by an Expert Working Group with specially trained officials, evaluate their responses and conduct follow-ups on identified risks, which may include audits at suppliers’ factories and offices (Methven O’Brien et al., 2016: 40; Sjöström and Scott Jakobsson, 2016: 18; Göthberg, 2019: 177). If abuse is discovered, public bodies use their leverage to advance change and improvement over time, by developing a time-bound remedial action plan and monitoring its implementation by suppliers (Methven O’Brien et al., 2016: 18; Göthberg, 2019: 174). In some cases, a supplier may be suspended temporarily if gross violations are found, pending further investigation. Contract termination is only used as last resort and only if suppliers consistently fail to engage. It is recognised that termination may undermine the councils’ commitment to help victims of abuse (Göthberg, 2019). Moving forward, the Sustainable Procurement steering group has emphasised a renewed focus on cooperation among regions, and on increasing knowledge of their supply chains to be able to respond better to future crises (Lonaeus, 2021).

The direct engagement with suppliers has produced several success stories, including with the rubber glove manufacturing industry. In 2015, the Region of Jönköping commissioned audits at one of its Swedish contractors, which distributed gloves for a large manufacturer, Ansell (Gripstrand and Muchlizar, 2015). Such audits identified 23 violations of labour rights, including confiscation of passports, recruitment fees and compulsory overtime (Göthberg, 2019: 175). In response, the manufacturer engaged in corrective action plans which, within a year, successfully addressed the majority of the violations, including a commitment to reimburse recruitment fees paid by workers in all factories it owned (ibid). In this case, national collaboration on public procurement was regarded as an effective tool to improve conditions in supply chains. However, in recognition that collaboration with suppliers should be pursued on a continuous basis, engagement with the rubber gloves supply chain in Malaysia continued, and further audits were carried out in 2019.

Sweden was no different to other ‘buying’ states when, during the Covid-19 PPE procurement crisis, it used emergency measures to procure equipment at the volume and speed required (Lonaeus, 2021). During the height of the pandemic, monitoring visits were suspended, and additional due diligence measures and actions to address human rights abuses in supply chains were temporarily put on hold. However, the public authorities have reported that they did find a way to continue with their engagement and monitoring of working conditions using local experts and partners (Westerberg et al., 2020). For example, follow-ups were conducted in spring and early summer 2020 on glove suppliers in Malaysia, based on violations identified already in 2019, especially regarding to the recruitment and working conditions of migrant workers. These highlighted that, although the suppliers had started to address some of the issues, some were still outstanding, such as the repayment of recruitment fees (Lonaeus, 2021). Despite this, reports of human and labour rights violations concerned Swedish supply chains too. For example, at the height of the crisis, the Government was also under scrutiny for procuring gloves produced by another glove manufacturer, Top Glove, despite forced labour allegations (Bhutta et al., 2021: 49).

Allegations also emerged that one of the key PPE suppliers was sourcing from a factory that had Uyghur workers transferred from Xinjiang Province, potentially in a forceful manner (SVT News, 2020). Action was taken to suspend the supplier and demanded that those workers should be returned to their home province, but this took 5 months longer than initially required (ibid).

Swedish public buyers also responded to broader reports of forced labour and human rights violations in China, targeting Uyghurs and other ethnic minority citizens. In 2020, the central purchasing body for Swedish municipalities, regions and their companies (Adda Central Purchasing Body), the Swedish Regions and the Church of Sweden joined in a collaborative initiative to conduct due diligence and monitor the risk of state-imposed forced labour in the supply chains of the goods and services they procure. In 2021, The Swedish public procurer SKL Kommentus Inköpscentral, the Swedish Regions’ National Secretariat for Sustainable Procurement and the Church of Sweden, produced a joint letter requiring their suppliers in several industries, including those suppliers of medical equipment, to take certain actions following concerns over the issue of Uyghur forced labour (Business and Human Rights Resource Centre, 2021).

Discussion

Each of the models presented has strengths and weaknesses in terms of eliciting action from public buyers and suppliers to address human and labour rights abuses in health supply chains and their potential to prevent, mitigate and remedy such abuses.

The global significance of import bans cannot be underestimated, given the prominence and size of the consuming power of the US (and EU if they approve similar regulations). The US federal government is in fact the largest purchaser of goods in the world (Conrad et al., 2015; Methven O’Brien et al., 2016: 1; Pietropaoli et al., 2021: 5; Vanpeperstraete, 2021: 52). However, the effectiveness of these bans has been questioned when invoked as a zero-tolerance approach, rather than as a last-resort mechanism, to be used in cases when cooperation with suppliers to remediate the abuses has not been feasible (Nissen, 2018: 70). Bans may even undermine collaborative approaches focused on prevention and remediation of human and labour rights abuses (Giaonpoulus, 2021: 28, 31), while potentially discouraging transparency and the provision of remedy altogether. Some companies, in trying to avoid import bans, may avoid identifying risks, and when violations are identified, cut and run from these suppliers. This removes the opportunities to address or change the abusive labour practices through engagement and use of leverage (LeBaron, 2021b; Vanpeperstraete, 2021: 31).

Lastly, beyond short-term impacts on suppliers, import bans do not deal with systemic issues in a high-risk commodity or supply chain, nor do they tackle the enabling environment that allows labour rights abuses to flourish (LeBaron, 2021a, 2021b). Therefore, while this model sends a very strong message to suppliers that they will not tolerate human rights abuses, it does not necessarily address poor working conditions in other circumstances, but potentially perpetuates them. The import bans may, therefore, only prove beneficial in the short-term, when businesses may be faced with sales loss, while their long-term impact has yet to be proven (Pietropaopli et al., 2021: 6).

The light-touch approach has increased awareness in the private and public sectors regarding human and labour risks in supply chain (Martin-Ortega, 2017, 2022). Increased public scrutiny has sometimes resulted in corporate and public policy changes, and may encourage the development of human rights due diligence strategies. However, the risks of suppliers ‘cutting and running’ to avoid reputational damage are similar to those in the zero-tolerance approach. Equally, it has no inbuilt mechanism to address systemic abuse and require remedy for the abuses identified. There is no evidence that this approach has brought about significant changes to purchasing practices which may contribute to exploitation in global supply chains, nor more effective actions on identified worker rights violations (Nelson et al., 2020). The lack of sanctions for those not complying does not provide avenues for accountability beyond public scrutiny, but relies on reputational risk to drive action, weakening its overall impact (Harris and Nolan 2022: 239).

On the other hand, the direct engagement approach has been praised by experts for incentivising good practice and having a potential positive impact in reducing worker vulnerability (Pease, 2019). Its strength lies in the fact that it aims to change the operating environment for suppliers of public sector buyers, while addressing actual violations taking place. Its focus is on establishing effective and lasting partnerships with key suppliers to help them manage and oversee improvements in their own sourcing practices and supply chains, beyond the limited timeframe of the contract. Long-term collaboration increases the potential for addressing the dynamics which perpetuate systemic abuse in supply chains and to achieve remediation. Contractual requirements for suppliers make it harder not to take action without consequences. This model of collaboration, while potentially able to provide the most significant results for workers exposed to abuse, is labour intensive and requires commitment, resources and capacity by buyers. Additionally, its impact is necessarily connected to the leverage that public bodies have on suppliers – which is often related to the volume of purchase and the other factors which are not necessarily in the control of the public body.

Lastly, these approaches lack the involvement of the most critical stakeholders in global supply chains: the workers who may be affected by business operations, who are arguably also the primary intended beneficiaries of these tools (Claeson, 2019; Outhwaite and Martin-Ortega, 2019; Harris and Nolan 2022: 234). This is crucial to bring about sustainable, long-term improvements to working conditions, but also to ensure that actions taken do not negatively impact workers themselves. This can be the case if disengagement with businesses linked to human and labour rights abuses leads suppliers to close their doors, where vulnerable workers may be left without a job, and forced to accept work that is even more dangerous in order to make a living (LeBaron, 2021b). For example, this was observed following the US WRO against WRP Asia Pacific, which is reported to have resulted in the termination of contracts for many workers, negatively impacting those already in exploitation (Giaonpoulus, 2021: 31; Pietropaoli et al., 2021: 7).

The three models have significant limitations to address wider dynamics and root causes of exploitation in the supply chain, which are systemic in global supply chains, and in effect a product of the current global economy – or to influence models of production that carry risks of harm to workers. The three present the risk, to different extends, of disengagement by suppliers exposed to higher risks of human and labour rights abuse, which would result in the perpetuation of poor working conditions, as they search for other makers and buyers with less demands. The three models are also deficient in their direct engagement with workers and their representatives. Critical to addressing human and labour rights abuses in global supply chains a mature industrial relations system that enables workers to collectively negotiate better terms and conditions directly with their employers and that recognises the importance of freedom of association and collective bargaining.

While overall, the different regulatory instruments that states have developed to prevent or mitigate the risk of human and labour rights abuses in global supply chains can be powerful tools for states to comply with their international human rights obligations, we argue that there are significant limitations of this pull, push and dance, when deployed in isolation. Instead, an approach which relies on a more systematic and comprehensive combination of these regulatory tools – rather than adopting an approach that overly relies on one of them – is necessary. This requires the development of a new theoretical framework to address human and labour rights issues in global supply chains. While it is not the aim of this article to define such theoretical framework or delineate the contours of the approach, the analysis of the current approaches and their key regulatory tools throws some light over which specific elements need to be present in this exercise: clear mandatory obligations for businesses to identify, prevent, mitigate and remediate – i.e. develop human rights due diligence – need to be defined and accompanied by accountability measures for those causing, contributing to or linked to the abuses, including through exclusion from the market; incentives for transparency and long-term collaboration with businesses, focused on identifying and addressing systemic issues; concrete and clear requirements to take action when abuses are identified, which includes the provision of effective remedy to rights-holders; strategic partnerships and collaboration among states and NGOs to share capacity and build leverage over supply chains; meaningful engagement of rights-holder as well as their legitimate representatives and trade unions.

Conclusions

The protection of life and health in some parts of the globe should not be achieved at the expense of risking the life and health of others in less developed economies. The COVID-19 pandemic, however, exacerbated human rights risks and the vulnerabilities of millions of workers around the world, including those engaged in the production of PPE equipment. Focusing on global supply chains of PPE, and Malaysia and China in particular, this article has identified three approaches taken by public authorities to address human and labour rights risks: zero-tolerance, light-touch and direct engagement. Overall, it has argued that no one approach has been able to thoroughly address the human rights risks in supply chains, nor has any state managed to prevent the higher incidence of labour exploitation and abuse of workers during COVID-19. In fact, evidence of continued labour exploitation in the supply chains of PPE equipment demonstrate that the systems currently in place to address these risks are failing to do so successfully.

Trade restrictions and import bans can be powerful tools that demonstrate clear commercial and reputational consequences for companies that fail to comply with their human rights obligations. However, using them as part of a zero-tolerance approach has its limits. They are blunt instruments, and beyond short-term impacts on suppliers, they do not deal with systemic issues in high-risk commodity supply chains, nor do they tackle the enabling environment that allows labour rights abuses to flourish. In some cases, there may be short-term benefits for specific workers (such as repayment of recruitment fees), but there is also evidence that these measures may inadvertently result in greater levels of risk and harm for categories of workers in the longer term. Transparency regulation can increase understanding of global supply chains and allow public bodies and their suppliers, including in the PPE supply chains, to take better decisions and put in place strategies to prevent and mitigate human and labour rights abuse. However, a light-touch approach which predominantly relies on similar regulation without sanctions and accountability will have limited impact in practice. Long-term engagement with suppliers throughout the procurement process can have demonstrable impact on the ground, but it requires great capacity and resources, as well as great leverage over suppliers – something that individual public buyers may not have on their own.

However, this article has also argued that there are strengths in each system. A combination of all of them in some form may be the more effective and resilient approach – not only during a crisis, but also in the longer term; not just to address specific violations but also systemic abuse. Moving forwards, the meaningful inclusion of those affected by business operations, especially workers, must be a priority, regardless of the approach adopted.

PPE procurement will continue to be a high priority for states as the incidence of pandemics and other health crises are likely to rise. There has never been a better time for rectifying the mistakes and learning the lessons from unethical procurement during the COVID-19 crisis. We now know more about what works and what does not. A careful combination of different tools, using the right levers in the right ways for the right reasons, applied in a strategic and coherent way, offers a way forward. If future PPE procurement can successfully learn the lessons of COVID-19 by increasing transparency, trust, partnerships and incentives to raise labour standards across the health supplies sector, it would inspire public bodies and suppliers to do the same in other sectors.

Footnotes

Declaration of conflicting interests

The authors declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The authors received no financial support for the research, authorship, and/or publication of this article.

ORCID iD

Olga Martin-Ortega

Author Biographies

Olga Martin-Ortega is professor of International Law and Director of the Business, Human Rights and the Environment Research Group (BHRE), School of Law and Criminology, University of Greenwich, UK.

Martina Trusgnach is PhD candidate, Vice-Chancellor Scholar, School of Law and Criminology, University of Greenwich, UK.

Cindy Berman is director of Impact and Innovation, Electronics Watch.

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Push,pull,dance: Approaches to address labour abuse in public health supply chains

Abstract

Keywords

Methodology and limitations

Labour exploitation in the production of PPE

Addressing labour abuse in public supply chains before, during and after the COVID-19 pandemic

Zero-tolerance

Light-touch

Direct engagement

Discussion

Conclusions

Footnotes

Declaration of conflicting interests

Funding

ORCID iD

Author Biographies

References