KUALA LUMPUR: Top Glove Corporation said on Monday it had begun making remediation payments to migrant workers who were employed by the world’s largest medical glovemaker before 2019, when it put in place ethical recruitment practices.
The United States is a major market for medical gloves, which have seen huge demand as a result of the Covid-19 pandemic, and last month the US Customs and Border Protection (CBP) placed a detention order on imports from two of Top Glove’s subsidiaries, Top Glove Sdn Bhd and TG Medical Sdn Bhd.
The order was issued due to suspicions of forced labour among Top Glove’s migrant workers. Foreign workers are often charged a fee by employment agents to land jobs in Malaysia, a debt they then work to pay off.
Top Glove said in a stock exchange statement that it had made the first remediation payment of RM4.4 mil.
“The total remediation fee to be paid is estimated at RM53 mil, subject to finalisation with the US Customs and Border Protection (CBP),” it said, adding that it “continues to actively engage with the US CBP towards resolving the Withhold Release Order (WRO) expeditiously”.
It had earlier said it had made progress in engagement with the CBP and hoped to resolve the matter this month.
Top Glove has clarified that it was an issue with the retrospective payment of recruitment fees by staff to agents prior to the implementation of its Zero Cost Recruitment Policy.
At the end of the trading day, Top Glove’s shares were at RM27.20, down 94 sen, with 15.5 million shares traded.
Smaller rival Hartalega Holdings Bhd earlier said that from the fourth quarter it will reimburse up to a total of RM40 mil in recruitment fees previously paid by migrant workers to employment agents.
Another rival, Supermax Corporation Bhd, said its net profit for the quarter ended June 30 had risen from RM15.06 mil to RM399.62 mil.
It said this was its “best quarterly financial performance” and had been driven by an exponential rise in demand for gloves and an increase in production capacity, which it plans to almost double by the end of 2022. – Aug 10, 2020
