EXCLUSIVE Dyson Drops Malaysian Supplier ATA Due to Labor Issues

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A Dyson logo is seen on 5th Avenue in New York, New York, the United States on March 19, 2019. REUTERS / Carlo Allegri / File Photo

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  • Workplace audit, whistleblower allegations leading to dismissal
  • ATA already under US investigation into labor practices
  • ATA shares plunge 30%

KUALA LUMPUR, Nov. 25 (Reuters) – Dyson has ended its relationship with supplier ATA IMS Bhd (ATAI.KL) following an audit of the Malaysian company’s labor practices and claims by a launcher alert, said the company famous for its high-tech vacuum cleaners. Reuters.

The ATA, which is already the subject of an investigation by the United States into allegations of forced labor, did not immediately comment. He has previously denied such allegations.

Shares of ATA, which makes parts for Dyson vacuum cleaners and air purifiers, fell 30% to their lowest level since April 2020 after the Reuters report. According to ATA, Dyson accounts for nearly 80% of its revenue.

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The termination is also a blow to Malaysia, an electronics manufacturing hub that has come under scrutiny this year for exploiting foreigners who make up a large part of the workforce. his factory.

Dyson, privately owned by British billionaire James Dyson, said it received the results of an audit of working conditions at ATA in early October. He said he learned of the allegations of a whistleblower at an ATA factory in September and tasked a law firm to investigate the allegations.

“Despite intense engagement over the past six weeks, we have not seen sufficient progress and have already phased out some production lines,” Singapore-based Dyson said in a statement to Reuters. “We have now ended our relationship on six months’ contractual notice. We hope this will give ATA the momentum to improve and allow for an orderly exit in the interests of the workers they employ.”

In May, ATA denied allegations of forced labor at its factories after a prominent human rights activist said U.S. authorities would review the company’s labor practices.

The activist, Andy Hall, shared a letter that U.S. Customs and Border Protection (CBP) sent him informing them that they had agreed to investigate an ATA unit after reporting complaints received of workers.

CBP did not comment on the investigation.

CBP has banned six Malaysian companies in the past two years from selling their products in the United States after finding evidence of forced labor.

In July, the US State Department put Malaysia on a list with more than a dozen countries, including China and North Korea, saying it had not made progress in eliminating trafficking. workers.

Most migrant workers in Malaysia come from Bangladesh and Nepal and are employed in factories, plantations and construction sites.

ATA posted record revenue and profits for the fiscal year ended March 2021, as lockdowns induced by COVID-19 boosted demand for home appliances such as Dyson’s upright vacuum.

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Reporting by A. Ananthalakshmi; Editing by Lincoln Feast.

Our Standards: The Thomson Reuters Trust Principles.


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