Working Conditions Engagement
Grievance Mechanisms Sick Pay Distribution by Contract Type Oversight of Governance Structure Support Worker Representation Engage Workers on Industry Trends
Health & Safety
Grievance Mechanisms - Availability & Access
Group-level mechanism: Marfrig reports public information on the company's Whistleblowing Channel, "HelpLine", which expressly condemns retaliation toward whistle-blowers. Company disclosure on the mechanism indicates that it has good accessibility and availability across its operating markets in South America. In the US, National Beef operates an independent channel which appears to have good availability and access for employees and other stakeholders with reporting through a hotline or web form, including an anonymous option. In response to FAIRR feedback during Phase 1 of this engagement, the "HelpLine" no longer requires an email address to make an anonymous report. Other reporting platforms: Marfrig operates an open-door policy in its Uruguay-based operations only on topics relating to labour issues, internal conflict resolution, and worker support. It is unclear which level of management workers have access to through this policy and how the company ensures workers can access this channel without fear or threat of retaliation.
Grievance Mechanisms - Effectiveness & Evaluation
The company states that it uses dissemination campaigns to ensure workers and other stakeholders are aware of the HelpLine and to create an environment of trust around it, through its website, plant-level displays, and contractual clauses with third parties. Marfrig plans to conduct a survey in the second half of 2022 to assess employee satisfaction with the channel. The company does not disclose how it assesses the effectiveness of its National Beef grievance channel.
Grievance Mechanisms - Categories & Reporting
The company reports the grievance metrics for the HelpLine, which received 518 cases in 2020 and 368 in 2021. Of these, the company reports 98% were from Brazilian operations and 62% (228) were related to human rights in 2021. In response to Phase 1 (2021) of this engagement, the company now disaggregates grievance metrics by type of the individual filing the report (employee, former employee, third party, "not informed"), by category of grievance (from a list of 21 topics, which it discloses in full), and by geography. For the second year in a row, the company reports that the high rates of grievance cases regarding moral harassment (57% of cases) prompted the company to hold training on this topic. The increase in Moral Harassment reports YoY suggests that the trainings are not enough to address this topic. The company's grievance metrics do not include North American operations under National Beef.
Grievance Mechanisms - Channels for H&S and Worker Rights
Marfrig makes clear that human rights-related grievances can be reported through the HelpLine and health and safety is included in the list of grievance categories provided by the company, an improvement on its previous disclosure. The company's disclosure does not include North American operations under National Beef.
Grievance Mechanisms - Resolution Process
The company does not report on its grievance resolution process, including any steps taken following the receipt of a case. The company's disclosure does not include North American operations under National Beef.
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Sick Pay - Sick Pay Entitlement
In response to Phase 1 (2021) of this engagement, the company now reports that it makes paid sick leave available to workers across its South American operations under the laws and regulations of each country. Workers are required to submit a doctor's note to access sick pay in Marfrig's Brazilian operations, which can be obtained from on-site outpatient clinics available at all plants free of charge. The company's disclosure does not include its paid sick leave policy for US operations under National Beef. Refer to Company/Investor Meeting Notes Phase 2 (2022) for more insight.
Sick Pay - Other Economic Incentives
incentives available to workers. It now reports that workers can access a variable remuneration programme, leadership bonuses, long-term incentives, and, depending on CBA terms, a profit-sharing programme, all based on annual or financial targets depending on seniority. At its beef processing units, Marfrig offers workers additional days off based on their attendance. FAIRR highlights that this kind of attendance-based benefit can create conflicting incentives for workers to attend work while sick. The company also runs a "Refer-a-Friend Program", wherein existing Marfrig employees receive a bonus if they refer a contact to for a role and this person becomes a permanent hire. Additional benefits: The company's occupational health programme offers a range of services based on biological monitoring, with preventative actions for employees to support "psychophysiological health".
Fair Working Conditions
Distribution by Contract Type
In response to Phase 1 (2021) of this engagement, Marfrig now discloses a breakdown of workforce distribution by contract type across its five operating markets, providing metrics on its permanent and temporary workforce as well as whether workers are on full- or part-time contracts. The company's workforce is predominantly permanent and full-time, with 100% of its Brazilian workforce employed under these terms. Marfrig's remaining markets hire all or almost all workers on a full-time basis and rely heavily on permanent employees, except in Chile, the smallest operation, where 56% of the workforce (322 people) are temporary hires. Marfrig does not disclose whether it hires subcontracted workers.
Oversight of Governance Structure
The company's Ethics and Compliance Committee reports to the Board. The Committee comprises representatives from Human Resources, Legal, and Operations and meets regularly to discuss ethics and conduct issues, including disseminating the Ethics and Compliance Code, the reporting channel, and the Compliance Programme. Marfrig does not disclose examples of metrics reported to the Committee or how the Board follows up on labour issues. Refer to Company/Investor Meeting Notes Phase 2 (2022) for more insight. The company does not disclose examples of how it uses grievance metrics to make changes internally or examples of initiatives implemented as a direct result of reports received. Refer to Company/Investor Meeting Notes Phase 2 (2022) for more insight.
Support Worker Representation - Internal & External Structures
Board-level representation: Marfrig's public disclosure does not comment on its approach to elevating worker voice at board level. Refer to Company/Investor Meeting Notes Phase 2 (2022) for more insight. Internal committees: Marfrig's Brazilian operations have Internal Committees for the Prevention of Accidents in compliance with local regulation, made up of members elected by workers and/or representatives appointed by the company. In all plants across Chile, Argentina, and Uruguay, Health and Safety Committees are active, on which employee representatives are present. Additionally, the company's "Share & Grow Together Program" provides workers with a space for conversations to create a better working environment. "This program includes surveys with employees, performed by external experts, and training." It is unclear what employees/level of seniority participate in this programme and how the output is leveraged by the company to elevate worker voice. The company does not provide any information on the kind of topics covered, processes followed under this programme, how often meetings take place and in what kind of forum. Dialogue with trade unions: The company does not publicly report on its dialogues with trade unions, there has been no update on this disclosure from Phase 1 (2021) of this engagement. In response to Phase 1 (2021) of this engagement, Marfrig now states its support for the right to freedom of association (FoA). The company also reports that it carries out actions to realise this support, however, it does not provide any details on these actions. Disclosure of dialogues/engagement with trade unions would provide evidence of the company's active support to (FoA).
Support Worker Representation - Restrictions Under Law
The company does not operate in markets where freedom of association is restricted under law.
Support Worker Representation - Collective Bargaining
Marfrig now discloses that 100% of its workers in Brazilian plants are covered by CBAs, 81.5% in Argentina, 0% in Chile, and 61% in Uruguay. In its dialogue, Marfrig is unable to provide metrics on the CBA coverage of its US workforce or detail on why unionisation rates are at 0% in Chile. Marfrig's public disclosure does not comment on its approach to extending collective bargaining agreements (CBA) to non-unionised workers. Refer to Company/Investor Meeting Notes Phase 2 (2022) for more insight.
Support Worker Representation - Operations in China
Engage Workers on Industry Trends - Impact assessment on Employees
Automation: Whilst Marfrig states that it is investing in technologies and production solutions to "transform" the production process, the company does not disclose whether it conducts social impact assessments to analyse the risks and opportunities of these technologies. Refer to Company/Investor Meeting Notes Phase 2 (2022) for more insight. Climate risk: Marfrig has set two near-term SBTs aligned with 1.5°C, has committed to a Net-Zero target, and is a member of the SBT Business Ambition for 1.5°C campaign. Corporate disclosure does not comment on whether Marfrig conducted a social impact assessment as part of the target-setting process. Refer to Company/Investor Meeting Notes Phase 2 (2022) for more insight.
Engage Workers on Industry Trends - Workforce Engagement
The company does not disclose evidence of conducting levelled dialogues with workers or their representatives on its automation and climate mitigation efforts. Marfrig does not report on its efforts to train/upskill workers about climate or automation or consulting workers and/or their representatives in this process. Refer to Company/Investor Meeting Notes Phase 2 (2022) for more insight.
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Engage Workers on Industry Trends - Just Transition
The company's Materiality Matrix acknowledges the potential for a "rural exodus" and decline in rural income due to climate change, as well as the risk of unemployment and a drop in income caused by the blocking of farms that do not meet its climate/deforestation standards. The company also comments on transition assistance programmes to support dismissed workers due to closing operations, however, this is not specific to climate or automation, and the process is not reported to be carried out in consultation with workers or their representatives. However, Marfrig does not publicly state its support for a Just Transition in the food sector.
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Index Working Conditions Score:
14 February 2023
Phase 2 | Marfrig Global Foods SA Meeting Notes
Phase 2 | Marfrig Global Foods SA Assessment
Phase 2 | Members' Progress Report
Phase 2 | Public Progress Report
Phase 2 | Sample Engagement Letter
Working Conditions Engagement