Unilever Lipton Workers

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Victory for Tea Workers in Pakistan!
A negotiated settlement between Unilever and the IUF (International Union of Food Workers, etc.) has resolved the long, difficult conflict over the rights of precarious workers at the company's directly-owned Lipton/Brooke Bond tea factory in Khanewal, Pakistan. This settlement came after a long struggle, involving a large international community of activists.

The Khanewal factory with only 22 directly-employed Unilever workers and many hundreds of disposable jobs for casual workers supplied by labor contractors on a "No work, no pay" system became a powerful symbol of the denial of fundamental trade union rights through massive casualization, or the placement of workers in temporary jobs in which they are denied many of the basic rights of regular workers. Precarious workers at Khanewal were legally excluded from joining a union of Unilever workers and participating in a collective bargaining relationship with Unilever as their real employer.

Under the terms of the settlement, Unilever has agreed to create 200 additional direct, permanent jobs, retroactive to October 15, 2009, with job selection to be based on seniority and priority given to the members of the Khanewal workers' Action Committee, which led the struggle locally with the support of the IUF-affiliated National Federation of Food, Beverage and Tobacco Workers. The selection and employment process will be jointly monitored and implemented by the IUF and Unilever at national level.

Because the labour contracting (temporary employment) agencies in many cases systematically failed to fulfil their mandatory financial obligations to the workers they employed as well as their statutory obligations to the state social security and retirement funds, the settlement involves both direct lump sum payments by Unilever to the contract agency workers (both those who do receive permanent positions and those who do not) as well as guarantees from Unilever that the arrears in contractors' mandatory obligations to the state will be fully met.

Action Committee members, for their part, agree to withdraw all court petitions as part of the global agreement on permanent jobs and the wider compensation package. The settlement also contains language on non-discrimination against Action Committee members and full representational rights for the IUF and its affiliates.

As part of the agreement, Unilever commits to investment and continued operations at the Khanewal factory.

Background on the Unilever Lipton Case in Pakistan
In Unilever's Lipton tea factories across Pakistan, over 8,000 workers were employed but the majority of them are considered temporary workers, hired through contract labor agencies. Workers at a Unilever Lipton tea factory in Pakistan were protesting the company's refusal to provide permanent jobs for their workers.

The Unilever tea factory in Khanewal employs 22 permanent workers and 723 “temporary”, disposable workers. These are contract workers hired through contract labor agencies. Because they are contract laborers, they have no annual or medical leave, they cannot join a union of Unilever workers and they receive a wage that is 1/3 of the permanent workers' wage. Supported by the International Union of Food and Allied Workers (IUF) these workers are currently challenging their disposable contracts and fighting for the right to work for Unilever. They want direct, permanent employment with Unilever which would enable them to receive the same rights, wages and benefits as the 22 permanent workers including the right to join the union and bargain with Unilever.

Although they are “temporary workers” some of these workers have worked at the factory for decades. The majority of them have worked for more than a decade at the Khanewal factory, with an average of 15 years and some as long as 30 years. But since they're not formally employed by Unilever, they are barred from joining a union of Unilever workers and bargaining with Unilever as their employer.

Recent success for Lipton Workers!
IUF filed a complaint with the Organization for Economic Cooperation and Development (OECD) to hold Unilever accountable for denying basic rights to the majority of its workers through subcontracting. The OECD Guidelines for Multinational Enterprises require overseas subsidiaries of transnational companies to conform to international standards of trade union and human rights, including adherence to ILO Conventions on the right of workers to organize trade unions and bargain collectively with employers. The complaint has has mixed results so far, but has demonstrated a path towards victory. Click here to learn more about mechanisms to combat contract labor worldwide.

At Unilever's Lipton factory in Rahim Yar Khan, Pakistan, the OECD complaint led to a settlement between the IUF and Unilever which secured the creation of new permanent positions for all the union-supported Action Committee members. The Action Committee was formed to fight for their appointment as directly employed permanent workers with the right to join the union.

The settlement stipulates that Unilever will create 120 new permanent positions at the plant, effective as of June 24 this year, and that all Action Committee members will be appointed to these positions. According to the agreement, these workers shall suffer no discrimination at the factory, and the company pledges to abstain from interference in the work of the union in which they will now be members.

The Rahim Yar Khan settlement constitutes an important union victory in the fight against disposable jobs and Unilever's strategy of reducing union bargaining power by radically shrinking the number of permanent employees eligible for union membership and inclusion in the collective bargaining unit.

The Khanawel workers have not had the same success, however. As at Rahim Yar Khan, a union-supported Action Committee is struggling for direct employment and union membership and bargaining rights. While publicly claiming to be "addressing" the issue, Unilever management has been seeking to destroy the movement by denying the workers employment under the "No work, no pay" system while bringing in new contract workers, driving them deeper into poverty and debt.

Visit the official Casual-T campaign website here.
View the Business and Human Rights Report on Unilever here.

Want to learn more about Contract Labor and Disposable Jobs
Visit ILRF's Precarious Work and Contract Labor Page here.