McDonald's, Others Deny Reports of Coffee-Linked Forced Labor

McDonald's, Illy, Nestle and other companies responded to allegations from civil society groups that their supply chains in Brazil have ties to forced labor.

McDonald's "does not tolerate forced labor" in its supply chain and is committed to "sustainable sourcing" of its products, the company said in a Jan. 29 statement. The restaurant chain also said it has "established processes and protocols" to ensure that McDonald's serves "high quality and sustainably sourced products."

A report released Jan. 10 by the Netherlands-based Centre for Research on Multinational Corporations (SOMO) and Brazil-based Conectas claims that coffee farms using forced labor sell to the Brazilian Regional Cooperative of Coffee Growers of Guaxupe, or Cooxupe, which the report said in turn sells directly to McDonald's, Dunkin' Donuts, Jacobs Douwe Egberts Peet's and Illy.

Measures taken by the Brazilian government since 1995 have helped uncover cases of forced labor, especially in "Minas Gerais, Brazil’s primary coffee-producing state," the report said. Between 1996 and 2023, the Brazilian Labour Inspection Department found 3,700 workers in "slave-like conditions" in coffee plantations throughout Brazil, the report said. As of October, 39 of the 471 employers on Brazil's "Dirty List" of companies caught using forced labor were coffee producers, the report said.

But Brazil has since "stymied" efforts to eradicate forced labor, the report said. The Dirty List was temporarily suspended from 2014 to 2016 and the government narrowed the definition of "slave-like work" and "subjected the ‘Dirty List’ to political decision-making, until the Supreme Court overruled the policy in 2020," the report said. From 2019 to 2022, the Jair Bolsonaro government's Ministry of Labor was dissolved and resources for labor inspections "were significantly reduced," the report said. Cases continued to surface, the report said.

Workers have been rescued from a farm under Cooxupe that "illegally withheld workers’ wages and made unlawful deductions for costs associated with their work" as recently as July 2021, the report said. Other rescues from Cooxupe farms occurred in June 2020 and in 2018, it said.

The report said certification schemes relied upon by multinational coffee buyers to avoid forced labor aren't accurate. In 2018, 18 workers were rescued from a farm that had the Coffee and Farmer Equity (C.A.F.E.) Practices program certification from Starbucks, as well as being Rainforest Alliance certified and 4C (Common Code for the Coffee Community) Association certified, the report said.

Other farms certified by the Rainforest Alliance had farms with labor violations, the report said. Twenty workers were rescued from one farm certified by the Rainforest Alliance that had "labour violations and undignified conditions that amounted to modern slavery," the report said.

Workers were also rescued in July and August 2022 from two farms tied to a supplier of Nestle that had certifications from the Rainforest Alliance. One of those farms also had C.A.F.E Practices certification, the report said.

Still, many companies continued to cite certification schemes as part of their forced labor prevention practices. In its Jan. 30 response to the report, Starbucks said it uses the C.A.F.E. Practices verification program, though only as part of its "holistic work" to ensure the "long-term supply of high-quality coffee."

"To maintain an active status in the program, each supply chain is required to undergo reverification regularly with frequency dictated by their performance in the program and the size of the farm," Starbucks said. It also "relies on SCS Global Services (SCS) to ensure the quality and integrity of the third-party auditing for C.A.F.E. Practices." The criteria for this are "open-sourced and publicly available" and in instances where Starbucks is notified of violations, it takes "immediate action," which can include suspending the "commercial relationship" with the farm, the coffee chain said.

McDonald's said it has been purchasing "Rainforest Alliance certified coffee" through coffee company Mother Parkers. "The Rainforest Alliance’s certification criteria do not allow forced labor, including use of trafficked and bonded labor, or the use of extortion, debt bondage, threats, monetary fines or penalties," McDonald's said.

JDE Peet's outlined its process for ensuring forced labor was not in its supply chain and reiterated its commitment to human rights compliance. The supplier uses a "Common Grounds" program and is "working towards ensuring that 100% of our sourced volumes" are covered by its responsible sourcing program by 2025.

In its response, Illycaffe said that while it sources coffee from Cooxupe, it doesn't source coffee from any company on Brazil's Dirty List.

"As a company, we invest heavily both through our technicians and by activating collaborations with local bodies and institutions to make the coffee supply chain fairer and more sustainable," Illycaffe said. The practices cited in the report "do not belong to our business model based on the value creation for all our stakeholders."

Nestle said that in Brazil they had set up a "due diligence system" to address human rights risks in the supply chain. The company also said in October that it had reached a settlement with Conectas and ADERE-MG in response to a 2018 report they issued that contained similar allegations. "While the parties have agreed to keep the details of this settlement confidential, it includes key elements to further strengthen our collaboration on the ground," the company said.

Dunkin' Donuts and Cooxupe didn't immediately respond to our request for comment. Rainforest Alliance and 4C didn't respond to our request for comment.