A life of dignity long overdue for Assam’s tea workers

  • 16 January 2017
Tea workers in Assam

In this long-form guest blog, Simran Sachdev, Justice Program Officer and Jayshree Satpute, Co-Founder of Nazdeek, a legal empowerment organisation, comment on recent World Bank findings of labour abuses on Assam tea plantations that the Bank co-owns with Tata, and what this means for tea workers.

In August 2009, a pregnant tea plantation worker collapsed on Nowera Nuddy estate in West Bengal. She had just made a request for maternity leave at the plantation’s health clinic.

The incident led to a labor dispute between workers and the tea plantation owner, resulting in workers being locked out for an initial two weeks, and then a subsequent three months. During the first two weeks, workers received part of their food rations, but no pay. During the second lock-out, the plantation owner said they would not provide any pay or rations.

The role of Amalgamated Plantations Private Limited (APPL)

Nowera Nuddy is one of the tea estates that is part of the World Bank’s International Finance Corporation (IFC) investment in partnership with Tata Global Beverages. The partnership, the Amalgamated Plantations Private Limited (APPL), implements an employee-share programme in Assam and West Bengal – giving workers the opportunity to share in company profits.

The IFC invested US $7.8 million for a 19.9% stake in APPL. Tata, renowned for its high ethical standards, retained a 49.6% stake.

The combination of complying with World Bank Standards and implementing a worker-shareholder model was meant to bring improved living and working conditions for tea workers, including adequate healthcare, water and sanitation, food rations, and housing.

Seven years into the IFC investment and three years after an official complaint was filed with the World Bank’s Compliance Advisor Ombudsman (CAO), the situation of tea plantation workers is similar to what it was before: they struggle with ethnic segregation, don’t have access to basic services, receive wages below the legal minimum, and lack bargaining power. Such conditions contribute to the state of Assam having the country’s highest maternal mortality rate.

Assam is the largest tea-growing region in the world and numerous global companies source tea from the state. Many of the tea gardens in the region are also Rainforest Alliance and Fair Trade Certified, but conditions are still sub-par; thus, such certifications cannot be relied on alone.

World Bank investigation and action plan

In response to a complaint regarding poor living and working conditions on Assam’s tea gardens submitted by three non-governmental organizations – People’s Action for Development (PAD); Promotion and Advancement of Justice, Harmony and Rights of Adivasis (PAJHRA); and the Diocesan Board of Social Services (DBSS) – the CAO investigated.

The CAO released its investigative report in November 2016, affirming the many issues stemming from the IFC investment that complainants had previously stated.

In response to the report, the World Bank Group released an action plan. But Nazdeek charges that the plan is very limited in scope and fails to address the root causes of workers’ poverty highlighted in the report.

Changes beyond what is in the action plan – including compliance with Indian labour laws – must be implemented for the hope of a better life for tea workers and their families to be realised.

A key goal of IFC’s investment into APPL was to implement the shareholder programme, which would provide tea workers with decision-making power. However, the report found no adequate consultation with workers at any stage of the investment process.

In fact, workers initially resisted the implementation of the IFC project because it would have deducted the cost of shares from their already meagre salaries; tea workers in Assam receive Rs 126 per day – much below the legal minimum wage of the state of Rs 250.

Problems over freedom of association and more

The lack of consultation and worker engagement occurred in the backdrop of restricted freedom of association on the tea gardens. Complainants stated that on all but one of the APPL plantations in Assam, workers are required to pay dues to the largest tea worker representative union in Assam – a union that campaigners allege has consistently negotiated wages below the legal minimum.

Workers reported fearing retaliation from management if they joined other unions and raised concerns about restrictions by APPL on access by non-residents and non-workers to plantation housing areas, hindering the ability of workers to organise.

Depriving workers of freedom of association in this manner ensured that workers did not gain the decision-making power they were meant to via the shareholder program. In addition, despite owning shares of APPL, workers have no representation on the company’s board and thus have no way to exert their shareholder power.

The CAO validated concerns that workers have been raising for years regarding poor living and working conditions, and found evidence of human rights violations taking place on the tea plantations.

Some of the CAO report’s key findings include:

  • Prior to investing, IFC did not review client compliance with requirements to provide housing or other basic services to workers under Indian law
  • During the investment, IFC’s consideration of worker health indicators was insufficient
  • IFC did not ensure that wages were consistent with IFC’s commitment to support jobs that offer a way out of poverty
  • IFC did not diligently assess risk of child labor on APPL plantations
  • IFC’s review prior to investing did not adequately consider potential adverse impacts of the employee shareholder program on workers
  • IFC had insufficient evidence that its requirements in relation to freedom of association and collective bargaining were being met
  • APPL did not have in place an effective grievance mechanism for workers and their organisations to raise concerns, even after the Nowera Nuddy incident
  • IFC did not properly apply its requirements regarding the handling and use of pesticides to this project, resulting in workers being exposed to extremely hazardous chemicals
  • IFC did not consider whether Adivasi workers on APPL tea estates should be considered Indigenous Peoples, which would have helped protect their culture and identity

Moving forward in Assam

An investment like APPL requires the inclusion of local voices: workers must be included by investors in decision-making, and in determining what changes need to be made and how they should be implemented. Without a real commitment to addressing power imbalances between workers and management, changes will be ineffective and tea workers will remain in poverty.

So where do we go from here?

30,000 tea plantation workers are permanently employed by APPL, affecting them and their families – a total of 155,000 people, most of whom belongs to Adivasi (indigenous) communities.

Generations of tea workers have been dependent on tea companies not only for their livelihoods, but also for housing, food, and healthcare.

Boycotting Assam tea is not the answer, as boycotts would result in the closure of tea gardens and workers would be further pushed into poverty. Instead, consumers should use their resources and purchasing power to pressure both the IFC and APPL to drastically improve living and working conditions for tea workers who make the production of tea possible.

The IFC would be remiss in passing up this historic opportunity to make improvements on its investment in India’s tea, and the chance to contribute to truly lifting workers out of poverty. It should seize the opportunity before it’s too late.

Nazdeek is a legal empowerment organisation committed to bringing access to justice closer to marginalised communities in India. Its model fuses grassroots legal education, community monitoring of service delivery, use of judicial and non-judicial remedies and strategic research and advocacy to advance social and economic rights. Follow Nazdeek on twitter here.



ETI's blog covers issues at the intersection of business, news and ethical trade. We welcome a range of insights and opinions from our guest bloggers, though don't necessarily agree with everything they say.