United States Securities and Exchange Commission
Washington, D.C. 20549
Notice of Exempt Solicitation
Pursuant to Rule 14a-103
Name of the Registrant: Tyson Foods, Inc.
Name of persons relying on exemption: American
Baptist Home Mission Society (ABHMS)
Address of persons relying on exemption: Investor
Advocates for Social Justice, 40 S Fullerton Ave. Montclair, NJ 07042
Written materials are submitted pursuant to Rule
14a-6(g) (1) promulgated under the Securities Exchange Act of 1934. Submission is not required of this filer under the terms of the Rule,
but is made voluntarily in the interest of public disclosure and consideration of these important issues.
The American Baptist Home Mission Society (the
“Proponent”), along with 6 co-filers,1 urges shareholders to vote FOR Proposal 4, the shareholder proposal requesting
the Board of Directors commission an independent third-party audit assessing the effectiveness of the Company’s policies and practices
in preventing illegal child labor throughout its value chain, at Tyson Food, Inc.’s Annual Meeting of Shareholders on February 8,
2024.2
Summary of the Proposal
The proposal requests that Tyson commission an independent third-party
audit assessing the effectiveness of the Company’s policies and practices in preventing illegal child labor throughout its value
chain. The audit should include:
| 1. | an evaluation of Tyson policies and practices regarding, but not limited to, slaughter and processing facilities, third-party contractors,
suppliers etc. linked to child labor violations; |
| 2. | meaningful consultation with workers, suppliers, and other relevant stakeholders to inform appropriate solutions and ensure compliance
with federal child labor requirements; and |
| 3. | recommendations for actions and regular reporting with progress on identified actions. |
Support for this proposal is warranted and in the best interest
of shareholders because:
| 1. | Illegal child labor in meatpacking companies’ value chains is a systemic issue, which presents material risks to Tyson and its
shareholders; |
| 2. | Failure to meaningfully address illegal child labor exposes Tyson and its investors to financial, legal, regulatory, and reputational
risks; and |
| 3. | Tyson’s policies and strategy (outlined in its Statement in Opposition) have failed to meaningfully address illegal child labor
and systemic exploitation of its workers as a contributing cause of illegal child labor. |
Proponent Rationale for Engagement
The proponent, American Baptist Home Mission Society (ABHMS), is a
faith-based institution whose vision and values promote the care of the earth, the rights and dignity of all people, racial equity, peace
and social justice through its ministry work and investments. ABHMS believes that, through improving human rights and addressing systemic
inequalities, companies can become more sustainable and contribute to a more positive and equitable society. ABHMS is a long-term investor
in Tyson Foods that has engaged the Company on human rights due diligence, racial equity, labor rights, and water stewardship over the
course of many years. Most recently, ABHMS has engaged the Company on its exploitative labor practices, especially regarding Tyson’s
treatment of workers during the COVID-19 pandemic.
40 S Fullerton Ave,
Montclair, NJ 07042 ◊ 973-509-8800 ◊ info@iasj.org ◊ www.iasj.org
In the past year, more evidence of Tyson’s exploitative labor
practices have come to light, as the Department of Labor (DOL) found seven cases of illegal child labor in Tyson’s Arkansas and
Tennessee facilities.3 According to the investigation, children worked the overnight shift and were engaged in hazardous
work, including using caustic chemicals and cleaning meat processing equipment, such as back saws, brisket saws, and head splitters.4
More recently, DOL launched a separate investigation into whether Tyson had relied on migrant child labor to clean its slaughterhouses.5
The investigation is ongoing, but investors are concerned this is just the beginning of an increase in illegal child labor cases coming
to light. Moreover, investors are concerned about risks of illegal child labor occurring at Tyson’s contract poultry farms. For
example, recent allegations claim that Tyson’s chicken farms have been using illegal child labor to catch chickens.6
Investors believe illegal child labor in Tyson’s value chain is a tragic symptom of a greater problem - Tyson’s exploitation
of its workforce.
In 2021, Tyson committed to commissioning an independent Racial
Equity Audit (REA), considering its abuse of workers, especially the disparate impacts on workers of color during the COVID-19 pandemic,
and the ways the Company continues to further racial injustices.7 Although the REA was supposed to be conducted within a
year, by the end of 2022, Tyson had not demonstrated any progress on the audit. In February 2023, shareholders attended the Tyson AGM
and published a statement, urging the Company to follow through with its commitment.8 From April 2023 until now, investors
have not received any updates on the REA, putting into question Tyson’s commitment.
In light of the recent findings of illegal child labor in Tyson’s
facilities and the uncertainty about the Company honoring its racial equity audit commitment, in August 2023, ABHMS filed a shareholder
proposal at Tyson related to illegal child labor in its value chain. Specifically, the shareholder proposal points out the presence
of child labor in Tyson’s operations as a symptom of a larger pattern of abuse and exploitation of the Company’s workers in
its value chain.
The proponents therefore offer this proposal - supported by strong
reputational and financial risk arguments - to Tyson and its shareholders as an invitation to deeply examine its business model and to
make the necessary changes to contribute to a more equitable and sustainable future - a future in which children do not have to engage
in illegal and dangerous work to support an industry that relies on exploitative labor practices.
Arguments in Favor of the Proposal on Living Wage and Income Report
to Eradicate Child Labor
1. Illegal child labor in meatpacking companies’ value chains
is a systemic issue, which presents material risks to Tyson and its shareholders;
Over the past year, the Department of Labor (DOL) investigations have
found increasing cases of illegal child labor in a variety of high-risk sectors, such as food and manufacturing. According to the DOL,
illegal child labor in the US has significantly increased over the past few years, with an increase of 69% since 2018.9 Illegal
child labor represents a clear material risk to meatpacking companies, resulting in financial, reputational, and regulatory costs.
A February 2023 DOL investigation found illegal child labor in 13 meat processing facilities in eight states, including in Tyson Foods’
facilities.10 According to the investigation, the child labor violations were systemic.11 In more recent months,
reports have come out with information on additional illegal child labor in Tyson’s plants, indicating this problem may be more
pervasive than initially thought.12 In response, the DOL recently opened investigations into Tyson and Perdue Farms to determine
whether the companies relied on illegal child labor to clean slaughterhouses.13 The investigation is ongoing.
40 S Fullerton Ave,
Montclair, NJ 07042 ◊ 973-509-8800 ◊ info@iasj.org ◊ www.iasj.org
Furthermore, increased illegal child labor in the meatpacking industry
can be linked to labor shortages caused, in part, by Tyson and its peers’ exploitative labor practices and poor treatment of workers
in its value chain. According to the FAIRR Initiative, labor shortages in the meatpacking industry are “linked to poor working
conditions, including plant-level health and safety risks faced by workers, which jeopardise companies’ ability to attract and retain
willing workers.”14 Other experts have reiterated that these so-called “labor shortages” are self-inflicted
wounds stemming from poor working conditions at companies’ facilities.15 Tyson has a reputation for exploiting workers
and providing poor working conditions. For example, two recent congressional reports detail Tyson’s failure to protect its workers
during the COVID-19 pandemic and active opposition to federal and state health emergency safeguards.16 To address these self-induced
labor shortages, companies have increasingly been relying on illegal child labor, since children, especially migrant children, are vulnerable
and easier to exploit.17
While the presence of illegal child labor itself represents significant
material risks for companies and their investors,18 poor labor practices, more generally, have been connected to major negative
financial impacts to companies’ bottom lines.19 Poor labor conditions, of which illegal child labor is both a symptom
and an example, has been linked to lower productivity, higher turnover, more workplace injuries, and overall decreased financial performance.20
2. Failure to meaningfully address illegal child labor exposes Tyson
and its investors to financial, legal, regulatory, and reputational risks;
Tyson faces a host of regulatory and legal challenges. The Department
of Labor and state labor agencies enforce violations of child labor law. As a result, there is no private right of action for victims
of child labor under the Fair Labor Standards Act to sue Tyson for child labor violations, as there are for wage theft claims. There are
nonetheless, significant government fines and ongoing investigations, including:
| ● | 6 cases of illegal child labor in Tyson’s Green Forest, AR facilities, with an assessed penalty of $90,828, the maximum civil
penalty allowed under federal law;21 |
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| ● | 1 case of illegal child labor in Tyson’s Goodlettsville, TN facilities, with an assessed penalty of $15,138, the maximum civil
penalty allowed under federal law;22 |
| ● | An ongoing DOL investigation against Tyson and Perdue Farms into child labor violations by their subcontractor. Notably, this appears
to be the first time DOL is attempting to hold parent companies jointly liable for the child labor violations of their subcontractors,
signaling a move towards greater supply chain accountability and liability.23 |
Tyson also faces a host of lawsuits from workers alleging negligence,
wrongful death, and other tort claims related to Tyson’s poor handling of the pandemic.24 Also, in 2023, OSHA found
20 violations at 12 of Tyson’s facilities in Indiana, Missouri, Iowa, Arkansas, Nebraska, North Carolina, and Texas, leading to
initial fines of over $230, 407.25 This is despite OSHA’s limited resources and the fact that many injuries are not
reported by employers.26 Since companies are only required to record on OSHA-provided injury logs serious injuries that receive
a doctor’s care, Tyson reportedly requires injured workers to consult with on-site nurses first before visiting a doctor. On-site
nurses have reported being pressured into only providing first aid instead of recommending medical treatment, in an effort to lower mandatory
reporting numbers.27 The report also alleges that Tyson’s chaplains play on the religious beliefs of workers to manage
dissent and to dissuade workers from organizing.28 Additionally, between 2012 and 2021, Tyson plants experienced 47 ammonia
leaks, injuring almost 150 workers. Ammonia-related injuries at Tyson plants accounted for 60% of all ammonia injuries reported to the
EPA by meatpackers.29
A new bill, the Protecting Children Act, was recently introduced that
would enhance measures to end illegal child labor.30 Among other things, the bill seeks increased civil and criminal penalties
for child labor violations, expansion of capacity for enforcement, and the prohibition of weakening of child labor rules.31
Additionally, the DOL and the Department of Health and Human Services have recently deployed a set of new efforts to combat illegal child
labor.32 Among these efforts, the DOL commits to holding all employers accountable for illegal child labor in their supply
chains.33 As a result, companies can now be held accountable for child labor violations of their subcontractors and staffing
agencies.
Tyson also faces reputational risk from illegal child labor being
connected to its operations, which may result in financial loss for the Company. A company’s reputation can meaningfully influence
its financial performance, and a damaged or lost reputation is difficult to repair. According to the Conference Board, companies with
a high reputation ranking perform better financially than lower ranked companies, and executives find it is much harder to recover from
a reputational failure than to build and maintain reputation.34 Corporations with a good reputation benefit from strong market
capitalization, better business efficiency, and recruitment and retention of strong talent.35 Recently, a coalition of worker
organizations protested in front of Tyson’s headquarters, urging the Company to respect its workers and to stop relying on illegal
child labor.36 A related letter by the Food Chain Workers Alliance expresses growing concern around Tyson’s responsibility
for illegal child labor in its supply chain.37
3. Tyson’s policies and strategy (outlined in Statement in
Opposition) have failed to meaningfully address illegal child labor and systemic exploitation of its workers as a contributing cause
of illegal child labor.
40 S Fullerton Ave,
Montclair, NJ 07042 ◊ 973-509-8800 ◊ info@iasj.org ◊ www.iasj.org
Tyson’s response to child labor in its supply chains, as detailed
in its Statement in Opposition, is wholly insufficient for the following reasons:
| 1. | The information outlined in the Statement in Opposition narrowly focuses on Tyson’s sanitation services. The proposal asks
for an assessment of Tyson’s value chain, which includes the entirety of its operations, as well as of its suppliers. |
The shareholder proposal asks for an independent, third-party audit
assessing the effectiveness of Tyson’s policies and practices in preventing illegal child labor throughout its value chain.
In contrast, Tyson’s Statement in Opposition narrowly describes the limited actions it has undertaken to ensure there is no illegal
child labor in its sanitation service providers. Tyson’s response excludes any information on how it is addressing illegal child
labor in all other parts of its value chain, from the Company’s own employees, to other labor subcontractors, to its chicken farmers
and other suppliers’ operations. The persistence of illegal child labor in value chains is a systemic issue, present in multiple
sectors and industries, not just in sanitation service providers.
The vulnerability of child workers, who are often migrants, and
the limited resources of the Department of Labor to identify cases of illegal child labor mean the majority of cases go unreported or
unidentified. Companies should proactively perform robust due diligence to ensure there is no illegal child labor in their value chains.
The narrowly-constructed response from Tyson in its Statement in Opposition suggests the Company responds reactively to public scandals.
The requested independent audit is aimed at helping Tyson proactively identify and address instances of illegal child labor in its value
chain. This is especially timely, as new information alleges Tyson’s chicken farms use illegal child labor to catch chickens.38
A lack of commitment by Tyson to investigate these allegations further highlights why an independent, third-party audit is necessary.
| 2. | Tyson’s existing policies and practices are insufficient, as they failed to prevent illegal child labor |
Child labor violations in Tyson’s value chain go against the
Company’s stated commitments and suggest a lack of meaningful policy enforcement by the Company. Illegal child labor is in direct
conflict with Tyson’s Code of Conduct commitment on “Not tolerating child, forced or abusive labor in any operations or facilities.”39
Tyson’s Supplier Code of Conduct outlines supplier expectations to “ensure no forced labor or child labor is being used or
human trafficking is occurring,” but framing this as an expectation rather than a binding and enforceable requirement of doing business
with Tyson weakens the effectiveness of this Code.40 Tyson’s primary mechanism for reporting grievances, a “Tell
Tyson First” helpline, does not appear to be an effective mechanism for handling the sensitivities that come with reporting and
providing remedy in cases of illegal child labor.41 While Tyson has a Policy Library listing other policy documents relevant
to worker rights issues, many of them are internal-only and require a login, including a Human Rights Policy and Health and Safety Policies,
preventing investors from accessing additional company commitments that Tyson may be violating in practice.42
| 3. | The changes outlined in the Statement in Opposition are minor and ineffective. |
Tyson’s Statement in Opposition explains the steps the Company
has taken in light of DOL’s Packers Sanitation Services, Inc. (PSSI) investigation and findings of illegal child labor in some
of Tyson’s plants. While Tyson states it terminated its relationship with PSSI at a number of facilities, it does not name which
ones (apart from Green Forest and Goodlettsville). Additionally, we can infer that Tyson has not completely cut ties with PSSI and still
keeps sanitation contracts with PSSI at some of its facilities. In contrast, Tyson’s peer, JBS, confirmed the company had cut all
ties with PSSI over widespread allegations of child labor at meatpacking plants across the country.43
40 S Fullerton Ave,
Montclair, NJ 07042 ◊ 973-509-8800 ◊ info@iasj.org ◊ www.iasj.org
Tyson also states its own employees are responsible for sanitation
services at about 38% of its facilities, and that the Company intends to significantly increase this capacity. The Statement in Opposition
fails to mention whether 38% is an increase since the illegal child labor findings or whether this percentage has been longstanding at
the Company. Further, Tyson does not provide any concrete, time-bound commitments on how it will increase its in-house sanitation capacity.
Additionally, Tyson states it is implementing a new compliance program
in which a third-party auditor will conduct random supplier audits. The details of this new audit compliance program are vague, leaving
open questions of who the auditor will be, how the Company defines “random,” etc. Even with greater clarity on these questions,
however, implementing a new auditing program would still likely be insufficient. A recent New York Times exposé sharply criticizes
social compliance audits for consistent failures to identify child labor.44 Unlike the current auditing systems in place,
the proposal’s requested independent, third-party audit should have authority to enter Tyson’s facilities unannounced at all
hours of operation.
In addition to the aforementioned, Tyson is failing to meaningfully
address systemic exploitation of workers as a root cause of illegal child labor. The Statement in Opposition fails to address what
the Company is doing to improve the labor conditions for its workers. Furthermore, Tyson has not given any indication that it is conducting
a racial equity audit, in accordance with its 2021 commitment.
Conclusion
Proponents encourage all Tyson shareholders to support Proposal
4: End Child Labor in the Value Chain
For more information, please contact: Aaron Acosta, Program Director
at Investor Advocates for Social Justice and representative of the American Baptist Home Mission Society, via email: aacosta@iasj.org
or phone: 973-509-8800.
1 Benedictine Sisters of Mount St. Scholastica, Presbyterian
Church USA, Sisters of St. Joseph of Peace WA, Sisters of Bon Secours, Sisters of St. Francis of Philadelphia, Trinity Health
2 The Company calls this proposal “Shareholder proposal
regarding Tyson Foods’ labor practices,” omitting any reference to child labor in the title.
3 https://www.dol.gov/newsroom/releases/whd/whd20230217-1
4 https://www.dol.gov/newsroom/releases/whd/whd20230217-1
5 https://www.nytimes.com/2023/09/23/us/tyson-perdue-child-labor.html
6 https://www.theguardian.com/us-news/2023/oct/20/republican-child-labor-law-death
7 https://www.iccr.org/tyson-foods-commits-conduct-racial-equity-audit/
8 https://iasj.org/iasj-calls-on-tyson-to-honor-its-commitment-to-conduct-an-independent-racial-equity-audit/
9 https://www.dol.gov/newsroom/releases/osec/osec20230227
10 https://www.dol.gov/newsroom/releases/whd/whd20230217-1
11 https://www.dol.gov/newsroom/releases/whd/whd20230217-1
12 https://www.nytimes.com/2023/09/18/magazine/child-labor-dangerous-jobs.html
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Montclair, NJ 07042 ◊ 973-509-8800 ◊ info@iasj.org ◊ www.iasj.org
13 https://www.nytimes.com/2023/09/23/us/tyson-perdue-child-labor.html
14 https://www.fairr.org/news-events/press-releases/meat-companies-inaction-on-working-conditions
15 https://truthout.org/articles/child-labor-is-on-the-rise-as-republicans-see-an-answer-to-labor-shortages/;
https://www.americanprogress.org/article/its-a-good-jobs-shortage-the-real-reason-so-many-workers-are-quitting/; https://aflcio.org/about/advocacy/legislative-alerts/statement-record-child-labor
16 https://coronavirus.house.gov/sites/democrats.coronavirus.house.gov/files/2021.10.27%20Meatpacking%20Report.Final_.pdf;
https://coronavirus.house.gov/sites/democrats.coronavirus.house.gov/files/2022.5.12%20-%20SSCC%20report%20on%20Meatpacking%20FINAL.pdf
17 https://www.nytimes.com/2023/03/27/opinion/child-labor-laws.html;
https://truthout.org/articles/child-labor-is-on-the-rise-as-republicans-see-an-answer-to-labor-shortages/
18 https://www.bloomberg.com/news/articles/2023-06-14/us-slips-in-supply-chain-ranking-after-child-labor-violations
19 https://www.osha.gov/businesscase/costs
20 https://www.americanprogress.org/article/the-business-case-for-good-jobs/;
https://www.osha.gov/businesscase/costs
21 https://www.dol.gov/newsroom/releases/whd/whd20230217-1
22 https://www.dol.gov/newsroom/releases/whd/whd20230217-1
23 https://news.bloomberglaw.com/daily-labor-report/perdue-tyson-foods-face-unique-probe-in-child-labor-crackdown
24 https://law.justia.com/cases/federal/appellate-courts/ca5/22-10171/22-10171-2023-03-27.html;
https://www.ca5.uscourts.gov/opinions/pub/21/21-11110-CV0.pdf; https://www.insurancejournal.com/news/southcentral/2023/03/10/711829.htm#
25 https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1632254.015;
https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1658965.015; https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1626640.015;
https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1626601.015; https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1632254.015;
https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1639823.015; https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1611588.015;
https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1610057.015; https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1652043.015;
https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1645531.015; https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1642395.015;
https://www.osha.gov/ords/imis/establishment.inspection_detail?id=1644566.015
26 https://www.nytimes.com/2021/04/28/opinion/osha-us-workplace-safety.html
27 https://civileats.com/2022/11/17/injured-and-invisible-worker-safety-chicken-hospital-healthcare-osha-injury/
28 https://civileats.com/2022/11/17/injured-and-invisible-worker-safety-chicken-hospital-healthcare-osha-injury/
29 https://www.cnn.com/2023/05/04/business/tyson-ammonia-leaks-invs/index.html
30 https://www.govinfo.gov/content/pkg/BILLS-118hr4440ih/pdf/BILLS-118hr4440ih.pdf
31 https://democrats-edworkforce.house.gov/imo/media/doc/protecting_children_act_fact_sheet1.pdf
32 https://www.dol.gov/newsroom/releases/osec/osec20230227
33 https://www.dol.gov/newsroom/releases/osec/osec20230227
34 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1077894
35 https://www.provokemedia.com/research/article/link-between-corporate-reputation-market-value-strengthens-study
36 https://arkansasadvocate.com/2023/10/17/arkansas-protestors-call-on-tyson-to-improve-supply-chain-working-conditions/
37 https://arkansasadvocate.com/wp-content/uploads/2023/10/Food-Chain-Workers-Alliance-Letter-scaled.jpeg
38 https://www.theguardian.com/us-news/2023/oct/20/republican-child-labor-law-death
39 https://www.tysonfoods.com/sites/default/files/2023-12/Code%20of%20Conduct%20-%20Tyson%20%28Interactive%29%20%283%29.pdf
40 https://www.tysonfoods.com/sites/default/files/2021-06/supplier-code-of-conduct_0.pdf
41 https://secure.ethicspoint.com/domain/media/en/gui/71667/index.html
42 https://www.tysonfoods.com/ethics-and-compliance/policy-library
43 https://www.reuters.com/business/meatpacker-jbs-ends-sanitation-contracts-with-us-company-fined-hiring-kids-2023-04-24/
44 https://www.nytimes.com/2023/12/28/us/migrant-child-labor-audits.html?smid=nytcore-ios-share&referringSource=articleShare
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