Prison-Based e-Waste Processing – The Consequences to Business, Health and Safety

By David Bernstein, AnythingIT

The Cost of Prison Business

In 1865, slavery and involuntary servitude was abolished by the 13th Amendment except as punishment for crime.

In 1871, the Virginia Supreme Court declared that prisoners were ‘slaves of the state.”

In the federal prison system, 100% of able bodied prisoners are required to work, according to the U.S. General Accounting office of the Prisoner Labor Division. Starting in 1997, UNICOR, a corporation that employs prisoners in a variety of capacities to process electronic waste and produce goods and services for federal agencies began to accept computers, monitors, printers, and other types of e-waste for recycling at federal prisons. UNICOR sold these e-waste items to its customers, sometimes following refurbishment, or disassembled the items into their component parts and sold the parts to recyclers for further processing. As of June 2010, UNICOR had 103 factories at 73 prison locations, employing approximately 17,000 inmates or 11 percent of the inmate population. UNICOR’s minimum wage is $0.23 an hour.

Not listed on the annual report is a fact uncovered in a book by Christian Parenti, in Lockdown America: Police and Prisons in the Age of Crisis. Parenti reveals that the percentage average industrial orders delivered late are 6%. UNICOR delivers 42% of its orders late. Despite this track record, the Department of Defense purchased $388 million in goods and services from UNICOR in 2001. The U.S. Postal Service spent an additional $21 Million.

Quantity, not Quality

The U.S. Department of Justice is conducting an investigation into military contracts issued to ArmorSource, an Ohio company, and then subcontracted to UNICOR, following the recall of 44,000 potentially defective combat helmets. According to U.S. Representative Chris Carney, “FPI (UNICOR) has not met protective standards, nor has it met required deadlines in its production of these crucial helmets… and we can’t wait any longer to protect our troops.”

The 44,000 helmets, which were recalled on May 14, 2010, were part of a 600,000 helmet contract for the U.S. Army and 100,000 lightweight helmets for the U.S. Marine Corps. The contracts are now in question as a result of the recall, as the helmets failed ballistics testing.

Competing for Business

In 2011, UNICOR pulled in approximately $900 million in revenue. That profit has come at the expense of electronic recyclers and other small businesses across America, who are complaining about the edge that UNICOR has in winning government contracts.

Utilizing poorly paid and often indifferently supervised prisoners to manufacture goods for use in the federal prison system and also products that are in direct competition with private-sector businesses have compromised quality.

Being a federally owned corporation with an abundance of employees forced to work for under $1 per hour, it almost by defaults wins contracts to create military apparel, operate call centers and process government electronic waste. A bipartisan group of lawmakers has proposed new rules that would change the way prison manufacturing companies do business, subjecting them to stricter standards that would lead to higher prices.

In Grand Rapids, MI, U.S. Representative Bill Huizenga is focusing on UNICOR with a new bill that was introduced in May, 2013. The Federal Prison Industries Competition in Contracting Act of 2013 would force UNICOR to compete with private businesses for government contracts.

Huizenga’s bill would get rid of that “no-bid” status, essentially forcing UNICOR to compete with private companies. The legislation also would gradually raise the wages of inmate workers, all of whom are under the Federal Bureau of Prisons, to minimum wage. Half of inmates’ wages “would go toward reparations for their crimes” or other such payments, Patrick said. The other half could be used to pay for external debts and obligations.

In July 1996, Master Chief Petty Officer John Hagan, the Navy’s senior enlisted sailor, told the House National Security Committee that “UNICOR’s product is inferior, costs more and takes longer to procure. UNICOR has, in my opinion, exploited their special status instead of making changes which would make them more efficient.”

The Defense Logistics Agency found that UNICOR’s prices were an average of 13 percent higher than those of commercial companies, according to a letter George Allen, the deputy commander of the agency’s Defense Personnel Support Center, wrote in May 1996 to Rep. Van Hilleary, R-Tenn.

The Environment In and Out of the Prison System

In 2006, the Center for Environmental Health released a report documenting toxic exposure in e-waste processing prisons to inmates, prison personnel and families. Meanwhile, the system was undercutting U.S. recyclers trying to do business the right way.

UNICOR’s website states, “In addition to UNICOR’s restrictive no-landfill policy, of electrical components, the Recycling Business Group complies with OSHA standards.” The addition of the word “restrictive” implies that the no-landfill policy is limited. That is because they are not e-Steward certified, UNICOR’s downstream partners are not audited, and regulations cannot be guaranteed.

UNICOR staff reported that e-waste was sometimes sold to vendors that exported it to other countries and that staff and inmates at times loaded international shipping containers with e-waste. Prior to approximately mid-2003, UNICOR did not seek any information about the fate of its e-waste and whether it was being unlawfully disposed of abroad or used in ways that created environmental and human health hazards.

Jim Puckett, Executive Director of BAN, said, “EPA and electronics manufacturers fiddle while computers get burned in China, dumped in our local landfills or hauled into prison sweatshops. Once again we are given sound-effects instead of effectiveness. As electronics consumers and as global and US citizens we deserve far better than a voluntary call to — perhaps, maybe, if you want to, do something, without doing, too much of, anything different, at all.”

Office of the Inspector General – The Investigation

The Office of the Inspector General, Oversight and Review Division published a Review of the Federal Prison Industries’ Electronic Waste Recycling Program in October, 2010 after UNICOR’s recycling of e-waste resulted in complaints from Federal Bureau of Prisons (BOP) and UNICOR staff and inmates, most notably from Leroy A. Smith, Jr., a former Safety Manager at the United States Penitentiary (USP) in Atwater, California.

In particular, the complaints stated that UNICOR’s e-waste recycling practices were not safe and had made UNICOR staff and inmates sick. As a result of these complaints and at the request of the BOP, Department of Justice (DOJ), and attorneys for Mr. Smith, the Inspector General investigated the safety of UNICOR’s e-waste recycling operations, as well as other allegations of theft, conflict of interest, and environmental crimes that arose during our investigation related to UNICOR’s e-waste operations.

Investigative Summary

The investigation found that prior to 2009 UNICOR’s management of the e-waste recycling program resulted in numerous violations of health, safety, and environmental laws, regulations, and BOP policies. It was concluded that UNICOR’s Headquarters staff poorly managed UNICOR’s e-waste program prior to 2009. UNICOR staff members often failed to perform hazard assessments on new e-waste operations or did so incorrectly, and important health and safety information was not shared with BOP executives and safety staff that could have prevented the violations from occurring. It was also found that managers in UNICOR’s Recycling Business Group, primarily General Manager Lawrence Novicky and his assistant, Bruce Ginther, concealed warnings about hazards related to toxic metals from UNICOR and BOP staff and from inmates.

A Failure of Standards

The investigation identified numerous systemic shortcomings in UNICOR’s and the BOP’s operations that are believed to have jeopardized UNICOR’s ability to comply with industry standard health, safety, and environmental requirements. Numerous instances of staff misconduct and performance failures were also discovered. These included actions that endangered staff and inmates, as well as jeopardized the client’s data and reputation: dishonesty, dereliction of duty, and theft, among others. In all, the report concluded that 11 UNICOR and BOP employees committed either misconduct or performance failures in their work related to the e-waste recycling program.

The Inspector General’s report also identified potential criminal conduct by BOP and UNICOR staff, which resulted in referrals to two other Department of Justice components. In February 2007, information was referred to the Environmental Crimes Section in the Justice Department’s

Environment and Natural Resources Division indicating that UNICOR managers had knowingly endangered staff and inmates, were aware of unlawful disposals of hazardous waste, and had concealed information from regulators. Following a lengthy investigation that the Environmental Crimes Section conducted in conjunction with the Office of the Inspector General, EPA, FBI, and the U.S.

Attorneys’ Offices for the Northern District of Ohio and the District of New Jersey, no action was initiated because of various evidentiary, legal, and strategic concerns.

It was determined that UNICOR failed to address hazards related to e-waste in its recycling factories and to warn staff and inmates about the presence of toxic metals in their work areas. In addition, it was concluded that due to UNICOR’s failure to conduct such assessments, UNICOR did not properly integrate hazard controls into its e-waste work processes.

Cadmium and lead exposures were eventually controlled to levels below OSHA exposure limits over time, however. These changes took place over periods of years, through a process of “trial and error” at some factories. UNICOR and the BOP did not have policies that required UNICOR to have qualified personnel, including staff from the BOP’s Health Services Division, conduct assessments on UNICOR’s new operations, or on changes in existing operations, that would identify the hazards that UNICOR was required to disclose under OSHA regulations. Interviews and review of inmate injury records revealed that inmates who worked in glass breaking operations frequently were cut by the broken glass, some resulting in serious injuries.

Improvements

In 2008, the Federal Occupational Health Service released a report documenting substantial problems in the protection of prisoners and prison personnel from e-waste toxics. The Office of the Inspector General made more than 150 recommendations to rectify the deficiencies that were identified during their inspections of UNICOR’s e-waste facilities. These recommendations addressed 47 issues in 12 general topic areas. By 2009, with limited exceptions, UNICOR’s e-waste operations (including CRT glass breaking activities) were compliant with OSHA requirements and were being operated safely, though the agencies that assisted the investigation recommended additional improvements. The major concern was that UNICOR and the BOP need to hire or retain staff that is adequately trained to identify and correct health, safety, and environmental compliance problems. Sixteen of the 47 issues required future updates from the Inspector General’s office.

The recommendations address issues involving factory supervision and regulatory compliance. For example, it was recommended that UNICOR and the BOP implement procedures that will hold supervisors accountable for compliance with health, safety, and environmental laws and regulations.

The Waiting Game

On August 5, 2011, The Council of Prison Locals (CPL) of the American Federation of Government Employees (AFGE) circulated a press release criticizing the Bureau of Prison’s (BOP) failure to implement safety recommendations to UNICOR. According to the release, “It’s unconscionable that BOP has yet to implement the inspector general’s recommendations to ensure worker safety,” said CPL President Bryan Lowry. “The inspector general’s findings are in line with what we’ve been saying for years. Our staff members were exposed to dangerous levels of toxic metals, which BOP knew about and allowed to continue. The inspector general concluded improvements were needed, yet we’re still waiting on the agency to put these safety measures in place to protect our staff,” Lowry added.

Recidivism

The UNICOR prison inmate work program is an important management tool that federal correctional officers and staff use to deal with the huge increase in the BOP prison inmate population. It helps keep nearly 19,000 prison inmates productively occupied in labor-intensive activities, thereby reducing inmate idleness and the violence associated with that idleness. It also provides strong incentives to encourage good inmate behavior, as those who want to work in UNICOR factories must maintain a record of good behavior and must have completed high school or be making steady progress toward a General Education Degree.

The national Reentry Resource Center, a project of the Council of State Government, conducted a study to research the rehabilitation rate of prisoners. The study used two groups; a treatment group that consisted of inmates who had worked for UNICOR (57%), a combination of UNICOR and vocational training (19%), and vocational training with no UNICOR participation (24%). The comparison group was drawn from prisoners who had participated in less than 6 months of UNICOR, failed to complete a vocational program, or had never been enrolled in either.

The study reveals that the male treatment group was less likely to experience a parole revocation at both 6 and 12 months after release. At 1 year after release, 6.6% of the treatment group had recidivated, compared to 10.1% of the comparison group. In the analysis of female prisoners, no significant differences were found, and recidivism rates were low in both the treatment and comparison groups.

Clearly, prison labor has advantages, both to the rehabilitation process, as well as providing an inexpensive source of labor in abundance. At what point, however, do we cease taking business from environmentally certified companies and putting the health and safety of this labor at risk, as well as the security of the agencies that employ their services?