Life on a palm oil estate: how do you care for the welfare of hundreds of workers?

Home sweet home: It looks like any other street in the ‘burbs, but these homes are actually in the middle of a palm oil estate in Perak. — Photos: ONG SOON HIN/The Star

It's a sunny afternoon on the Jenderata oil palm estate just outside Teluk Intan, Perak. I’m being driven around by United Plantations vice chairman and chief executive director Datuk Carl Bek-Nielsen, my tour guide for the day.

We stop outside a row of terraced houses and Bek-Nielsen urges me to take a look at them. These 140sq m houses are accommodations for employees classified as general estate workers, I’m told; some are cheery with potted flowers, and I notice satellite dishes on some roofs and cars parked in some porches.

“We offer free housing to our workers. Also, free piped water, electricity and medical care. For our workers from abroad, like Indo­nesia or Bangladesh, we strive to have a maximum of two people per room. That’s what we have on a majority of our estates,” he says, adding that United Plantations Bhd (UP) can house thousands of workers on its estates.

As we walk around, Bek-Nielsen makes small talk in fluent Malay – while he is of Danish ancestry, Bek-Nielsen grew up on Jenderata, playing on the estate’s grounds. He is, in fact, following in the footsteps of his father, the late Tan Sri Borge Bek-Nielsen, a former UP chairman who was known as the “palm oil king”.

A mustachioed man comes out of a nearby house, spots the boss and, smiling, salutes like a soldier – such seems to be the respect Bek-Nielsen’s workers have for him.

A worker handling one of the furnaces at the Jenderata Mill.
A worker handling one of the furnaces at the Jenderata Mill.

The man who saluted is clearly not local; Bek-Nielsen says that 85% to 90% of the estate’s general agricultural staff are from India, Indo­nesia and Nepal.

“But I don’t like calling them foreign workers. In UP, we refer to them as guest workers. They come as our guests to work for us and then they go back. They are people, just like us,” Bek-Nielsen says.

This is why we’ve been invited here, to have a look at the working conditions on this estate, particularly conditions for foreign workers.

Earlier in the year, articles in the British newspaper The Guardian alleged that foreign plantation workers are exploited in South-East Asia and that they have fewer rights than local workers.

Bek-Nielsen is firm in his reply when we bring up the claims: UP does not condone such practices and it prides itself on protecting workers’ welfare, whether they are local or foreign. If there are oil palm estates abusing workers’ rights, they are giving the entire industry a bad name.

‘You have to make sure that the social fabric around your operations is intact,’ says Bek-Nielsen.
‘You have to make sure that the social fabric around your operations is intact,’ says Bek-Nielsen.

“I’m not disputing The Guardian’s findings, nor am I endorsing them. Some of them could be true. The key thing is, if it is true, then it is a disgrace, and the companies involved have a moral obligation to correct the wrongs. If there is substance to these allegations, then I hope the authorities come down on wrongdoers at once,” he says.

As the Guardian articles pointed out, one of the main issues immigrant labour faces globally is having their right to travel curtailed; illegal and trafficked workers often have their passports taken from them, forcing them to work as indentured slaves, practically. This is something Bek-Nielsen obviously feels strongly about, and he becomes animated as he insists that workers on local estates are not illegal and have freedom of movement.

“We don’t have illegal workers on our estates. If the authorities catch anyone who has been doing that, the ramifications would be enormous. You wouldn’t be allowed to move in and out of the country. Your passport would be impounded, and your bank account frozen,” he points out.

UP also does not restrict workers’ passports, Bek-Nielsen says, as evidenced by the fact that more than 10% of its workforce returned home on leave last year.

And 1,500 to 1,800 of its foreign workers are repatriated every year to make way for new workers coming in – something that would be difficult to do if the workers were illegal.

Faizol Haniba, an assistant manager who heads a team of about 300 mostly foreign workers, explains that his staff have lockers for their documents.

“They keep their keys with them. We don’t confiscate their passports. They can come and take their passports and go anywhere they want,” he explains.

Foreign worker welfare committees have also been organised to keep a special eye out – traditionally, foreign labour is vulnerable to exploitation, so UP wants to make sure their rights are looked after.

Meeting human needs

Bek-Nielsen is a firm believer in sustainability, not only environmentally but also operationally; to him it is pointless for a company to burn itself out trying to make huge profits in one year with little regard for the future.

“It is very important to have a long-term approach. You cannot think, ‘I want to just milk and slaughter the cow today.’ Today, we must appreciate that the price of being cheap is just too high. If you go down that path, you will not be able to provide sustained growth or sustained, balanced economic viability.

“It is about trying your best to reach a point where development equals positive change,” he says.

“Business is, of course, about generating a profit. But it’s also about doing it in the right way. It’s not enough to just do well, you also have to do good. You have to make sure that the social fabric around your operations is intact.”

UP’s awards over the years seem to bear Bek-Nielsen out. Among them is the honour of being proclaimed the world’s first certified producer of sustainable palm oil by the Roundtable on Sustainable Palm Oil. In 2011, Malaysia’s Human Resources Ministry awarded it the prize for the best safety and health practices in the country, and in 2015, UP took first prize in the Best Corporate Social Responsibility Initiatives category at The Edge Billion Ringgit Club Corporate Awards.

Jenderata seems to bear out UP’s track record. The 6,500ha estate is a thriving little town in its own right with four schools, 24 places of worship (including mosques, churches and temples), an old folk’s home, playgrounds, football fields and two clinics, among other facilities.

“We make sure workers’ houses are presentable and provide free schooling for children. We make sure there are recreational facilities like badminton courts and football fields so people can have fun after work – people have a right to these basic needs of humanity, and that’s what we offer,” Bek-Nielsen says.

The estate even has its own bakery to make bread and Danish pastries (what else!); it was founded by UP in 1982 after employees complained about the quality of the local bread. I’m slightly jealous – how come my office doesn’t have a Danish bakery?

UP has about 5,000 employees of which more than 1,000 work on Jenderata in jobs such as harvesting oil palm fruits, driving estate locomotives and tractors, spreading fertiliser, running the mills, and attending in the clinics.

These jobs, says Bek-Nielsen, come with pay that is higher than the minimum wage: “Our average pay last month was just over RM1,400 per general worker – this is about 30% higher than the minimum wage in Peninsular Malaysia.”

(The minimum wage was set at between RM900 and RM1,000 for Peninsular Malaysia by the Mini-mum Wages Order 2016.)

UP is also a stickler about following labour laws on employee leave.

“General workers have 12 to 14 days of leave, and we follow the mandatory annum given by labour laws. They get public holidays off, and one day of rest a week. Whether they want to adhere to that, however, is up to them. We may offer more jobs or work, it’s up to them to voluntarily accept or decline,” Bek-Nielsen explains.

In it for the long-term

Going deep into the estate, we stop momentarily to watch oil palm fruits being harvested. Workers slice the fruits off the palm fronds using mechanical cutters and then – rather quaintly – use buffaloes to transport the fruits to the mill. I find the combination of modern technology and (very) old-school transport amusing, but it turns out there are practical reasons for using the animals: apart from being a greener mode of transport, the buffaloes handle the soft soil much better than tractors and don’t make ruts as heavy tractors would.

Old-school transport to move the oil palm fruit bunches to the mills keeps things a little greener.
Old-school transport to move the oil palm fruit bunches to the mills keeps things a little greener.

Adding to the estate’s green credentials are the mills’ biomass reciprocating boilers and biogas plants that supply steam and power while cutting costs and carbon dioxide emissions.

At the mill, assistant manager Faizol talks enthusiastically about his team of 359 workers; 45 of them are locals who serve as mandur and kangani (supervisors) while the rest, usually guest workers, are general or contract workers.

Faizol wants to make a point about recruitment, earnestly saying that when it comes to foreign recruitment, proper procedure is always followed, with UP human resources personnel going abroad to find the best labour.

“In Indonesia, they will go to villages and talk to the headmen to find people. Then they will go through the normal visa process with the Immigration Department here, and then the workers will be assigned to us for training.

“Training is done on the grounds, with assistants and staff,” says Faizol, who has worked at UP for five years.

Training, he explains, is matched to each worker’s abilities and is carried out for three months or more.

“We had a few degree holders from Bangladesh. Those fellows, we didn’t even need three months to train them, they caught on very fast,” Faizol says.

Faizol’s duties include supervising his team members’ daily workload as well as ensuring everyone’s welfare is taken care of.

“We look after everything from A-Z, from accommodation to food to electricity. We offer free transport for people to do their Friday prayers. Even today, we are arranging for a pap smear procedure for the women at Hospital Teluk Intan, for foreigners and local workers alike. That is part of our social responsibility,” he says.

Of course, disputes do arise, as they would in any workplace; however, Faizol says they have been rare in his experience, and usually tend to be settled quickly.

“If they are small matters, it’s usually a verbal warning. If it’s anything major, then maybe we suspend people for one day. But these fellows, they usually don’t have any big issues. Very, very rare,” he emphasises.

Looking after his team members’ welfare includes making sure they are trained properly to handle any dangerous jobs, like spraying chemicals. Faizol says that they are sticklers for meeting or even exceeding the standards set by the Malaysian Department of Safety and Health (DOSH).

“We provide a full set of personal protective equipment, including goggles, masks and boots – it all comes from DOSH. We can’t use the normal cikai-cikai (simply anything) type you find in the market,” Faizol says with a laugh, explaining that they spare no expense in getting approved equipment because “we need to maintain the safety of the workers”.

Additionally, all workers in such areas are subject to monthly medical examinations to ensure they have a clean bill of health.

‘We need to maintain the safety of the workers,’ says Faizol.
‘We need to maintain the safety of the workers,’ says Faizol.

Bek-Nielsen adds that safety is a top priority on Jenderata, as is the constant maintenance of all machinery.

“We have safety officers who go around conducting audits in our mills and refineries and on the estates. They come around without notice. We look for weak links and try to make them stronger.

“We have to be open and transparent about weaknesses, which every now and then surface. It’s all about creating a culture of safety and trying to become better at what we are doing,” Bek-Nielsen explains.

One of the workers residences at the Jenderata Estate.
One of the workers residences at the Jenderata Estate.

The tour ends at Jenderata’s guest house with a delicious lunch provided by the staff and a discussion about the false perceptions foreign media sometimes have of how plantations are run.

Maintaining the welfare of workers on such a large estate is a challenge, Bek-Nielsen says, but it’s something he enjoys and works on constantly.

He has plans already for, among other things, building more guest workers’ terraces next year.

“It’s continuous upgrading. Certain stretches of road will be tarmaced, and some shophouses will be renewed. We’re building 32 new first-class workers’ houses – that’s 64 units, which means 64 families will enjoy new housing facilities,” Bek-Nielsen says proudly.

“The palm oil industry is definitely not a bed of roses. But neither is it a bed of nails. The industry has many good things to offer and has played a fundamental role in lifting millions of people out of poverty in South-East Asia.

“Yes, there are black sheep who have to clean up their act. They need to focus on ‘long-termism’ and not just the short term.”

Whether in agriculture or otherwise, the workers on Jenderata estate are taken care of

M. Ulsalakshi is a slight but spirited woman who speaks confidently with a no-nonsense attitude. A native of Teluk Intan, Perak, she’s been working as a mandur on the Jenderata Estate for more than two decades.

Her tasks include supervising a group of 12 workers and determining their wages for the day. Most of her team members are guest workers from Indonesia, India and Bangladesh.

Managing all of them can be tough sometimes, but, in her words, it’s a job that she “banyak suka” (likes very much).

“This company helped my children a lot when they were studying. They helped us with loans. And when my children went to study outside Teluk Intan, they helped provide buses,” Ulsalakshi says, speaking in Malay.

“There’s free housing and free water. And if we have health problems, there are hospitals nearby. Anything that happens, we can handle.”

Her confident words are echoed by fellow supervisor V. Kanniga, who has also worked at United Plantations (UP) for more than two decades. She leads a team of 14 men, supervising them as they harvest oil palm fruits.

“It’s good here. The company has helped my children go to school, and I am very grateful for that,” Kanniga said, also speaking in Malay.

Irwan, a guest worker from Lombok, Indonesia, has been working on Jenderata Estate for about nine months. His main job is to load gathered oil palm fruits onto a buffalo, to be transported to the mills. According to him, he was brought here on the recommendation of his elder brother.

“I work from seven to 11, and then three to six. I like it here, it’s good,” Irwan says in halting Malay.

Goh: ‘There’s room for growth, you don’t just stop at one level because there are opportunities to improve yourself.’
Goh: ‘There’s room for growth, you don’t just stop at one level because there are opportunities to improve yourself.’

It’s not just the estate workers who are taken care of, of course; according to UP vice chairman and chief executive director Datuk Carl Bek-Nielsen, every worker, whether they work in the estate hospital, bakery, clubhouse, mill or refinery has their welfare looked after.

Goh Kheng Wee, for example, is a resident engineer at the Jenderata Mill. He’s worked there for nine years, starting in 2007 as a cadet engineer.

“Palm oil is a great industry to work in, as it promotes sustainable practices. There’s a lot of room for growth – you don’t just stop at one level because there are a lot of opportunities to improve yourself,” he says.

At the Jenderata Group Hospital, senior hospital assistant in charge N. Maheswaran sees patients every day, treating them for all manner of ailments, from the common cold to industrial accidents.

The hospital features various up-to-date medical facilities, and a medical officer visits every day to deal with more complicated medical cases.

“We’ve got good facilities here. I wouldn’t say it’s until we can do heart surgery or anything like that! But what we have is good,” Maheswaran says.

Does he enjoy his work on the estate?

“Definitely. If not, I wouldn’t be at this job for the past 35 years! Everything is taken care of here, we have quarters to stay in, which are well-furnished, and even my garden is taken care of.

“You’ll never get any of this living on your own,” Maheswaran says.

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