Ramesh Khadka, 19, began the journey to his slaughter in this valley of rivers, where green rice terraces march up the mountains like stairs...

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LELE, Nepal —Ramesh Khadka, 19, began the journey to his slaughter in this valley of rivers, where green rice terraces march up the mountains like stairs toward the heavens.

After passing among a series of shadowy, indifferent middlemen, he finished it a month later in a dusty ditch in western Iraq.

There, bound and helpless, the teenager was shot three times in the back of the head by insurgents, his execution and that of 11 of his countrymen captured on videotape.

He and his colleagues were on their way to jobs at a U.S. military base in Al Anbar province when they were kidnapped. The killings last year remain the worst case of violence against private contractors in the Iraq war.

The incident and its aftermath raise troubling questions about America’s reliance on hiring the world’s poorest people to do the dirtiest jobs in one of the most dangerous places on Earth.

Contractors working for the United States, including KBR, a Houston-based subsidiary of Halliburton, have brought tens of thousands of workers into Iraq from impoverished countries including Nepal, the Philippines and Bangladesh to do menial jobs, from cooking and serving food to cleaning toilets.

In relying on a work force of third-country nationals, however, the United States has embraced a system of labor migration rife with abuse, corruption and exploitation, according to dozens of contractors, migrant workers, labor officials and advocates interviewed in four countries.

Labor brokers

The system revolves around so-called labor brokers, whose numbers have exploded during the past decade in the Middle East and Asia. Such agencies take advantage of porous borders and rising global demand for cheap labor to move poor workers from one country to low-paying jobs in another.

Although millions of Iraqis are desperate for jobs, the U.S. military requires that contractors such as KBR hire foreigners to work at bases to avoid the possibility of insurgent infiltration.

Willing to work anywhere, the laborers often take out usurious loans to pay the agencies a finder’s fee for the overseas jobs. Once abroad, the workers find themselves with few protections and uncertain legal status.

In Iraq, the vulnerability of such workers is heightened. Neither the United States nor Iraq has an adequate system for protecting their rights, labor advocates say.

Violence is the greatest risk. At least one-third of the 255 contractors reported killed in Iraq since the U.S.-led invasion in 2003 came from Second or Third World countries, according to a Los Angeles Times analysis of data maintained by a Web site that tracks contractor deaths.

Little regulation

The enforcement of labor rights appears virtually nonexistent. In Khadka’s case, for example, it appears that the Nepalese were headed to work for a Jordan-based subcontractor to KBR, family members and manpower-agency officials say.

If true, all 12 men should have been covered by generous death benefits required by federal law for anyone working for a U.S. contractor, even indirectly, say insurance and legal experts. But their families have received no such payments.

After questions from the Los Angeles Times, KBR said it would investigate whether benefits were owed. KBR is the largest employer of third-country nationals, with about 25,000 workers in Iraq, typically through Middle Eastern subcontractors.

Because of the danger of exploitation, some labor-exporting countries, such as the Philippines and Nepal, have forbidden their nationals to work in Iraq. But labor brokers bring in such workers using loopholes in a system with almost no regulation. An estimated 5,000 Nepalese work in Iraq.

Labor advocates say the practice amounts to modern-day indentured servitude, funded by U.S. taxpayers.

Khadka grew up in a mud and brick home on the outskirts of this village, one of seven children in a poor farming family.

There is not much work in such villages in Nepal, one of the world’s most impoverished countries. Unemployment is compounded by a Maoist insurgency that has killed more than 12,500 people since 1996. Rebels frequently kidnap young men as recruits, providing incentive to flee to cities and abroad for work.

Khadka was working at a hotel in Nepal’s capital, Kathmandu, for $38 a month when he learned of job opportunities overseas from Bala Gam Piri, the owner of the employment agency Moonlight Manpower, said family members and officials with the Nepal Association of Foreign Employment Agencies, a trade group. Piri is believed to have fled Nepal after the killings, which set off riots in the capital. He could not be located for comment.

For Nepalese, working abroad has become part of the fabric of life. The money they send home accounts for more than one-fifth of the country’s tiny economy.

Employment agencies are a booming business in Nepal. There were fewer than a dozen a decade ago; more than 530 now exist, according to statistics maintained by the Association of Foreign Employment Agencies, a trade group. Although most are described as legitimate businesses, scores have been closed for labor-law violations.

Up-front fees

Khadka joined the diaspora on June 29, 2004, boarding a plane for the first time in his life.

“His last words were: ‘I’m flying now. Don’t worry about me. I’ll be back in a few years,’ ” recalled his tearful father, Jit Bahadur Khadka. “I told him, ‘Wait. I’ll send you anywhere.’ But he didn’t want to wait. He wanted to make something of himself.”

Piri had promised Ramesh Khadka $200 a month as a cook with the U.S. Army, although it was unclear where the job would be, the family said. In return, Khadka had to pay $3,000, plus hand over his passport to Piri to make sure he couldn’t run away.

The family went to wealthy neighbors to borrow the money, paying annual interest of 24 percent. His father told him not to go. But Khadka was an independent teenager who dreamed of making enough to build a concrete house next to his family’s crumbling mud-daubed home.

As Piri was gathering the workers in Nepal, Hayder Aliam was in Jordan helping arrange their transport to Amman, its capital.

Aliam is the office manager for Morning Star, a Jordanian manpower agency that imports laborers by working with recruiting agencies in poor countries.

Inside Aliam’s office in a busy commercial district, women from Indonesia and the Philippines stand in corners while wealthy Jordanians sit in overstuffed leather chairs, sorting stacks of files with job-candidate applications.

In class-conscious Amman, the nationality of your domestic help carries a certain status. Filipinas are the most desirable, and most expensive, followed by Indonesians and Sri Lankans.

The Nepalese have one advantage, however: Unlike other nationalities, Nepalese do not need a visa before their arrival in Jordan. Thus, when a KBR subcontractor approached Morning Star with an urgent need for workers, the company immediately thought of Nepal, Aliam said.

Morning Star and Moonlight worked together to fill the order. Although Morning Star normally imports domestic servants only for Jordan, the lure of a $200 fee for each Nepalese for Iraq proved too much to resist.

The identity of the subcontractor remains unclear. Aliam said the men were working for Daoud & Partners, which holds a catering and laundry subcontract with KBR. In early news accounts, however, another Morning Star employee identified the subcontractor as Besharat & Partners, a construction company. In an interview, a Daoud official who did not want his name used because of the sensitivity of the issue denied any connection to the workers. Besharat & Partners could not be located.


The subcontractor collected the workers at the Amman airport for transport directly into Iraq, Aliam said. From there, he said, the Nepalese were taken to a convoy of vans bound for the long, dangerous road from Jordan into western Iraq.

What happened next is unknown. The men simply vanished.

Then, on Aug. 20, 2004, Radhika Khadka was at home when a neighbor told her about a grainy Internet video being broadcast repeatedly on Nepalese television.

There, Radhika, 55, could see her son crammed into a room with the 11 other men holding their passports in front of them. One of the men, with a U.S. flag draped across his chest, read from a statement in halting English.

He said the group had been kidnapped by Iraqi insurgents who called themselves the Ansar al Sunna Army.

When the camera panned over her son, she saw the look on his face, and her heart broke.

“I felt like I had been hit by a rock,” she recalled.

Frantic for help

The family contacted Piri, the labor broker, who said he would do everything he could to get their son back. Then he disappeared.

The Nepalese government did little. The country is so poor that it has only one embassy in the region, in Qatar, with just four employees.

In desperation, the ambassador turned to Prakash Gurung, a Nepalese businessman who lives in Qatar and runs his own manpower agency there. Gurung heads a committee established by the embassy to troubleshoot international labor issues.

Lacking contacts in Iraq, Gurung sent an e-mail to a Sunni Muslim group whose address he got from Al Jazeera, the Arab satellite channel. The group promised to try to help negotiate, but Gurung is not sure whether they did anything at all.

Eleven days after the first Internet video, a second surfaced.

This time, none of the Nepalese workers spoke, except to scream.

The first worker was laid on the ground, his throat to the sky. A hand can be seen in the video grasping a knife, slowly sawing through the man’s neck as he sputters and chokes, blood gushing from his body.

Over the next few minutes of the video, the Nepalese are brought out in pairs, laid on the ground, and shot at close range.

The insurgents shot three bullets into the back of Khadka’s head.

In Kathmandu, the execution of the workers touched off a government crisis.

Protesters set upon Kathmandu’s only mosque, burning it and ripping the Quran to pieces, according to local reports. They also attacked hundreds of the widely reviled employment agencies. In two days of rioting, one protester was shot to death and the government clamped down with a 24-hour curfew.

The unrest contributed to the instability that King Gyanendra later cited in dissolving the Cabinet and declaring a state of emergency that gave him absolute power in February 2005.

In the days that followed, the government revoked Moonlight’s license. Seeking to quell the outrage, the government announced it would compensate the survivors. Each family was given nearly $14,000, a large sum in a country where the annual income is $279.

The Khadkas have used their money to pay off Ramesh’s debt and for Radhika’s medical expenses. She had fainting spells after the news of her son’s death and refused to leave the family’s home for seven months.

An earthy, blunt-spoken woman, Radhika has harsh words for the government, and for Piri. The government paid the money, she said, to stop the violence. But nobody ever apologized.

“If we had been big shots, they would have said that they were sorry,” she said. “But we’re poor people. We’re nobody.”

Business as usual

More than a year later, the labor markets operate as usual in Iraq.

U.S. officials said they are about to include new regulations in all Defense Department contracts to prevent labor trafficking. The payment of labor broker fees is not considered trafficking, although exceptionally high fees or interest rates are illegal under U.S. trafficking laws.

Commanders “need to be vigilant to the terms and conditions of employment for individuals employed by DoD contractors,” Defense Secretary Donald Rumsfeld wrote in a memo in September 2004. “Trafficking includes involuntary servitude and debt bondage. These trafficking practices will not be tolerated.”

KBR, the Halliburton division, said all of the subcontractors it hires for projects in Iraq are required to respect local labor laws and provide appropriate housing, medical treatment and security protection for workers.

All KBR subcontractors also must provide employees with so-called Defense Base Act insurance, a federal program that provides for medical care and death benefits worth as much as $54,000 a year to survivors.

In Jordan, the ministries of Labor and Interior launched investigations after the killings. Morning Star was shut down for four months but allowed to reopen after promising to stop sending workers to Iraq.

Why reform is unlikely

In Nepal, the government recently announced the closure of 32 additional agencies for sending workers to Iraq. It has proposed a labor law that would set criminal sentences for labor brokers, instead of fines.

Even if a new law is passed, skeptics doubt it will have much effect. First, several brokers interviewed in Kathmandu said existing laws are bypassed easily, thanks to corruption in the government.

Second, the international nature of the problem makes it difficult to crack down. For instance, although Nepal forbids its workers to go directly to Iraq, a Nepalese can travel to India, and then on to Iraq without violating any laws.

Finally, the Nepalese government is heavily dependent on the money its workers send home, and it gains little from objecting to abuse of its workers, which is widespread. If Nepal makes it harder to hire its workers — by demanding higher wages, for instance — the hiring countries will turn to another poor country, depriving Nepal of needed cash.

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