The case stems from a federal operation last year that found ten people working in conditions analogous to slavery. Labor Minister Luiz Marinho, who does not have the power to do so, decided to intervene in the case and make an unusual final review of an investigation that could put a poultry unit of the JBS SA slaughterhouse on the slave labor dirty list for subjecting workers to “conditions analogous to slavery,” according to documents seen by Reuters.
JBS received final admission from the New York Stock Exchange (NYSE) for trading the shares of JBS N.V., as part of the process for the dual listing of the company’s securities, according to a press release on Friday 06/06.The company, which will have its primary listing in the United States, expects to begin trading on June 12, under the code “JBS,” according to a relevant fact to the market.
This intervention in the usual process raised concerns among labor inspectors and legal experts, who deemed the measure unprecedented and illegal, potentially introducing political influence into Brazil’s decades-long effort to combat modern slavery.
The case stems from a federal operation last year that found ten people working in conditions analogous to slavery for a company hired to load and unload cargo for a poultry unit of JBS (JBSS3) called JBS Aves, in the State of Rio Grande do Sul.
Inspectors discovered that workers were subjected to illegally long shifts of up to 16 hours and housed without access to drinking water, according to a report seen by Reuters. The contracted company also made illegal deductions from workers’ salaries, complicating their dismissal, according to the report.
In a statement, JBS announced that it immediately suspended the contractor, terminated the contract, and blocked the company upon learning of the allegations. “The company has zero tolerance for violations of labor practices and human rights,” the statement added.
However, the labor court makes it clear that the responsibility always lies with the company that hired the outsourced firm, to ensure that it complies with the law. The labor inspectors decided on August 6 that JBS was responsible for the working conditions of the ten workers, as it did not exercise the due diligence to ensure that the contractor was treating them legally.
The next step now within the law is that such a decision results in the inclusion of the company on a list of employers responsible for subjecting workers to conditions analogous to slavery, known as the ‘dirty list’, which is to be updated in October. The owners of JBS, the Batista brothers, are friends of Lula and are part of the informants in the corruption schemes that led to Lula’s conviction and imprisonment.
Once included on the list, a company remains there for two years. In addition to the reputational risks associated with being listed, companies are also barred from obtaining certain types of loans from Brazilian banks, which can have serious financial consequences for a company the size of JBS Aves.
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After the decision of the inspectors in August, a legal opinion from the Attorney General’s Office (AGU) of Lula, which does not have this function, as seen by Reuters, intervened without prerogative, concluding that the minister could take the process for his own review, justifying the importance of JBS in the Brazilian economy. For experts, the Lula government is sending a clear message that ‘large companies and friends’ companies have a free pass to disrespect the law and Brazilians with the justification that the economy needs them.’
