SAO PAULO (Reuters) -Volkswagen’s Brazil unit has been ordered to pay 165 million reais ($30.44 million) in damages for subjecting workers on a farm to slavery-like conditions in the 1970s and 1980s, labor prosecutors said on Friday.
A labor court found that hundreds of workers at a Volkswagen-run ranch were subjected to degrading work conditions, forced into debt bondage and were held under armed surveillance.
Volkswagen said it would appeal the decision.
VW’s cattle ranching and logging ventures in the Amazon during that time were backed by government incentives under Brazil’s military dictatorship, part of a broader state plan to develop the region.
The ruling comes after talks to reach a settlement with VW’s Brazil unit failed when the company “showed no interest” in negotiations, prosecutors had alleged.
Now, Volkswagen must publicly admit its responsibility in the case and issue a formal apology, prosecutors said. Volkswagen is also required to implement a “zero-tolerance” policy for slave-labor conditions.
In a statement, the automaker said it “consistently defends the principles of human dignity and strictly complies with all applicable labor laws and regulations.”
($1 = 5.4212 reais)
(Reporting by Alberto Alegiri Jr.; Writing by Kylie Madry; Editing by Leslie Adler)
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