Forced Labor

Abolishing the practice of using forced labor is a global challenge. Many countries are enforcing or promulgating regulations to ban the import of products suspected of being produced using forced labor, including the United States, Canada, and the European Union.

The United States is taking the lead on global enforcement. The United States prohibits the importation of all goods, wares, articles, and merchandise mined, produced, or manufactured, wholly or in part, in any foreign country by convict, indentured, or forced labor, under penal sanctions. 19 U.S.C. § 1307 (Section 1307). The statute broadly defines forced labor as:

All work or service which is exacted from any person under the menace of any penalty for its nonperformance and for which the worker does not offer himself voluntarily…the term ‘forced labor or/and indentured labor’ includes forced or indentured child labor.

There is no de minimis exception to this prohibition. The Trade Facilitation and Trade Enforcement Act (TFTEA) of 2015 eliminated the consumptive demand exception, which allowed the importation of merchandise produced with forced labor if the goods were not produced in sufficient quantities in the United States to meet demand. 

Increasingly, there are reports of worker exploitation and incidences of forced labor worldwide. Recently, the human rights abuses by the Peoples Republic of China (PRC) against the Uyghur population, ethnic Kazakhs, ethnic Kyrgyz, and members of other Muslim minority groups in the Xinjiang Uyghur Autonomous Region (XUAR) have raised public concern and resulted in global condemnation. This concern resulted in the passage of the Uyghur Forced Labor Prevention Act (UFLPA), which imposes a rebuttable presumption that all goods produced in whole or part in XUAR are produced with forced labor and thus banned from the United States. 

However, forced labor is not limited to China or XUAR - there have been reports of North Korean, child, prison, and indentured labor around the world, implicating many industries. 

For companies, forced labor has become a priority issue and an area of substantial risk. Companies are facing increased government enforcement actions, intended to protect exploited and abused workers and to prevent prohibited goods produced with forced labor from entering the country. Forced labor has recently become the subject of bi-partisan legislation, a Court of International Trade case, US Customs and Border Protection (Customs or CBP) rulings, and ever increasing Customs scrutiny and detentions.

Companies are also at risk of public outcry and boycotts if forced labor is discovered in their supply chain. Consumers do not want to unwittingly purchase goods produced with forced labor and inadvertently support human rights violators. Many companies and industries are the subject of non-governmental organization investigations and forced labor reports that publicly name implicated companies. Companies have also been sued by private parties in international court for selling goods allegedly produced with forced labor.

Companies are now responsible for monitoring the ever-changing government forced labor restrictions and legislation. They must assess their entire supply chains for forced labor risks – a difficult task for many companies with deep supply chains that do not have access to their upstream suppliers; establish policies and procedures to eliminate forced labor from the supply chain; and address any forced labor found in the supply chain, which may require the company to shift supply chains.

This can be a herculean task for many companies – but we are here to help.