Forced Labor Allegations | Ottawa terminates contracts with Supermax Healthcare Canada

(OTTAWA) The Trudeau government is terminating outstanding contracts with Supermax Healthcare Canada to supply nitrile gloves because its Malaysian supplier is suspected of using forced labor to manufacture personal protective equipment.

Joel-Denis Bellavance
The Press

The Press learned that the Ministry of Public Services and Supply has still not received the results of the audits which had been promised to clarify allegations that Malaysia’s Supermax Corp used forced labour. These audits were to be submitted to him at the end of November.

As of September 30, Supermax Healthcare Canada, the Canadian division of Supermax Corp, has secured the equivalent of $240 million in federal government contracts since the start of the pandemic.

“The Government of Canada is terminating its existing contracts with Supermax Healthcare Canada for the supply of nitrile gloves. No further deliveries have been accepted or paid for by Canada after November 2021,” said in an email to The Press Stéfanie Hamel, spokesperson for the Department of Public Services and Procurement.

“Given the seriousness of the allegations and the expected time before the final results of the audit are available, the Government of Canada has decided, and Supermax Healthcare Canada has agreed, to terminate by mutual consent the two existing contracts for the supply of nitrile gloves,” she added.

It was impossible to know on Friday the value of the two terminated contracts.

Supermax Healthcare Canada, which has a storefront in Longueuil, has also won contracts totaling $330 million from the Quebec government for the purchase of personal protective equipment during the health crisis. But Quebec claims to have no longer had an active contract with the company for a few months.

Forced Labor Allegations

Last October, US Customs and Border Protection decided to seize disposable gloves made by Supermax Corp and its subsidiaries at all US ports of entry after being made aware of the forced labor allegations.

Forced labor is considered a modern form of slavery by the International Labor Organization, a specialized agency of the UN.

In Canada, the Trudeau government decided to suspend the delivery of contracts a month later, in November, following the decision of the American authorities, even though similar allegations had been brought to its attention in early January 2021.

At the time, the Department of Public Services and Supply asked six suppliers sourcing gloves from Malaysia, including Supermax Healthcare Canada, to provide information demonstrating that they were meeting their labor and human rights.

The Department decided to maintain the contracts with Supermax Healthcare Canada after receiving explanations of its practices, policies, audit and investigation strategies, and compliance with international standards.

But the move by US authorities has forced Ottawa to demand accountability again. Supermax Corp had notably agreed to hire an independent firm to investigate. In all, three audits were to be conducted. One of them was to be handed over to the federal government in November. This has not been done.

“Incompetence”

Conservative MP Pierre Paul-Hus argued that the federal government had failed in its obligations in this case.

“Since the beginning of 2021, it was a known fact here and elsewhere in the world that this company was involved in forced labor. It is unacceptable that the Government of Canada has closed its eyes and signed contracts related to companies that use human slavery. This is more than willful blindness, it is incompetence on the part of the minister. It is clear that there was a lack of diligence,” he said.

The deputy leader of the New Democratic Party, Alexandre Boulerice, was just as critical.

It is good news that the contracts are terminated. But how come such a mistake was made in the first place? Therefore, the necessary measures must be taken to prevent this from happening again. We have international commitments. You have to respect them,” he said.

In a statement sent to The Press, Supermax Healthcare Canada confirmed the termination of the contracts and indicated that the results of ongoing independent audits at Supermax Corp’s Malaysian facilities could not be released until the spring.

“These contracts strictly relate to gloves from the Malaysian factories targeted by the American allegations and managed by the supplier Supermax Corp. It is only these facilities and not those of Supermax Healthcare Canada that are currently undergoing an independent audit process. »

We would also like to point out that the federal government is not suspending its business relationship with Supermax Healthcare Canada for other personal protective equipment, in particular the surgical masks produced in its Longueuil facilities. “Supermax Healthcare Canada can still participate in Canadian government tenders for other products. »

Supermax Healthcare Canada is 67% owned by the parent company in Malaysia and 33% by its Executive Vice President, Sylvain Bergeron, a resident of Lac-Brome, Quebec.