The palm oil industry was one of the sectors that practised good capitalism back in the 1940’s. This was largely eroded when the sector moved towards more foreign labour. Now that there is a move back to using local labour, this provides challenges which are being addressed by good capitalism principles. In this article we look at how employing ex-convicts could be the answer to a growing labour problem in the oil palm sector.

Strange as it may sound, especially because of all the negativity associated with rubber and oil palm plantations, some practices in the estates from as early as the 1940s are now seen as good capitalism.

In the early days, estate workers in Malaysia, comprised of South Indians who came to the country under the kangani system. They worked in the rubber estates which were later cleared to plant oil palm, with the first commercial oil palm planting being on the Tennamaram Estate in 1917. The jobs were laborious and dangerous with demanding conditions.

 

 

(Picture from writer)

 

The palm oil industry was one of the sectors that practised good capitalism back in the 1940’s. This was largely eroded when the sector moved towards more foreign labour. Now that there is a move back to using local labour, this provides challenges which are being addressed by good capitalism principles. In this article we look at how employing ex-convicts could be the answer to a growing labour problem in the oil palm sector.

Strange as it may sound, especially because of all the negativity associated with rubber and oil palm plantations, some practices in the estates from as early as the 1940s are now seen as good capitalism.

In the early days, estate workers in Malaysia, comprised of South Indians who came to the country under the kangani system. They worked in the rubber estates which were later cleared to plant oil palm, with the first commercial oil palm planting being on the Tennamaram Estate in 1917. The jobs were laborious and dangerous with demanding conditions.

 

 

 

(Picture from writer)

 

Yet, it not uncommon to see two or more generations working and living on the same estates, working in the same jobs, for example as harvesters or replanting.

Partly due to their lack of education, the generations of families continued living and working in the estates, as the far-sighted estate management employed various ways to sustain its workforce.

From the early days of the longhouses or kongsi as they were once known, the management began to improve the accommodation to retain workers. Companies such as the Eastern Plantation Agency and Sime Darby Plantation, built better homes, such as semi-detached houses, that included at least two rooms, a toilet and bathroom. The maintenance of the homes was caried out by the estate management. Water was also freely available in most places and a subsidised rate was provided for electricity.

Estate workers were given access to healthcare where hospital assistants were employed to ensure the workers’ general health and react to emergencies. This was later expanded to Group medical benefits that included hospitalisation.

In addition to meeting their basic needs, estate management also provided for the social needs of the workers.

Temples were expected on these estates where prayers or the temple tiruvilla (temple’s anniversary celebrations) were a grand affair that even attracted those from neighbouring estates. Sometimes there were more than one temple on an estate, to cater to the different caste of the workers.

To encourage women to work, a creche and/or nursery was provided, which were usually tended by ayahs (a term to address the caregivers). Usually, the children were given to the care of ayahs who are of the same ethnicity for religious and cultural sensitivity. The estate management also supported the nurseries by providing the children with free milk powder, which encouraged mothers to leave their children at the nurseries and work in oil palm nurseries, weeding, spraying pesticides, applying fertilisers or as general workers.

To avoid any kind of mishap at workplace, pregnant women were only allowed to work up to their seventh month and return to work after 90-days paid maternity leave.

Facilities such as football fields, community halls and primary Tamil schools were also provided. The teachers were brought from India and later, government provided trained teachers whose accommodations were provided by the estate management. Inter-estate football matches were one way of building a community and sense of belonging among the workers.

Religious classes and cultural dances like Bharatanatyam were also held, usually at the estate temples or community halls.

In the 1960s, it was common for estate management to play movies at the football fields, usually on Saturdays for the workers and their families. Until today, those who grew up in that environment can recall the almost carnival like set-up at the football fields with stalls selling light snacks such as kacang puteh and vadai, where devotional movies or those of famous stars like MG Ramachandran and Sivaji Ganesan were played. However, the trend of playing movies at football fields was gradually replaced by television as it became more available, and affordable, in the 1970’s.

When discussing workers’ welfare, one particular company, the United Plantations and its Jendarata Estate, comes into mind. Apart from implementing proper housing schemes for its workers, the company also built an old folks’ home, in 1967, for its retired workers, providing meals, medical care as well as cash allowances. It was also one of the companies that believed in profit sharing where staff were paid bonuses each year.

By giving back to the communities that they work with, the companies earned not just the unwavering loyalty of the workers, but also saw higher productivity.

 

 

(Picture from writer)

Cases of unpaid wages, or slavery, by some unscrupulous estate managements are often raised but the National Union of Plantation Workers, armed with the relevant government Acts are fast to act, ensuring that the workers are fairly treated, and such complaints are addressed.

Looking after the workers’ welfare was uncommon at this time and only a few companies were engaged in such activities. Take the Cadbury company for example which created the Bournville village for its workers, complete with facilities which were unheard of at the time such as cricket and football pitches, playgrounds and gardens. The company was well known not just for its chocolates but also for better working conditions and social benefits.

 

 

The New Future

As times changed, estate lands were sold or cleared to build more complexes or housing. The children of estate workers ventured out of the plantation and armed with better education and skills, they wanted something different to toiling under the sun, doing laborious jobs.

Palm oil owners and companies begin to source workers from outside Malaysia such as Bangladesh and Indonesians who took over the 3D (dirty, dangerous and difficult) jobs.

Today, the plantation sector is struggling to meet its workforce requirements, since the government issued a freeze on hiring foreign workers in the plantation sectors, as it wants to reduce the dependency on foreign labour. Unfortunately, Malaysians who by now have tasted life outside the estates and enjoyed working in air-conditioned factories, are largely refusing to take up the estate jobs.(Picture from writer)

Perhaps the Sime Darby Plantation (SDP)’s initiative to provide jobs to parolees might help the sector, which is in dire needs for workers. The conglomerate is in a partnership with the Malaysian Prisons Department where parolees who have given their formal consent, are hired to do general work such as manuring, weeding and field upkeep.

The parolees are paid minimum wages which will be directly transferred to their accounts. They are provided with the same benefits as the estate workers such as free housing, subsidised electricity, free water and overtime opportunities. Upon completion of their sentence, the parolees can apply to work for the company.

This initiative helps parolees reintegrate back into society and, at the same time, provides them with employable skills. Not only are they given a fresh start after a life in prison, but this can also reduce the percentage of them returning to their criminal past. It could also reduce prison overcrowding.

“SDP is proud to be supporting the programme because we realise that assimilating into society whilst being dogged by stigma is not an easy task for most former inmates. Our aspiration in collaborating with MPD through this programme is to help parolees turn over a new leaf and build a better future for themselves and the families”, the company said in a statement.

The Sime Darby Plantation initiative is a good example of Good capitalism, demonstrating that it is beneficial to all the stakeholders involved.

What is Good Capitalism?

It is looking beyond profits and ensuring that a company’s workforce, and community (be that local or international) in which it operates, are key stakeholders and that their needs are taken into account when deciding how to utilise the profits made by the company.