Global Forced Labor Trade and Supply Chain Regulations

Forced labor is a serious and pervasive human rights issue affecting millions worldwide. According to the International Labor Organization (ILO), the Asia-Pacific region has the highest number of people in forced labor, followed by Africa and the Arab States, with Fifty million people living in modern slavery in 2021, of which 28 million were in forced labor.

This problem is particularly prevalent in the global technology industry, where products are often produced through complex and fragmented supply chains involving many suppliers and subcontractors. It can occur at various stages of the semiconductor supply chain, including mining, silicon wafer production, and the assembly and testing of finished products. In some cases, migrant workers may be recruited under pretenses and forced to work in hazardous conditions for little or no pay.  

There have been numerous reports of forced labor in the technology industry, particularly in countries such as China, where labor laws are weaker, and enforcement is often lax. As a result, workers may be subjected to long hours, low pay, dangerous working conditions, and other forms of exploitation, and may be unable to leave their jobs due to threats, violence, or other forms of coercion.

There have been reports of forced labor in the mining and production of raw materials such as cobalt, mica, tin, and others. Children are often forced to work long hours in dangerous and unhealthy conditions and may be physically and emotionally abused. For example, cobalt is a critical component of lithium-ion batteries in smartphones, laptops, and other electronic devices. The Democratic Republic of Congo (DRC) produces more than half of the world's cobalt, and there have been reports of forced and child labor in cobalt mines. Learn more about forced labor in the technology industry and the raw material linked to forced labor.

To address these issues, governments and international organizations have implemented regulations and guidelines for companies operating in the electronics industry. Some of which include:  

• The US Forced Labor Prevention Act (UFLPA): The UFLPA requires companies to disclose the steps they have taken to prevent forced labor in their supply chains and prohibits the import of goods made with forced labor.  

• German Supply Chain Due Diligence Act (SCDDA): The SCDDA stipulates that companies must take remedial actions if they cause or are connected to adverse environmental or human rights impacts in their operations and supply chains.  

• Modern Slavery Act (UK): The UK government introduced the Modern Slavery Act in 2015, which requires companies with a revenue of more than £36 million to publish annual statements outlining the steps they have taken to prevent modern slavery in their operations and supply chains.  

• California Transparency in Supply Chains Act (US): The California Transparency in Supply Chains Act, enacted in 2012, requires companies with annual revenues of more than $100 million doing business in California to disclose their efforts to eradicate slavery and human trafficking from their supply chains.

• EU Non-Financial Reporting Directive (EU): The EU Non-Financial Reporting Directive requires certain companies to disclose information on their policies, risks, and outcomes related to social, environmental, and human rights issues, including forced labor.

• Australian Modern Slavery Act (Australia): The Australian government introduced the Modern Slavery Act in 2018, which requires companies with an annual revenue of more than $100 million to report on their efforts to identify and address the risks of modern slavery in their operations and supply chains.

These regulations aim to increase transparency and accountability in supply chains and encourage companies to take action to address forced labor. Companies that fail to comply with these regulations may face penalties or legal action, which can have significant financial and reputational consequences.

There also have been efforts by governments, civil society organizations, and the private sector to address the issue of conflict minerals. For example, the Dodd-Frank Wall Street Reform and Consumer Protection Act in the United States requires companies to disclose their use of conflict minerals in their products and supply chains and to report on their efforts to ensure that these minerals are sourced responsibly. Other initiatives, such as the Responsible Minerals Initiative, provide tools and resources for companies to trace the origin of minerals in their supply chains and ensure that they are not contributing to human rights abuses or conflict.  

Additionally, the Organization for Economic Cooperation and Development (OECD) has developed guidelines for responsible mineral supply chains, including due diligence processes to identify and address risks of forced labor and human rights abuses in the mining and production of raw materials. The Electronic Industry Citizenship Coalition (EICC) has also developed a code of conduct for its members that includes requirements for responsible sourcing of raw materials, fair labor practices, and respect for human rights in the supply chain.

To comply with the various global regulations and guidelines, companies in the electronics industry have begun creating remediation policies, conducting supplier audits, and engaging with stakeholders to promote transparency and accountability in their supply chain.