The supermarket chain Kaufland Polska received a sizable loan of EUR 160 milion in February 2005 from the European Bank for Reconstruction and Development to finance the strategic expansion of its supermarkets across Poland. At the same time the Polish Labour Inspectorate was conducting an investigation into Kaufland’s supermarkets. This investigation revealed Kaufland’s contempt for Polish law and regulations.

To work for Kaufland in Poland you better be prepared to remove the expression “It is impossible to do” from your mindset. Unfortunately this perfectly reflects working conditions in Kaufland’s supermarkets and the company’s strategy towards human resources – first hand employee accounts of enforced and unpaid overtime, for example, are commonplace.

Such labour rights issues should be dealt with by the EBRD’s environmental appraisal process, which says: "In line with its mandate to promote environmentally sound and sustainable development, the term ‘environment’ is used in this Policy in a broad sense to incorporate not only ecological aspects but also worker protection issues ...".

Yet the results of the inspection show that the EBRD’s environmental analysis for this project was flawed otherwise such problems connected with labour rights would have been picked up and identified. As a public institution which draws on taxpayers’ money, the EBRD should ensure it supports only trustworthy, responsible businesses. Therefore Polish Green Network, together with the Nationwide Trade Union “Inicjatywa Pracownicza”, recently sent an official complaint to the EBRD’s Independent Recourse Mechanism regarding a violation of the EBRD’s procedures and policy.

As a result of Bankwatch interventions, the EBRD commissioned an external independent expert on labour standards to review the situation in Kaufland stores.  The EBRD claims that, together with Kaufland Poland, they identified specific actions for the company to mitigate deplorable working conditions.

Bankwatch then requested more detailed information about this announced action plan. However, neither the EBRD nor Kaufland Poland were willing to disclose details about these “improvements”.