Spotlight News 10/20/2016

BSI Analysis: Japan’s Tightened Scrutiny of Foreign Trainee Program Likely Exposing More Labor Exploitative Practices in Manufacturing and Other Labor-Intensive Sectors

Japan has been under increasing domestic and international criticism for the rampant exploitation of its foreign trainee program workforce. The government began the program 23 years ago aiming to give people from developing countries the opportunity to learn new skills. However, in face of a shortage of workers in this fast-aging country and the stagnant economy, companies have abused this program to fulfill their labor needs.

Companies have reportedly employed these foreign workers as trainees and used them as cheap labor in manufacturing, processing, and other labor-intensive sectors. Violations include underpayment, unsafe working conditions, and excessive working hours, which in many cases led to death by overwork. Many workers reportedly are forced to work several hundreds of hours a month in overtime. In addition, the employees tend to under-report their labor practices since such practices are in violation of Japan’s labor law. The concerning problem of foreign workers’ labor conditions in Japan surfaced quite recently thanks to improvements in data collection and a new law aiming to regulate overtime.

A just-released inspection survey by the labor ministry in 5,173 workplaces across the country, found 3,695 workplaces in breach of labor standards in 2015, an increase of 24% from the previous year. A recent court ruling on the death of a 27-year-old Pilipino worker, who was working 78.5 to 122.5 hours of overtime a month, was confirmed as death by overwork. It marked the first documented case of a migrant worker’s death by overwork.

This year, Japan has hosted a record 210,000 foreign trainees, and the number is expected to increase as the government seeks to accept additional workers to revive the economy. Though the overall threat of working conditions in Japan is low, excessive overtime in the labor-intensive sector poses serious risks to working conditions that could hurt the reputation of companies sourcing from suppliers with low labor standards. 

Brazilian Customs Officer Strike Creating Kilometer-Long Queues of Cargo Trucks at Border Crossings as Paraguay Projects Economic Losses of $100 Million

The strike by customs officers in Brazil has created reportedly kilometer-long queues of cargo trucks at border crossings with Paraguay and Bolivia as officials stop all operations through tomorrow. This is the latest in a series of strikes since July by customs officers in Brazil, and a Paraguayan commission of major exporting industry associations is projecting at least $100 million in economic losses due the labor stoppages. The commission indicated that the labor stoppages and subsequent delays in grain shipments to Brazil as well as economic uncertainty leading to the cancelation of contracts have severely impacted Paraguayan industry. Customs officers in Brazil are reportedly scheduled to meet tomorrow to determine possible further labor stoppages.

Ukrainian Prime Minister Reveals No Working Cargo X-Ray Scanners at Customs Checkpoints Across Country due to Supply Chain Corruption

In a recent interview, Ukrainian Prime Minister Volodymyr Groysman revealed that Ukrainian customs officers deliberately damaged X-ray scanners for cargo inspection at checkpoints across the country in order to facilitate smuggling schemes. Most customs officers are reportedly unable to survey goods without removing them by hand from vehicles and containers. This finding underscores how the significant risk of supply chain corruption exacerbates the Severe threat of cargo disruption in Ukraine.

Prime Minister Groysman also highlighted the bilateral efforts between Ukraine and the United States to address such serious gaps in border and customs operations. For example, as part of a broader joint action plan, Ukrainian authorities recently launched several mobile anti-corruption teams to monitor activities at checkpoints across the country. The frequent rotation of these new inter-regional units are reportedly beginning to achieve some success in thwarting smuggling schemes.