6 Lessons for Businesses Seeking to Identify Forced Labour Risk Earlier

Following the US Customs and Border Protection's Withhold Release Order (WRO) issued against Giant Bicycle, The Remedy Project conducted a case study testing a methodology for the early identification of forced labour risk in Taiwan's manufacturing sector.

Using publicly available information, the study examined how macro-level structural vulnerabilities, including recruitment debt, employer-binding practices and fear-based controls, can interact with business decisions to create or amplify forced labour risk. It then considered whether earlier identification and preventive action could plausibly have reduced the risks that ultimately contributed to regulatory action.

The analysis does not make independent findings of liability. Rather, it uses the Giant case to illustrate six broader lessons for businesses seeking to strengthen due diligence, identify risk earlier and act before harm becomes entrenched.

While grounded in Taiwan's manufacturing sector, these lessons have broader relevance for organisations seeking to build more resilient and responsible global supply chains.

Macro-Conditions Shape Business Practice Risks

As demonstrated in the Taiwan case, business practices determine whether existing structural risks are reinforced or reduced. It is not possible to address business practice risks meaningfully without first understanding the macro-level context in which those practices operate.

Implication: Due diligence frameworks must assess both structural conditions and specific business practices. A framework that assesses only factory-level practices without reference to macro-level drivers will systematically miss the conditions that make exploitation endemic.

Giant takeaway: The macro-level context, which includes widely reported recruitment fees, employer-binding practices and excessive overtime, constitute early warning indicators that should have prompted deeper interrogation of audit findings, as well as appropriate costing and procurement practices to avoid exacerbating pressures on workers.

Procurement Practices Have Forced Labour Implications

Price pressure is not a neutral commercial decision; it has direct human rights implications.

When buyers drive prices below the level required to cover ethical recruitment costs and living wages, they structurally create conditions in which suppliers can only remain competitive by passing costs onto workers.

Implication: Responsible sourcing requires that pricing covers the full cost of ethical recruitment and living wages. This is not a philanthropic demand; it is a prerequisite for supply chain integrity and regulatory compliance in an environment of increasing mandatory due diligence requirements.

Audits Alone Are Not Sufficient to Detect Forced Labour

Traditional social audits are structurally ill-suited to detecting forced labour in contexts of fear-based control and information asymmetry. When workers are afraid of retaliation from employers, including consequences such as forced repatriation in a context of no genuine job mobility, they cannot be expected to speak openly during on-site audits. Labour inspections that identify overtime violations may nonetheless miss the wider context that translates these violations into forced labour. A methodology that relies primarily on formal audit processes will generate false assurance in exactly the contexts where risk is highest.

Implication: Audits must be supplemented with off-site worker interviews conducted in workers’ native languages, independent worker voice mechanisms and meaningful engagement with civil society organisations and worker representatives. The absence of complaints is not evidence of compliance; in high-risk contexts, it can be a warning sign.

Worker Voice is the Most Critical Due Diligence Tool

Workers are best placed to provide a clear understanding of their working conditions. The challenge is to create mechanisms through which they can safely communicate this knowledge.

Independent, trusted worker organisations and representative bodies can provide crucial insights. Worker voice channels are also important tools and must be accessible, confidential and trusted. However, effective worker voice cannot be reduced to the deployment of tools alone; it depends on sustained, meaningful engagement with workers and their representatives.  

Meaningful engagement requires ongoing dialogue and responsiveness to worker input, rather than one-off consultations or passive reporting channels. Worker voice tools are too often treated as supplementary features of due diligence when they should be the primary methodology. Critically, worker input must be triangulated with other data, including audit findings and grievance records.

By the same token, grievance mechanisms must be tested to ensure that workers are aware of them, trust them and can use them without fear of retaliation. Learning generated through grievance mechanisms must feed back into due diligence and remediation systems, informing changes to business practices and preventive actions aimed at reducing the likelihood of recurrence.

Implication: Businesses must invest in accessible, confidential, independent worker voice mechanisms and in meaningful stakeholder engagement processes that prioritise regular, good‑faith dialogue with workers, trade unions  and legitimate worker representatives.

Source Country Context Matters

The vulnerability of migrant workers in Taiwan’s manufacturing sector is not created in Taiwan alone. It is shaped by the socio-economic conditions in workers’ countries of origin, such as poverty, high informal employment and increasing climate stress, that drive workers to accept exploitative terms prior to their departure. Recruitment debt begins in source countries. Due diligence that focuses only on post-arrival conditions will systematically miss the point at which vulnerability is created.

Implication: Due diligence must map recruitment pathways from pre-departure phase. Addressing source country push factors through responsible pricing and recruitment partnerships is essential to addressing forced labour at its structural root.

Short-Term Supplier Relationships Can Increase Exploitation Risk

Workers on fixed-term contracts with limited rights to change employers are acutely vulnerable when their employment relationship is unstable. Where buyers pursue short-term commercial relationships with suppliers, driven by price competition rather than partnership, supplier instability transfers directly to worker insecurity. In such contexts, lead companies tend to rely on compliance policing rather than collaborative approaches that support suppliers to manage risk proactively.

This dynamic discourages transparency. Suppliers facing uncertain volumes and frequent buyer switching have limited incentives to disclose labour risks or invest in durable workforce systems, particularly where disclosure is more likely to trigger sanctions than support.

Implication: Lead companies should move toward partnership models with longer-term commercial commitments and volume stability, shifting from a policing‑oriented approach to one focused on resilience‑building and risk mitigation. Stable supplier relationships create the foundation for operational continuity, trust and supplier confidence to invest in workforce systems that minimise worker vulnerabilities. Partnership‑based relationships also promote transparency, alignment and shared responsibility in identifying and managing forced labour risks, which are essential for a healthy and resilient supply chain.  

As regulatory expectations and stakeholder scrutiny continue to evolve, organisations will increasingly be expected not only to identify forced labour risks, but to demonstrate how they understand, manage and address them in practice.

Read the full Taiwan case study and explore more insights from The Remedy Project.

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