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Labour Transformation Programme (LTP)

Labour Transformation Programme (LTP)

Labour Transformation Programme (LTP) in Malaysia

The Labour Transformation Programme addresses how mills and plantations can take practical steps to improve their labour practices and add value to the company's competitive edge.


Palm oil refineries are dedicated to upholding their commitment according to their responsible sourcing policy of No Deforestation, No Peat, and No Exploitation (NDPE). This initiative includes actively engaging suppliers to improve their labour management practices.

The collaboration between Earthworm Foundation and palm oil refineries aims to support mills and plantations in identifying areas for improvement and implementing an action plan to meet refineries' NDPE requirements. Having good labour practices in place will help companies reduce their potential risks of law and labour violations and enhance workers' well-being, performance and engagement. Hence, mills and plantations can gain a competitive commercial edge based on the current industrial requirements.

What is the Labour Transformation Programme (LTP)?

The Labour Transformation Programme (LTP) is a 2-visit engagement.

In this engagement, Earthworm Foundation, refineries, and supplying mills collaborate to share information and identify gaps concerning labour practices. To achieve this, the engagement with entities will include the following:

  • Management interview
  • Workers interview
  • Document review
  • Site visit
  • Contractor's interview (if any)

The LTP is neither a certification nor audit programme nor is it a human rights assessment. Instead, it is an engagement which provides tailored support to engaged entities so they can take practical steps to improve their labour practices based on the recommendations.

Labour Transformation Programme Scope

The scope corresponds with the No-Deforestation, Peat or Exploitation (NDPE) requirements, along with standards established by the Malaysian Sustainable Palm Oil (MSPO) 2.0 and the Roundtable on Sustainable Palm Oil (RSPO).

It also complements the international frameworks for the protection of human rights: such as the UN Guiding Principles on Business and Human Rights, the International Labour Organization (ILO), the OECD Guidelines for Multinational Enterprises, the Universal Declaration of Human Rights (UDHR) and the United Nations Sustainable Development Goals (UNSDG). These priorities closely reflect the international market's concerns surrounding forced and bonded labour, child labour and recruitment practices.

The scope is a five-step supplier engagement framework that covers eight topics.

  • Contract management
  • Grievance management
  • Freedom of movement
  • Post-arrival recruitment practices (site-level)
  • Wages and working hours
  • Freedom of association
  • Accommodation
  • Health and Safety

Labour Transformation Programme Engagement Structure

Expected Benefits

Mill/Plantation Management

Clear and quantified progress can be reported to buyers and international markets to maintain market access.

Palm Oil Refineries

Received personalised action plan to improve labour practices and implement strategies to map/monitor own supply chain.


Improved working conditions, morale, and productivity.

Key Impacts

Earthworm Foundation has completed 23 LTP engagements.

16% improvement in improving procedure, socialisation and documentation for grievances.

36% improvement in freedom of movement and safekeeping of the passports.

18% improvement in recruitment of workers, especially foreign workers.

39% improvements in workers' quarters aligned with legal requirements.

Learnings from Previous Engagements

  • Labour Transformation Programme (LTP) have helped mills and plantations to identify good practices and gaps in their current operations.
  • Engaged mills and plantations shared that the LTP provides them with a platform to identify and address their supply chain challenges on labour and human rights.
  • Engaged mills and plantations shared that receiving a thorough and personalised action plan has helped identify realistic yet effective strategies to improve labour practices in their daily operations.

Some Companies who have Engaged in the Labour Transformation Programme (LTP)

In 2017, the Fuji Oil Group launched a supply chain Labour Transformation Programme (LTP) in collaboration with Earthworm. LTP identifies labour-related issues with Fuji Oil Group's suppliers and helps its suppliers build management systems to address these issues.

Learn More

'The LTP helps third-party mills and plantations to refine their management practices on labour rights. The program focuses on four key labour rights areas prevalent in the Malaysian palm oil industry – employment contracts, recruitment practices, grievance mechanisms and freedom of movement – and engages small and medium-sized mills and plantations to address challenges in these areas.'

Bunge Loders Croklaan

Contact Information

Contact Lynda Lim, Technical Lead (Social & Human Rights), at for further information on the Labour Transformation Programme (LTP) and how Earthworm Foundation can help.

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