Shareholders give Unilever a dressing down

At the Unilever shareholders’ meeting today, the Dutch trade union FNV, the international trade union for food workers IUF and other interested parties, such as VBDO, raised the issue of the working conditions of workers in Pakistan, India and Kenya.

The recently published SOMO briefing paper ‘Unilever; Overview of controversial business practices in 2008’ showed, for example, that Unilever is increasingly recruiting workers in Asia on the basis of temporary agency contracts rather than permanent contracts. That temporary personnel earn a lot less than permanent employees, are not entitled to holiday leave, sickness pay or overtime supplements, and are often forbidden from joining a trade union.

One example is the Lipton tea factory in Karachi, Pakistan, which was closed in 2008, after which all the work was transferred to a local company, where all the 800 employees work on the basis of temporary contracts.

In a response to SOMO’s study, Unilever states that it complies with local regulations and customs. Furthermore, the company says it is not the only business to contract out its tea packing.
SOMO researcher Sanne van der Wal has indicated that she considers this a strange response. “Unilever has contracted out almost all of its tea packing work in Pakistan, while tea packing is the most important work of a tea factory.”

In 2009, IUF started a large-scale campaign against Unilever. In order to support Lipton factory workers in Pakistan, a website(opens in new window) was set up and a complaint was submitted to the OECD, among other things.

In preparation for the 2009 shareholders meetings, SOMO and VBDO are jointly carrying out research into the CSR policy and practice of ten Dutch stock-exchange listed companies in 2008. SOMO is drawing up a profile for each of these companies, on which the VBDO will base its voting advice and ask critical questions.