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Opinion: ‘Fair Trade’s Dirty Little Labor Secret is Out’

fair trade and coffee farmworkers

Photo by the University of London

by Michael Sheridan of CRS Coffeelands Blog

(Editor’s note: Daily Coffee News first covered the report discussed below in May. However, we feel that the importance of this subject as it relates to sustainability efforts within the coffee industry, as well as regular contributor Michael Sheridan’s unique perspective, warrants the further coverage.)

In May, researchers at the Fairtrade, Employment and Poverty Reduction program at the School of Oriental and African Studies in London released a report based on four years of intensive field research in Ethiopia an Uganda with findings critical of Fair Trade’s record on farmworkers. I only just got around to reading the full report. I know I am coming late to the conversation, but today I share the three messages I consider most important in this report.  (They are not, incidentally, the ones the FTEPR researchers consider the most important.)

In their Introduction, the authors suggest that the three principal findings of the research are these:

  • “Wage employment in areas producing agricultural exports is widespread.”
  • “People who depend on access to wage employment in export commodity production are typically extremely poor.”
  • “This research was unable to find any evidence that Fairtrade has made a positive difference to the wages and working conditions of those employed in the production of the commodities produced for Fairtrade certified export.”

These are all valuable findings. But that doesn’t necessarily make them the report’s most important contributions to our understanding of Fair Trade or the sustainability conversation in coffee.

In my opinion, the report’s top three messages are these.

1. Fair Trade Coffee’s Dirty Little Labor Secret is Out

The Fair Trade narrative and Fair Trade Certification standards have stubbornly insisted on the distinction between “smallholder” and “hired labor” production systems in spite of clear and persistent evidence that the reality in the coffeelands is much more fluid. Smallholder coffee farmers are a significant source of both demand for and supply of wage labor in the coffee sector.

On the demand side, the report argues that Fair Trade standards for coffee “have been based on the erroneous assumption that the vast majority of production is based on family labor.” It identifies larger smallholders as the principal source of labor demand in coffee.  But in my work, I routinely see farmers with one hectare of coffee or less relying primarily on hired labor during harvest. Despite the false dichotomy between smallholder and hired labor systems, hiring farmworkers is not the exclusive domain of large landowners.

On the supply side, the report talks about huge percentages of households in coffee-growing areas in Ethiopia and Uganda that have worked for wages in the coffee fields. My experience in Latin America is consistent with those findings. In our projects, wage labor on coffee farms is a standard component of livelihood diversification strategies among smallholder coffee farming households. For households that do not permanently depend on paid labor outside their own farms, wage labor is a leading coping strategy in times of economic distress. In other words, smallholder coffee farmers are frequently also coffee farmworkers. This is especially true among the most marginal smallholder coffee growers.

But for me, this report illuminates more on farmworkers than Fair Trade. It represents powerful confirmation of two other truths:

2. Farmworkers are the Poorest and Most Vulnerable Participants in Coffee Supply Chains


3. They are Mostly Invisible in Coffee’s Sustainability Movement

I confess that I initially read the report’s first two key findings with some cynicism, scrawling “DUH!” in the margins next to each of them.  They are, after all, things we “know” empirically from our work in the coffeelands. But the report’s authors make the case convincingly with data, bringing welcome rigor to each of these points and showing how families dependent on agricultural wage labor are systematically poorer, hungrier and more vulnerable than their neighbors who are not.

When I once heard a coffee colleague liken recruiting farmworkers for harvest to “scraping the bottom of the barrel,” I winced — mostly because it sounded so uncharitable, but partly because I understood where it was coming from. Many people in the coffeelands only perform unskilled manual labor in the fields — the most grueling and least profitable way to earn a livelihood — because they don’t have better, less grueling and more rewarding options. In a labor market that is increasingly knowledge-based, the workers who do the unskilled manual farm labor are generally the poorest, the least educated, and the most vulnerable, as the report shows.

The authors attribute their most provocative finding — that Fair Trade in coffee has not had a positive impact on farmworkers — to certification’s relentless and exclusive focus on smallholder growers and democratically run cooperatives.

They write, memorably:

“Fairtrade certification has failed to benefit poor wage workers because it has overlooked their existence.”

But it is not just Fair Trade coffee that has historically disregarded farmworkers. For a quarter-century, the coffee industry has distinguished itself for tireless innovation to make the coffee trade more inclusive, but the sprawling farmworker population has mostly remained at the margins of those efforts.

Thankfully, if slowly, this is beginning to change. If the social impact narrative of Fair Trade, and of sustainable coffee more broadly, is to ring true, farmworkers and farmworker issues must move more quickly into the slipstream of the conversation. A natural starting point might be fore  all of us — industry, academia, aid organizations, certifiers, policymakers — to heed this recommendation from the SOAS researchers:

It is imperative for policy makers and donor agencies to improve their understanding of the material conditions of low-income wage workers.




Just the tip of the iceberg! Conditions for workers in CERTIFIED farms in Costa Rica are appalling.

Robert Fulmer

Farm labor is exploited all over the world and the incentive for this to continue is very strong. Calling this FT’s “dirty little secret” is a disgenouse attempt to weaken the most ambitious attempt the coffee industry has ever come up to address low living standards. FT is of course limited, expecting it to solve and take responsibility for the problem is unrealistic. It is a noble fist step. Got a better idea?



Thank you very much for your comment.

To be clear, I am definitely NOT one of the Fair Trade haters seizing on an opportunity to trash the system. I have been working in the U.S. marketplace and in the field with growers to promote Fair Trade for more than 10 years and I agree with you–it is an ambitious and largely successful approach to make the coffee trade fairer for smallholder growers.

That said, it is true that Fair Trade Certification for coffee–until Fair Trade USA’s controversial move to break with FLO, certify estates and advance a farmworker empowerment agenda–made the farmworker population invisible to Fair Trade consumers. And not just the large, permanent workforces on estates–the hired labor in the Fair Trade Certified coffee supply chain who were obscured behind the relentless narrative of small-scale growers who depend on family labor. Reliance on family labor is a reality, to be sure. But not the only reality. There is plenty of hired labor on smallholder farms that are part of the Fair Trade system if not part of the narrative.

This is the secret I was referring to. I did use the “dirty little secret” language in my original post here ( but it was not my headline. And it was not the main point of my post. The main points I wanted to make were that the SOAS report is more enlightening on farmworker issues than Fair Trade, and that we all–certifiers, workers, industry, government, non-profits, etc.–need to engage the farmworker population more frontally if we are to really reach the poorest and most vulnerable participants in our industry.

As I have written in reply to some of the comments to my coffeelands blog post, I don’t necessarily think that it is Fair Trade’s responsibility to resolve The Farmworker Problem. But I don’t think the fact you mention–that farm labor is exploited all over the world–should absolve Fair Traders or anyone else from working in our supply chains to end farmworker abuse.

Thanks for your leadership all these years on Fair Trade and other sustainability issues.


Price Peterson

Excellent article. A number of years ago a proposal was made at the SCAA meeting in Boston for ‘FAIR WAGE’ coffee. It was shouted down. Perhaps its time has come and it just may be the “better idea” Bob Fulmer is looking for.


Thanks for the kind words, Price. They mean a lot coming from you.

I was involved in planning and facilitating a discussion on farmworkers in coffee for the last SCAA Expo in Seattle, and we wrestled a lot in our planning discussions about how much of the responsibility for advancing a BIG IDEA, or a “better idea,” as Bob called it, fell to us. At a certain point we wondered whether it was less an issue of a single BIG IDEA than a commitment to bring the industry’s boundless creativity and energy to bear on farmworker issues in a way it has with Fair Trade and other sustainability initiatives. It is hard to imagine that if we collectively devoted half the energy to farmworkers in coffee as we have over the years to Fair Trade that we wouldn’t come up with impactful new approaches to improve the way we engage with this massive, vulnerable and largely invisible group of people on whom we all depend for our coffee and our livelihoods.

In a “conversation” on Twitter prompted by this post, I suggested a more modest starting point than a BIG IDEA would be a conversation designed to better understand the challenges and opportunities that lie latent in closer engagement industry-wide with farmworkers.

Thanks again for making the time to weigh in.


Ben Corey-Moran

Thanks Michael, for sparking a dialogue around one of the most complex and challenging issues we face in the coffee industry—how to reach the poorest of the poor, within a largely transient workforce. I would however, like to re-frame the conversation a bit. This isn’t just a fair trade problem; it’s a wage worker issue, and a “how much we pay for our coffee” issue. The fundamental economics of coffee reflect an acceptance of poverty that is in itself unacceptable, not to mention, unsustainable. Fair Trade emerged thanks to the efforts of pioneers who sought to change this. Historically, in coffee, our focus was on one specific part of the larger supply chain (cooperatives). This is slowly evolving. Just a few years ago Fair Trade USA developed the first standards for farm workers and independent smallholders in coffee–two groups previously excluded from the majority of all sustainability conversations. The important takeaway here is not that fair trade has failed, but rather that the opportunities and benefits of fair trade do not yet reach everyone.

At the end of the day, creating sustainable livelihoods for more people in coffee–including wage workers on farms of all sizes–will require not just the efforts of a few fair trade certifiers, but of the entire coffee industry. There is a collective responsibility here that has yet to be recognized in a significant way.



Thank YOU for your (characteristically) incisive comments here.

I agree entirely that this is not a Fair Trade issue but an issue related to the underlying economics (and perhaps politics) of the coffee trade. That the responsibility for addressing it is collective. And that the takeaway is not the failure of Fair Trade. I tried to make this clear in my post by suggesting the real illumination in the SOAS report was around farmworkers and not Fair Trade, but judging from the tone of some of the responses my post has provoked, I didn’t make the point clearly enough.

The approach you have taken at FTUSA, expanding Fair Trade Certification as a strategy for reaching, organizing and empowering farmworkers, is audacious. It certainly was controversial. We still don’t know if it will work. What is certain is that it has gone a long way to making the farmworker population more visible in coffee’s sustainability conversation and to bringing farmworker voice to bear on that conversation.


Andy Newbom

The mega giant “coffee” companies will never pay a decent, sustainable price for coffee. The general public wont either. Neither those mega companies nor their customers value or like coffee. it is simply a vehicle for money movement. Expecting them to WANT to care about farm workers is disingenuous.

Sure I WISH they cared, but they don’t. it’s up to us at the small end of the market to make the massive impact. Fair Trade is vastly better than the typical rape and pillage pricing and policies of the main market. There is no single answer and no single solution. Even in the bottom of the market there is vast room for improvement without breaking the whole market.

Jamie Marie Padilla

Thank you, Michael, for writing this thoughtful response to the SOAS report. I couldn’t agree more that their findings tell us more about farm workers in coffee than they tell us about Fair Trade. (Mini rant… It took four years worth of “rigorously designed and methodologically original fieldwork” to figure out that initiatives not directly aiming to reduce poverty for wage earning workers failed to reduce poverty for wage earning workers?!?). Rant aside, what’s key here is exactly what you highlighted. Namely, that farm workers in coffee have largely remained at the margins of sustainability initiatives coming out of an industry where there is SO much collective goodwill. Thankfully, the conversation is picking up momentum and some folks are out there experimenting and engaging to figure this out without having the next big idea clearly defined. There’s no road map here. But what we do know is that if farm workers themselves aren’t at the table while this conversation takes off, we will miss out on important opportunities maximize the impact of our best efforts.

I lament that the message being drawn out of this report (at least as I’ve seen it framed since its release) is that Fair Trade is a failure. This is not helpful. While certification schemes have their limitations, FTUSA through Fair Trade for All has the best process in place thus far and continues to try to evolve the standards in place to maximize impact on farm workers. Perhaps the researchers weren’t aware of these innovations in FT (resisting another rant…). Nonetheless, I gladly welcome that they’ve stirred the pot on this. The more we get out of the weeds of smallholders vs. plantations and into a more informed conversation about farm workers in coffee production, the closer we get to finding that sweet spot (or spots) where the interests of roasters, coffee lovers, farm workers, and their employers line up to the benefit of all.

Thanks again, Michael!


Fair trade has been used to imply the fair treatment of the farmers and the farm laborers by those who market their product in the U.S. and Europe. This report makes it clear that story is not true so all those who have invested in the promotion of that system will rise to fair trades defense.That is what we are seeing now but history has shown these myths cannot be sustained.
As a society, when we chose to vote with our dollars things will change at origin. This concept was proven with divestiture in South Africa leading to the the downfall of Apartheid or with elimination of sweatshop goods from asia by major U.S. clothiers.Now we are witnessing the change in the coco production due to networks reporting like those shown on CNN.
When the consumer sees the reality of the farmworkers and their families that are kept in adjunct poverty by large growers and processors while these same people reap record profits there will be a call for change and all the large retail companies like starbucks will race to show they are not part of that problem even though they are now.
Times they are a changing and the coffee drinker will no longer pay 15 dollars a lb for quality coffee while the farm owners drive land cruisers and the workers ride donkeys…
I live and work in Nicaragua so I see the injustice first hand…


Let me speak for a lot of us in Central America, Fair Trade, Rainforest Alliance, really just makes us farmers poorer and worse off. We are forced to spend all this money to make a certification, and get paid a few points more. Really, the whole certification process is to make rich American coffee drinkers feel good about what they are drinking and about themselves. At a break even cost of $1.70. To process and export the coffee costs $14 dollars a quintal (100 lbs). Pay $2 dollars per quintal on top of that for “coffee rust tax.” What is left. Just make sure we have enough money to plant corn and beans to make it through the next 9 months and pay the bank loan at 14% interest. Fairtrade and Rainforest Alliance are for farmers that are wealthy with 50-400HA of land. Most farmers have 1-5 hectare and have to pool all the coffee together. These farmers don’t live in the Fairtrade and Rainforest Alliance world.

K.C. O’Keefe

I think the report indirectly supports that there is a larger issue at play, namely minimum farm size economics. Is there such thing as too small of a farm to be economically sustainable? What size does a farm need to be to be able to pay minimum legal wage to is day laborers?

Here in Peru we talk regularly about 5 hectare+ minimum to be a “sustainable” family farm (and that with 20 QQ+ minimal yields), yet the average farm size in Peru hovers around 2.5 hectares and 12 QQ per hect.


Here in Nicaragua most small farms are worked by family and relatives at harvest,with little paid as wages because its a group effort. The real issue I see is they have no credit or access to cash for fertilizers and fungicides so they borrow from the mill and later they have to sell the harvest at the price the mill dictates…Fair wages are not often paid by larger farmers who have access to banks and lines of credit so farm size to me is a distraction to the issue of the small farmer only getting 10% or less of the retail price coffee sells for, is that FAIR TRADE? The day laborers are workers and granted some income is better than none but we should stop insulting them by saying fair trade is helping them.
The premiums of fair trade go to the middle men and retailers.

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