CHILD LABOR AND FORCED LABOR ARE
still common in the developing world.
According to a 2013 estimate by the
International Labour Organization, 168
million underage children still work
around the world, often in harsh conditions. The ILO estimated in 2014 that
around 21 million people worldwide
are victims of forced labor.
A trade law signed by President
Barack Obama in February could help
stomp out this exploitation, however. The Trade Facilitation and Trade
Enforcement Act of 2015 is primarily
focused on giving the U.S. government
more power to enforce trade rules with
other nations. But it also closes a longstanding loophole that allowed for the
importation of goods produced by children and forced laborers.
Under the Tariff Act of 1930, it’s generally illegal to import foreign goods
produced by forced labor. However,
there is an exemption for products that
are not available “in such quantities in
the U.S. as to meet the consumptive
demands.” The TFTEA abolishes this
“consumptive demand exception” and,
thus, the loophole.
Sarah Rathke, a partner at Squire
Patton Boggs, says it’s rare that U.S.
customs turns away products at the
border because it suspects that illegal
forms of labor are at play. But without
the consumptive demand loophole, the
government may decide to come down
harder on suspected violators.
“The question will be: How stringently is the law enforced, and what
kind of evidence is necessary to turn
goods away?” Rathke says. That question remains unanswered for now, but
resources do exist to help both importing companies and officials at the border determine what products pose a
higher risk of child or forced labor.
The U.S. Department of Labor keeps
a list of products from different areas of
the world that it has reason to believe
are made using children as laborers and
forced labor. The current list includes
more than 350 items, from Indian ciga-
rettes to Panamanian coffee to Egyp-
tian limestone. The public can submit
imports to be considered for the DOL
list, which may happen more often now
that the consumptive demand excep-
tion is no more.
Joseph Laroski, counsel at King &
Spalding, says the passage of the TFTEA
provides an opportunity for companies
to reassess their supply chains and how
they verify that labor laws aren’t being
violated. He explains that many companies have already started to double down
on the integrity of their supply chains,
using such tools as new codes of conduct
and third-party certification programs.
“It’s part of a growing trend of
embracing the corporate social responsibility concept, whether it’s in areas
like labor or conflict minerals or land
rights,” Laroski says.
Some companies have even become
the subject of lawsuits over allegations
that they misinformed their customers about forced labor on their supply
chains. For instance, separate class
action lawsuits filed against Mars Inc.,
Nestle USA Inc. and The Hershey Co.,
all in September 2015, claimed that all
three of the companies were violating
California’s false advertising laws by
failing to disclose that the chocolate
they sold was produced in part by
forced labor and child labor from the
And even without the legal risk,
the moral implications of such deeply
exploitative labor practices can severely
affect public perception of a company
and its brand. “Reputational risk is so
high,” Laroski says, “that companies
have been getting on board and devoting more resources to these sorts of
issues.” —REBEKAH MINTZER
WORLDBEAT ❘ IN-HOUSE AROUND THE GLOBE
COMBATING A SCOURGE
A law aims to prevent importation of goods produced by forced labor.
CHILDREN WORKING IN A S TONE MINE AT
JAFLONG IN BANGLADESH ON MARCH 18