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Olam Progida

Publication date: 
Miércoles, Mayo 8, 2019

In March 2018, the FLA received a Third Party Complaint from the Tekgida-IS trade union (Tekgida) in Turkey concerning allegations of noncompliance with ILO Conventions 87 and 98 (freedom of association and the right to organize and bargain collectively) and, by extension, relevant provisions in the FLA Workplace Code of Conduct and Benchmarks at the Progida production facility in Piraziz / Giresun owned and operated by Olam Group (Olam), an FLA-affiliated company.  Olam had acquired the Progida Group, a leading hazelnut exporter with headquarters  in Istanbul, in 2011, including this processing plant in the heart of the hazelnut growing region of Turkey.

Subsequent to the receipt of this Complaint, there was an extended period of time during which FLA personnel based in Turkey were in active contact with representatives of both Olam and Tekgida with respect to what appeared to be good faith efforts to address the allegations raised in the Complaint as well as related matters.  These engagement activities are noted in the investigative report.  After concluding that the dialogue between Olam and Tekgida was unlikely to result in a resolution of the underlying issues, the FLA on November 6, 2018 accepted the Third Party Complaint at Step 2 of the process and communicated that action to representatives of both Olam and Tekgida. 

Olam subsequently informed the FLA that, consistent with existing Third Party Complaint procedures, it would proceed with an investigation into the allegations raised in the Complaint.  Olam in turn it commissioned Professor Omer Ekmekci, an academic with a specialization in labor law, to conduct the investigation, focusing in particular on nine workers who alleged that they had been dismissed because of their involvement in union activities and their membership in the Tekgida trade union.  Professor Ekmekci added attorneys Ozen Erdogan and Zeynep Guver to his investigative team.

The investigative report submitted by Professor Ekmekci and his colleagues further details the course and the scope of the investigative team’s work.  The FLA notes that, as set forth in the report, the investigators engaged in a broad set of meetings/interviews both at the workplace and offsite, as appropriate, and both through this and the thorough review of documents conformed with the requirements of the Terms of Reference.  The report documents the substantial number of interviews conducted and breaks down that total into different categories, and describes in detail the documents reviewed and other elements of the investigative process.  The investigators analyzed the information provided and reviewed it against both applicable law and the relevant provisions of the FLA Code and Benchmarks.

The FLA notes that the investigative report is clear and unambiguous with respect to the company’s failure to specify grounds for the termination of the nine workers, and offers a perspective on the likely effect of this failure with respect to ongoing litigation being pursued by Tekgida through the Turkish judicial system.  The report goes on to state that, notwithstanding the failure to specify termination grounds, in the view of the investigators “this does not prove on its own that termination is based on union-related reasons”. 

In short, after their comprehensive review of documents and series of interviews, the investigators determined that they were not able to reach a conclusion concerning that core allegation in light of the “totally opposite statements” and “entirely opposite allegations” with respect to the reasons for the dismissals.  Thus, the report does not make a finding on what the investigators acknowledge to be “[t]he most important issue in the case” and leave for another forum the decision on whether the dismissals were “based on union-related grounds.” 

Yet after reaching this decision not to make a determination as to the motivations underlying the workers’ dismissals, the report nevertheless then goes on to weigh in concerning the option of reinstatement of some or all of the nine dismissed workers – specifically recommending against any such reinstatement.  The FLA has concerns about both the reasoning of the report in this regard and with the decision to make a recommendation on this issue – which is also likely to be part of a future court ruling in the ongoing judicial proceeding.  

To be clear, the FLA is not in a position to analyze the risks of “tension” and “polarization” at the workplace of which the report speaks, but it finds the report’s analysis to be speculative, and notes further that both parties – Olam and Tekgida – share responsibility for taking steps to mitigate such concerns, including through a renewed dialogue on the underlying issues.

The FLA is pleased that the report concludes with a series of practical recommendations to Olam designed in part to help rebuild the apparent erosion of trust between the parties and restore the more “positive environment” that the report states had existing as recently as mid-2018.  To that end, the FLA endorses the report’s calls for multiple trainings of workers concerning their rights including pursuant to the FLA Code and Benchmarks; of Human Resources personnel concerning the same issues; of a cross-section of supervisors and managers on not only freedom of association  and union rights but also problem solving and communications techniques; and of workers concerning access to “Complaint, Suggestion and Opinion boxes” with an understanding that the company would ensure concerns raised there are adequately taken into consideration. 

The report also calls for additional measures by the company to ensure it has information enabling the correction of “deficiencies and non-conformities” and with respect to concerns raised about favoritism in how blue-collar workers are called for work.  It recommends the establishment of an Annual Leave Committee comprised of both employer and worker representatives.  Finally, it calls for a revamping of the performance evaluation system based on the need to “assess performance on the basis of objective criteria.”  Clearer and demonstrably objective procedures for worker retention and dismissal are essential, and, in the view of the FLA, could help foster a more positive overall work environment.

Through this series of recommendations, the investigators reveal that while they could not determine the reason for the nine worker dismissals, they see a need for numerous improvements on the part of factory management over the coming months.  The FLA urges Olam to move expeditiously to put in place the procedures necessary to effectuate the series of recommendations set forth in the report, all of which in the view of the FLA are achievable during calendar year 2019 – regardless of the results of any litigation concerning other unresolved issues.  The FLA intends to remain actively engaged in monitoring timely implementation of the report’s recommendations, and looks forward to receiving regular updates from Olam.

More broadly, implementing these corrective measures to remediate concerns identified by the investigators has the potential to establish a foundation for a more constructive, ongoing dialogue between employer and union.  This takes on added importance given information provided by the union to the FLA subsequent to the conduct of this investigation concerning eight additional dismissals of union members at Giresun and a second Olam-owned facility at Sakarya – dismissals said to have prompted the resignation of a much larger number of workers from the union at those two facilities during the first half of March. 

While the allegations concerning those more recent dismissals and related actions are outside the scope of this investigation and obviously require additional analysis and review, the FLA believes that this investigative report maps out a constructive path forward even while not reaching a conclusion concerning the reasons underlying the nine dismissals that it has analyzed.  To that end, the FLA hopes that the report can help advance a reopening of the formerly constructive dialogue between Olam and Tekgida, which could play an important role in the implementation of the detailed set of corrective actions.

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