Upon noticing a high turnover particularly among migrant workers at one of its Chinese suppliers, German SME Haas & Co. Magnettechnik, a producer of magnetic foils and tapes with around 30 employees, worked with its supplier to improve working conditions.
The company conducted a comprehensive mapping of its magnet supply chain to identify potential risk hot spots. Amongst other findings, the results showed that one of Haas & Co.’s suppliers in China faced significant seasonal attrition of its internal migrant workers. To fill the staff shortages, the factory had to employ untrained workers, causing a negative effect on product quality and high costs for re-production. Having noticed sub-standard safety conditions and worker accommodation during on-site visits, Haas & Co. collaborated with the supplier to improve working and living conditions for its migrant workforce. In doing so, Haas & Co. built on its long-term relationship with the factory and pointed out the business benefits of investing in worker welfare.
After just one year, it became clear that relatively low cost measures such as the provision of enhanced personal protective equipment (PPE), the installation of emergency switches on production machines or the renovation of worker accommodation, had significant positive impacts. The supplier was able to increase the return rate of migrant workers to up to 90%. Improvements in employee satisfaction were mirrored by an increase in product quality and productivity. For Haas & Co., this experience showed that even though small businesses might lack the leverage of larger players, there are still ways for them to enhance workers’ rights in supply chains. The company has since integrated human rights considerations in its purchasing conditions and engages its suppliers on human rights issues and their importance not only for workers, but also business.