EXTERNAL ASSESSMENT ALLIANCEONE TOBACCO MALAWI LTD.
Virginia Flue-Cured farmers in Kasungu
and Mpherembe/Mzuzu

Agricultural Labor Practices ProgramFebruary, 2019

External Assessment

Table of Content
Executive summary. .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 3Market and company background .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 61. Implementation of the ALP Program .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 81.1. Commitment to the ALP Program. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.2. Strategy and objectives. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.3 Internal capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.4. Communication of the ALP Code requirements to farmers. . . . . . . . . . . . . . . . . . . . . . . 13
1.5. Internal monitoring: data collection, accuracy, and addressing issues . . . . . . . . . . . . . . 15
1.6. Address systemic and/or widespread issues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2. Farm-level assessment of working conditions regarding the ALP Code Standards .  .  .  .  .  . 18
2.1. ALP Code Principle 1: Child labor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
2.2. ALP Code Principle 2: Income and work hours. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
2.3. ALP Code Principle 3: Fair treatment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.4. ALP Code Principle 4: Forced labor and human trafficking . . . . . . . . . . . . . . . . . . . . . . . 25
2.5. ALP Code Principle 5: Safe work environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.6. ALP Code Principle 6: Freedom of association . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.7. ALP Code Principle 7: Terms of employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3. ALP Program: feedback from farmers, workers, and other stakeholders .  .  .  .  .  .  .  .  .  .  .  .  .  . 32
Appendices .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 34
Appendix I – AOTM’s Action Plan 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Appendix II – Scope and methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Appendix III – Legal information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Appendix IV – Materials provided to the farmers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Appendix V – GMS system for leaf technicians. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Appendix VI – Glossary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

EXECUTIVE SUMMARY

EXTERNAL ASSESSMENT
Virginia Flue-Cured farmers in Kasungu and Mpherembe/Mzuzu

External Assessment

Philip Morris International (PMI) requested Control
Union (CU) to conduct an external assessment of
the flue-cured Virginia (FCV) tobacco growing
operations of its supplier Alliance One Tobacco
Malawi Ltd (AOTM) in the Mpherembe/Mzuzu
region (northern Malawi) and Kasungu region(central Malawi). This assessment, which took place
in February 2019, evaluated the labor practices atcontracted farms, and whether these were meetingthe standards of the Agricultural Labor Practices(ALP) Code. 1 CU also evaluated AOTM’s internal
capacity to implement the ALP Program, theirunderstanding of farm practices, and how they
identified, recorded and addressed ALP-related
issues.
For this assessment CU interviewed eleven AOTM
management personnel, twelve leaf technicians,
and two external stakeholders (an employee ofthe non-governmental organization YONECO 2,
which was responsible for conducting the support
mechanism pilot; and an employee of Lloyds ofBay, a consulting company which AOTM planned
to contract for providing social worker trainings tolocal ALP committees later in 2019). In addition,over a period of one and a half weeks, CU visited
42 farms (21 in Kasungu and 21 in Mpherembe/
Mzuzu) 3, interviewing a total of 42 farmers, 16family members and 90 external workers.
An
information
triangulation
methodology
was used to evaluate farm practices. The threesources included interviews, documentation, andobservation, together with a “Five Whys Analysis”
problem analysis. The “Plan, Do, Check, Act” cycle
was adopted for analyzing AOTM’s management
approach.

1.

2.
3.

As of 2019, AOTM based its ALP strategy on PMI’s
Step Change goals, focusing on child labor, minimum
wage, availability and usage of personal protective
equipment (PPE), and workers’ accommodation. As
part of this strategy, several initiatives were being
planned and implemented, such as expanding the
support mechanism, organizing various educational
programs, improving workers’ accommodations,and providing PPE, worker-contract templates andfarmer record books.
AOTM had set up an ALP team within its leaf
department, which was responsible for implementing
the ALP Code at farm level, including the creation
and updating of communication materials, trainingof leaf technicians and farmers, monitoring, andanalysis of collected data. The field supervisorsand leaf technicians held monthly meetings, which
included discussion of ALP-related topics. The leaf
technicians, who served as the main link between
AOTM and the farmers, generally had an adequate
knowledge on the ALP Code, particularly withregard to the Principles of Child Labor, Income
and Work Hours, and Safe Work Environment.
Communication of the ALP Code to the farmers
took place through individual farm visits, groupmeetings, local ALP committees, and writtenmaterials such as farmer record books, leaflets andcontract templates. Direct verbal communication
proved to be the most effective. All but one of the
farmers visited was aware of the ALP Code, andawareness among family members and workers was
also relatively high.
As part of their farm visits, leaf technicians had
to update the Farm Profiles (socio-economic
information) and monitor adherence to the ALP
Code. Twelve of the 42 Farm Profiles checked by

The main goal of the ALP Code is to eliminate child labor and other labor abuses progressively where they arefound, and to achieve safe and fair working conditions on all farms from which PMI sources tobacco. For more
information on the background of the ALP Program see https://www.pmi.com/sustainability/good-agriculturalpractices/upholding-labor-rights-on-the-farms.
Youth Net and Counselling, a Malawian NGO
The original scope included Rumphi instead of Mzuzu, but this had to be changed in order to be able to conduct
unannounced farm visits (see Appendix II)
4

External Assessment

CU (29%) did not fully correspond with the situation
at the farm, mostly in terms of number of workers
living or working on the farm. In addition, none of
the seven farms with tenants (17%) were classified
as such in the Farm Profiles. The leaf technicians
had to visit each farm at least five times per season
for systematic monitoring, whichwas conducted
through AOTM’s digital data collection system(GMS). In term of reporting the findings the system
did not differentiate between Prompt Actions
and situations not meeting the standard; thesewere grouped as ‘incidents’. At the time of CU’s
assessment only 89 incidents had been reported forthe current crop year. This number is extremely low
compared to the total number of AOTM farmers(>13,000), and none of the findings from CU werereported in the system, which indicates that there isconsiderable room for improvement in the reportingby leaf technicians. None of the farms visited by CU
had a reported incident.

Awareness of the risks of GTS and CPA was highamong farmers and workers, although they did
not consistently act on this in terms of PPE use; in
addition, they only associated GTS with harvesting,
not with stringing or carrying tobacco. On ten
Kasungu farms (48%) and six Mpherembe/Mzuzu
farms (29%), CPA was not stored in a safe and locked
storage, despite the storage box and instruction
provided by AOTM. Furthermore, none of the
farmers disposed of their empty CPA containers ina safe way. Ten farmers in Kasungu (48%) and five in
Mpherembe/Mzuzu (24%) did not know the correct
re-entry period after CPA application and only one
farmer owned a warning sign to stop persons fromentering the field within that period. At six Kasungu
farms (29%) and three Mpherembe/Mzuzu farms(14%), CU considered the workers’ accommodation
to be unsafe, observing big cracks in the walls,
holes in the roof, and dried tobacco being stored in
the workers’ bedrooms.

The main findings of the farm-level assessment
were related to Child Labor, Income and Work
Hours, and Safe Work Environment. Eight minors
were found working in tobacco production at four
farms in In Mpherembe/Mzuzu (19%). Mostly they
were helping with carrying and stringing tobacco
leaves, which was generally falsely considered a
non-hazardous task suitable for children by thefarmers. Seven farms in Kasungu (33%) and four
farms in Mpherembe/Mzuzu (19%) paid at least
one of their workers below the legal minimum wage
(20 workers in total). In addition, at two farms (5%)(one in each region) workers wives were found tobe helping their employed husbands without pay
and without any contract or arrangement with thefarmer. Furthermore, seven farms (17%) were foundto work with tenants, whose pay entirely depended
on their tobacco yield at the end of the season.

In terms of feedback received by CU, the general
feeling among farmers and workers was that the
ALP Code and AOTM’s support had increased thesafety on the farm (especially in terms of PPE use),
had reduced child labor incidents and had increased
the number of children going to school. In addition,
the interviewed farmers reported that the written
contracts reduced disputes about payment at theend of the season, and that the implementationof ALP had generally improved the relationshipbetween farmers and workers.
The outcome of this assessment can be used asa tool to facilitate management with continuous
improvement.
CU
acknowledges
AOTM’scommitment to addressing the issues identified
and defining areas of improvement through theimplementation of an action plan (see Appendix I).

5

MARKET AND COMPANY BACKGROUND

EXTERNAL ASSESSMENT
Virginia Flue-Cured farmers in Kasungu and Mpherembe/Mzuzu

External Assessment

Agriculture is the main industry in Malawi, withnearly 65% of the population employed in this
sector. Tobacco is by far the biggest cash crop; witha share of 55% in commodity export it is a major
contributor to the Malawian economy, followed bytea and sugar with a share of less than 10 percent
each. 4 Given that Malawi is the most tobaccodependent economy in the world, the country andits population (of which about 50% live below thepoverty line) are vulnerable to external shocks
such as extreme weather events and decreased
international demand for tobacco.
Burley is the main tobacco type grown in Malawi:
in 2015 it accounted for 87% of total tobacco
production. Other tobacco types produced aredark fired and flue-cured Virginia (FCV). Before
1989, tobacco production was tightly controlled
by the government; only estate owners were
eligible for obtaining a production license or wereable to achieve the required production scale forselling tobacco leaves at the auctions. Only after
liberalization of the tobacco economy in the early
1990s did it become possible for smallholder
farmers to produce and sell tobacco, which resulted
in a rapid growth in tobacco production. 5

Alliance One Tobacco Malawi (AOTM) is the biggest
tobacco buying company in Malawi and has been
operating in Malawi for over 60 years (including
through predecessor companies). AOTM’s head
office is located in Lilongwe and ten agronomy
offices across the country to serve ten growing
areas. For the 2019 crop season AOTM had direct
growing contracts with over 13,000 farmers, ofwhich 99.9 percent were smallholder farms. Around19 percent of the contracted farmers grew flue
cured Virginia (FCV) and 81 percent grew Burley. In
2019, AOTM’s farmers were supported by a total of
472 permanent employees in the leaf department,
including 179 leaf technicians, 10 area fieldadministrators and 10 area field supervisors who
were directly involved with the farmers.

All tobacco produced in Malawi is still sold at
auction floors; however, these days, large tobacco
buying companies and their contracted farmers
commit beforehand to buy/sell a specified amount.
These pre-agreed sales are part of the companies’
integrated production system (IPS) in which
contracted farmers also receive crop inputs andtechnical support. In the Malawi market, the pricepaid for the tobacco is not agreed beforehand.
The national Tobacco Control Commission setsa minimum price each year based on the costs ofproduction, and the tobacco companies usually pay
their farmers slightly above that level.

4.
5.

Data for 2018, see Index Mundi – Malawi (https://www.indexmundi.com/malawi/economy_profile.html)
Food and Agriculture Organization – Tobacco in Malawi (http://www.fao.org/3/y4997e/y4997e0i.htm)
7

Chapter 1

IMPLEMENTATION OF THE ALP PROGRAM

EXTERNAL ASSESSMENT
Virginia Flue-Cured farmers in Kasungu and Mpherembe/Mzuzu

External Assessment

1.1. Commitment to the ALP Program
On their global website, AOTM’s parent company
Alliance One International (AOI) committed
publicly to the elimination of child labor and theimprovement of working conditions in tobacco
crop production. The website provided information
about the company’s policy on sustainability andsupply chain integrity and their commitment to
the ALP Code. AOTM itself was also committed to
ALP through own internal policies on Sustainable
Tobacco Production (STP) and dedicated budget for
initiatives on ALP implementation. Furthermore theLeaf Director presented the ALP Code as a solution
for tobacco leaf integrity at the 30th annual congressof the Tobacco Association Malawi (TAMA). 6

1.2. Strategy and objectives
At the time of this assessment, AOTM had adopted
the four main global goals of PMI’s Step Change
approach as their focus for the 2019 season. These
goals were:• No children performing hazardous tasks intobacco by 2022
• All workers paid at least the legal minimum wage
by 2022• Personal protective equipment (PPE) for crop
protection agents (CPA) and against the green
tobacco sickness (GTS) availability and usage for
all workers/farmers by 2020

initiatives were developed not only in cooperation
with PMI, but also with Limbe Leaf Tobacco (thesecond biggest tobacco buying company in Malawi)
and experiences and best practices were shared
among companies. Ongoing initiatives within thescope of this assessment, such as providing PPE andcontract templates, are discussed in Chapter 1.6.
AOTM’s STP team conducted an annual risk
assessment, based on results from monitoring andown experience. Risk levels were determined by
the probability and severity of the incident andclassified as acceptable, adequate, tolerable orunacceptable. The risk assessment covered risks on
governance as well as risks with regard to behavior
not meeting the ALP Code, specified detailed
for each measurable standard. The highest risks
identified were related to child labor, safe work
environment, income and payment schedules. In thepast, the annual risk assessment would provide themain basis for identifying strategy focus areas but
currently the goals of PMI’s Step Change approachplay a more leading role.
Root cause analysis was not a structural part of
AOTM’s risk assessment. The company relied mostly
on the local ALP committees 7 and baseline studies.
Leaf technicians did not document root causes intheir reports on incidents observed at the farms.

AOTM’s response:• All workers with access to safe and clean
accommodation by 2020

“The intent of the [later in this report explained] ALP

AOTM had a number of initiatives planned for
2019, such as expanding the support mechanism,
organizing various educational programs, andimproving workers’ accommodations. However,since these initiatives were not taking place within
the scope of this assessment and/or had not yet
been started, they are not evaluated in this report.
Since ALP transcends company lines, some of thesepreventative measure to help address any potential

6.
7.

Committee Initiative is to not only raise awareness of
ALP incidents but also identify the root causes. As arisks before issues are identified, the ALP committees
conduct an analysis for farms and families mostvulnerable to ALP incidents.”

As of 2019, AOTM was also required by PMI toadapt their sourcing strategy to allocate tobacco for
PMI only from farmers who do not employ tenants.

https://www.tamalawi.com/
The ALP committees were local groups set up to support ALP training and farm monitoring. As from 2018/2019
they also act as mediators in case of disputes, as part of AOTM’s support mechanism (see Chapter 2.3.3)
9

External Assessment

Malawi has a long history of producing tobacco in aland tenancy system, where tenants grow tobacco
on a piece of land of a farmer (the landowner,
who himself may have a contract with a tobaccocompany) and agree to produce a given volume of
tobacco for a specific price, mostly at own risk if
the yield turns out low. A 2015 study of the Malawi
Centre for Social Concern (CfSC) found that tenancy
labor in its current practice is often characterized
by exploitative arrangements that marginalize anddegrade the workers. 8 In 2016 the Minister ofLabor, Youth, Sports and Manpower Development,
Henry Mussa, argued that the tenancy system isdetrimental to the country’s development and thatit keeps a large proportion of farm workers trapped
under the poverty line. 9
In order to ensure that no tobacco from tenants
would be allocated to PMI, AOTM decided to
no longer contract any farmers with tenants (asof 2019). This decision was also included in thecontracting standard operation procedure (SOP) forthe leaf technicians. Nevertheless, CU found thatseven of the 42 farms visited for this assessment(17%) still worked with tenants (two in Kasungu
and five in Mphrembe/Rumphi), which shows that
AOTM’s goal has not yet been fully achieved. CU
also found that AOTM’s new requirement that
farmers no longer work with tenants, even though
included in the contracting procedure for leaf
technicians, had been communicated to farmers
only verbally; it had not yet been included into thecontract between AOTM and the farmers, whichstill mentions the payment of workers per bale or
kg as an accepted payment method, which is thepayment method prevalent in the tenancy system.
AOTM’s response:“To meet the [above identified] objectives, AOTM has
identified the following strategies:

creating a ratio of 75:1 farmers to Field Technicians(FTs). AOTM believes that this ratio will allow FTs
to spend additional time on the farm focused on
ALP monitoring, training of contracted farmers andworkers, and thereby boost program compliance.
2. No individual under the age of 18 should be
involved in any aspect of tobacco production. […]AOTM believes that it will minimize confusion
among farmers and local communities and allow thecompany to mitigate potential risks.
3. No farmer should contract with tenant workers.
AOTM will not contract with farmers who employ
tenant workers. AOTM believes this will reduce therisk of forced labor and human trafficking in its
supply chain.”

1.3 Internal capacity
1.3.1. Dedicated organizational
structure
AOTM had set up an ALP team as part of its leaf
department (see graph below). Each of AOTM’s ten
area agronomy offices had an area field administrator
who was supervised by the ALP Coordinator, whoin turn was reporting to the Customer Programmes
Manager (the former ALP Coordinator). The leaf
technicians (leaf technicians), who served as the link
between the management and the farmers, werealso part of the internal structure for implementing
the ALP Program. The leaf technicians interviewed
by CU had an average of 77 farmers (both FCV andBurley) to look after, and were supposed to visit eachfarmer at least five times during the cropping season
for ALP monitoring. AOTM worked in close contact
with PMI Regional, receiving regular guidance andfinancial support for the implementation of the ALP
Program and specific initiatives.

1. Long-term grower consolidation program. This
strategy will look to centralize the AOTM grower base,8.
9.

http://tobacco.cleartheair.org.hk/wp-content/uploads/2016/01/CSC-Malawi-tenant-research-study-2015.pdf
https://www.business-humanrights.org/en/malawi-tenancy-system-benefits-investors-but-leaves-tobaccofarmers-trapped-under-poverty-line
10External Assessment

Internal structure for ALP implementation

Supporting Role

Leaf Production
Director

Regional Sustainability Manager
Corporate Affairs Manager

Customer Programmes
Manager

Smallholder Operations
Manager

ALP Coordinator

Area Field Supervisor(x10)

Area Field
Administrator (x10)

Leaf Technician(x179)

1.3.2. Roles and responsibilities
The Steering Committee, consisting of thesenior management staff, was responsible forcommunicating ALP updates and projects to PMI,
and approving and supporting local projects for ALP
implementation.
Overall responsibilities of the ALP team included:• Rolling out the ALP Code, and coordinating thecollection of farm data;• Training area supervisors and leaf technicians toensure proper implementation of the ALP Code;• Testing the leaf technicians’ knowledge throughwritten tests after each training;• Developing and updating
materials for farmers;

communication• Developing and analyzing documentation forfarm monitoring, including the development andimplementation of action plans where necessary;• Updating the risk assessment at least annually;

Leaf technicians were in charge of farmer trainings,
which were held individually and in group meetings
throughout the season, and were also responsible forvisiting and monitoring the farms. It was their task
to support farmers in all aspects related to growing
tobacco, including: (i) recruiting new farmers; (ii)gathering farm data to complete the Farm Profiles;(iii) visiting farmers to provide production support
throughout the season and training them on ALP;(iv) delivering inputs from AOTM to the farms; and(v) monitoring the practices on the farms, reporting
situations not meeting the standard and Prompt
Actions. All but one of the twelve leaf technicians
interviewed (92%) confirmed that they had beensupervised in their field work by their superior. The
latter, the area field supervisors, were also paying
unannounced visits to the farms to check andvalidate the data collected by the leaf technicians,
the results of which were included in the technicians’
performance reviews.

• Implementing and/or supporting projects andinitiatives approved by the management team.
11

External Assessment

1.3.3. Training and knowledge of the
ALP Program
Members of the Management Team and ALP Team
received guidance on ALP from PMI Regional. The
ALP Program had been rolled out through a formal
training session in 2011. Management staff had
sufficient understanding of the main purpose andcontent of the ALP Program. Awareness was highest
regarding the Principles of Child Labor, Income andWork Hours, and Safe Work Environment, whereas
Terms of Employment was mostly not understoodas the requirement to inform workers on their legal
rights.
The ALP Coordinator trained the area field
supervisors and the leaf technicians four times per
year, with the content of the training dependingon the current crop stage. The leaf technicians’
knowledge was tested through written tests.
CU’s assessment of leaf technicians’ knowledge of
ALP Code Principles showed the following results:
1. Child labor: All twelve leaf technicians
interviewed by CU were aware of the meaningof this ALP Code Principle. Furthermore, allleaf technicians were aware that the legal
minimum age had been raised to 18, although
three (25%) actually thought that this age was19, not 18. When asked about hazardous tasks,
none mentioned the complete list. The majority
referred to application of chemicals (50%) or
activities that can put a person at risk (50%),
while stringing and harvesting were mentionedby only one technician (8%).
2. Income and work hours: In general, leaf
technicians had a good understanding of this
ALP Code Principle. All leaf technicians knew thecorrect legal minimum wage for Malawi. All leaf
technicians were aware of the allowed work hours.
Knowledge on overtime regulations and overtime
payment was limited; only two leaf technicians(17%) correctly mentioned that overtime shouldbe paid at 1.5 times the normal pay.

3. Fair treatment: Eleven leaf technicians (92%)
could provide a basic explanation of this
ALP Code Principle, but none provided a full
explanation. Six leaf technicians (50%) mentionedthat there should not be any discrimination or
unequal treatment. Eight leaf technicians (67%)
mentioned that there should be a respectfultreatment of workers without harassment orviolence. However, none mentioned that farmers
must make themselves available to workers whowant to discuss potential grievances.
4. Forced labor and human trafficking: Most of
the leaf technicians (92%) could give a basic
explanation of this principle, mentioning mostlythat workers should be free to leave their jobor that work should be voluntary (58%), that
farmers should not employ prison labor (33%)
that workers should not be working under debts(25%), or that farmers should not retain theirworkers’ identity documents (25%). However,none mentioned that workers should be paid
directly, or that payments should not be withheld.
5. Safe work environment: With regard to thisPrinciple, the leaf technicians mainly mentionedthat the farmers should provide workers’
accommodations that meet the minimum
standards (50%); that workers should not be
subjected to any hazards or health risks (50%);
and that PPE should be worn when applying
crop protection agents (CPA) (25%). One (8%)
mentioned that empty CPA containers shouldbe punctured, but none mentioned the need of
triple rinsing. Handling of green tobacco andthe related risk of green tobacco sickness (GTS)
was not specifically mentioned by any of the leaf
technicians. Furthermore, none mentioned that
farmers should observe a re-entry period after
CPA application, and only one (8%) mentionedthat farmers should provide clean drinking
and washing water to their workers. One leaf
technician (8%) did not remember anything of
this principle.

12External Assessment

6. Freedom of association: All leaf technicians
had an adequate understanding of this ALP CodePrinciple.
7. Terms of employment: This principle was mostly
understood as complying with the local laborlaws or having a written contract in place. Six leaf
technicians (50%) mentioned that workers should
be informed about their tasks and payment, but only
one specifically mentioned that workers should be
informed about their legal rights.

1.3.4. Internal communication
The field supervisors held monthly meetings with
their leaf technicians in the area offices, which
included discussion of ALP-related topics. In orderto develop and implement the new Step Change
goals, regular meetings were held between the
ALP team and the senior management. Informal
communication among colleagues in the different
local offices took place on a frequent basis.
The Steering Committee met at least three times
per year. In preparation for these meetings the ALP
Coordinator produced several reports, including a
progress analysis on ALP implementation. These
reports were sent on to PMI Regional after approvalby the Steering Committee.

1.4. Communication of the ALP Coderequirements to farmers
1.4.1. Communication strategy andtactics
AOTM started to communicate the ALP Codeto farmers in 2011/2012. At the time of theassessment, communication efforts were focused
mainly on the four prioritized Step Change goals, andmore in general on the principles of Child Labor and
Safe Work Environment, as these were considered
the most important areas for improvement (as also
indicated by the risk assessment).
To communicate the ALP Program to farmers, family
members and workers, AOTM was using several
methods: direct communication and training,

written information materials, radio broadcasts,
and local ALP committees.
• Direct communication and training throughfarm visits: On average, leaf technicians visited
each farm at least monthly, often also two to
three times per month, for monitoring andsupport, including individual training of farmers
and, occasionally, training of family members or
workers.
• Farmer group meetings: Each area field teamorganized four farmer group meetings per
season in the different villages, including grouptrainings and demonstrations of best practices
by demo farmers.
• Written communication materials: AOTM had
provided farmers with a ‘farmer record book’,
which contained all relevant information on
tobacco growing and the content of the ALP
Code, including the legal framework. Additionally,
AOTM had developed three posters (one onChild Labor, one on Safe Work Environment,
and one on the remaining ALP Principles) anda flyer on the seven ALP principles including allmeasurable standards, which had been handed
out to each farmer. All materials had alreadybeen updated to the revised version (2018) of
the ALP Code. However, the flyers and posters,
which were likely to be the only written materials
seen by workers, lacked information on local
laws and regulations such as legal minimum age,legal minimum wage and overtime regulations(this information was included only in the farmer
record book). Furthermore, while the information
on child labor and safe work environment was
image-based and easily understandable, theinformation on the remaining ALP Code was
text-heavy and lacked supporting illustrations.
In addition to the written materials describedabove, AOTM provided contract templates forfarmers with hired labor, which included basic
legal information. This was part of AOTM’s
policy to promote the use of written contracts(even though Malawi law only required a written
statement, as opposed to a formal contract; see
Chapter 2.7.2).
13

External Assessment• Radio broadcasts: To communicate ALP-related
topics, AOTM also made use of radio broadcasts.
• Local ALP committees: AOTM had set up local
committees, each consisting of a traditional
leader, a schoolteacher and a maximum of five
farmers. These committees were intended not
only to support the leaf technicians in farm
monitoring, but also to give training and advice
to farmers, hence supporting communication
about ALP. The number of local ALP committees
had been raised from 30 in the last season to 179(i.e. one committee for each leaf technician) in
the 2018/2019 crop season. As from 2018/2019
the committees also played a role in mediation(see Chapter 2.3.3).
The following table shows the level of awarenessamong the interviewed farmers, family members
and external workers with regard to the ALP CodePrinciples. In line with AOTM’s communication
focus areas, the highest levels of awareness were
found for the topics of Child Labor and Safe Work
Environment, followed by Income and Work Hours.

Level of awareness of ALP Code Principles*
Farmers (42)Family members (16)External workers (90)Child labor

36 (86%)8 (50%)

62 (69%)

Income and work hours

31 (74%)4 (25%)

41 (46%)

Fair treatment

20 (48%)1(6%)

34 (38%)Forced labor and human trafficking

17 (40%)2 (13%)

27 (30%)

Safe work environment

38 (90%)5 (31%)

63 (70%)Freedom of association

18 (43%)2 (13%)

27 (30%)Terms of employment

17 (40%)1 (6%)

22 (24%)

None of the above

1 (2%)

6 (38%)

13 (14%)* Note that these data only show whether the interviewees remembered the principles, and not whether they fully
understood their meaning.

Interviewees who were aware of (at least some aspects of) the ALP code were also asked how they learned
about it. As the table below shows, verbal communication efforts were generally more effective thanwritten materials.

Means of communication through which the ALP Code was received
Farmers (41 out of 42)

Family members and workers (87 out of 106)

Directly from the leaf technician

36 (88%)52 (60%)Farmer group meeting

39 (95%)n.a.

Poster/Record book17 (41%)16 (18%)

Radio broadcast

1 (2%)

2 (2%)

Verbally from the farmern.a.

78 (90%)14External Assessment

1.4.2. Farmers’ responsibilities
At the beginning of each crop season, farmers
signed a new growing contract with AOTM. In
addition to the ALP requirements and the obligation
to participate in the ALP trainings, this contract
included a clause on contract termination in case of
three reported Prompt Actions. So far, no contracts
had been terminated for ALP reasons as noneof AOTM’s farmers had more than two reported
Prompt Actions. However, CU observed during thefarm visits that some leaf technicians had also raised
Prompt Actions only verbally, without documenting
them in the system.
In addition, CU observed that the farmer contract
for the current crop season still mentioned payment
per bale, per kg or split shares as accepted payment
methods for workers, even though AOTM had
decided to no longer contract farmers working withtenants (see Chapter 1.2).

AOTM’s response:“Beginning in crop year 2020, AOTM revised thisapproach [the “three-strike approach” in which a
farmer could have up to three types of the same
Prompt Action incident per season before thecompany would consider terminating the farmer’s
contract with AOTM ] to a “two-strike approach” toencourage further improvement among the farmer
base. This approach is coupled with pre-contracting
due diligence of farmers against this procedure.”

1.5. Internal monitoring: data collection,accuracy, and addressing issues
At the time of the assessment, AOTM was collecting
two types of ALP-related data from the farms: socioeconomic information (Farm Profiles) and ‘incidents’at the farm, which covered situations not meetingthe standard and Prompt Actions. All information
was collected digitally in the Grower Management
System (GMS). Leaf technicians were supposed to

do at least five monitoring visits per season, but
usually they would visit the farmers more frequently(e.g. for technical support unrelated to ALP).

1.5.1. Socio-economic data: FarmProfilesThe socio-economic information for Farm Profiles
was collected at the beginning of each season during
the contracting period, and was updated after every
visit by the leaf technicians. For all farms visited by
CU an updated Farm Profile was available.
When comparing the data reported in these profiles
to actual farm situations, CU found that twelve
profiles (29%) did not fully correspond with thesituation observed at the farm. In general, temporary
workers (who were hired for a short period, i.e. notseasonal) were not recorded in the profiles since
their numbers could differ from day to day , but thismeant that some farms were incorrectly classified
as family farms while in reality they hired temporary
workers during harvesting and curing. Furthermore,in six of these profiles (50%) the number of seasonal
workers living on the farm did not match, and noneof the cases with tenants (7 farms) were indicatedcorrectly in the Farm Profiles.

1.5.2. Systematic monitoring: situations
not meeting the ALP Codestandards
The documented systematic monitoring in AOTM’sdigital data collection system (GMS) was split in two
parts, there were general questions on the ALP and
additionally the incident reporting which consistedof one main question, asking whether the farm met
all ALP measurable standards. If the answer was‘yes’ the monitoring was thereby completed in thesystem; if ‘no’, more options would appear to specify
the findings. For the leaf technicians, the system did
not differentiate between a situation not meetingthe standard and a Prompt Action; this information
was categorized later, when the accumulated data
were analyzed.

10. For farms where workers were hired on a daily basis, it was challenging to keep the Farm Profile up to date in termsof the exact number of workers.
15

External Assessment

Monitoring data was available for all farms visitedby CU. However, none of the findings identified
by CU (see Chapter 2) were documented in the
GMS and none of the visited farms had any Prompt
Actions or other incidents reported in the system,
which indicates insufficient reporting prodecuresand room for improvement by AOTM.

1.5.3. Prompt Actions
As mentioned above, the reporting procedureused by the leaf technicians did not differentiate
between Prompt Actions and situations not meetingthe standard; these were grouped as ‘incidents’.
The reporting procedure consisted of several steps.
After identification of an incident the leaf technician
had to stop the activity, inform the farmer andsubmit a report to the GMS system. Dependingon the severity of the incident and the farmer’s
willingness to cooperate, the leaf technician had
to return within six weeks to see if the situation
had improved and to close the incident report in
the system. If the situation was reoccurring, localgroups such as the ALP committee or farmer club
could be asked to mediate, or the case would be
redirected to a higher management level within
AOTM. As of 2019, severe breaches such as forcedlabor or child labor were also to be reported to theDistrict Labor Office (DLO) or the village chief.
All twelve leaf technicians interviewed were awareof the procedure for follow-up; however, thetimeframes they mentioned for closing the incident
report differed from three days to six weeks. The
majority of the leaf technicians (66%) had a correctunderstanding of the meaning of Prompt Actions.
However, during CU’s farm visits it became clearthat some leaf technicians who had identified a
Prompt Action (such as workers harvesting tobacco
without gloves) and had created an action plan withthe farmer and workers, had not actually reported
the incident in the GMS system.

At the time of the assessment a total of 89 incidents(including Prompt Actions) had been reportedby the leaf technicians for the current crop year;
these were related to child labor (35%), income
and work hours (2%), safe work environment (53%)
and terms of employment (10%). The number ofreported incidents is extremely low compared tothe total number of contracted farmers (>13,000),or the findings by CU, which indicates that there
is considerable room for improvement in themonitoring and reporting by leaf technicians, aswell as in the management system for validating thework of the leaf technicians.

1.5.4. Data management and analysis
Leaf technicians were responsible for updating theFarm Profiles and reporting any findings on the ALP
Code, using the GMS system on their smartphone.
The updated and reported information was
downloaded weekly by the management personnel
for checking and creating reports. Data plausibility
was checked by a data analyst, who also extracted
the Prompt Actions from the list of incidents
reported.
CU observed that the GMS did not allow leaf
technicians to see the incidents reported in previous
seasons (including Prompt Actions). This limits theirability to take previous findings into account andmake an in-depth analysis of the issues observed,
especially when they have not worked with thefarmer in question before.

1.5.5. Improvement plans for individual
farms
In case of an identified incident or Prompt Action,
the leaf technicians had to fill out a report in the
GMS and agree on an action plan with the farmer.
In most cases these plans focused on reminding andeducating the farmer about the correct practices,rather than analyzing the root causes and developing
corrective actions to address these causes.

16External Assessment

1.6. Address systemic and/or widespread
issuesBased on the risks and issues identified (see Chapter
1.2), PMI’s leaf tobacco suppliers are expected toaddress systemic and/or widespread issues throughoperational initiatives, community programs (which
may be supported by a financial contribution fromPMI) and engagement with key stakeholders.
At the time of the assessment, AOTM was
implementing the following operational initiatives
in the regions within the scope of this assessment:• Worker contract templates
In order to help formalize employment
and support farmers and workers in theiragreements, AOTM provided the farmers with
contract templates for their workers. Thirtyseven farmers (88%) had received the contract
templates; written contracts (all based on thistemplate) were found at 28 of these farms (76%),
mostly for seasonal workers. The templateincluded a table for recording worker attendance(hours worked) and for cash advances and in-kindpayments. Although the workers’ attendance
was not always filled in, CU observed that cash
advances and in-kind payments (such as food orsoap) had been recorded in these tables. Threefarmers (8%) mentioned that they did not findthe templates useful because they had to fill in
the workers’ wages before they knew what pricethey would receive for the tobacco themselves.
Positive feedback regarding the contract
templates included that the contracts informed
both parties of the agreement and helped tokeep track of deductions and workhours, thereby
reducing discussions or disagreements at thetime of payment.

• Farmer record book
All farmers visited had received a ‘farmer record
book’ (see Chapter 1.3.1). CU found that all
books were being used and that the dates of leaf
technicians’ visits and CPA applications could beverified. All farmers mentioned to find the record
book useful because it provided information on
tobacco growing and also helped to document
any farm activities.
Three other ongoing initiatives, which will be
discussed in more detail in Chapter 2 (FarmFindings), were:• Provision of improved PPE for CPA application,with new gloves, face shields, more durable dust
masks, and overalls 11 (see Chapter 2.5);• Provision of gloves for handling green tobacco
leaves. These cotton gloves were provided
for the first time in the crop year 2019; therecommendation was eight pairs of gloves percontracted hectare (see Chapter 2.5);• Setting up local ALP committees functioning as
a support mechanism in all operation areas (onecommittee per each leaf technician) (see Chapter
2.3).

11. See photos in Appendix IV
17

Chapter 2

FARM-LEVEL ASSESSMENT OF
WORKING CONDITIONS REGARDING
THE ALP CODE STANDARDSEXTERNAL ASSESSMENT
Virginia Flue-Cured farmers in Kasungu and Mpherembe/Mzuzu

External Assessment

This chapter describes CU’s assessment of theworking conditions on farms with regard to the ALP
Code Principles and Measurable Standards. ALP
Code Principles are short statements designed to
guide farmers on specific practices, resulting in safeand fair working conditions. A Measurable Standard
defines a good practice and over time can beobjectively monitored to determine whether, andto what extent, the labor conditions and practices
on a tobacco farm are in line with each ALP CodePrinciple. 12

2.1. ALP Code Principle 1: Child labor

AOTM’s response:“To better protect children under 18, as of the 20182019 crop year, AOTM has revised its ALP program
to prohibit anyone under the age of 18 years frombeing involved in any tobacco-related activities. This
directive is communicated to contracted growers
and is incorporated into the training programs andcommunication materials for growers, workers and
FTs accordingly.
In addition to the strategic change, AOTM has also
begun implementing the following new initiatives:
Afterschool

Activities

Program

-

AOTM

is

implementing a pilot project in the Mchinji 2 Scheme

There shall be no child labor.

in Mchinji District to encourage children to stay inschool, reduce idleness, and promote safety andMain findings and challenges

2.1.1. Children working and activities
performed
In the region of Kasungu, no evidence was found ofchildren below 18 years of age working in tobacco
production. 13 However, in Mpherembe/Mzuzu,
minors were found working in tobacco production
at four farms (19%). At one of these farms, thefarmer’s children, aged 10, 12 and 13, were helping
with carrying and stringing tobacco leaves, together
with the 15-year old son of a worker. All four children
confirmed to go to school and to help afterwards. At
the second farm, two tenant’s children, aged 16 and17, were involved in carrying tobacco leaves andstringing. Both only occasionally went to school,
because the family often could not afford the school
fees, or even buy soap for washing their clothes. At
the third farm, one of the seasonal workers was still
17 at the time of entering employment, he turned
18 a few months into the job. Finally, at the fourth
farm, the 17-year old wife of a worker was helping
her husband. She was not paid for this work.

mental/social development through the provisionof sporting equipment/infrastructure and indoor
games. This project was initiated in September 2019
and will run through April 2020, with over 886 pupils
expected to benefit. […] Should the pilot project be
successful in its objective of minimizing child laborrisks, AOTM intends to rollout the program to an
additional 25 schools over the course of the next
three years.
Sustainable School Feeding Project - AOTM has
identified that hunger is a driver in school absenteeism
in areas where the company has found high incidents
of child labor. To address this challenge, the company
is implementing a pilot Sustainable School Feeding
project in the Mchinji 2 Scheme in Mchinji District
beginning in CY2019. Through this initiative, AOTM
will work with the school to establish gardens which
will, in time, serve as a food resource for students.
The project will also involve updating the kitchens at
local schools to include new pots, utensils, etc. andthe provision of a maize miller.”

12. The scope and methodology of the assessment are described in Appendix II.
13. Based on a reinterpretation of Malawi law, AOTM had communicated to their farmers that no person under 18
years of age would be allowed to work in any tobacco-related activity, as of the 2018-2019 crop year. Therefore,
this report considers all tobacco-related work under 18 as child labor (including non-hazardous, light work allowedby the ALP Code for children between 15 and 18).
19

External Assessment

Underlying factors that increase risk
CU identified four underlying factors that increased
the risk of child labor:
1. Awareness of the legal minimum working age
was limited. Seven farmers (17%) and workers
at 14 farms (34%) said they did not know what
the correct legal minimum age was. Carrying
tobacco or helping with stringing was generally
considered non-hazardous and a good task forchildren.
2. Involving children in farm work is still common
practice in Malawi. Children are expected tosupport the family income and share in theworkload. CU observed children helping in
tobacco at several neighboring farms (notnecessarily contracted by AOTM).
3. In Malawi, child marriage is widespread: 42% ofgirls are married before the age of 18, and one
in ten are married before their 15th birthday. 14
It is common for wives to help their employedhusbands, also in tobacco (see Chapter 2.3).
4. Malawi had only recently introduced a national
ID as an instrument for checking ages (2018); it
was not yet common practice to ask for the ID
when hiring young workers.
5. Farmers want to teach their children how tofarm, because school education may not ensurea job.

Analysis and priorities
Elimination of child labor was one of the main focus
areas of AOTM. At the time of CU’s assessment,
the legal framework had just been re-interpreted
to define child labor in a stricter way and the topic
was also emphasized in AOTM’s communicationmaterials and trainings. However, many families

are living below the poverty line (see Market andCompany Background) and children are expected tocontribute to the family income. Additional efforts
from AOTM are needed in order to reach their goalof eliminating child labor. Furthermore a lack in
knowledge of hazardous tasks, including among theleaf technicians was identified by CU.

2.2. ALP Code Principle 2: Income andwork hours
Income earned during a pay period or
growing season shall always be enoughto meet workers’ basic needs and shallbe of a sufficient level to enable thegeneration of discretionary income.
Workers shall not work excessive orillegal work hours.
Main findings and challenges

2.2.1. Payment of workers
Of the 42 farms visited, only one farmer (inMpherembe/Mzuzu) was not hiring workers; allother farmers hired workers. Many of these had
more than one type of worker, including tenants,
seasonal workers, and temporary workers hired for
harvesting and curing. Seven farms in Kasungu (33%)
and four farms in Mpherembe/Mzuzu (19%) paid atleast one of their workers below the legal minimum
wage.15 On most farms, workers were provided withfood (either cooked meals or maize and salt) andreceived accommodation where needed. Fourteenof the farmers in Kasungu (66%) and seven farmers
in Mpherembe/Mzuzu (35%) deducted these inkind payments from the final cash payment. 16 It
was not possible for workers to refuse the in-kindpayment and receive their full wage in cash.

14. https://www.girlsnotbrides.org/child-marriage/malawi/
15. The legal minimum wage in Malawi is 962 Kwacha per eight-hour working day
16. AOTM communicated to farmers that in-kind payment was allowed up to 50% of the total wage. For further legal
information, see Appendix III
20

External Assessment

For the purpose of this assessment, workers’
incomes were calculated as wage per month. If
workers were employed on a daily basis their income
was extrapolated to a monthly wage based on a fullworking week (eight hours per day, six days a week).
The table below shows the calculated pay rates inthree categories (below the minimum wage, at theminimum wage, and above the minimum wage) andthe number of workers receiving this pay rate. Notethat tenants are not included in these numbers;
their situation is discussed further down thissection. Furthermore, one worker is not included inthis table, because the farmer in question had not

yet agreed on a wage for the season, stating that it
was difficult to do this if he did not know yet how
much he would receive for the tobacco.
Furthermore, the table differentiates between
workers receiving the full payment in cash as
specified in their contract (without deductions forthe food and soap provided) and workers for whom
the costs of food and soap was to be deducted fromthe total wage specified in their contract. Note that
accommodation was provided free of charge and nofees were being deducted for this. The table shows
the range of salaries paid per contract and the range
of deductions as documented by the farmer.

Kasungu

Breakdown of calculatedsalaries (MWK/month)< 25,000=25,000>25,000Min.
salaryMax.
salaryAverage

Without deductions(n=19)

9 (47%)

3 (16%)

7 (37%)

10,00027,00021,540With deductions(n=30)

4 (13%)

14 (47%)

12 (40%)13,75027,77825,354889

15,7897,208

Deductions
Mpherembe/ Mzuzu

Salary range (MWK/month)Without deductions(n=17)

6 (35%)

2 (12%)

9 (53%)

13,60028,00023,933

With deductions(n=12)

1 (8%)

5 (42%)

6 (50%)

19,00027,77825,889

5,000

8,421

6,421

Deductions

As the table shows, the amount deducted showed a substantial range. For one worker, the deduction forin-kind payment was higher than the allowed maximum of 50% of the total wage.

17.

Based on the legal minimum wage, the monthly pay should be at least 25,000 Kwacha
21

External Assessment

The tenants workers (who were found at seven of
the 42 farms visited) did not have a fixed income.
In most cases they had one hectare of land to growtobacco and expected to produce between 10 and
28 bales (about 100 kg each) for which they hoped
to receive between 25,000 and 30,000 Malawi
Kwacha (MWK) per bale. This would yield between
300,000 and 700,000 MWK per season (about ten
months) as payment for the (usually) two persons
working the crop. These expectations are based on
previous seasons and results may differ substantiallyin the current crop season, in which, for example,
due to rain and high humidity more days for curing
were required. The Malawi Tobacco Commission
has estimated that the production of FCV tobacco
costs 367 man-days per hectare of tobacco perseason. Based on the legal minimum daily wageof 962 MWK, this would amount to a minimum
required pay of 353,054 Kwacha per hectare perseason. According to this calculation, two tenants(one in Kasungu and one in Mpherembe/Mzuzu)
earned less than the legal minimum wage, since
they expected to earn 300,000 and 324,000 MWK
per season, respectively. Usually, the landowners
would provide the tenants with food (milled maize
and salt, not necessarily enough for the season) anda small piece of land for growing own vegetables,
free of charge. In addition, they would provide
inputs for growing the tobacco. This is not includedin above calculation.
At two farms (one in each region) women were foundto be helping their employed husbands (mostly withstringing) without pay and without any contract orarrangement with the farmer. The husband also did
not receive any extra pay for bringing in helping
hands.

2.2.2. Payment schedule
End-of-season payment was practiced at mostfarms. 18 According to the farmers and workers
interviewed, the main reasons for this practice were,firstly, that farmers lacked the money to pay theirworkers throughout the season, having sufficient

cash funds only after selling the tobacco harvest,
and secondly, that many of the workers wanted tobe paid the full sum at the end of the season to beable to go home with a sufficient amount of moneyand not spend their wages before that. Although
Malawi law allows for end-of-season payment if
agreed between employer and employee, the ALP
Code advises to pay the salary regularly and at
least once a month, to reduce the risk of forced orindebted labor (see also Chapter 2.4).

AOTM’s response:“AOTM has developed the following strategies toaddress these [wage] challenges:
Business Planning and Financial Literacy Training- To help farmers better manage their finances,
thereby increasing the amount of money available
for worker payments, AOTM has engaged a thirdparty to implement a training program that will
provide farmers with access to business planning andfinancial literacy information (i.e. Cost of Production,
labor utilization, planning, budgeting, saving andinvesting for business growth).
Beginning in CY2019, AOTM plans to implementa Trainer of Trainers (TOT) program for Financial
Literary to over 7,000 farmers, as follows:• 1309 farmers and 96 field staff trained inyear 1 (TOTs)• 2,000 farmers trained in year 2• 1,900 farmers trained in year 3• 1,811 farmers trained in year 4
Village Savings and Loans Association (VSLA)
Training to farmers’ spouses - In CY2019, AOTM
trained 2,275 women on VSLA management andentrepreneurship. By training farmers’ spouses on
financial management, AOTM hopes to improvea farmer’s management of household finances
and increase the ability of farmers to properly pay
workers and minimize risk of child labor.”

18. Malawi law requires weekly or monthly payment, unless otherwise agreed between employer and employee.
22External Assessment

2.2.3. Work hours and overtime
payment
No evidence was found of farmers disrespecting
the legal work hours on a regular basis outsideof the harvesting and curing peak. At 15 farms in
Kasungu (71%) and 16 farms in Mpherembe/Mzuzu(80%) workers were also involved in curing, inaddition to their usual shift. This meant that they
had to monitor the curing barns and the fire every
two hours (on average) for around seven days in arow, per barn. Only at four of these 31 farms (13%)
curing was paid at a premium, 19 with payments
ranging from 500 to 2,000 Kwacha per night ofcuring. None of the farmers provided overtime
pay for overtime unrelated to curing. Often, they
considered that overtime work was compensatedby the low workdays at the beginning of the season;
however, this practice is not in line with Malawi law,as maximum working hours are not set per season,
but per week. At 11 of the 41 farms with workers(28%), overtime was not considered voluntary,
as workers upon starting their employment had
generally agreed to be involved in curing; here,
the overtime was already included in the working
agreement (without additional pay) and workers
could not decide to not want to do the overtime
that day. No evidence was found of workers notreceiving at least one resting day per week outsideof the curing period.

2.2.4. Legal benefits
On 26 farms (62%) workers did not get a day off
on public holidays, although they were legally
entitled to this benefit. According to Malawi law,workers employed less than a year are not entitledto any further benefits. Since all farms visited by
CU worked with temporary and seasonal workers(employed for a maximum of 9 months per year),no further benefits were verified during thisassessment.

Underlying factors that increase risk
In Mpherembe/Mzuzu, farmers at all farms (100%)and workers at 17 farms (81%) could state thecorrect legal minimum wage of 962 Kwacha per day.
Awareness in Kasungu was lower; here, farmers atseven farms (33%) and workers at eight farms (38%)
did not know the legal minimum wage. In addition,knowledge on overtime regulations was very limited
in both regions.

Analysis and priorities
The ALP Code Principle of Income and Work Hours
was a focus area for AOTM and part of the Step
Change Goals. However, CU’s findings demonstratethat there are still widespread issues related to this
topic, especially in terms of pay rates, overtime
arrangements, and unpaid labor by workers’ wives.
Furthermore, despite AOTM’s measures, the tenantsystem still appears to be common among AOTM
farms, and this system involves considerable risk ofunderpayment and the inability to allocate wages
to the actual amount of work done per person. (seealso Chapters 1.2 and 2.4).

2.3. ALP Code Principle 3: Fair treatment

Farmers shall ensure fair treatment ofworkers. There shall be no harassment,
discrimination, physical or mental
punishment, or any other forms of abuse.

Main findings and challenges

2.3.1. Treatment of workers
No evidence was found of sexual or physical abuseon the farms. 20

19. Under Malawi law overtime should be paid at 1.5 times the normal pay during the work week.
20. See Appendix III for legal details on fair treatment.
23

External Assessment

However, at one farm in Mpherembe/Mzuzu (5%)
a case of verbal abuse was identified. Here, thefarmer, who upon CU’s arrival at his farm tried tohide the fact that he had workers, employed a familyof four as tenants on his farm. All four reported thatthe farmer would shout badly at them if they madeany mistakes, and the children also mentioned thatwhen their monthly ration of maize was not enoughand they went to ask the farmer for more, he denied
to give them more maize and said they did not work
hard enough to earn more food. Clear signs of fear
and mistrust could be observed in all workers on
this farm in the presence of the farmer.

2.3.2. Discriminatory practices
Two types of discriminatory practices were identified.
First, in Malawi it is not common practice to employ
women in tobacco, particularly for curing. Most
women were hired (for activities other than curing)
only if they were the wife of a worker, and mostly
on a daily basis and on a verbal agreement. At one
farm in Kasungu, the farmer specifically mentionedthat he would never hire women as they could not
do the same job as men. Secondly, especially in thecase of tenants, it is common practice in Malawi to
only employ the man, as head of the family, and not
his wife, even though she usually helps her husband
in tobacco production. These women are left emptyhanded when something happens to their husband(see Chapter 2.4.1).

2.3.3. Support mechanism
Support mechanisms facilitate workers’ access to
information, assist workers in difficult situations,and mediate disputes between farmers and workers.
PMI’s leaf tobacco suppliers are expected to ensurethat farmers and workers have access to such amechanism.
AOTM had developed two different approaches tothe support mechanism: providing a toll-free line
and setting up local ALP committees.

The toll-free line was piloted in the current crop
season in the Mchinji area and was being evaluatedbefore further expansion into other regions.
Improvement points had already been identified by
the NGO responsible (YONECO, a local organization
with experience in this field). The mechanism had
been used a few times; however, in the majority ofcases the worker who had made the complaint had
left the farm by the time the farmer was identified,hence these grievances had not actually beensolved. For the future, AOTM aimed at a closer
collaboration between the toll-free line counsellors
and the local ALP committees (see below). One
point of concern noted by CU was that AOTM had
received an overview of the cases showing thenames of the farmers about whom the callers hadcomplained. The anonymity of the callers was still
ensured, but such overviews do pose a risk to therequirement of confidentiality.
AOTM’s response:“The Support Mechanism provides more opportunities
to support farmers and workers to resolve problems
that cannot be easily resolved at farm level. The
pilot project was evaluated, and proved to not meet
all the required success factors, and hence was not
expanded.
Although the Support Mechanism was not expanded,
it provided farmers and workers access to a channel
where they could receive independent mediation,
dispute resolution, and incident prevention services;
information on better hiring practices; and avenues
for workers to get redress. In the long-term, AOTM
intends to have the Support Mechanism in all
the areas where the company sources tobacco in
Malawi.”The local ALP committees were an existing structure
to provide local support in monitoring and training of
farmers. Recently, AOTM had expanded the numberof local committees from 30 to 179 (one for each

21. This area was outside of the scope of the present assessment, therefore awareness among farmers and workers
could not be assessed with regard to the existence of the toll-free line.
24External Assessment

AOTM leaf technician). Each committee consistedof one traditional leader, one schoolteacher, and amaximum of five farmers. In addition to supporting
leaf technicians with monitoring and training, it was
their task to mediate disputes between farmers
and workers and to follow-up on the solutions. To
provide these committees with the necessary soft
skills and knowledge on how to handle sensitive
topics, AOTM was in the process of hiring a social
consultancy firm (Lloyds of Bay) for providing asocial worker training to all committee members
later in 2019.
Of the farmers in Kasungu, eight (38%) were awareof the existence of their local ALP committee; inMpherembe/Mzuzu this number was 13 (62%).
Of these farmers, none in Kasungu and six inMpherembe/Mzuzu (46%) knew that thesecommittees had a grievance mediation function in
addition to their role in training and monitoring.
This low awareness is likely due to the very recent
expansion of the number of committees and thelimited communication about their new function.
So far, none of the persons interviewed had madeuse of their local ALP committee for any grievances.
The ALP Code requires access to a fair, transparent
and anonymous grievance mechanism. At the timeof the assessment this requirement was not yet
fulfilled, as the local ALP committees could notensure anonymity and also were not independent,
given that they mainly consisted of farmers.
Nevertheless, AOTM’s current plan to expand andintegrate the two approaches (toll-free line andlocal committees) is a potentially effective option,
considering that the ALP committees know the local
people and rely on culturally accepted structures(which makes it easier to mediate and solve
grievances), while the toll-free line can provide
anonymity and fair and independent counsel.
In addition to a formal support mechanism, the ALP
Code requires that farmers should make themselves
available to their workers to discuss potential
grievances. Except for the verbally abusive farmer
mentioned in Chapter 2.3.1, no cases were identified
where farmers were unavailable to their workers.

Analysis and priorities
This principle was not a focus area for AOTM.
Nevertheless, the company was taking important
steps towards setting up a locally accepted support
mechanism. Together with raising further awarenessamong farmers, workers and family members, these
efforts will increase the possibilities for offering
support in case of conflicts and promoting respectfulcooperation between farmers and workers.

2.4. ALP Code Principle 4: Forced laborand human trafficking

All farm labor must be voluntary. There
shall be no forced labor.

Main findings and challenges

2.4.1. Involuntary labor
Forced/indebted labor was identified at two farms
visited by CU (5%). The first case was forced labor
observed at a farm in Kasungu, where the farmer
demanded his workers, whose contract was for
tobacco, to work in other crops as well (within
their usual working shifts). As this was against theagreement, the workers stated that they wanted toleave but that the farmer told them that if they did,they would not receive any payment for the work
already completed.
The second case was indebted labor observed at a
farm in Mpherembe/Mzuzu, where the farmer had
employed several tenants. One of the tenants had
run away and had taken some farming tools withhim. He had left his wife and toddler at the farm,without any money or food. The farmer hired aworker to finish the work and denied the wife any
payment for the work already done by her husband
since he had not completed his work and had stolen
tools. The wife had also worked for the farmer but
had no formal contract and hence could not claim
any payments for herself. Lacking the funds to pay

25External Assessment

for the bus to her home region she stayed withanother tenant couple, helping them with work in
exchange for food, but withoutfurther payment.
CU observes that the tenancy system carries aninherent risk of forced labor. Due to the nature of
their contract it is not possible for tenants to leave
the farm before the crop is harvested, because
in that case they will not receive any money.
Furthermore, the tenant system usually only
employs the man, as head of the family, and not his
wife, even though she usually helps her husband in
tobacco production. These women are left emptyhanded when something happens to their husband,
which increases the risk of forced labor.
AOTM’s response:“AOTM has taken the strategic decision, effective
CY2019, to not contract with farmers who employ
tenant farmers. AOTM believes that this action will
reduce the risk of forced labor and human trafficking
in its supply chain.”No evidence was found of contracted prison labor,of workers being obliged to hand over their originalidentity documents or to pay a financial deposit.

2.4.2. Indirect payment
In addition to the indirect payment of tenants’ wives
at seven farms (17%), indirect payment was also
identified at one farm in Mpherembe/Mzuzu (5%),
where three couples were hired on equal terms,
but the wages were always paid to the husband
as head of the family. The persons in question all
declared to CU that they would share their income.
Indirect payment is seen as a risk of forced laborand farmers should ensure direct payment to all
workers individually.

Analysis and priorities
This principle was not a focus area for AOTM.
Although the issues identified by CU were mostly
isolated cases, the vulnerable situation of tenants

and women, in particular, requires continued
monitoring by the leaf technicians.

2.5. ALP Code Principle 5: Safe work
environment
Farmers shall provide a safe work
environment to prevent accidents andinjury and to minimize health risks.
Accommodation, where provided, shallbe clean, safe and meet the basic needsof the workers.

Main findings and challenges

2.5.1. Training and awareness of GTS
Awareness of GTS was high among both farmers andworkers. All farmers were aware of the existence andavoidance of GTS; the same was true for workers at
38 farms (90%). GTS training was provided by leaf
technicians and farmers. Generally, farmers had abetter knowledge of GTS than family members or
workers. The women who helped their husbands
without a formal employment arrangement usually
had not received any training on GTS.
Despite the high awareness, PPE use was limited.
At none of the farms visited, complete sets of PPE
were worn at all times by all persons handling green
tobacco. During harvesting, the majority of persons
involved were wearing at least long sleeves, at all
farms (see Table below). However, stringing andcarrying tobacco was falsely not considered ahazardous activity in relation to GTS and usage ofPPE (or simply wearing long sleeves) was therefore
very limited for these tasks, indicating a lack ofunderstanding of the causes of GTS. CU observed
three pregnant women and two nursing womenhandling green tobacco while wearing incomplete
PPE; in one case, the mother had her baby tied to
the front during stringing.

26External Assessment

Use of protective clothing during harvesting

Kasungu(T=21)

Mpherembe/Mzuzu(T=21)

Complete protective clothing (Long sleeves, long pants,
gloves, shoes, and rain gear in case of wet tobacco)

3 (14%)

7 (33%)Long sleeves, long pants, gloves, rain gear

6 (29%)

6 (29%)Long sleeves, long pants, gloves, shoes

1 (5%)-Long sleeves, long pants, gloves

3 (14%)-Long sleeves, gloves, rain gear

2 (10%)--

1 (5%)Long sleeves, gloves

5 (24%)

6 (29%)Long sleeves, long pants

1 (5%)--

1 (5%)Long sleeves, long pants, rain gearLong sleeves

AOTM’s response:“AOTM continues to provide all its farmer base with
PPE appropriate to supplied CPAs, as well as for GTS
prevention, in their farmer input packages. This PPE
provision is coupled with cash advances as well ascompliant, low-tox CPAs to help minimize potential
ALP incidents. Field Technicians provide training on
the use of the provided PPE.”

2.5.2. Training and handling of CPA
Like for GTS, safety awareness with regard tohandling CPA was high among both farmers andworkers, although they did not consistently act on
this. 22 No evidence was found of persons applying
CPA without any protective equipment 23; however,
one nursing woman was reportedly being involvedin CPA application. AOTM provided rubber gloves,plastic overalls, dust masks and face shields to thefarmers 24. Boots were not provided, which may
explain why at 14 farms in Kasungu (67%) and
17 farms in Mpherembe/Mzuzu (81%) persons
applying CPA said not to wear boots (or shoes)
during CPA application because these were too
expensive to afford on their own. In terms ofwearing the equipment provided by AOTM, farmers
and workers mentioned to wear dust masks at all
Kasungu farms and 19 Mpherembe/Mzuzu farms(90%); plastic overalls at 17 Kasungu farms (81%)
and 14 Mpherembe/Mzuzu farms (66%); gloves
at 20 Kasungu farms (95%) and 19 Mpherembe/
Mzuzu farms (90%); and face shields at 17 Kasungu
farms (81%) and 18 Mpherembe/Mzuzu farms(86%). On one farm (2%) the equipment for CPA
application was in poor condition: here, an old andrusty watering can was being used.

22. It should be noted that the main method to apply CPA at the farms visited was targeted application rather thanspraying. Hence, people were less inclined to protect themselves
23. CPA application was not observed during CU’s farm visits, hence this evidence is based on what farmers andworkers answered to the question “What do you wear when applying CPA?”, and on CU’s inspection of the state of
the PPE present at the farm.
24. For photos of the PPE provided by AOTM, see Appendix IV
27

External Assessment

At nine farms (21%) evidence was found of persons
applying fertilizers without gloves. At one farm themilled maize for own consumption was being stored
in an empty fertilizer bag. 25
On ten Kasungu farms (48%) and six Mpherembe/
Mzuzu farms (29%), CPA was not stored in a safeand locked storage. AOTM had handed out a plastic
box for storing CPA and had advised to keep thechemicals out of reach of children and install thebox at a height of at least 1.5 meters. In most ofthese cases the CPA was stored in the farmer’shome (which was usually not locked), under or next
to the bed, on the couch or in a pile of clothes.
Proper disposal of empty CPA containers proved to
be a major challenge: none of the farmers triplewashed and punctured their empty CPA containers
before disposal, and none disposed of themcorrectly. In Kasungu, two farmers (10%) stored theempty containers in their home without rinsing, twofarmers (10%) buried the containers or threw theminto the toilet pit, nine farmers (43%) burned themwithout prior rinsing, and seven farmers (33%) said
to rinse the containers first and then burn them. In
Mpherembe/Mzuzu, one farmer (5%) said to rinse
the containers and then throw them out into thefield, three farmers (14%) buried the containers or
threw them into the toilet pit, twelve farmers (57%)
burned the containers without rinsing, and five
farmers (24%) rinsed the containers at least once
before burning them.
AOTM’s response:“AOTM plans to contract with a third-party in CY
2020 to collect and incinerate used CPA containers.
AOTM will continue to monitor growers to ensurethat CPA bottles are not re-used for drinking water,
they are triple rinsed, punctured and incinerated,according to manufacturer recommendations andapplicable laws.”

Ten farmers in Kasungu (48%) and five in
Mpherembe/Mzuzu (24%) did not know the correct
re-entry period after CPA application; in mostcases they mentioned a period longer than the timerequired by AOTM. Only one farmer (2%) mentioned
to use a warning sign to ensure that nobody would
enter the field after application, while 39 farmers(93%) reported to inform others verbally and to
watch out that nobody would enter the field. 26

2.5.3. Clean drinking and washing waterNo evidence was found of drinking and washingwater not being available to family members andworkers; however, occasionally workers had to fetch
the water themselves or their wives would have tobring it to them. Not all farmers had access to a wellor borehole close by; in those cases, the persons on
the farm had to use the water from a local stream.
None of the farmers had (portable) sanitary facilities
at the field. Most of the work, especially stringing
and curing, was done at the farmer’s house or curingbarn. Basic sanitary facilities were available in theliving areas in all cases.
AOTM’s response:“All farmers are trained to use sanitary water sources.
A pilot WASH program is on-going in the Mponela
and Madisi Growing Areas to ascertain the feasibilityof providing grower clubs with potable water throughcommunity boreholes and water tanks.”

2.5.4. Workers’ accommodation
Among the farms visited by CU, workers’
accommodation ranged from single-room huts
made of branches and mud, to brick houses withseveral rooms. In most cases, the rooms wereshared (two workers, or one couple). Windows were
mostly fully covered or non-existent. Although
this made ventilation difficult it was sometimes
requested by workers to prevent theft. Kitchen andsanitary facilities were mostly provided in additionalbuildings outside the workers’ accommodation.

25. Fertilizer application could not be observed during the visits and underlies the same limitations as CPA application
26. It could not be observed whether someone actually stayed around the field to warn trespassers
28External Assessment

At six Kasungu farms (29%) and three Mpherembe/
Mzuzu farms (14%), CU considered the housing to
be unsafe and not meeting the basic needs of theworkers. This evaluation was based on observing
clearly unsafe situations such as big cracks in thewalls, holes in the roof, and dried tobacco being
stored in the workers’ bedrooms.
Housing was provided to all seasonal workers freeof charge; however, on one farm the farmer justgave the workers a piece of land and told them tobuild their own home.
No accommodation was provided to local workers
doing the curing; they would sleep next to the curingbarn during monitoring breaks. Seasonal workers
would do the same if the curing barns were locatedtoo far away from the workers’ accommodation
provided.

AOTM’s response:“To improve worker accommodation, AOTM plans
to construct 780 workers’ housing units in Kasungu,
Madisi, Mponela, Lilongwe West and Mchinji
Growing Areas between August 2019 and October
2020. The Accommodation Improvement Projectwill run in 2 phases, with phase 1 taking place in2019 covering 400 farms and the other 380 to becompleted by 2020. Below is the breakdown of the
Accommodation Improvement Project Plan between
August 2019 and August 2020:

2.5.5. Safety at the farm
At three farms (7%) sharp farming tools were notstored properly but lying around in areas wherechildren were playing. The majority of the farmers(38, or 90%) was able to provide transport to a
medical facility in case of an accident. Four farmers(10%) had access to a first-aid kit and three farmers(7%) reported to have received a first-aid training.
Furthermore, 15 farmers (36%) mentioned to haveresources in case of fire. Mostly this related tohaving buckets of water.

Analysis and priorities
Safe work environment, especially PPE use andaccommodation for workers, was a focus area
for AOTM. This focus was evident in the field, asawareness on this Principle was found to be relatively
high among both farmers and workers. Nevertheless,the understanding of the causes of GTS was limited
to harvesting; many farmers and workers were notaware of the risks involved in stringing or handlinggreen tobacco. In addition, unsafe CPA storage andunsafe disposal of empty CPA containers was foundto be widespread, showing that this topic requires
more attention. Furthermore, even though thenumber of clearly unsafe accommodations was low,
the living conditions observed by CU were mostly
very basic; hence, the ongoing efforts of AOTM to
improve workers’ accommodation deserve to becontinued. 27• Lilongwe West x 67 housing units• Mponela x 120 housing units• Mchinji x 131 housing units

AOTM’s response:• Madisi x 292 housing units and“AOTM will continue to raise awareness of priority• Kasungu x 170 units

issues such as hazardous farm tasks, the importance

Survey results also indicated that 55% of farmers
would be able to meet worker accommodation
standards if building materials, such as iron sheets,of wearing PPE while applying or handling CPAs, reentry period for CPAs, Green Tobacco Sickness andsafe accommodation for workers.“

cement and door/window frames, were provided.
As part of this initiative, AOTM will provide suchmaterials.“

27. Initiatives outside of the regional scope of this assessment, as mentioned in Chapter 1.2; and the accommodation
minimum standards set by AOTM
29

External Assessment

2.6. ALP Code Principle 6: Freedom of
association
Farmers shall recognize and respect
workers’ rights to freedom of association bargain collectively.

Main findings and challenges

2.6.1. Workers’ right to freedom of
association
No evidence was found of farmers disrespecting
their workers’ right to freedom of association.
There were no active labor unions in the regionof the assessment. Nevertheless, no evidence wasfound of farmers not allowing their workers to
discuss common work goals and interests.

Analysis and priorities
This ALP Code Principle was not a focus area for
AOTM as there were no unions or associations
active in the region.

2.7. ALP Code Principle 7: Terms of
employment
Farmers shall comply with all laws of
their country relating to employment.
Main findings and challenges

2.7.1. Information on legal rights
Typically, farmers informed their workers about
the basic employment conditions at their farm,
such as the wage they would receive, the hours
they needed to work, their tasks, and payment
conditions. However, none of the farmers fully
informed their workers about their rights in terms oflegal benefits, the legal or recommended minimum
wage, or the legal minimum rate for overtime hours.

This was found to be due to the farmers’ lack ofawareness that it was their responsibility to provide
this information to their workers. In the cases where
the farmers used the contract template provided by
AOTM, basic legal rights were included in the copy
given to the worker.

2.7.2. Written contracts
Malawi law did not require a formal written
contract between farmers and workers, only awritten statement containing the main employment
conditions. However, AOTM promoted the use offormal written contracts and provided a template
which included basic legal rights, a timesheet andtable for documenting deductions and advances.
Written contracts (all based on these templates)
were present at 16 farms in Kasungu (76%) and at
12 farms (57%) in Mpherembe/Mzuzu.
At one farm, according to some workers theircontract had only been filled out in the previous
week, even though the signed date said the
beginning of the season, several months earlier. At
two other farms, the contracts did not match withthe actual work practice. In one of these cases thecontract showed a fixed sum at the end of the season,
whereas in reality the worker was a tenant paid perbale of tobacco. In the other case, the workers had
not signed the contract and had not received thecopy; the farmer in question said that he had filledin the contract to satisfy AOTM’s requirements but
was not planning on actually paying this amountof money to his workers and therefore would notshow or give them their copy because they could
take this to the labor office. In several other cases,
the contract was signed by both parties without thewage being specified.
CU observed that, in general, only seasonal workers
received a written contract; temporary workers
usually did not have a written contract in place.
Furthermore, at two farms (one in each region)
women were found to be helping their employedhusbands without being paid themselves andwithout any contract or arrangement with thefarmer (see Chapter 2.2.1 and 2.4.1).

30

External Assessment

Lastly, several farmers reported that it was very
difficult to agree on a wage with the worker if they
did not yet know which price they would get for
their tobacco at the end of the season. Their growing
contract with AOTM only specifies the volume tobe delivered and bought, not a pre-agreed price.

AOTM’s response:“To address these issues, AOTM plans to intensify its
training and sensitization for all contracted farmers
to comply with Terms of Employment in accordancewith Malawi Government regulations on labor.
AOTM believes that an increase in number of farms
using the contract template will lead to an improved
understanding of the law and labor practices.”

Analysis and priorities
AOTM was actively promoting the use of written
contracts and provided farmers with contract
templates. Although farmers did not yet fully
understand that it was their responsibility to informworkers on their legal rights, increased usage ofthe contract templates is a first step toward better
informing the workers. Furthermore, more effort
should be put into improving the rights, direct pay
and employment structures for women.

31Chapter 3

ALP PROGRAM: FEEDBACK FROMFARMERS, WORKERS, AND OTHERSTAKEHOLDERS

EXTERNAL ASSESSMENT
Virginia Flue-Cured farmers in Kasungu and Mpherembe/Mzuzu

External Assessment

Control Union asked farmers, family members andworkers what had changed on their farms since
the start of the ALP Program. The general feelingamong farmers was that the ALP Code and AOTM’s
support had helped them to better understandand avoid the risks involved in tobacco farming,and that the program had helped to reduce childlabor. In addition, the interviewed farmers reported
that the written contracts (based on the templates
distributed by AOTM) reduced disputes about
payment at the end of the season, and that theimplementation of ALP had generally improved therelationship between farmers and workers. Most of
the feedback was positive and a good relationshipwith the leaf technicians was reported in all cases;
however, some farmers complained about the latedelivery of the PPE, so that harvesting had alreadystarted when the PPE arrived.
Workers and family members reported a decreasein child labor, a better knowledge on the risks
involved in tobacco production and how to avoid
them, as well as an increased usage of working
contracts between farmers and workers.
Leaf technicians received feedback from farmers
as well as workers and family members during theirfarm visits. They would discuss their findings during
meetings with their supervisors if considered
relevant. However, there was no structured process
for reporting these findings to the ALP team.
In addition to farmers, family members and workers,
CU also interviewed two other stakeholders:(1) a representative of the non-governmentalorganization YONECO (Youth Net and Counselling),
which had been in charge of the support mechanism
pilot; and (2) a consultant from a social consultancy
firm that would provide a social training to the
local ALP committees later in 2019. Both parties
gave positive feedback and were happy with theircollaboration with AOTM. However, YONECO
had identified several improvement points for the
support mechanism pilot that AOTM will need toaddress, including a better integration with thework of the local ALP committees and a morethorough ALP training for the counsellors (who inthe pilot had only received a one-day orientation
at the beginning of the project). The trainings by
Lloyds of Bay had yet to commence, but the training
materials shown to CU looked promising and theconsultant was optimistic about the feasibility andoutcome of the training.

33

Chapter 4

APPENDICESEXTERNAL ASSESSMENT
Virginia Flue-Cured farmers in Kasungu and Mpherembe/Mzuzu

External Assessment

Appendix I – AOTM’s Action Plan 2019
Introduction
Alliance One Tobacco (Malawi) Limited (AOTM or the Company) is committed to respecting and protecting
human rights within the company and throughout its supply chain. In this regard, AOTM welcomesControl Union’s (CU) comprehensive assessment of the implementation of the Agricultural Labor Practices(ALP) program, conducted in the Kasungu, Mpherembe and Mzuzu districts in Malawi in February 2019.
AOTM is encouraged that CU recognizes its extensive efforts in implementing the ALP program and theimprovements that the company has made since CU’s previous assessment of the Kasungu district inFebruary 2016. AOTM acknowledges that while many of its programs are having a positive impact, there
is room to continuously improve working conditions on tobacco fields in Malawi.
AOTM is fully committed to strengthening its ALP program through farmer training, farm monitoring,and targeted initiatives to achieve tangible and measurable results over time. As noted by CU, AOTM has
already developed and implemented a comprehensive set of initiatives to tackle many of the critical issues
identified during the assessment. Findings from the most recent assessment have provided AOTM with
helpful information, which in addition to our internal farm monitoring data, has driven the prioritization ofparticular issues and the development of a focused action plan for the 2020 crop season.
AOTM understands that effective implementation of the action plan will require allocation of sufficient
resources and an increased level of engagement with contracted farmers, their families, and workers.
AOTM is committed to achieving long-term sustainability of tobacco production in Malawi while helping
all contracted growers make continuous improvement toward the implementation of the ALP principles.

ALP Program Strategy & Objectives
AOTM’s strategy to enhance and strengthen its ALP program is to bolster the visibility and importance of it
within the Company’s contracted farmer base and local communities. By increasing the amount of time theCompany spends working with farmers to help them understand the ALP program, as well as increasing
community involvement, the Company has identified the following four objectives:
1. No children performing hazardous tasks in tobacco by 2022;
2. All workers paid at least the legal minimum wage by 2022;
3. All contracted farmers and workers provided with Personal Protective Equipment (PPE) to protect
against any hazards from Crop Protection Agents (CPA) or Green Tobacco Sickness (GTS) by 2020; and4. All workers have access to safe and clean accommodation by 2020.
To meet these objectives, AOTM has identified the following strategies:
1. Long-term grower consolidation program. This strategy will look to centralize the AOTM grower base,creating a ratio of 75:1 farmers to Field Technicians (FTs). AOTM believes that this ratio will allow FTs
to spend additional time on the farm focused on ALP monitoring, training of contracted farmers andworkers, and thereby boost program compliance.

Appendix I - AOTM’s Action Plan _ page 1 of 1235

External Assessment

2. No individual under the age of 18 should be involved in any aspect of tobacco production. While thisstandard is higher than both local law and the guidance set by the International Labor Organization(ILO), AOTM believes that it will minimize confusion among farmers and local communities and allow
the company to mitigate potential risks.
3. No farmer should contract with tenant workers. AOTM will not contract with farmers who employ
tenant workers. AOTM believes this will reduce the risk of forced labor and human trafficking in its
supply chain.
Along with these adjustments in the strategic direction of the program, AOTM is continuing to improve
program management, strengthen its existing communication materials and training programs, and workwith external stakeholders. Since completion of the CU assessment, AOTM is developing and implementing
the following new initiatives:• After School Activities Program;• Sustainable School Feeding Project;• Business Planning and Financial Literacy Training ;• Village Savings and Loans Associations Training;• Worker Accommodation Improvement;• Provision of Personal Protective Equipment; and• Water Sanitation and Hygiene (WASH) programs.

Program Improvements and new initiatives are described in more detail throughout this action plan.

ALP Program Management – General Comments
AOTM is focused on improving its existing ALP program by continuously adjusting its program management
to drive success, enhancing communication and training material, actively monitoring farmers for program
compliance, and engaging third-parties to support various initiatives. CU’s analysis of the ALP program has
provided AOTM with helpful feedback so that the company can continue to evolve its programs.
1) ALP Program Management
ALP program management starts with leadership in the AOTM head office in Lilongwe, Malawi. The company
has a Steering Committee, consisting of senior management staff, responsible for communicating ALP
updates and projects to customers and other stakeholders, and approving and supporting local projects
for ALP implementation.
This team includes a dedicated ALP Coordinator who oversees implementation of ALP programs andactivities in all growing areas where AOTM sources tobacco. The ALP Coordinator also leads an ALP teamthat is responsible for: rolling out the ALP Code, and coordinating the collection of farm data; training
area supervisors and field technicians to ensure proper implementation of the ALP Code; testing the fieldtechnicians’ knowledge through written tests after each training; developing and updating communicationmaterials for contracted farmers; developing and analysing documentation for farm monitoring, including
the development and implementation of action plans where necessary; updating the risk assessment atleast annually; and implementing and/or supporting projects and initiatives approved by the management
team.
Appendix I - AOTM’s Action Plan _ page 2 of 1236

External Assessment

At the field level, there are Area Field Supervisors (AFS), Area Field Administrators (AFA) and Field
Technicians (FTs) who all work directly with contracted farmers to ensure that ALP standards arecommunicated, understood and implemented. FTs are trained on ALP throughout the crop cycle to ensurethat they have the knowledge and capacity to communicate ALP requirements to the farmers effectively.
AOTM also conducts additional training to FTs to address any shortcomings noted, and ensure the detailsof ALP principles are understood for application on assigned farms.

Supporting Role

Leaf Services
Manager

Regional Sustainability Manager
Corporate Affairs Manager

Customer Programs
Manager

Senior AgronomistSmallholder

ALP Coordinator

Area Field Supervisor(x10)

Area Field
Administrator (x10)

Field Technician(x179)

2) Training and Communication
Consistent communication with farmers is key to driving improvement in their labor practices. To enhance
ALP knowledge and program compliance, AOTM communicates with farmers in a variety of ways, including:a. Group Trainings
AOTM FTs host five ALP-specific group trainings for contracted farmers each season. The inclusion ofworkers and family members is encouraged at all training sessions to allow for a greater reach within
the farming chain. Training is conducted at each major crop stage (Seedbeds, Land Preparation and
Growing, Topping and Harvesting, and Marketing stages). This ensures that the content is focusedon activities of a particular crop stage, with appropriate inclusion of ALP code at all trainings.
b. Individual Trainings
Contracted farmers, workers and mothers are continually re-trained on ALP issues, particularly what
constitutes child labor and the risks associated with the employment of child labor, during individual
farm visits. FTs visit farms at least 10 times per season.

Appendix I - AOTM’s Action Plan _ page 3 of 1237

External Assessmentc. Written Material
AOTM provides 100% of contracted farmers with written training and communication materials
which include the Farmer Record Book (FRB), and ALP posters, leaflets and brochures.
The Farmer Record Book provides detailed information on all aspects of the ALP program andgoes into particular detail regarding what constitutes child labor and the risks associated with thepractice. AOTM includes a sample farmer employee contract template which prescribes standard
working conditions, remuneration and adherence to ALP code.
Farmers or workers who are not fully literate are encouraged to get assistance from government
Field Officers or FTs.
d. Radio broadcast messages
To ensure farmers who are not literate also receive the ALP messages, AOTM runs radio messages
through Malawi’s National Broadcasters Zodiak Broadcasting Station (ZBS), Malawi Broadcasting
Corporation (MBC) and community radios such as YONECO FM and Radio Tigabane.
e. ALP Committees
As part of its community engagement initiative, AOTM developed ALP Committees to complement
FTs’ work with regards to farm monitoring and reporting. The committees help to sensitize local
communities on ALP issues and form an important vehicle through which issues are communicatedand addressed, alongside the implementation of any initiative. They also maximize the involvementof women in the ALP program, as these demographics are often catalysts of change in communities.
The intent of the ALP Committee Initiative is to not only raise awareness of ALP incidents but also
identify the root causes. As a preventative measure to help address any potential risks before issues
are identified, the ALP committees conduct an analysis for farms and families most vulnerable to
ALP incidents.
The ALP Committees also include a complaint mechanism where farmers and workers can raise
concerns or ALP incidents. This mechanism provides farmers and workers with an avenue to speak
up about their concerns without fear of repercussion.
In addition, the ALP Committees provide social support where required (children removed fromchild labor, welfare, living conditions, etc.) and help to ensure proper labor laws and policies areunderstood and adhered to.
Since the most recent CU assessment, AOTM has expanded its number of ALP Committees from 30
to 179.
3) Farm Monitoring & Incident Resolution
AOTM has a strong system in place to monitor growers for compliance with the ALP program. This system
involves both consistent farm visits, in which AOTM FTs collect data regarding farm operations and provide
farmers with guidance on all aspects of crop production, as well as logging information from the visits into
Alliance One’s award-winning farm monitoring tool, Grower Management System (GMS).
The farm monitoring program involves a series of announced and unannounced visits. During the growing
season, AOTM FTs visit farms at least 10 times for farm monitoring and extension activities. While FTs
Appendix I - AOTM’s Action Plan _ page 4 of 1238

External Assessment

monitor for ALP incidents throughout the entire season, there are a minimum of five visits per season
specifically dedicated to ALP monitoring. FTs capture the data on a mobile device which then transmits theinformation to the central serve where automated reports are generated for management review.
AOTM takes a continuous improvement approach to managing ALP incidents identified on farms.
Recognizing that an incident often has a deeper root cause than immediately apparent, the FT will work
collaboratively with the farmer to develop a solution and then follow-up with the farmer to ensure thatit has been implemented. Historically, AOTM applied a “three-strike approach” in which a farmer could
have up to three types of the same Prompt Action incident per season before the company would consider
terminating the farmer’s contract with AOTM. Beginning in crop year 2020, AOTM revised this approachto a “two-strike approach” to encourage further improvement among the farmer base. This approach is
coupled with pre-contracting due diligence of farmers against this procedure.
4) Stakeholder Engagement
Many of the human rights challenges in tobacco production in Malawi are tied to larger socio-economic
issues within in the country. Malawi is one of the poorest countries in the world, with a population of justover 18 million 28 and approximately 50% of those individuals live below the poverty line, according to theInternational Monetary Fund. Roughly 84% of the population lives in rural areas and nearly 11 million of
those individuals are engaged in smallholder subsistence farming.
Despite the availability of new agrarian technologies with demonstrated productivity gains, farmers areoften hesitant to adopt new farming practices without reliable and persuasive sources of information. This
results in farmers relying on historical methods of production that increase the risk for potential humanrights violations. It is critical that they receive messages from a variety of stakeholders in Malawi.
To truly address the root causes of human rights issues, AOTM must collaborate with third parties, including
without limitation, the Ministry of Labor (MOL), the International Labor Organization (ILO), EliminatingChild Labor in Tobacco Foundation (ECLT), and other NGOs and industry stakeholders.
An example of AOTM’s commitment to stakeholder engagement is the Company’s recent efforts tooperate a pilot support mechanism in Mchinji District through collaboration with YONECO (the Support
Mechanism). This toll-free hotline was developed as a tool for data collection (Toll-Free Line) and as away to improve communication between farmers and workers through case remediation. The Support
Mechanism provides more opportunities to support farmers and workers to resolve problems that cannot
be easily resolved at farm level. The pilot project was evaluated, and proved to not meet all the required
success factors, and hence was not expanded.
Although the Support Mechanism was not expanded, it provided farmers and workers access to a channel
where they could receive independent mediation, dispute resolution, and incident prevention services;
information on better hiring practices; and avenues for workers to get redress. In the long-term, AOTM
intends to have the Support Mechanism in all the areas where the company sources tobacco in Malawi.
AOTM has found the Support Mechanism to be beneficial in addressing concerns across all seven ALP
principles.

28. https://data.worldbank.org/country/malawi
Appendix I - AOTM’s Action Plan _ page 5 of 1239

External Assessment

ALP Principle Assessments & Specific Actions
ALP Code Principle 1: Child Labor
AOTM does not permit the use of child labor in its supply chain or in the Company. During its assessment,
CU identified eight minors working in tobacco production on four out of the sampled 37 farms.
The Malawi Government’s Employment Act (CAP 55:02) – Employment (Prohibition of Hazardous Work
for Children) Order 201229 outlines hazardous tasks with the tobacco industry, and provides that noindividuals under the age of 18 can perform such tasks, with the exception of 16-18 year-olds that havereceived appropriate training, supervision and safety equipment.
In 2018, AOTM conducted a root cause analysis to better understand why, despite this regulation, farmers
continue to utilize children in farming. The Company identified the following reasons:• Casualness on the part of the farmers, despite training;• Cultural desires to train children to become responsible citizens;• Low literacy levels of parents/guardians which impact their view of the value of education;• Lack of parental care; and• Perceptions that children are a source of cheap labor.

To better protect children under 18, as of the 2018-2019 crop year, AOTM has revised its ALP program
to prohibit anyone under the age of 18 years from being involved in any tobacco-related activities. This
directive is communicated to contracted growers and is incorporated into the training programs andcommunication materials for growers, workers and FTs accordingly.
In addition to the strategic change, AOTM has also begun implementing the following new initiatives:
1) Afterschool Activities Program
AOTM is implementing a pilot project in the Mchinji 2 Scheme in Mchinji District to encouragechildren to stay in school, reduce idleness, and promote safety and mental/social development
through the provision of sporting equipment/infrastructure and indoor games. This project was
initiated in September 2019 and will run through April 2020, with over 886 pupils expected tobenefit.
The initiative also looks at training teachers on the coordination of Physical Education & extra
murals. In this regard, Mkomachilolo Primary School in Mchinji Scheme in Mchinji District was
identified for implementation.
Should the pilot project be successful in its objective of minimizing child labor risks, AOTM intends
to rollout the program to an additional 25 schools over the course of the next three years.

29. CAP 55:022 defines “children” as individuals 15 years of age or younger.
Appendix I - AOTM’s Action Plan _ page 6 of 1240

External Assessment2) Sustainable School Feeding Project
AOTM has identified that hunger is a driver in school absenteeism in areas where the company
has found high incidents of child labor. To address this challenge, the company is implementing apilot Sustainable School Feeding project in the Mchinji 2 Scheme in Mchinji District beginning in
CY2019. Through this initiative, AOTM will work with the school to establish gardens which will, intime, serve as a food resource for students. The project will also involve updating the kitchens at
local schools to include new pots, utensils, etc. and the provision of a maize miller. Any excess foodthat is not consumed by students can be sold to the local community and the local community canalso bring their maize to the school to mill for a small service fee. The intent is to allow the school
to generate additional financial resources thereby supporting its sustainability.
3) School Improvement Projects
AOTM has provided materials and expertise to improve over 20 local schools since 2011, building
and improving school blocks, teacher administration blocks, libraries, and student ablutions as wellas providing desks for students. These long-term initiatives have positively impacted over 20,000
children in AOTM growing areas.

ALP Code Principle 2: Income and Work Hours
Control Union concluded that there was a lack of awareness among both farmers and workers regarding
the minimum wage and overtime regulation. Specifically, Control Union identified multiple women helping
their employed husbands (mostly with stringing) without pay and any contract or arrangement with thefarmer, and the employed husbands did not receive any extra payment for bringing in helping hands. Endof-season payment was practiced at most farms, and workers did not get a day off on public holidays.
In 2018, AOTM conducted a Root Cause Analysis on Minimum Wage Payment which revealed a range ofroot causes including:
1. Lack of enough seasonal operating income by farmers,
2. Farmers’ knowledge gap on labor laws, and3. Farmers undermining workers.
AOTM has developed the following strategies to address these challenges:
1) Farmer-Worker Contract Templates
To encourage farmers to keep records of worker payments, AOTM provides Farmer-Worker Contracts
and Time Sheets to 100 percent of contracted farmers. FTs and ALP supervisors check on the use of
these templates during on-farm visits and also monitor for compliance that all in-kind deductions/payments do not exceed the maximum allowable percentage of the total wage.
2) Business Planning and Financial Literacy Training
To help farmers better manage their finances, thereby increasing the amount of money available
for worker payments, AOTM has engaged a third-party to implement a training program that will
provide farmers with access to business planning and financial literacy information (i.e. Cost of
Production, labor utilization, planning, budgeting, saving and investing for business growth).
Appendix I - AOTM’s Action Plan _ page 7 of 1241

External Assessment

Beginning in CY2019, AOTM plans to implement a Trainer of Trainers (TOT) program for Financial
Literary to over 7,000 farmers, as follows:• 1309 farmers and 96 field staff trained in year 1 (TOTs)• 2,000 farmers trained in year 2• 1,900 farmers trained in year 3• 1,811 farmers trained in year 43) Village Savings and Loans Association (VSLA) Training to farmers’ spouses
In CY2019, AOTM trained 2,275 women on VSLA management and entrepreneurship. By training
farmers’ spouses on financial management, AOTM hopes to improve a farmer’s management ofhousehold finances and increase the ability of farmers to properly pay workers and minimize risk ofchild labor.
AOTM has established 91 VSLAs (one per scheme) in 91 schemes in the Kasungu, Madisi, Mponela,
Lilongwe West and Mchinji Growing Areas. This training will help create additional householdincome to enable minimum wage to be paid.

ALP Code Principle 3: Fair Treatment
CU found that there was an instance of verbal abuse and that there were instances of discrimination
among the farmer base. The issue here is that one farmer would shout badly at the workers when they
made mistakes. At another farm in Kasungu, the farmer specifically mentioned that he would never hire
women as they could not do the same job as men. According to CU, none of the interviewed farmers were
aware that the ALP committees had a grievance mediation function that they could access.
In addition to the grievance mechanism outlined on page 3, AOTM is implementing the following strategies
to address these challenges:
1) ALP Committee Program Expansion
AOTM has expanded the number of local ALP committees from 30 to 179 (one for each AOTM fieldtechnician). These committees include a traditional leader, a schoolteacher, and a maximum of five
farmers to support FTs with monitoring and training.
2) Social Development Training
In CY2020, AOTM plans to engage a social consultancy firm to provide social development training to
all ALP committee members to strengthen local awareness and understanding of the Fair Treatment
principle.
3) Farmer Education
All contracted farmers are educated on the importance of fair treatment and why they need to makethemselves available to workers to discuss any work-related matters.

Appendix I - AOTM’s Action Plan _ page 8 of 1242External Assessment

ALP Code Principle 4: Forced Labor and Human Trafficking
CU identified two instances of forced labor and other instances of indirect payment (or the risk thereof).
According to CU, in one case where a husband/wife couple was hired, the husband was paid but the wife
was not. CU saw a risk where workers had to wait for the farmer to sell his tobacco and therefore, could
not leave. This is because the limited capacity of the market means that all the farmers’ tobacco cannot bebought once but rather in phases.
As previously noted, AOTM has taken the strategic decision, effective CY2019, to not contract with
farmers who employ tenant farmers. AOTM believes that this action will reduce the risk of forced laborand human trafficking in its supply chain.
For all contracted farmers who employ hired labor, AOTM is distributing written farmer-worker contract
templates to help ensure that there is a mutual agreement between the farmer and his workers. The
company is also providing template timesheets, which will help ensure the farmers pay workers wages inline with Malawi’s legal minimum wage and the Malawi Employment Act.

ALP Code Principle 5: Safe Work Environment
CU identified a variety of issues regarding compliance with the Safe Work Environment principle, including
a purported lack of PPE usage, improper use of equipment and storage, improper CPA container disposal,a lack of knowledge regarding proper field re-entry periods after CPA application, poor access to clean
drinking and washing water, and inadequate housing for workers.
To address these challenges, AOTM is implementing the following actions:
1) Continued trainings focused specifically on the Safe Work Environment Principle
AOTM will continue to raise awareness of priority issues such as hazardous farm tasks, the importanceof wearing PPE while applying or handling CPAs, re-entry period for CPAs, Green Tobacco Sickness
and safe accommodation for workers. Printed materials are used to impart this information. CPA
management training focuses on safe storage and safe usage through understanding and complying
with the instructions on the CPA label. FTs conduct this training for workers and farmers with theintention of targeting as many people on the farm as possible.
2) Worker Accommodation Improvement Project
In CY2018, AOTM conducted a baseline survey on 14,882 contracted farmers of which 7,039 hired
labor and provided accommodations to workers. The survey revealed that 48 percent of those who
provided accommodations did not meet minimum accommodation industry standards.
In addition, AOTM conducted a “blitz survey” among 66 farmers to learn more about the root causesof these issues and better understand the type of support farmers needed. The analysis of thesefindings indicated that root causes ranged from:• Land tenure issues where most farmers use borrowed/rented fields - an arrangement whichis temporary in nature hence creating difficulties for farmers to meet minimum standards on
accommodation;• Lack of prioritization by farmers – Farmers tend to focus more on increasing hectares and foodrequirements, leaving accommodation as a low priority;
Appendix I - AOTM’s Action Plan _ page 9 of 1243External Assessment• High illiteracy;• A view that proper accommodation is temporary and thereby is considered a waste of resourcesby some farmers; and• Selfishness/pride/prestige from the farmers which results in a perceived gap between them andtheir workers.

To improve worker accommodation, AOTM plans to construct 780 workers’ housing units in Kasungu,
Madisi, Mponela, Lilongwe West and Mchinji Growing Areas between August 2019 and October
2020. The Accommodation Improvement Project will run in 2 phases, with phase 1 taking place in2019 covering 400 farms and the other 380 to be completed by 2020. Below is the breakdown of
the Accommodation Improvement Project Plan between August 2019 and August 2020:• Lilongwe West x 67 housing units• Mponela x 120 housing units• Mchinji x 131 housing units• Madisi x 292 housing units and• Kasungu x 170 units

Survey results also indicated that 55% of farmers would be able to meet worker accommodation
standards if building materials, such as iron sheets, cement and door/window frames, were provided.
As part of this initiative, AOTM will provide such materials.
3) PPE Provision
AOTM continues to provide all its farmer base with PPE appropriate to supplied CPAs, as well as for
GTS prevention, in their farmer input packages. This PPE provision is coupled with cash advances aswell as compliant, low-tox CPAs to help minimize potential ALP incidents. Field Technicians provide
training on the use of the provided PPE.
In CY19 all contracted farmers were supplied with a comprehensive PPE package for CPAs, which
included new gloves, face shields, durable dust masks, and overalls, and GTS gloves. Farmers were
provided with eight pairs of cotton gloves per hectare to protect against GTS.
4) CPA Container Collection
AOTM plans to contract with a third-party in CY 2020 to collect and incinerate used CPA containers.
AOTM will continue to monitor growers to ensure that CPA bottles are not re-used for drinking water,
they are triple rinsed, punctured and incinerated, according to manufacturer recommendations andapplicable laws.
5) Water Sanitation and Hygiene (WASH) Programs
All farmers are trained to use sanitary water sources. A pilot WASH program is on-going in the
Mponela and Madisi Growing Areas to ascertain the feasibility of providing grower clubs withpotable water through community boreholes and water tanks.

Appendix I - AOTM’s Action Plan _ page 10 of 1244

External Assessment

Since 2012, over 125,485 people have benefitted from the implementation of AOTM’s WASH programs:
Initiatives

Tobacco Farmers

Other Crops

Communities

Dams

3,756

4,025

9,500

Rural Boreholes

1,120

-

20,953

Shallow Wells

950

-

4,500

Peri-Urban Boreholes--

80,616Irrigated Crops

-

65

-

5,826

4,090

115,569

Total Number of Impacted People

125,485• Over 20,000 people have benefitted from the 64 rural boreholes. In addition to donating theboreholes, AOTM provides training on how to maintain the borehole to support community
ownership of the borehole. The community selects the members of the Borehole Committee, acritical element of sustainability.
• Over 45,200 urban dwellers have benefitted from the additional 10 school boreholes drilled under
the peri-urban project.
• 740 people have been trained to maintain the boreholes.
• Over 411,065m3 of water has been provided to 3,756 tobacco farmers, 4,025 other farmers, and9,500 surrounding communities.
• AOTM has enhanced awareness and compliance of water health and sanitation within thecommunities.

ALP Code Principle 6: Freedom of Association
AOTM supports the right to freedom of association and collective bargaining and recognizes the importanceof these rights for farmworkers. CU did not find any evidence of farmers not respecting this right.
AOTM regularly trains its staff so that there is understanding of this principle and also emphasizes it
through the ALP written material. FTs provide ongoing farmer and worker education regarding this principle
through one-on-one visits and group training.

ALP Code Principle 7: Terms of Employment
CU found that none of the farmers interviewed fully informed their workers about various rights including
legal benefits, the legal or recommended minimum wage, and the legal minimum rate for overtime hours.
CU also found that some workers contracts had only been filled out in the previous week, some contracts
did not match with the actual work performed, some workers had not signed the contract or received
the copy, and some contracts failed to specify the applicable wage. CU also observed that only seasonal
workers received a written contract; temporary workers usually did not have a written contract in place.
To address these issues, AOTM plans to intensify its training and sensitization for all contracted farmers
to comply with Terms of Employment in accordance with Malawi Government regulations on labor.
AOTM believes that an increase in number of farms using the contract template will lead to an improved
understanding of the law and labor practices.
Appendix I - AOTM’s Action Plan _ page 11 of 1245

External Assessment

In CY 2019, AOTM distributed template contracts and timesheets that farmers can use with their workers
to assist farmers in meeting Malawi’s legal minimum wage as well as track other relevant data. Field
Technicians provide guidance to farmers on the templates. Field Technicians and Area Field Supervisors
verify that these documents are being used by farmers during their field visits.

Conclusion
AOTM has been committed to PMI’s ALP program since its introduction in 2011, and the Company
appreciates CU’s acknowledgement of the positive changes that have occurred in its contracted farmer
base both since the inception of the program as well as since the previous CU assessment. The company has
already made progress in addressing many of the issues identified in the assessment and looks forward tocontinuing to drive improvement in these areas. AOTM is confident that the above-mentioned initiatives
will enable the achievement of ALP targets set.

Appendix I - AOTM’s Action Plan _ page 12 of 1246

External Assessment

Appendix II – Scope and methodology
Assessment teamOpening meeting

The team responsible for conducting thisassessment consisted of three auditors (two from
Kenya, one from Mozambique), three translators
to the local languages Chichewa and Tumbuka, and
two CU coordinators (one from Germany, one fromthe Netherlands). 30 The auditors conducted farmassessments and interviewed leaf technicians. The
two coordinators interviewed AOTM management
and external stakeholders. The auditors as well as
the coordinators were trained by Verité and Control
Union. 31 This qualification process consisted of thefollowing stages:

On 11 February 2019, CU started the assessmentwith a meeting at AOTM’s head office in Lilongwe,
Malawi. This meeting was attended by AOTM’s
local management team, as well as PMI Regional.
CU presented the objectives and approach of theassessment, while AOTM provided an overview ofthe market and company background, as well as
milestones in ALP implementation.

• Selection of candidates by CU;• Webinars organized by CU to verify suitability ofcandidates;• Completion of online training provided by Verité;• Full week classroom training conducted by Verité
with CU;• Two-day refresher training by the CU coordinator
prior to starting the field visits; and• Shadowing during farm visits by CU coordinators.
Desk review
Prior to this assessment AOTM was requested tosend documentation to CU to give the assessment
team a better idea about the market characteristics
and the management systems that were in place.
Philip Morris provided the legal information thatwas relevant to the ALP Code (See Appendix III for
more detailed legal information). This was important
to ensure a thorough preparation of the assessment.

Methodology for ALP implementation
review

system

The methodology used for evaluating AOTM’s
implementation of the ALP Program was based on the
widely used PDCA 32 cycle, which is a management
method for the continuous improvement ofprocesses and products. As part of this evaluation,
CU spent two days (11 and 12 February 2019) at
AOTMS’s head office. CU interviewed management
staff, analyzed documentation and evaluated
AOTM’s systems, to better understand how the
implementation of the ALP Program was organized.
In total, CU interviewed eleven management
personnel and twelve field personnel. Additionally,
CU interviewed two stakeholders: one memberof YONECO, the NGO that had conducted thepilot project on the support mechanism; and one
employee of Lloyds of Bay, the social consultancy
firm that was going to provide social trainings to the
local ALP committees later in 2019. All interviews
were conducted individually, so that interviewees
felt comfortable to speak freely and raise any issues.

30. The coordinator from the Netherlands did not stay for the entire assessment, but only for the management
assessment.
31. All three auditors had been trained by Verité in November 201732. Plan, Do, Check, Act
Appendix II - Scope and Methodology _ page 1 of 647

External Assessment

Scope and farm sampling
These farmers were supported by ten area field
supervisors and 179 leaf technicians. To constitutea meaningful sample, CU needed to visit at least
41 farms, the square root of the total number ofcontracted farmers within the scope, as indicated by
AOTM prior to the assessment. In total, CU visited
42 farmers (21 in Kasungu and 21 in Mpheremeb/
Mzuzu), which were sampled randomly or selectedbased on geographical spread. Over a period of 1.5
weeks CU visited 9-12 farms per day, where eachfield day was followed by a reporting day. The
graphs below provide demographic information
about the farms visited in the two regions assessed.
Farm size Kasungu (n=21)(ha contracted by AOTM)

19%
43%

Tobacco production in Malawi is concentrated
mainly in the central and northern region of thecountry. In addition to the headquarters in Lilongwe,
AOTM operates two branch offices in Limbe (south
Malawi) and Mzuzu (north Malawi) and ten Area
Agronomy offices across the country. To ensure amanageable sample size, the present assessment
focused on AOTM contracted farmers growing FCV
tobacco in Mpheremeb/Mzuzu (north Malawi) andKasungu (central Malawi). (Note: The original scopeincluded the Rumphi area instead of the Mzuzu
area, but this had to be changed in order to ensure
unannounced farm visits, see below).
The majority of the farmers in the scope of thisassessment (74%) grew tobacco on an area of lessthan three hectares. All of the farmers owned theland they farmed.

0-1
38%

1<=3
>3

Farm size Mpherembe/Mzuzu (n=21)(ha contracted by AOTM)

33%

24%

0-1
43%

1<=3
>3

In 2019, AOTM had contracts with 13,348
smallholder farmers across Malawi, in addition toeight large commercial farmers and 16 AOTM farms.
Appendix II - Scope and Methodology _ page 2 of 648

External Assessment

Previously contracted by
AOTM Kasungu (n=21)

Previously contracted by AOTM
Mpherembe/Mzuzu (n=21)

5%

5%

Yes
No

95%

Stage of tobacco production
Kasungu (n=21)

20

Yes
No

95%

Stage of tobacco production
Mpherembe/Mzuzu (n=21)

21

21

20

15

15

10

10

5

5

0

21

20

0
Harvesting

CuringHarvesting

CuringType of farm Kasungu (n=21)

19%

5%Farm with only migrant workers (no family members)
Farm with family members and local and migrant workers

14%
52%
10%

Appendix II - Scope and Methodology _ page 3 of 6

Farm with family members and local workers
Farm with local and migrant workers (no family members)
Farm with family members and migrant workers

49External Assessment

Type of farm Mpherembe/Mzuzu (n=21)

5%
17%

19%

Farm with only migrant workers (no family members)
Farm with family members and local and migrant workers
Farm with family members and local workers

12%7%

Farm with local and migrant workers (no family members)
40%

Farm with family members and migrant workers
Family farm with only family members working

Except for one farm in Mpherembe/Mzuzu, allfarmers were hiring workers at some point during
the tobacco season.
The farm visits by CU are supposed to beunannounced. In order to achieve this, the tobaccocompany is informed about the names of theselected leaf technicians only the day before they
are to join the visits, and the leaf technicians are
informed of the names of the farmers to be visited
only on the day of the visit itself, while in the car,and only for the next farmer to be visited that day.
The reason for this is that CU wants to obtain arealistic picture of the farm practices, which ismost likely to be seen when arriving unannounced.
This procedure was also followed in the present
assessment. Unfortunately, during the farm visits
it became clear that all farmers and many workers
knew the time period in which the visits would takeplace, and five farmers (12%) had been informed
the night before or the same day that CU would
most likely visit that day. CU therefore decided toadjust the scope, and switch from the Rumphi to
the Mzuzu area to be able to arrive unannounced.
Methodology for ALP farm practices review
The methodology used during the farm visits was
based on triangulation of information. Auditors
were instructed to seek at least two, preferably
three, sources of information. They used their

Appendix II - Scope and Methodology _ page 4 of 6

findings to draw conclusions about whether farm
practices were meeting the standard of the ALP
Code. These sources could be interviews with
farmers, family members, or workers. Sources
could also include documentation and visualobservation of the farm area, field, storage facility,
and curing barns. This methodology was also
used to investigate the underlying factors that
increase the risk of not meeting the standard. In
addition to information triangulation CU also used
the “Five Whys” methodology, a commonly usedtechnique to obtain an understanding of problems,
to investigate the reasons behind certain issues.
Before every interview CU explained the objectiveof the assessment and assured interviewees that all
information would be kept completely anonymous.
Next to assessing labor practices, CU also verified
the impact of AOTM management systems and the
ALP Program, to see how this was perceived by leaf
technicians, farmers, family members, and workers.
People interviewed
Whenever possible, interviews with workers andfamily members were conducted individually andwithout the farmer, to avoid undue bias. For thesame reason, all interviews with farmers wereconducted without the leaf technicians. In total,
148 persons were interviewed by CU (42 farmers,
16 family members and 90 external workers).

50External Assessment

Demographic information on the 106 family members and external workers interviewed:
Type of interviewee
60
50
40

48

42

30

External workers

20

Family members

10
8

8

Mpherembe/Mzuzu

Kasungu0

Gender
60
9

50

11

40

47

39

30

Female

20

Male

10
0

Mpherembe/Mzuzu

KasunguAge of interviewees
60
55

50
40

11

30

Adults (>=18)

20
10
0

15-17
2

13-14
1

1

Mpherembe/Mzuzu

Appendix II - Scope and Methodology _ page 5 of 6

1

<13

Kasungu51

External Assessment

The number of interviewees below 18 only shows
how many children were interviewed; this does notnecessarily mean that they were working.
Closing meeting
On 11 April 2019 a closing meeting was held at
AOTM’s head office in Lilongwe, Malawi. Similar tothe opening meeting, this meeting was attended by
AOTM’s management team and PMI Regional. After
CU presented their initial findings, AOTM requested
clarification of some items, which was followed bya constructive discussion on several topics. Overall,CU’s findings were considered a useful base fortaking action to improve AOTM’s implementationof the ALP Program.
Reporting procedure
During the assessment, auditors reported after eachfield day to the coordinator. This person monitored
the auditors’ findings and provided feedback
whenever necessary. The coordinator compiled all
findings and combined these with the findings fromthe management assessment. Public release of CU’s
assessment report demonstrates PMI’s commitment
to transparency, which is an important componentof the ALP Program. CU authored the final report,
which was evaluated by Verité. PMI reviewed thereport to ensure consistency of the presentation ofCU’s findings worldwide. Finally, AOTM reviewed
the report to verify that all the information wascorrect, and to finalize their action plan based on
this report.

33. Leaf tobacco suppliers can start drafting their action plans after the closing meeting, as initial findings usually do
not differ much from the final report.
Appendix II - Scope and Methodology _ page 6 of 652

External Assessment

Appendix III – Legal information
Author: PFI Partnerships – Local Suppliers Legal Team – PMI OC
Date of Original Analysis: Q1 2017
Date of Updated Analysis: December 24th, 2018

Principle 1 – Child Labor
Summary

ALP MEASURABLE
STANDARDS

MARKET LEGAL STANDARDS

Minimum age foradmission to work is
not less than age forcompletion of mandatory
schooling

Malawi matches with theminimum age of 14 34,
excepted for developing
countries under the ILO
Convention 138.

Except in the conduct ofdomestic work, Employment
Act prohibits engagement ofchildren aged below 14 in childlabor. ILO Convention 138 refers
to a minimum age of 15 for
employment, Malawi is, pursuant
to the derogation available to thedeveloping countries, allowed
to adopt the age of 14. Malawi
ratified Convention 138 in 1999,
making use of this derogation.

In any case, minimum age
for admission to work is
not less than 15 years OR
the minimum age provided
by law, whichever offers
greater protection

Malawi matches with theminimum age of 14 35,
accepted for developing
countries under the ILO
Convention 138.

Children below 15 years of age
may be allowed to work within alimited working hours subject tothe above conditions

MATCHESNo person under 18
involved in hazardous
work

EXCEEDSOPPOSESCOMMENTS

Employment Act 36 prohibits
for any child aged below 18 inhazardous work. Paragraph 6(1) of
the Ministerial Order 37 prohibits aperson under the age of 18 fromcarrying out hazardous work set
out in the Schedule to the Order.
Paragraph 6(2) of the Orderstates that such work shall not be
prohibited where: (a) the person
is aged between 16 and 18; (b)health and safety of that person is
fully protected; and (c) the person
has received adequate training in
performing the activities.

34. Section 21 of the Employment Act.
35. Section 21 of the Employment Act.
36. Section 22 of the Employment Act.
37. Employment (Prohibition of Hazardous Work for Children) Order, 2012 [Gazette No. 1 of 2012] (“2012 Order”).
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External Assessment

A child may only help on
the family farm if it is lightwork AND if the child is
between 13-15 years OR
between 12 and 14 forlight work in terms of the
ALP, which ever affords
greater protection

The farmers’ own ordependent children
may help on house holdchores within their home.

Work shall not be allowed
between 8:00 p.m. to 6:00 a.m.
for a child below 15 years of age

Applicable laws
• Constitution of Malawi.
• Employment Act [Cap. 55:01 of the Laws of Malawi].
Minimum age for employment (in tobacco)• There is not a specific rule in tobacco.
• It is prohibited to engage any child aged below 14 in any child labour, including work in public or
private agricultural undertaking, unless it is work done at home or at a vocational school or technicaltraining. 38
Age (or ages) limits for compulsory schooling• The Constitution encompasses the right to education, but it does not prescribe age limit for citizens
to start attending school.
• Other than the Constitution, there are not specific references on the laws about this matter.
• Under s.13 of the Education Act of 2013, provision of primary education in government schools is
compulsory for every child below eighteen (18) years of age.
Definitions of hazardous work (incl. agricultural activities that constitute hazardous work) as well as any
tasks that workers under 18 are specifically prohibited from participating in by law• It is prohibited the engagement of any person aged between 14 years and 18 years in any occupationor activity that is likely to be harmful to the health, safety, education, morals or development ofsuch person or likely to be prejudicial to his/her attendance at school or any other vocational ortraining program i.e. hazardous work. 39 The Employment Act does not specify the type of activities
prohibited under the Act. However, the Schedule to the 2012 Order includes the following on the listof hazardous work in the tobacco sector: topping and suckering activities or handling tobacco leaves
in the harvesting process; handling or grading tobacco leaves in damp conditions or conditions ofpoor lightning or ventilation; and any other work involving tobacco in commercial tobacco estates orcommercial tobacco farms. 40
38. Section 21 of the Employment Act.
39. Section 22 of the Employment Act.
40. Schedule 1 (c) (iii) of the 2012 Order. According to local leaf supplier and following its further consultations with
the Ministry of Labor, the hazardous list of the Order needs to be reviewed, as the Ministry of Labor agrees that thelisting of hazardous work in the schedule ending with an overall clause that makes all work hazardous is confusing
and needs to be corrected. Local supplier and regional PMI team is following up this matter.
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External Assessment• The Labor Minister is empowered, in consultation with relevant organizations of employers andemployees, to specify, by notice published in the Gazette, occupations or activities which, in his
opinion, are likely to be a hazardous task/activity. 41• The Labour Minister promulgated the 2012 Order pursuant to section 22 (2) of the Employment Act.
This 2012 Order42 prohibits all children aged below 18 from being engaged in hazardous work. 43
However, a person aged 16 to 18 may be engaged in hazardous work in all sectors, including the
agricultural sector, provided that 44:
i. The health and safety of such a person is fully protected from the hazardous work, andii. Such person has received adequate training to perform such hazardous work.
• As already provided above, the Schedule to the 2012 Order includes the following on the list ofhazardous work in the tobacco sector: topping and suckering activities or handling tobacco leaves
in the harvesting process; handling or grading tobacco leaves in damp conditions or conditions ofpoor lightning or ventilation; and any other work involving tobacco in commercial tobacco estates orcommercial tobacco farms. 45• In addition, the 2012 Order also includes the following on the list of hazardous work for the entire
agriculture sector (including the tobacco sector): handling or applying agricultural chemicals, veterinary
drugs, pesticides/insecticides in an agricultural undertaking; handling plants or soil immediately after
the application of agricultural chemicals or during any other period specified in chemical labels; curing
or processing agricultural products where there is exposure to temperatures or working at heights
hazardous to safety, health and well-being of persons; and any other activity involving dangerous
machinery, dangerous equipment or dangerous tools.
• It is an offence and subject to a fine and/or imprisonment on conviction with a maximum sentence of
three years for any employer who fails to comply with any of the requirements of the 2012 Order. 46
Requirements applying to farmers’ own children or other family members such as nieces and nephews
helping on the farmers• There are not specific references on the laws about this matter. By implication, Section 21 of the
Employment allows labor by the farmers’ own or dependent children if the children are helping on
agricultural activities within their home.

41. Subsection 22(2) of the Employment Act.
42. The Labor Minister published the Employment (Prohibition of Hazardous Work for Children) Order, 2012 [GazetteNo. 1 of 2012] (The 2012 Order).
43. Pursuant to section 22 of the Employment Act.
44. Paragraph 6 and Schedule of the 2012 Order.
45. Schedule 1 (c) (iii) of the 2012 Order. According to local leaf supplier and following its further consultations with
the Ministry of Labor, the hazardous list of the Order needs to be reviewed, as the Ministry of Labor agrees that thelisting of hazardous work in the schedule ending with an overall clause that makes all work hazardous is confusing
and needs to be corrected. Local supplier and regional PMI team is following up this matter.
46. Paragraph 9 of the 2012 Order.
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External Assessment

Other restrictions or requirements on the employment of workers under 18 years (e.g. limit on work
hours, work permits, etc.)• It is prohibited that a person aged between 14 and 18 work for more than 40 hours a week. 47• These are the maximum working hours for a person under the age of 18, who is enrolled inschool: (a) 20 hours in a week during the school term; (b) 40 hours in any week that falls entirely
within the school holidays; (c) three hours on any school day which is followed by another school
day; or (d) four hours on any school day followed by a non-school day, such as a Friday or thelast day of a school term. 48• It is prohibited that a person aged below 18 from working in an environment involving extreme
temperatures below 6º C or above 30º C due to their potential to jeopardize the safety, health,welfare and comfort of persons below the age of 18: (a) unless the cold or hot temperatures
are a result of natural climate conditions and adequate measure are taken to protect the person
including – (i) adequate protective clothing is provided to maintain optimum body temperature;(ii) presence in such environment shall not exceed one hour of continuous work; (iii) adequate
water breaks are taken at reasonable intervals taking into account individual susceptibility; (iv)adequate potable water or any beverage is made available and is conveniently accessible to all
persons; and (v) the persons are acclimatized to such working environment; and that work does
not exceed four hours every day. 49• It is permitted for a person under the age of 18 to only lift weight which is substantially lessthan lifted by adult workers of the same sex and, in any case, must be reasonable so as not tojeopardize the safety, health and well-being of that person. 50• Finally, it is required that the distance and weights which a person under the age of 18 may
travel and carry respectively to be practically reasonable so as not jeopardize the safety, healthand well-being of that person. 51

47. Paragraph 3(1) of the 2012 Order.
48. Paragraph 3(2) of the 2012 Order.
49. Paragraph 5 of the 2012 Order.
50. Paragraph 7 of the 2012 Order.
51. Paragraph 8 of the 2012 Order.
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External Assessment

Principle 2 – INCOME AND WORK HOURS
Summary
ALP MEASURABLE
STANDARDS

MARKET LEGAL STANDARDSMATCHES

Wages of all workers meet, Minimum wage forat minimum, national legal all workers is at
K962.00 per day.
standards or agricultural
benchmark standards.

EXCEEDSOPPOSESCOMMENTS
Effective 1st July 2017, the minimum
wage, including agricultural workers, isK962 per day (equivalent to US$1.20).
The minimum daily wage relates to thenormal 8 hour working day. If a worker
is required to work outside the normal
8 working hours, overtime is payable.
Overtime is payable at the rate of 1½
outside the working hours on eachbusiness day and at the twice a rate fornon-business day.
Please note that there is no sectorial
minimum wage in Malawi by the dateof this update.

Wages of all workers
are paid regularly, at aminimum, in accordancewith the country’s laws.

Yes, but workers
can also be paid
at the end of theseason provided
it is agreed by theworker.

Law does not control the periods forpaying wages, provided that the wages
are not paid less often than oncea week in the case of an employee
whose wages are fixed by the hour,
day or week, and not less than a monthin the case of a permanent employee
whose wages are fixed on a monthly
or yearly basis. Seasonal workers and/or tenants can be paid on a monthly
or weekly basis if it is agreed between
the employer and the seasonal worker
or tenant. The law does not provide alegal minimum payment frequency for
tenants.

Work hours are incompliance with thecountry’s laws.

The normal hours
of work of any
employee shall not
exceed eight (8)hours a day

The regular maximum working hours
are 8 hours in a day for 6-day week 52.
Where an employee is asked to work
more than eight hours a day, he/shewould be entitled to overtime.
If a worker is employed for part-time,
but would be staying at the farm forthe whole season, such as a tenant,this would be deemed to be full-time
employment, depending on the termsof the respective employment contract.

Excluding overtime, work
hours do not exceed, on aregular basis, 48 hours per
week.

Employment Act 53
sets the maximum
working hours
for an employee
at 48 hours aweek, excluding
overtime.

52. Section 36 of the Employment Act.
53. Section 36 of the Employment Act.
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External Assessment

Overtime work hours arevoluntary.

Yes 54, overtime
work hours arevoluntary.

The regular maximum working hours
are 8 hours in a day for 6-day week 55.
Where an employee is asked to work
more than eight hours a day, he/shewould be entitled to overtime.

Overtime wages are paid
at a premium as requiredby the country’s laws or by
any applicable collective
agreement.

Yes, overtime paid
at a premium asprescribed under
Employment Act 56.

See below the answer on the section‘Requirements that employers mustmeet to request overtime fromworkers…’.

All workers are provided
with the benefits,holidays, and leave towhich they are entitled by
the country’s laws.

Yes, these areprovided under
Employment Act 57.

See below the answer on the section‘Laws on basic entitlements or
benefits…’.

Applicable laws
• Employment Act [Cap. 55:01].
• Workers Compensation Act [Cap. 55:03].
• Pension Act [No. 6 of 2011].
• Immigration Act [Cap. 15:03].
• Employment (Prohibition of Hazardous Work for Children) Order.

Laws on regular and overtime wages including laws on in kind payment (e.g. minimum wages, minimum
wages agreed with unions, agricultural wage benchmark standards). If a minimum monthly wage isreferenced, please indicate how many hours this wage represents• The Minister of Labor has the authority, in consultation with responsible bodies of workers andemployers, to fix scales of minimum wages. 58 Pursuant to this statutory provision, the Minister has
effective 1st July 2017 set the minimum wage of workers, including in the agriculture sector, at
K962.00 per day (equivalent to US$1.20) [Gazette of 2017].
• Section 50 (4) of the Employment Act provides for payment in-kind where it is customary to do so.
The Act does not prescribe a maximum amount of the salary being paid in kind, but the expectations
are that payment in kind would comprise partial payment of the salary and not payment of the wholesalary in kind. In the agriculture sector, it is customary to sell to the workers food rations, particularly
maize, value of which is deducted from the salary payable to the workers. The law does not provide
guidance on how to determine the value of the in-kind payment. Generally, the value would be an
accepted market price for commodities that are sold (i.e. paid in kind) by farmers to workers e.g. maize.

54. Section 39 of the Employment Act.
55. Section 36 of the Employment Act.
56. Section 39 of the Employment Act.
57. Section 44 of the Employment Act.
58. Section 54 of the Employment Act.
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External Assessment

Wage and hours laws specific to piece rate workers, seasonal workers, and migrant workers• The same as the previous answer K962.00 per day (equivalent to US$1.20).
• Workers can be paid at the end of the season provided it is agreed by the worker.

Other specific rules applicable to migrant workers including any legal requirements to ensure they arelegally permitted to work
• Laws require every migrant worker to apply and obtain an appropriate permit in order to stay andwork legally in Malawi. Permit applications are required to include proof that the employer has not
succeeded to find a duly qualified person within Malawi to fill up the required position to be taken bya migrant worker. 59• In addition, migrant workers are prohibited from changing employers within Malawi without thewritten approval of the Director General of the Department of Immigration and Citizenship Services. 60• Be also aware that migrants may also be internal migrants, i.e. cross districts/cross regions. In thesecases permits are not required.

Laws on payment of wages relevant to the frequency of payment in agriculture, for example, laws on
whether end of season one-time payments are permissible• The Employment Act does not control the periods for paying wages (provided that the wages are notpaid less often than once a week in the case of an employee whose wages are fixed by the hour, dayor week and not less than a month in the case of an employee whose wages are fixed on a monthly or
yearly basis).
• Law requires employers to inform employees at the time of their appointment the intervals at which
remuneration would be paid. 61

Laws on regular and overtime hours (e.g. maximum work hours, requirements for overtime hours to be
voluntary)• It is allowed that parties agree in the employment contract the employee’s working hours, and the law
sets the maximum working hours for an employee at 48 hours a week, excluding overtime. 62• The regular maximum working hours are 8 hours in a day for 6-day week. Where an employee is asked
to work more than eight hours a day, he/she would be entitled to overtime. 63• The Employment Act requires employers to ensure that employees do not work for more than 6consecutive days without a period of rest, comprising at least 24 consecutive hours. There is no legal
option for farmers/workers to waive the right of the 24-hour break after six consecutive working days.

59. Sections 21 and 25 of the Immigration Act.
60. Section 25 of the Immigration Act.
61. Subsection 27(3) (d) of the Employment Act.
62. Section 36 of the Employment Act.
63. Section 36 of the Employment Act.
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External Assessment

Employers are also required to ensure that shift workers working six days a week do not work for morethan 8 hours a day and shift workers working five days a week do not work for more than 12 hours aday. 64• If a worker is employed for part-time, but would be staying at the farm for the whole season, thiswould be deemed to be full-time employment, again depending on the specific terms of the respective
employment contract.

Requirements that employers must meet to request overtime from workers• The Employment Act provides for three classes of overtime wages: (i) Ordinary overtime i.e. time
worked on a working day in excess of the hours normally worked by the employee. Ordinary overtime
is paid at an hourly rate of not less than one and half (1½) wage for one hour; (ii) Day off overtime i.e.
time worked by an employee on a day on which he would otherwise be off duty. Day off overtime ispaid at a rate of not less than twice the normal hourly rate; and, (iii) Holiday overtime i.e. time worked
on a public holiday. Holiday overtime is paid at a rate of not less than twice the normal hourly rate. 65• The Minister of Labor has the authority, in consultation with responsible bodies of workers andemployers, to fix scales of minimum wages. 66

Laws on basic entitlements or benefits to be paid to workers (e.g. social security, health care, holidays,
other leave entitlements etc.)• Employees are entitled to a period of annual leave with pay (i.e. commensurate to their usual monthlypay) of not less than: (a) 18 working days if the employee works six days a week; and (b) 15 working
days if the employee works five days a week. 67• Employees are also entitled, upon completing 12 months of continuous service, to at least four weeks
sick leave on full pay and eight weeks sick leave on half pay during each year payable at the normal
rate of wages. 68• Every female employee is entitled to at least eight weeks maternity leave on full pay every three
years. 69• Law provides for mandatory compensation to workers injured in the course of employment. 70• Law requires every employer employing more than five employees to provide for pension. 71• Law sets the minimum statutory contributory rates at 10% and 5% for the employer and the employee
respectively. 72• The Pension Act exempts the following categories of employees/employers from Pension contributions:seasonal employees; tenants, holders of work permits, members of Parliament and domestic workers.

64. Section 36 of the Employment Act.
65. Section 39 of the Employment Act.
66. Section 54 of the Employment Act.
67. Section 44 of the Employment Act.
68. Section 46 of the Employment Act.
69. Section 47 of the Employment Act.
70. The Workers Compensation Act [Cap. 55:03 of the laws of Malawi].
71. Section 9 of the Pension Act [No. 6 of 2011 of the laws of Malawi].
72. Section 12 of the Pension Act.
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External Assessment

Principle 3 – FAIR TREATMENT
Summary
ALP MEASURABLE
STANDARDS

MARKET LEGAL STANDARDSNo physical abuse, threatof physical abuse, or
physical contact with
the intent to injure or
intimidate

Gender Equality Act 73
protects any person fromany form of physicalabuse.

No sexual abuse or
harassment

Gender Equality Act 74
protects any person fromany form of sexual abuse.

No verbal abuse or
harassment

Gender Equality Act 75
protects any person fromany form of verbal abuse.

Various special laws also provides
for penalties involving verbal
abuse or harassment such as the
Magna Carta for Women, Antisexual Harassment law, etc.

No discrimination on
the basis of race, color,caste, gender, religion,
political affiliation, union
membership, status as aworker representative,
ethnicity, pregnancy, social
origin, disability, sexual
orientation, citizenship, or
nationality

Gender Equality Act 76
protects any personfrom any form of
discrimination.

The New Civil Code also provides
for civil damages arising fromdiscriminatory acts

Worker access tofair, transparent andanonymous grievancemechanism

Both the Constitution& Employment Act 77
provides these rights.

MATCHES

EXCEEDSOPPOSESCOMMENTS

Applicable laws
• Constitution of Malawi.
• Gender Equality Act [No. 3 of 2013].
• Disability Act [No. 8 of 2012].
• Employment Act [Cap. 55:01].
Laws defining and prohibiting physical, sexual, or verbal threats, abuse, contact, or harassment• Constitution grants every person: (i) the right to fair and safe labor practices and to fair remuneration;(ii) the right to form and join trade unions or not to form or join trade unions; and (iii) the right to fairwages and equal remuneration for work of equal value without distinction or discrimination of any
73. Section 5 of the Gender Equality Act.
74. Section 5 of the Gender Equality Act.
75. Section 5 of the Gender Equality Act.
76. Section 20 of the Constitution, section 5 of the Employment and section 13 of the Gender Equality Act.
77. Section 31 of the Constitution and section 4 of the Constitution.
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External Assessment

kind, in particular on basis of gender, disability or race. Local courts have given examples of conductthat may be termed as unfair labor practices. Examples include: physical punishment or verbal abuseof the workers. 78• Law prohibits any person from committing, engaging in, subjecting a person to, or encouraging thecommission of any harmful practice. 79• Harmful practice is defined by the Law as meaning a social, cultural or religious practice which, on
account of sex, gender or marital status, does or is likely to undermine the dignity, health or liberty ofany person or result in physical, sexual, emotional or psychological harm of any person. 80 Any person
who contravenes section 5 is liable to a fine of K1,000,000.00 and/or imprisonment with a maximum
period of five (5) years.
• Section 13 of the Disability Act [No. 8 of 2012] prohibits discrimination in any form of employment.
Any person who contravenes this section is liable to a fine of K1,000,000.00 and/or imprisonment for
12 (twelve) month maximum period.

Laws defining and prohibiting discrimination• Section 20 of the Constitution and section 5 of the Employment Act prohibit the discrimination of
persons in any form; and all persons are, under any law, guaranteed equal and effective protection
against discrimination on grounds of race, color, sex, language, religion, political or other opinion,
nationality, ethnic or social origin, disability, property, birth or other status.

Protection of workers from discrimination (workers’ rights and employers’ obligations)• Subsection 31(3) of the Constitution entitles every person to fair wages and equal remuneration forwork of equal value without distinction or discrimination of any kind, in particular on basis of gender,
disability or race.
• Section 5 of the Employment Act prohibits any discrimination on the grounds of race, color, sex,
language, religion, political or other opinion, nationality, ethnic or social origin, disability, property,
birth, marital or other status or family responsibilities in respect of recruitment, training, promotion,
terms and conditions of employment or other related matters. Any person who contravenes thissection is liable to a fine of K10,000.00 and/or imprisonment for two years.
• Section 6 of the Employment Act requires every employer to pay employees equal remuneration forwork of equal value without distinction or discrimination of any kind, in particular, on basis of race,color, sex, language, religion, political or other opinion, nationality, ethnic or social origin, disability,
property, birth, marital or other status or family responsibilities.
Laws on resources for victimized workers including any access to grievance mechanisms• There are not specific references on the laws about this matter, but there are general rules regarding
disputes and complaints procedures under the Employment Law. 81

78. Subsection 31(1) of the Constitution.
79. Section 5 of the Gender Equality Act [No. 3 of 2013].
80. Section 3 of the Gender Equality Act.
81. See s64 of the Employment Act about Disputes and Complaints Procedures.
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External Assessment

Principle 4 – FORCED LABOR AND HUMAN TRAFFICKING
Summary
ALP MEASURABLE
STANDARDS

MARKET LEGAL STANDARDS

No work under bond, debt
or threat

The Constitution 82
prohibits any
forced labor.

MATCHES

Workers must receive
wages directly from theemployer.

EXCEEDSOPPOSESThe
Employment
Act entitles
an employee
to directly
receive wages
or to nominate
another person
as a recipient of
their wages 83.

Workers are free to leave
their employment at any
time with reasonable
notice, without threat or
penaltyWorkers are free toleave employment
at any timewith reasonable
notice 84.

Workers are not required
to make financial deposits
with farmers, labor
contractors, or any otherthird party at the time ofrecruitment or at any point
during employment

Workers are notrequired to makefinancial deposits
with farmers, labor
contractors or any
other third party.

Workers are not charged
recruitment fees or otherrelated fees for theiremployment by labor
contractors

Workers are
not charged
recruitment feesor other related
fees for theiremployment bylabor contractors.

Wages or income fromcrops and work done are
not withheld beyond thelegal and agreed payment
conditions.

Subject to rights
under the law,wages or income
from crops andwork done are notwithheld.

Farmers do not retain
the original identity
documents of any worker

Farmers are notallowed to retain
the worker’s
original identity
documents.

COMMENTSThis is a loophole in the law
which gives a worker an option
to nominate another person, suchas a spouse. Spouses can compel
each other to surrender wages
by nomination of payment. This
statutory requirement provides
the minimum which must becomplied with by the employer.

In practice, this may be abusedas farmers tend to retain the
documents as security.

82. Section 31 of the Constitution.
83. Section 50(3) of the Employment Act.
84. Section 29 of the Employment Act.
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External Assessment

Where farmers arelegally required to retain
the original identity
documents of workers,
they provide securestorage protected fromunauthorized access andensure workers haveaccess to their documents
upon end of employment

The law does not
require a farmer toretain the original
documents.

Where labor contractors
are used, farmers verify
their labor practices andensure they are in linewith the ALP standards

Malawi labour laws
are silent.

No employment of prisonor compulsory laborThis isprohibited by theConstitution 85.

Applicable laws
• Constitution of Malawi.
• Employment Act.
Legislation on forced labor (including any regulation on identity document retention or wage withholding)• Section 27 of the Constitution prohibits any form of Slavery, servitude and forced labor.
• Section 51(1) and (2) of the Employment Act entitles every employee in the public or private agricultural
sector to receive with each payment of wages an accurate itemized statement from the employer inwriting in a form which sets out: the employee’s gross wages due at the end of the pay period; theamount of every deduction from his wages during the pay period and the purpose for which eachdeduction was made; and the employee’s net wages payable at the end of the pay period.
Legislation relating to limits or prohibitions on recruitment fees and deposits workers may be required topay• There is not express legislation on this. However, this would be caught up by common law under the
principles of illegality. 86
Legislation regulating the operation of labor brokers and other third-party recruiters• There is not express legislation on this.
Laws on prison labor• Section 27 of the Constitution prohibits any form of Slavery, servitude and forced labor.

85. Section 27 of the Constitution
86. See s52 (1) (c) of the Employment Act.
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External Assessment

Principle 5 – SAFE WORK ENVIRONMENT
Summary
ALP MEASURABLE
STANDARDS

MARKET LEGAL STANDARDS

Farmers provide a safe
and sanitary working
environment

The Occupational Safety,
Health and Welfare Act 87
requires Employers toprovide safe & sanitary
working environment.

Farmers take allreasonable measures toprevent accidents, injury
and exposure to healthrisks.

The Occupational Safety,
Health and Welfare Act 88
requires Employers toprevent accidents, injury& exposure to healthrisks.

MATCHES

EXCEEDSOPPOSESCOMMENTS

The Hazardous List prevents
harvesting of tobacco leaves indamp conditions. 89 In addition,and by construction, this may becovered under the Occupational
Safety, Health and Welfare Act. 90

No person is permitted to
top or harvest tobacco,or to load barns unlessthey have been trainedon avoidance of green
tobacco sickness.
No person is permitted
to use, handle or apply
crop protection agents(CPA) or other hazardous
substances such as
fertilizers, without having
first received adequate
training.

The law does notdirectly address theissue on fertilizers.
By construction, thisis covered under the
Occupational Safety,
Health and Welfare Act 91.

No person is permitted
to use, handle or apply
crop protection agents(CPA) or other hazardous
substances such as
fertilizers, without using
the required personal
protection equipment.

The law does not directly
address the issue on
CPAs. By construction,
this is covered under
the Occupational Safety,
Health and Welfare Act 92.

87. Section 13 of the Occupational Safety, Health & Welfare Act.
88. Section 13 of the Occupational Safety, Health & Welfare Act.
89. 2012 Order, s1 (c) (ii).
90. Part VI of the Occupational Safety, Health & Welfare Act.
91. Part VI of the Occupational Safety, Health & Welfare Act.
92. Part VI of the Occupational Safety, Health & Welfare Act.
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External Assessment

Employment Act 93 prohibits
for any child aged below 18 inhazardous work. Paragraph 6(1) of
the Ministerial Order 94 prohibits aperson under the age of 18 fromcarrying out hazardous work set
out in the Schedule to the Order.
Paragraph 6(2) of the Orderstates that such work shall not be
prohibited where: (a) the person
is aged between 16 and 18; (b)health and safety of that person is
fully protected; and (c) the person
has received adequate training in
performing the activities. 95

Persons under the age of18, pregnant women, andnursing mothers must nothandle or apply CPA.

No person do not enter afield where CPA have been
applied unless and until it
is safe to do so.

The law does not directly
address the issue on
CPAs. By construction,
this is covered under
the Occupational Safety,
Health and Welfare Act 96.

Every person has access to This is provided 97 underclean drinking and washing the Occupational Safety,
water close to where they Health & Welfare Act.
work and live.

Accommodation, where
provided, is clean, safe,
meets the basic needs ofworkers, and conforms to
the country’s laws.

This is provided 98 under
the Occupational Safety,
Health & Welfare Act.

Applicable laws
• The Occupational Safety, Health and Welfare Act.

Requirements for provision of medical protection (availability of first aid kit, health & safety training etc.)• Section 13 of The Occupational Safety, Health and Welfare Act requires –in general- Employers toprovide safe & sanitary working environment.
• Section 33 of the Occupational Safety, Health and Welfare Act requires every occupier of a workplace toprovide and maintain a first aid box or cupboard of the prescribed standard which is readily accessible.
• Section 65 of The Occupational Safety, Health and Welfare Act provides for training and informationof potential hazards to which one may be exposed to in the work place.

93. Section 22 of the Employment Act.
94. Employment (Prohibition of Hazardous Work for Children) Order, 2012 [Gazette No. 1 of 2012] (“2012 Order”).
95. 2012 Order.
96. Part VI of the Occupational Safety, Health & Welfare Act.
97. Sections 28 and 29 of the Occupational Safety, Health & Welfare Act
98. Part VI of the Occupational Safety, Health & Welfare Act
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External Assessment

Requirements to report accidents and injuries• Section 66 of the Occupational Safety, Health & Welfare Act requires written notice of accident,
in prescribed form and accompanied by prescribed particulars, to be reported to the Director of
Occupational Health, Safety and Welfare where any accident occurs in a workplace that: (a) causes
loss of life to a person employed in that workplace; or (b) disables or is capable of disabling any personfrom carrying out normal duties at which he is employed. Provided that in the case of death or serious
injury, the written notice shall, where practicable, be preceded by phone notification or any fastestmeans of communication available to facilitate immediate investigation.

Requirements for green tobacco sickness training or awareness• The law does not directly address the issue about green tobacco sickness. By construction, this iscovered under Part VI of the Occupational Safety, Health and Welfare Act.

Requirements for PPE needed for using, handling, storing, or disposing of crop protection agents (CPA).
This may vary depending on the CPA in question.
• The Hazardous List prevents harvesting of tobacco leaves in damp conditions. 99 By construction, thisis covered under Part VI of the Occupational Safety, Health and Welfare Act.
• Section 59 of the Occupational Safety, Health and Welfare Act provides for general requirements foruse, handling, storing or disposing of dust, fumes and other impurity of such a character and to suchextent as to be likely to be injurious or offensive to the persons employed or any substantial quantityof dust of any kind.
• Section 65 of the Occupational Safety, Health and Welfare Act requires employers to provide employees
sufficient information and training on hazardous substances used at workplaces.

Restrictions on CPA use, handling, storing, or disposing (e.g. restrictions on vulnerable population such as
under 18s, pregnant women, nursing mothers interacting with CPA)
• The Hazardous List prevents those aged between 16 -18 to handle tobacco activities unless trained
and their safety is covered. 100 In addition and by construction, this is covered under Part VI of the
Occupational Safety, Health and Welfare Act.
• Section 59 further provides that all practicable measures, including the supply of breathing masks,
shall be taken to protect the persons employed against inhalation of the dust or fume or other impurity
and to prevent its accumulating in any workroom, and where the nature of the process makes itpracticable, exhaust appliances shall be provided and maintained, as near as possible to the point oforigin of the dust or fume or other impurity, so as to prevent it entering the air of any workroom.

99.
100.

2012 Order.
2012 Order.

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External Assessment

Other legislation related to CPA, (e.g. where they may be stored or transported, explicit restrictions on
specific CPAs, weather conditions under which CPA application may or may not occur, other restrictions
limiting contact or exposure with CPA)
• The law does not directly address the issue about green tobacco sickness. By construction, this iscovered under Part VI of the Occupational Safety, Health and Welfare Act.
• Section 51 of the Occupational Safety, Health and Welfare Act provides for general requirementsfor personal protective equipment needed for using, handling, storing or disposing of hazardous
substances. This Act defines hazardous substances to include agricultural or crop protection agents(CPA).

Requirements related to providing drinking water and safe housing• Section 29 of the Occupational Safety, Health and Welfare Act requires every occupier shall provide
at a workplace an adequate supply of clean and potable drinking water, maintained at suitable points
conveniently accessible to all persons employed.
• In effect, employers are required in terms of the Occupational Safety, Health and Welfare Act toprovide adequate supply of clean and potable drinking water to employees at a workplace maintainedat suitable points conveniently accessible to all employees.
• Also, every supply of drinking water which is not laid on shall be contained in suitable vessels, and shallbe renewed at least daily, and all practicable steps shall be taken to preserve the water and vessels fromcontamination; and a drinking water supply whether laid on or not, shall be clearly marked “DRINKINGWATER” in English and in such vernacular languages as the Director of Occupational Health, Safety
and Welfare may specify.

Requirements for worker accommodation if provided• Section 27 of the Occupational Safety, Health and Welfare Act requires every occupier to provide
sufficient and suitable sanitary conveniences for persons employed in the workplace, which must be
maintained and kept clean, and effective provision must be made for lighting the conveniences and,
where persons of both sexes are or are intended to be employed (except in the case of workplaces
where the only persons employed are members of the same family dwelling there), such conveniences
shall afford proper separate accommodation with a distinct approach for persons of each sex.
• Section 30 of the Occupational Safety, Health and Welfare Act requires every occupier to provide, for
the use of employees at a workplace, adequate and suitable accommodation for hanging or stowing
personal clothing not worn during working hours.
• Besides the above there are not further legal references to workers accommodation and in practiceleaf suppliers may apply their own internal guidance, i.e. houses with at least 2 rooms.

Restrictions on farm equipment (e.g. maintenance and licensing for operators)• Section 40 of the Occupational Safety, Health and Welfare Act restricts the operation of liftingmachines except by a person trained and competent to operate that machine.

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External Assessment• Also, it is permissible for such machine to be operated by a person who is under the direct supervisionof a qualified person for the purpose of training.
• Additionally, section 40 prohibits a person under eighteen (18) years of age shall be employed tooperate any lifting machine driven by mechanical power or to give signals to the operator of any suchmachine. 101 For purposes of section 40, the term ‘lifting machine’ includes crane, crab, winch, toggle,
pulley block, gin wheel, transporter or runway.

101.

See also S.2 (g) of the 2012 Order.

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External Assessment

Principle 6 – FREEDOM OF ASSOCIATION
Summary
ALP MEASURABLE
STANDARDS

MARKET LEGAL STANDARDS

Farmers do not interferewith workers’ right tofreedom of association.

The Constitution 102 andthe Labor Relations Act 103
guarantee the workers’
right to freedom of
association.

Workers are free to join
or form organizations
and unions of their own
choosing.

The Constitution 104 andthe Labor Relations Act 105
guarantee the workers’
right to freedom of
association.

Workers are free tobargain collectively.

The Constitution 106 andthe Labor. Relations
Act 107 provides rights
for workers to bargain
collectively.

Worker representatives
are not discriminatedagainst.

The Constitution 108 andthe Labor Relations
Act 109 protects workers’
representatives against
discrimination

MATCHES

EXCEEDSOPPOSESCOMMENTS

Worker representatives
have access to carryout their representative
functions in theworkplace.

Applicable laws
• The Constitution of Malawi.
• Labour Relations Act [Cap. 54:01 of the Laws of Malawi].
Laws on organizing unions and their operation (e.g. protections in place for freedom of association,
protection against employer interference)• Subsection 31 (2) of the Constitution provides every person with the right to form or join trade unions.
Subsection 32 (1) of the Constitution provides every person with the right to freedom of association,
which shall include the freedom to form associations.
102.
103.
104.
105.
106.
107.
108.
109.

Section 32(1) of the Constitution.
Part II of the Labor Relations Act.
Sections 31 (2) and 32(1) of the Constitution.
Part II of the Labor Relations Act.
Section 31 (2) of the Constitution.
Part II of the Labor Relations Act.
Section 31(1) of the Constitution.
Part II of the Labor Relations Act

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External Assessment• Section 4 of the Labour Relations Act gives every person the right to freedom of association, which
includes the freedom to establish and join organizations of his or her own choice.
• Section 6 of the Labour Relations Act protects employees (or any person seeking employment) frombeing prevented from joining associations or from being dismissed or prejudiced because of tradeunion membership or participation in the formation or the lawful activities of a trade union.
• Subsection 7(1) of the Labour Relations Act protects membership of an employee in a trade union aslong as the employee complies with the rules of the union.
• Subsection 7(2) of the Labour Relations Act (2) prohibits any trade union or similar organization fromdiscriminating in its constitution, rules or through its actions against any person on the grounds ofrace, color, nationality, ethnic or social origin, national extraction, religion, political opinion, language,sex, marital status, family responsibilities, age, disability, property or birth.

Laws or requirements for collective bargaining• Section 25 of the Labour Relations Act contains requirements for enterprise-level bargaining.
• Section 26 of the Labour Relations Act contains requirements for sectorial-level bargaining.

Laws related to worker representatives (e.g. requirements for representatives to be in place, protection
from discrimination, access to carry out functions in workplace)• Subsection 11(1) of the Labor Relations Act requires every worker representative organization to beregistered in terms of the provisions of this Act. The rights and benefits conferred by this Act uponorganizations may be exercised only if those organizations are registered in accordance with the Labor
Relations Act.
• Subsection 11(2) of the Labor Relations Act provides that any seven or more members of an
unregistered trade union, or two or more members of an unregistered employers’ organization, any ofwhom may be officers of the organization, may apply to the Registrar for registration in the prescribed
form. The application for registration is required to be accompanied by: (a) two certified copies of theorganization’s rules; and (b) the prescribed fee.

Other prohibitions on union discrimination and employer interference• In addition to the above statutory rights and prohibitions, the employee would be entitled to common
law remedies.

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External Assessment

Principle 7 – TERMS OF EMPLOYMENTSummary
ALP MEASURABLE
STANDARDS

MARKET LEGAL STANDARDSAt the time of hire,
farmers inform workers of
their legal rights

It’s difficult toensure that
farmers arecomplying with
this.

To ensure that farmers arecomplying, it may be necessary
to incorporate the terms in the
Employment Contract.

At the time of hire,
farmers inform workers of
the essential aspects of
the work relationship andwork place safety suchas work to be performed,
working hours, wages
paid, period of hire, and alllegally mandated benefits

These areincluded in the
Employment
Contract.

The Employment Act defines typeof contracts and provides whatnature of information should be
included in those contracts. 110

Farmers and workers
have entered into
written employment
contracts when requiredby a country’s laws andworkers receive a copy ofthe contract.

There is need toensure that thisdone.

Random interview of the workers
should reveal if this is done ornot.

MATCHES

EXCEEDSOPPOSESTerms and conditions of
employment contracts
do not contravene thecountry’s laws.

COMMENTS

It is also part of the Buyer/
Grower Integrated Production
System (IPS) contracts forthe farmer to adhere to andcommunicate ALP principles totheir workers.

The terms of the employment
contracts comply with theapplicable laws.

Applicable laws
• The Employment Act.
Legal requirements to constitute labor/employment relation• There is need of contract of employment. The contract can be written or oral.
• What is required is that there is a request/offer by the employer for the workers’ services for pay/consideration and the worker agrees/accepts to provide those services. Either offer or acceptance canbe express or implied from the dealings between the employer and the worker.
• In practice, leaf suppliers encourage the written labor agreements, which will normally include: (i)worker names (ii) working hours; and (iii) wages.

110.

Sections 25 (2) and 27 (3) of the Employment Act.

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External Assessment

Laws and regulations on employment contracts (incl. necessity for written employment contracts, and if
is not what are the grounds to consider the existence of a verbal employment agreement)• There is no written employment contract for workers as such. However, section 27 of the Employment
Act requires every employer to give to each employee a written statement of particulars of employment.
In Chasowa v Ibrahim Cash ‘n Carry [2008] MLLR 385 (IRC), the Industrial Relations Court held that
it was a duty of an employer in terms of section 27 of the Employment Act to draw up terms of theemployment, even where the parties did not draw up a written contract, and give them to an employee.
• In general, there is not a legal limitation to agree on a ‘part-time work contract’ 111 for a specific periodof time –i.e. from Oct. to Feb.-, and for non-exclusive obligations, thus this would fall under thecontract for a specified period of time as envisaged in the Employment Act. The labor laws set for thefollowing type of labor contracts: (a) a contract for an unspecified period of time; (b) a contract fora specified period of time; and (c) a contract for a specific task 112. In addition, the Employment Act
recognizes ‘share croppers tenant’ as employees 113. However, the Employment Act does not develop
any further the characteristics of the ‘sharecropping tenant’ agreement.
• All share cropper tenant agreements are subject to Malawi labour laws, particularly the Employment
Act. In the circumstances, it is always prudent for the farmers to ensure that the share cropper tenant
are provided with the minim requirements as set out under the Employment Act. Conceptually it may
be possible commercial tenants’ agreements. However, it is very rarely and or difficult to really findcommercial tenants in Malawi in the tobacco fields. In addition, it will be a challenge on the groundto identify when you will face a ‘sharecropping tenant’ agreement versus a landing and/or commercial
tenant agreement, which is not subject to the labor rules. In particular, because the basis of both
agreements may be similar, so both types of tenants will receive a piece of land and will agree toproduce an X volume of tobacco to be delivered a Y price at the end of a season. Now, in the case of
facing this situation, a basic answer/approach to help you to differentiate among these tenants will be
the independency and autonomy characteristics present on a commercial tenant versus the lack of itby the tenant worker. That said, the commercial tenant should have his/her own financial capabilities,
although the landowner would provide him/her the land and some inputs. To the contrary, a tenant
worker does not have the financial capability and will depend fully of the landowner. So, the landownerwill provide -in addition to the land and crop inputs- food, housing, medicines/personal cleaning stuff(i.e. soap). These additional inputs may be deducted from the payments to tenant worker.
• As said before, the tenant worker agreement is a not exclusive agreement if not made to be exclusiveby the contracting parties (the employer and the worker). A tenant worker, including a tenant share
cropper, could do other activities as far as comply on-time with the activities agreed with the landownerin terms of their employment contract. 114
111.

112.
113.
114.

We refer here a “part time work contract” as an agreement with the following characteristics: (i) a specificduration, i.e. 10 months; and (ii) an agreement on the total amount to be paid to the worker, agreed before
starting the work, and calculated, for example, using the potential number of days to be worked by the worker.
Section 25 of the Employment Act.
Section 3 of the Employment Act.
Three additional comments on the tenant workers situations: (i) their payment is a price of the tobacco agreed
beforehand with the landowner. This price is influenced by the guidance provided, in some crop seasons, by
the Tobacco Control Commission (TCC) in coordination with Farmer Associations (FA), and, this price guidancetakes into account cost of production. Cost of Production takes into account the per day minimum legal wage
(Further references, see ARET - http://www.aret.org.mw/ - as the key stakeholder involved in coming up withgovernment minimum prices for tobacco in Malawi). (ii) It is possible to add during the “Z” duration of thecontract some additional days of work or additional activities to do, and the additional tobacco delivered shallbe paid at the price effective in the market or indicated by the guidance set by the TCC/FA.

Appendix III - Legal Information _ page 21 of 2473

External Assessment• According to the information provided by the leaf supplier, in practice the landowner is the ‘farmer’ forthe purpose of the production agreement, and the one executing this agreement with the company.

Required content for written employment contracts• Written employment contract is required to include the following particulars:a. the names of the employee and of the employer;b. the date of commencement of the contract;c. the rate of remuneration and the method of calculating remuneration;d. the intervals at which remuneration is paid;e. the nature of the work to be performed;
f. normal hours of work;g. any provision for termination of the contract other than those provided by this Act;h. any disciplinary rule applicable to the employee.

Deadline for contract conclusion (e.g. on date of hire or within 30 days of hire etc.)• The labor agreements can be verbal/oral or written. In case of written agreements, the employer has
up to 1 month –counted from the date of hiring and reporting to work- to provide the worker with awritten statement with the terms of employment. 115

Requirements for various types of contract (indefinite term, definite term, temporary workers, andprobationary workers)• Section 25 of the Employment Act provides that an employment contract can be in any one of thefollowing forms: (a) a contract for an unspecified period of time; (b) a contract for a specified period oftime; and (c) a contract for a specific task. Therefore, this would be constructed as a way to differentiate
permanent and temporary contracts and piece-rate agreements.
• Where the purpose or effect of a contract is for the filling of a lasting basis of a post connected with
the normal and permanent activity of an undertaking, the contract shall be deemed to be a contract of
employment for an unspecified period of time.
• In a contract of employment in respect of a skilled worker, section 26 of the Employment Act provides
that parties may agree on the duration of the probationary period provided that the period cannot,
in any event, exceed twelve months. During a probationary period, a contract of employment may beterminated at any time by either party without notice.

115.

Section 27 of the Employment Act.

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External Assessment

Requirements for termination of employment (termination with or without cause, wrongful dismissal,
notice periods required to end employment etc.)• Section 57 of the Employment Act prohibits termination of contract employment by an employer
without cause or justification. Section 57 requires that there must be a valid reason for termination
connected with the capacity or conduct of the employee or based on the operational requirements of
the undertaking. Where the reasons of termination relate to the capacity or conduct of the employee,
the employment shall not be terminated before the employee is provided an opportunity to defend
himself against the allegations made (unless the employer cannot reasonably be expected to provide
such an opportunity).
• It is clear from the preceding paragraph that a combination of substantive and procedural justicewould always amount to fair dismissal. If one of them is missing or if both of them are missing, theresult leads to unfair dismissal.
• It is also clear that the law identifies the causes of termination as emanating from issues of conduct,
capacity or operational requirements.
• Courts have found the following to be some of the causes for termination: dishonesty, fraud, habitualabsenteeism, late reporting for duties, refusal to take lawful orders, refusal to go on transfer, offering
unauthorised credit facility, undermining authority, driving without authority, careless driving, refusal
to write a disciplinary report, failure to follow regulations, carrying unauthorised passengers on an
official motor vehicle, abuse of company facilities, damaging company property, assault, sleeping on
duty, breaking national laws, violent threats against superiors, failure to meet deadlines, unlawful
divulging of information, failure to account for stock, lack of commitment to duty and negligence.
• The Employment Act sets out the minimum notice period for termination of employment.
Notwithstanding this, an employer and an employee may agree on a longer notice period.
• A contract of employment for a specified period of time shall automatically terminate on the datespecified for its termination and, unless it is expressly or impliedly renewed or prolonged, no notice
shall be required for its termination.
• A contract of employment for an unspecified period of time may be terminated by either party upongiving the other the following minimum period of written notice:a. where the contract is to pay wages at a monthly rate, one month’s notice;b. where the contract is to pay wages at a fortnightly rate (i) one fortnight’s notice where the employee has been employed for less than five years; and(ii) one month’s notice where the employee has been continuously employed for at least five years;c. where the contract is to pay wages at a weekly rate (i) one week’s notice where the employee has been employed for less than two years;(ii) one fortnight’s notice where the employee has been continuously employed for a period of notless than two years but not exceeding five years; and(iii) one month’s notice where the employee has been continuously employed for at least five years;
d. where the contract is to pay wages at a daily or hourly rate (i) one day’s notice where the employee has been employed for less than six months;(ii) one week’s notice where the employee has been continuously employed for a period of not lessthan six months but not exceeding two years;
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75

External Assessment(iii) one fortnight’s notice where the employee has been continuously employed for a period of notless than two years but less than five years; and(iv) one month’s notice where the employee has been continuously employed for a period of at least
five years.
• Although the Employment Act provides that both the employer and the employee can terminate thecontract of employment by giving notice under sections 28 and 29, in reality, the right to terminate
a contract by mere notice is only available to the employee. The employer, must, in addition to thenotice, also comply with provisions of section 57(1) and 57(2) of the Employment Act, which requirethat before any unilateral termination of a contract by an employer, the employee must be furnishedwith valid reasons, and in cases of misconduct or incapacity, the employee must be afforded an
opportunity to be heard.
• Finally, it is worthy to mention that it is possible to terminate the labor agreement based on a breachof the ALP/GAP program, as far as in the labor agreement is set that worker shall comply with it. Keepin mind that the labor agreements may be verbal, therefore it would be challenging if the agreement isverbal to evidence the potential transgression.
Options for farmers to obtain legal assistance about their obligations (e.g. government departments, local
labor offices, farmer associations etc.)• Depending on the relevance of the legal issue to the respective institution, farmers may obtain legal
assistance from different institutions, including the following:a. Tobacco Association of Malawi (TAMA);
b. National Smallholders Farmers Association of Malawi (NASFAM);
c. Ministry of Agriculture (advice obtained from the Ministry of Justice);d. Ministry of Labour;e. District Labour Offices;
f. Local legal counsel of choice; org. Directorate of Legal Aid (Ministry of Justice and Constitutional Affairs).
Specific requirements for leaf growing contracts (e.g. government-imposed templates, government
approval of contracts, freedom to choose terms of contract)• The integrated production system (IPS), which was introduced in Malawi in October 2011 and adopted
fully by May 2012, is gaining more ground in the country. There is a template for IPS in Malawi, andalso the Tobacco Control Commission (TCC) IPS template, and also the possibility that leaf buyers have
set up tailor-made contract documents to enter into contract farming under the IPS scheme.
• The Tobacco Association of Malawi (TAMA) acts as a link between leaf buyers and tobacco growers.
It therefore ensures that the signed contracts are discharged by all parties in a fairest manner. The
Tobacco Control Commission approves contracts under the IPS.
• Some leaf buyers say that evidence shows that the IPS has proven to be the best system of producing
and marketing tobacco in Malawi as IPS is believed to offer sustainability for Malawi’s tobacco industry.

116.

In addition to TAMA, there are several Grower Associations in Malawi, for example: NASFAM, PHINDU etc.

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External Assessment

Appendix IV – Materials provided to the farmers
Posters on ALP - Chichewa (left) and English (right)

Appendix IV - Materials provided to the farmers _ page 1 of 677

External Assessment

ALP brochure

Malipilo agwirizane ndi ntchito komanso akhale okwanirakupezera zosowa za munthu.

Osalemba kapena kugwiritsa ntchito ana ochepera zaka 18 mu
ulimi wa fodya.

Anthu asagwire ntchito mopanikizika kapena mopambana
maola okhazikitsidwa ndi malamulo.

Ndondomeko imeneyi imathandiza chilinganizochi pomasulira
lamuloli, komanso mfundo ndi milingo yomwe Alliance One
ikuyembekeza kuti minda yomwe ili nayo pamgwirizano
wogula fodya ikwanilitse.
Tsinde la ndondomekoyi likuchokela pa malamulo a dzikookhudzana ndi ntchito, komanso malamulo a bungwe lalikulu
loyang’ana malamulo a pantchito pa dziko lonse lapansi.
Mfundo ndi milingo zandondomekoyi zayenera kumasuliridwa
ndi kukhazikitsidwa motsatana ndi malamulo tafotokozawa.

KUPATSIDWA ULEMU PANTCHITO•

Alimi akuyenera kuonetsetsa kuti chilungamo chikhalepo
pakati pa anthu ogwira ntchito.

•

Pasapezeke kunyozana, tsankho, chilango kapena kuzuza
kwa mtundu uliwonse.

Zoyenera kutsata•

Malipiro a ogwira ntchito onse (kuphatikizapo aganyu)
akhale osachepela mlingo umene udakhazikitsidwa
m’ malamulo adziko. (K962,000 patsiku)•

Malipiro aperekedwe mu nthawi yake molingana ndi
malamulo adziko.

•

Maola ogwilira ntchito agwilizane ndi malamulo koma
mwanjira iliyonse asapitilire maola 48 pa sabata.

•

Maola owonjezera pa ntchito asakhale okakamiza.

Alliance One ikudziwanso kuti nthawi zina boma ngati
mkhalapakati, ndi lomwe limathandiza kwakukulu
kupeza mayankho okhazikika a malamulo okhudzanandi zantchito, komanso mfundo zomwe makampani a
fodya ndi ena angatulutse.

•

Malipiro a ntchito yogwira pa nthawi yoonjezera alinganendi malamulo a dziko kapena motsatana ndi mgwirizano
womwe udakhazikitsidwa.

Alliance One ndi yokonzeka kukambilana ndi mabungwe
onse omwe nkhaniyi ikuwakhudza ndi cholinga chopititsa
patsogolo malamulo a pantchito.

•

Anthu ogwira ntchito akuyenela kupatsidwa zowayenelezakuti ntchito yawo iyende bwino komanso mpata wopuma
molingana ndi malamulo a dziko.

Alimi omwe tili nawo pa mgwilizano wolima fodyaadzathandizidwa kuti athe kutsatila lamuloli powaphunzitsa
ndikuwapatsa zowayeneleza kutero.

Zoyenera kutsata•

Pasakhale kumenya, kapena kuwopseza kuti wina amenyedwa,
kugwiriridwa kumene kapena kumugwira ndicholinga chofuna
kumubvulaza kapena kumuopseza.

•

Pasakhale kunyengereredwa kuti munthu agonane ndi
mnzake kapena kunyazitsidwa kwa mtundu uliwonse.

•

Pasakhale kunyogodolana kapena kutukwanana.

•

Pasakhale tsankho poyang’anira mtundu wamunthu, khungu, udindo,chibadwidwe (mwamuna kapena mkazi), chipembedzo, chipanicha ndale, umembala wa bungwe la za ntchito, kukhala mtsogoleri
wa gulu loyimira anthu ogwira ntchito, chigawo chochokera, kukhalandi pakati, ulumali, kapena unzika.

•

Pakhale ndondomeko zomwe zizipatsa ogwira ntchito
mwayi wopeleka madandaulo awo mwachinsinsi, mosaopa,
ndinso mwachilungamo.

Kuthandiza alimi omwe tili nawo pa mgwirizano wolima
fodya kuti akhale osunga lamuloli zikuthandizidwanso ndi
mfundo zakayendetsedwe kabwino kantchito zomwe
Alliance One idakhazikikamo.

Appendix IV - Materials provided to the farmers _ page 2 of 6

Tidzagwira ntchito ndi onse omwe timalumikizana
nawo pa nkhani ya fodya ndi cholinga choti timvetsetsemabvuto omwe makasitomala ndi alimi athu amakumana
nawo, ndi kugwilira ntchito limodzi yopeza mayankho amavutowo kuti pakutero tidzakwanilitse zomwe lamuloli likufuna.

Kumbali yawo, alimi adzapemphedwa kuwunikanso
njira zomwe amat sat i l a m’ kagwi l i dwe kawo
k a n tc h i to y a fo d y a pofananiza ndi zofunika zomwe
zili m’ndondomekoyi, ndi kusintha mwina ndi mwina
ngati ndi kofunika kutero.
Mabungwe oyima paokha azidzafufuza kuti awone
ngati ndondomekoyi ikutsatidwa.

ULIMI M’MALAWINTCHITO, MAOLA NDI MALIPIRO OYENERAMCHITIDWE OGWIRITSA ANA NTCHITO

Kampani ya Alliance One ndiyodzipeleka kuthana ndi
mchitidwe wolemba komanso kugwilitsa ntchito ana kuli
konse komwe izi zingachitike, ndipo ndiyokonzekanso
kukhala ndi ndondomeko zabwino zakagwili dwe
kantchito ku minda yonse komwe kumalimidwa fodya
yemwe kampani ya Alliance One imagulako mdziko muno.

NDONDOMEKO ZOVOMELEZEKA PA NTCHITO ZA- Chichewa

78External Assessment- English

INCOME AND WORKING HOURS
Income earned during pay period or a growing season
shall always be enough to meet workers basic needs
and shall be of a sufficient level to enable the generation of discretionary income. Workers shall not work
excessive or illegal work.

No children under the age of 18 shall be involved in tobacco
production (family or hired).

FAIR TREATMENT•

Farmers shall ensure fair treatment of workers. There shallbe no harassment, discrimination, physical or mental punishment, or any other forms of abuse.

Measurable Standards•

There is no physical abuse, threat of physical abuse,or physicalcontact with the intent to injure or intimidate.

•

There is no sexual abuse orharassment.

•

There is no verbal abuse or harassment.

•

There is no discrimination on the basis of race ,color, caste,
gender, religion, political affiliation, union membership, status
as a worker representative, ethnicity, pregnancy, social origin,disability, sexual orientation, citizenship, or nationality.

•

Workers have access to a fair, transparent and anonymous
grievance mechanism

Measurable Standards•

Wages of all workers (including for temporary, piecework,seasonal, and migrant workers) meet, at a minimum,
national legal standards or agricultural benchmark standards.
(K962,00/day)•Wages of all workers are paid regularly, at a minimum, in
accordance with the country’s laws.

•

Work hours are in compliance with the country’s laws.
Excluding overtime, work hours do not exceed, ona regularbasis, 48 hours per week.

•

Overtime work hours are voluntary.

•

Overtime wages are paid at a premium as required by thecountry’s laws or by any applicable collective agreement.

•

All workers are provided with the benefits, holidays, andleave to which they are entitled by the country’s laws

Appendix IV - Materials provided to the farmers _ page 3 of 6

This Agricultural Labor Practice Code supports thisobjective by defining the labour practices, principles
and standards AOI expects to be met on all farms withwhich AOI has contracted to purchase tobacco.
This Code is based on State and National Labour Laws
and the labor standards of the I n t e r n a t i o a l
L a b o u r Organization (ILO) Declaration on
Fundamental Principles and Rights at Work and otherrelevant ILO conventions.The principles and standardsof this code must be interpreted and implemented
in line with these laws and ILO conventions.
Supporting contracted farmers to remain in compliancewith the Agricultural Labour Code and its underlying
principles is supported by the Core Values of Alliance
One International, Inc. We will work with our entire
supply chain to understand issues, both with customers
and contracted farmers, and work collaboratively
towards solutions to ensure compliance.
AOI recognizes that in some cases long term solutions
to l abor i ssues ar e best suppor t ed t hr oughgovernment regulatory intervention, industry initiatives andother stakeholders’ involvement. AOI is committed toengaging with all relevant parties toward improvements infarm labour practices and compliance with the Code.
Farmers contracted to grow tobacco for AOI will besupported in complying with the Code throughtraining and technical support. For their part, farmers
are expected to review their practices against theCode requirements and make changes accordingly toensure compliance verifiable through independent
audits.

LABOUR PRACTICESThere shall be no child labour:

Alliance One International, Inc. (AOI) is committed toeliminate child labour and other labour abuses where they
are found and to achieve safe and fair working conditions on
all farms from which AOI sources tobacco.

MALAWI AGRICULTURALNO TO CHILD LABOUR

79

External Assessment

Farmer-worker contract template - Chichewa
MGWIRIZANO PAKATI PA MLIMI NDI OLEMBEDWA NTCHITO
Mbiri Ya Olemba Ntchito
Dzina: ……………………………………. Dzina la Kalabu/Esiteti: …………………..…. Mudzi: …………………………….
Mfumu ya ikulu (T/A): …………………… Boma: …………………………………… Nambala ya IFAS: …………………….
Mbiri Ya Olembedwa Ntchito
Dzina: …………………………………….. Mudzi: ……………………………............ Mfumu yaikulu (T/A): ………………
Boma: ……………………………..…….... Zaka: ……………………………………… Mamuna/Mkazi: ………....................
Masiku a Mngwirizano
Tsiku Loyambira: ……………………… Tsiku Lomaliza: ………………………… Kutalika kwa Mgwirizano: …………….
Malipiro (Malipiro, kuphatikiza ndi zolandira zina, asachepere mlingo wa boma wa MK962 patsiku kapena MK25,000 pamwezi)
Pa Chaka (MK): ………………………… Pa Mwezi (MK): …………………………. Pa Tsiku (MK): ……………………..
Zolandira Zina (Chitsanzo: chimanga, ndalama za ku chigayo, ndi zina zotero)……………………………………………………………………………………………………………………………………..
……………………………………………………………………………………………………………………………………..
Maola Ogwilira Ntchito pa Tsiku
Kuyambira: ………………………………………………….. Mpaka: …………………………………………………………..
Masiku Opumulira (Chitsanzo: la mulungu)………………………………………………………………………………………………………………………………………
Ntchito Zoyembekezeka Kugwiridwa ndi Olembedwa Ntchito………………………………………. ……………………………………………. …………………………………………..
………………………………………. ……………………………………………. …………………………………………..
………………………………………. ……………………………………………. …………………………………………..

Zifukwa Zomwe Zingapangitse kuti Mgwirizanowu Uthe……………………………………………………………………………………………………………………………………..
Zomwe Olemba Ntchito Akuyembekezeka Kukwaniritsa
 Kulipira malipilo omwe mwagwirizana pa nthawi yake Kupereka kwa olembedwa ntchito nyumba yogonamo yabwino ndi yotetezeka, madzi akumwa aukhondo, malo ophikira,bafa labwino ndi chimbudzi cha ukhondo.
 Kuwonetsetsa kuti olembedwa ntchito waphunzitsidwa za matenda odza kamba ka chikonga cha fodya (GTS) komanso
kuti wapatsidwa zovala zoyenelera kudzitetezera ku matendawa.
 Kuwonetsetsa kuti olembedwa ntchito waphunzitsidwa moyenera kagwiritsidwe ntchito ka mankhwala ndi zina zowopsezamoyo, zovala zodzitetezera, za mitengo ndi kalimidwe ka fodya kosamala chilengedwe.
 Kuwonetsetsa kuti palibe mchitidwe ogwiritsa ntchito ana ndi mchitidwe ozembetsedwa ndi kuwumirizidwa kugwira ntchito
pa mundapo.
 Pasakhale kulemba/kugwiritsa ntchito ana ochepera zaka 18.
 Kuwonetsetsa kuti ana onse a mnsinkhu oyenera kupita kusukulu okhala nawo pa mundapo akupita ku sukulu ndi kulowa
mkalasi.

Appendix IV - Materials provided to the farmers _ page 4 of 680External Assessment

Personal Protective Equipment- CPA application (face shield, mask, gloves (missing full body cover))Appendix IV - Materials provided to the farmers _ page 5 of 681

External Assessment

Gloves for handling green tobacco

Incident reporting in the ALP booklet

Appendix IV - Materials provided to the farmers _ page 6 of 682

External Assessment

Appendix V – GMS system for leaf technicians

Appendix V – GMS system for leaf technicians _ page 1 of 183

External Assessment

Appendix VI – Glossary
ALP

Agricultural Labor Practices

ALP Code Principle

Short statements that set expectations of how the farmer should
manage labor on his/her farm in seven focus areas

ALP Code

PMI’s Agricultural Labor Practices Code

ALP Program

Agricultural Labor Practices Program

AOTM

Alliance One Tobacco Malawi Ltd

CPA

Crop Protection Agents

CU

Control Union

GAP

Good Agricultural Practices

GTS

Green Tobacco Sickness

KPI

Key Performance Indicator

Leaf tobacco supplierCompany that has a contract with PMI to supply tobacco but is nota farmer

Measurable Standard

A Measurable Standard defines a good labor practice on a tobacco
farm and helps determining to what extent the labor conditions andpractices on a tobacco farm are in line with the ALP Code Principles

MWK

Malawi Kwacha (Malawian currency)NGO

Non-Governmental Organization

PMI

Philip Morris International, Inc. or any of its direct or indirect
subsidiaries

PPE

Personal Protection Equipment

Prompt Action

A situation in which workers’ physical or mental well-being might
be at risk, children or a vulnerable group – pregnant women, theelderly - are in danger, or workers might not be free to leave their
job

STP

Sustainable Tobacco Production

Appendix VI - Glossary _ page 1 of 184