Alarm over forced labour as illegal profits surge yearly

Several employers are denying each of their employees close to Sh226,000 of pay every year as a result of forced labor which is often underpaid or unpaid.

The International Labour Organisation (ILO) in its latest profits and poverty report says the total amount of illegal profits from forced labour has risen globally by 37 per cent since 2014, an equivalent of $64 billion (Sh8.4 trillion).

It says the increase is being fueled by both a growth in the number of people forced into labour, as well as higher profits generated from the exploitation of victims.

"There are many more victims of forced labour now than ten years ago. The current estimate of illegal profits is based on a total of 23.7 million people in forced labour in the private economy, compared to almost 18.7 million in 2014,” the report reads.

“This represents an increase of 27 per cent of people in forced labour in the private economy in the last ten years globally.”

ILO explains that the illegal financial gains represent the difference between what the employers are paying the workers and what they would be paying them in the absence of forced labour under normal circumstances.

In other words, they are the wages that rightfully belong in the pockets of workers that instead remain in the hands of their exploiters as a result of their coercive practices.

In Kenya, the vice is evidently prevalent, but with no exact quantification due to limited comprehensive data, according to the Federation of Kenya Employers (FKE).

“While Kenyan laws strictly prohibit such practices, isolated instances of forced labor may occur, especially in informal sectors and areas with limited governmental oversight,” FKE says.

Although not considered widespread, the employers' body says its effects are detrimental to the economy's positive growth prospects.

"Forced labour is responsible for undermining fair labor practices, distorting market operations and violating human rights."

This is concurred by Gilbert Houngbo, the director general at ILO, who says forced labour perpetuates cycles of poverty and exploitation and strikes at the heart of human dignity, a reason the international community must urgently come together to take action to end the injustice.

The report highlights forced commercial sexual exploitation as the leading source of illegal profits accounting for more than two-thirds (73 per cent) of the total illegal profits, despite accounting for only 27 per cent of the total number of victims in privately imposed labour.

The industry sector follows second with $35 billion (Sh4.5 trillion), followed by services at $20.8 billion (Sh2.7 trillion), agriculture at $5 billion (Sh655 billion), and domestic work at $2.6 billion (Sh340.6 billion).

These out of the total illegal profits generated from forced labour yearly amount to an estimated $236 billion (Sh30.9 trillion).

FKE says Kenya’s most risk sectors of forced labour are the informal and industry sectors with less regulatory oversight.

It further highlights the issue of migrant workers in Kenya as another contributing factor to the country’s illegal work profits.

Many migrant workers in Kenya come from neighboring countries, including those within the East African Community (EAC), which allows free movement of labor.

There are also migrants from unstable regions such as Somalia.

The country was last year flagged as becoming a hub of cross-border trafficking rings that exploit especially women and underage girls.

It was noted that the perpetrators were taking advantage of the porous borders and the poverty levels of the source communities.

Workers' underpayment has been noted as the main contributor to the rising illegal profits.

In the construction sector, for instance, ILO says documented forms of underpayment include unpaid overtime, lower wages than what was agreed upon, illegal or excessive deductions and withholding of wages.

“In the mining industry, debt bondage may arise when small-scale miners borrow from “sponsors” to buy equipment in exchange for a percentage of the ore they collect,” it says.

“Workers often do not earn enough and take additional loans for food. This cycle ultimately results in workers losing their freedom, as they are compelled to continue working to pay back their debts.”

On the other hand, domestic workers, 8 of 10 of whom are in informal employment, are particularly vulnerable to wage underpayment.

Unpaid overtime, lack of rest periods, and withholding of wages are among the documented violations linked to the underpayment of domestic workers.

In the hospitality, recreation and other sectors where informality is common, ILO says the absence of formal contracts means less wage transparency and greater vulnerability to wage abuses.

“Wage transparency is also often undermined in such contexts by the absence of payslips detailing basic wages, bonuses and deductions.”

Across all sectors, workers classified as seasonal and casual workers are frequently excluded from minimum wage protection granted to regular workers, leaving them especially vulnerable to underpayment.

To curb this vice and the illegal profits in its entirety in Kenya, FKE advocates for a comprehensive strategy that focuses on strengthening the labour market against exploitation.

Central to this effort is to enhance supply chain transparency and accountability, ensuring  ethical standards are maintained at every production stage.

“This is complemented by efforts to raise awareness and educate workers about their rights, empowering them to stand against and report exploitation,” it says.

It adds that investment in education and skills training is crucial in reducing workers' vulnerability to forced labour, with a strong push for creating employment environments that are both fair and sustainable.

“Public sensitization efforts are also essential, aimed at underscoring the negative impacts of forced labour and fostering a societal drive towards its eradication.”

To solidify these efforts, strengthening the justice system to address and penalize forced labour effectively is vital according to the employers' body.

"This goes hand in hand with fostering social dialogue and  tripartism, promoting collaborative efforts among governments, employers and workers' organisations in tackling labour issues," FKE adds in part.

“Additionally, improving labour market information systems through enhanced data collection and analysis is key to supporting informed policy-making and actions against forced labour.”