Obama’s Anti-Trafficking Order and Business

December 20 was the deadline for corporate suppliers of the world’s biggest consumer—the U.S. government—to have a say in new regulations aimed at ending indentured servitude overseas. The rules stem from an executive order Obama signed last year, called “Strengthening Protections Against Trafficking In Persons In Federal Contracts.”

The President’s dictate is unequivocal on one key point: If a company wants to keep the government as a customer, it must stop hiring overseas workers who had to buy their jobs. Foreign workers recruited from some of Asia’s poorest corners often go deep into debt to pay brokers for a crack at jobs on consumer-electronics assembly lines. 

Procurement lawyers in Washington say the ban applies all the way down the supply chain. It even applies to contractors selling commercial off-the-shelf goods.

Technology companies are already concerned about the ban. The new rules could force manufacturers to shoulder more of the costs of filling factories with cheap labor. Today those costs often fall on the workers and their families; shifting the burden would probably increase prices all the way up the supply chain.

Hey, someone has to pay for your new gadget.

Learn more at Cam Simpson’s and Adam Satariano’s Business Week article: What Obama’s Anti-‘Human Trafficking’ Order Means for Apple.

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