Chart - Nonprofit organization dedicated to ending sweatshop - Excel by maclaren1

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									FLA Audit Profile
Country                      China
Factory name                 36021552D
IEM                          Global Standards
Date(s) in facility          August 10-11, 2005
PC(s)                        Adidas AG, Puma
Number of workers            2009
Product(s)                   Plastic products
Production processes         cutting, sewing, printing, gluing, molding, assembly, finishing


                                                                                                                                                                        IEM Findings                                                                                                                                  Remediation                                                                        [Status]                            Update                                                      Update                                                  Update                                               Update
FLA Code/ Compliance issue    Country Law/Legal Reference                        FLA Benchmark                              Non-compliance           Risk of Non-compliance     Evidence of      If not    Sources/Docum        Notable                  PC Remediation plan                  Target      Factory                         Company follow up                          Documentation     Completed;      Company Follow Up              Documentation   Completed;     Company Follow Up        Documentation   Completed;     Company Follow Up     Documentation   Completed;     Company Follow Up       Documentation   Complete
                                                                                                                                                                                   Non-      corroborated, entation used for    Features                                                    Completion   Response                          (June 05, 2006)                                             Pending; On-   (September 21, 2006)                            Pending; On-    (July 12, 2007)                         Pending; On-     (July 21 2008)                      Pending; On-     (July 6, 2009)                           d;
                                                                                                                                                                                compliance    explain why   corroborating    implemented                                                       Date      (Optional)                                                                                       going                                                          going                                                   going                                                going                                               Pending;
                                                                                                                                                                              (uncorroborate                                   by Factory                                                                                                                                                                                                                                                                                                                                                                                                 On-going
                                                                                                                                                                                    d)                                       Management
                                                                                                                                                                                                                              or Company
1. Code Awareness
2.Forced Labor
There will not be any use of forced labor, whether in the form of prison labor, indentured labor, bonded labor or
3. Child Labor
No person will be employed at an age younger than 15 (or 14 where the law of the country of manufacture allows) or
younger than the age for completing compulsory education in the country of manufacture where such age is higher
than 15.
4. Harassment or Abuse
Every employee will be treated with respect and dignity. No employee will be subject to any physical, sexual,
psychological or verbal harassment of abuse.
Training of Management in                                     Employers will provide training to managers and      No specific training on this                                                            management                       1) Formulate policies and guidelines on how Nov. 30,                      1) policies and guidelines on discipline and complaints     1) Written policies   Completed
Disciplinary Practices                                        supervisors in appropriate disciplinary practices    issue for the management.                                                               interview                        to handle disciplinary cases and complaint    2005                        have been developed and comply with PC and FLA code         and procedure
                                                                                                                                                                                                                                            procedures. Include in the guidelines an                                  of conduct and local laws.                                  documents on file
                                                                                                                                                                                                                                            assurance that no action shall be made                                    2) Provided one copy of COC card to each workers            and posted in public
                                                                                                                                                                                                                                            against the worker making the complaint.                                  which contains policies and guidelines as well as           place in the factory;
                                                                                                                                                                                                                                            2) Brief all employees about the policies and                             complaint procedures                                        2) Worker's personal
                                                                                                                                                                                                                                            guidelines. 3) Provide training to                                        3) training provided to management and supervisors on       COC cards in pocket
                                                                                                                                                                                                                                            management and supervisory staff in                                       29th November, 2005 on how to handle disciplinary           3) Training records
                                                                                                                                                                                                                                            handling disciplinary cases.                                              cases.                                                      on these policies




Verbal abuse                                                Employers will prohibit screaming, threatening, or        The management is very                                                               worker                           1) Formulate policy and guidelines on           Nov. 30,                  1) policies and guidelines on harassment and abuse have     1) Written policies   Completed
                                                            demeaning verbal language                                 rude to workers when                                                                 interview                        harassment or abuse. 2) Brief all               2005                      been developed and comply with PC and FLA code of           and procedure
                                                                                                                      workers make mistakes.                                                                                                employees about the policies and                                          conduct and local laws.                                     documents on file
                                                                                                                                                                                                                                            guidelines. Include the topic in briefing new                             2) Provided one copy of COC card to each workers            and posted in public
                                                                                                                                                                                                                                            workers. 3) Provide training to                                           which contains policies and guidelines as well as           place in the factory;
                                                                                                                                                                                                                                            management and supervisory staff on the                                   complaint procedures                                        2) Worker's personal
                                                                                                                                                                                                                                            policy.                                                                   3) training provided to management and supervisors on       COC cards in pocket
                                                                                                                                                                                                                                                                                                                      29th November, 2005 on how to handle disciplinary           3) Training records
                                                                                                                                                                                                                                                                                                                      cases.                                                      on these policies




Monetary Fines and                                          Employers will not use monetary fines and penalties for   If workers are absent for 1                                                          worker                           1) Issue instruction to stop the practice of  Nov. 30,                    1)Factory has posted public notice at factory site on the   1)Posted notice      Completed
Penalties                                                   poor performance                                          day, the factory will deduct                                                         interview,                       issuing monetary fines and to deduct from     2005                        non-monetary fines and update Code of conduct               2)Distributed COC
                                                                                                                      wages equivalent to 3 days                                                           record review                    wages only the amount corresponding to the                                2) Factory held a meeting with all management and           card
                                                                                                                      pay.                                                                                                                  actual days of absence if entire annual                                   supervisors to explain this policy                          3)Interview with
                                                                                                                                                                                                                                            leave has been already used. 2) brief all                                 3) As stated in the worker's COC card and posters,          workers
                                                                                                                                                                                                                                            employees about the policy and post it at all                             workers can call the top management or file a complaint     4)Employment
                                                                                                                                                                                                                                            working areas. 3) Include the new                                         to HR manager if there is any fines or illegal deduction    orientation slides
                                                                                                                                                                                                                                            instruction / policy in briefing new
                                                                                                                                                                                                                                            workers/new hire orientation.




Monetary Fines and                                          Employers will not use monetary fines and penalties for   If the sanitation in any                                                             worker                           Issue instruction to discontinue other          Nov. 30,                  1)Factory has posted public notice at factory site on the   1)Posted notice      Completed
Penalties                                                   poor performance                                          dormitory is scored as the                                                           interview,                       monetary penalties for poor performance         2005                      non-monetary fines and update Code of conduct.              2)Distributed COC
                                                                                                                      worst, each worker in the                                                            record review                    and the lowest score for sanitation in the                                2) Factory held a meeting with all management and           card
                                                                                                                      dormitory will be fined 30                                                                                            dormitory.     Brief all employees about the                              supervisors to explain this policy                          3)Interview with
                                                                                                                      RMB, which will then                                                                                                  policy and post it at all working areas.                                  3) As stated in the worker's COC card and posters,          workers
                                                                                                                      become a bonus for the                                                                                                Include the new instruction / policy in                                   workers can call the top management or file a complaint     4)Employment
                                                                                                                      best dormitory. Monetary                                                                                              briefing new workers/new hire orientation.                                to HR manager if there is any fines or illegal deduction    orientation slides
                                                                                                                      fines for poor performance
                                                                                                                      are also prevalent.




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                                                                                                                                                                              IEM Findings                                                                                                                                   Remediation                                                                         [Status]                                    Update                                                                 Update                                                    Update                                               Update
FLA Code/ Compliance issue      Country Law/Legal Reference                          FLA Benchmark                                Non-compliance           Risk of Non-compliance     Evidence of      If not    Sources/Docum        Notable                  PC Remediation plan                   Target      Factory                         Company follow up                          Documentation      Completed;              Company Follow Up               Documentation    Completed;           Company Follow Up           Documentation     Completed;     Company Follow Up     Documentation   Completed;     Company Follow Up       Documentation   Complete
                                                                                                                                                                                         Non-      corroborated, entation used for    Features                                                     Completion   Response                          (June 05, 2006)                                              Pending; On-           (September 21, 2006)                              Pending; On-          (July 12, 2007)                              Pending; On-     (July 21 2008)                      Pending; On-     (July 6, 2009)                           d;
                                                                                                                                                                                      compliance    explain why   corroborating    implemented                                                        Date      (Optional)                                                                                        going                                                                    going                                                              going                                                going                                               Pending;
                                                                                                                                                                                    (uncorroborate                                   by Factory                                                                                                                                                                                                                                                                                                                                                                                                                        On-going
                                                                                                                                                                                          d)                                       Management
                                                                                                                                                                                                                                    or Company
5. Nondiscrimination
No person will be subject to any discrimination in employment, including hiring, salary, benefits, advancement,
discipline, termination or retirement, on the basis of gender, race, religion, age, disability, sexual orientation,
nationality, political opinion, or social or ethnic origin.
Other                                                                                                                                                                               Supervisors                  worker                           1) Develop a scheme for rating employees'        Nov. 30,                  1) Employee performance appraisal system has been           1) Employee job       Completed
                                                                                                                                                                                    often set                    interview                        performance and the corresponding clear          2005                      established to guide the wage increase and job              promotion and wage
                                                                                                                                                                                    wage levels                                                   guidelines on giving wage adjustments.                                     promotion.                                                  increase policy &
                                                                                                                                                                                    of workers                                                    2) Announce the scheme and guidelines to                                   2) Performance appraisal procedures and guidelines are      guideline
                                                                                                                                                                                    according to                                                  all employees and post copy at all working                                 posted inside factory notice boards for worker's info.      2)Public notice on
                                                                                                                                                                                    their private                                                 areas.      3) Brief all supervisors on the                                3) On 9th Dec.2005, factory held meeting with managers,     notice board
                                                                                                                                                                                    relations with                                                scheme and guidelines.                                                     supervisors and worker's representative to explain the      3) Meeting minutes
                                                                                                                                                                                    workers, and                                                                                                                             performance appraisal standards.                            on briefing
                                                                                                                                                                                    treat each
                                                                                                                                                                                    worker
                                                                                                                                                                                    differently.




6. Health and Safety
Employers will provide a safe and healthy working environment to prevent accidents and injury to health arising out
of, linked with, or occurring in the course of work or as a result of the operation of employer facilities

Safety Equipment                                               All safety and medical equipment (such as fire fighting      Found some fire                                                                      Visual                           1) Include in the yearly activities for health Nov. 30,                    1)Factory has internal audit team to conduct health and     1)Internal audit       On-going      1) The factory conducted the health      1) Internal      Ongoing        1) On-site inspections found      1)Monthly          Completed
                                                               equipment, first aid kits, etc.) shall be in place,          extinguishers are not                                                                inspection,                      and safety the regular monthly inspection      2005                        safety audit once per month which includes fire safety      reports on fire safety               and safety audit once per month          audit reports                   that all fire emergency           inspection records
                                                               maintained as prescribed and accessible to the               regularly checked and also                                                           Document                         and maintenance of all units of fire                                       [training] such as extinguishers and emergency lights.      2)New hire training                  before June 06, and once per week        on fire safety                  equipment including fire          2) HSE training
                                                               employees                                                    blocked. Also found 3 fire                                                           review.                          extinguishers. 2) Attach to every unit a tag                               2)All new workers are trained on basic fire safety          plans                                after June 06.                           2) HSE                          extinguishers were maintained     plans and records.
                                                                                                                            extinguishers are out of                                                                                              to record the regular inspection. 3)                                       awareness and how to escape in an emergency.                3)Fire emergency                     2) On-site inspections found that all    training plans                  properly and easy to access.      3) OSHAS18001
                                                                                                                            order.                                                                                                                Explain to all employees the importance of                                 3)Factory has emergency response plan which is              and evacuation plan                  fire emergency equipment is              and records.                    All fire emergency equipment      & ISO14001
                                                                                                                                                                                                                                                  unblocked access to every unit and enforce                                 practiced twice per year                                    and drill records                    inspected on a monthly basis by the                                      has been inspected on a           certificates.
                                                                                                                                                                                                                                                  consistently its observance.                                               4)Factory has made a plan to set up and implement           4)SoE plan                           safety officer. The inspection records                                   monthly basis by the safety
                                                                                                                                                                                                                                                                                                                             OSHAS18001 & ISO14001 management system before                                                   are kept on the tag of each                                              officer. The inspection records
                                                                                                                                                                                                                                                                                                                             the end of year 2006.                                                                            equipment.                                                               are kept on the tag hung on
                                                                                                                                                                                                                                                                                                                                                                                                                              3) All workers were trained on the                                       each equipment.
                                                                                                                                                                                                                                                                                                                                                                                                                              proper maintenance of fire                                               2) All workers were trained on
                                                                                                                                                                                                                                                                                                                                                                                                                              emergency equipment.                                                     the proper maintenance of fire
                                                                                                                                                                                                                                                                                                                                                                                                                              4) As per factory's plan, and                                            emergency equipment.
                                                                                                                                                                                                                                                                                                                                                                                                                              confirmed verbally by the factory                                        3) The factory has obtained the
                                                                                                                                                                                                                                                                                                                                                                                                                              management recently: The "First                                          certificates of OSHAS18001 &
                                                                                                                                                                                                                                                                                                                                                                                                                              Stage (Pre-audit)" for the OSHAS                                         ISO14001 through SGS on
                                                                                                                                                                                                                                                                                                                                                                                                                              18001registration was conducted by                                       20th January 2007.
                                                                                                                                                                                                                                                                                                                                                                                                                              SGS on October 9-10, 2006, and the
                                                                                                                                                                                                                                                                                                                                                                                                                              tentative dates for the " Second
                                                                                                                                                                                                                                                                                                                                                                                                                              Stage (Assessment)" are Dec 13-15,
                                                                                                                                                                                                                                                                                                                                                                                                                              2006.




                                                               All safety and medical equipment (such as fire fighting      Found one emergency light                                                            Visual                           1) Include in the yearly activities for health   Nov. 30,                  1)Factory has internal audit team to conduct health and     1)Internal audit       On-going      1) The factory conduct the health and    1)Internal audit Completed.
                                                               equipment, first aid kits, etc.) shall be in place,          has battery problem                                                                  inspection.                      and safety the regular monthly inspection        2005                      safety audit once per month which including fire safety     reports on fire safety               safety audited once per month before     reports on fire
                                                               maintained as prescribed and accessible to the                                                                                                                                     and maintenance of all units of emergency                                  such as extinguishers and emergency lights.                 2)New hire training                  June 06, and once per week after         safety
                                                               employees                                                                                                                                                                          lights. 2) Attach to every unit a tag to                                   2)All new workers are trained on basic fire safety          plans                                June 06.                                 2) HSE
                                                                                                                                                                                                                                                  record the regular inspection and                                          awareness and how to escape in an emergency.                3)Fire emergency                     2) On-site inspections found that all    training plans
                                                                                                                                                                                                                                                  maintenance.                                                               3)Factory has emergency response plan which is              and evacuation plan                  fire emergency equipment is              and records.
                                                                                                                                                                                                                                                                                                                             practiced twice per year                                    and drill records                    inspected on a monthly basis by the
                                                                                                                                                                                                                                                                                                                             4)Factory has made a plan to set up and implement           4)SoE plan                           safety officer. The inspection records
                                                                                                                                                                                                                                                                                                                             OSHAS18001 & ISO14001 management system before                                                   are kept on the tag hung on each
                                                                                                                                                                                                                                                                                                                             the end of year 2006.                                                                            equipment.
                                                                                                                                                                                                                                                                                                                                                                                                                              3) All workers were trained on the
                                                                                                                                                                                                                                                                                                                                                                                                                              proper maintenance of fire
                                                                                                                                                                                                                                                                                                                                                                                                                              emergency equipment.
                                                                                                                                                                                                                                                                                                                                                                                                                              4) As per factory's plan, and
                                                                                                                                                                                                                                                                                                                                                                                                                              confirmed verbally by the factory
                                                                                                                                                                                                                                                                                                                                                                                                                              management recently: The "First
                                                                                                                                                                                                                                                                                                                                                                                                                              Stage (Pre-audit)" for the OSHAS
                                                                                                                                                                                                                                                                                                                                                                                                                              18001registration was conducted by
PPE                                                            Workers shall wear appropriate protective equipment          Found some workers don't                                                             Visual                           1) Brief workers on the importance and           Nov. 30,                  1)PPE is part of new employee orientation training          1)new worker's        On-going       1) Factory has provided training for     1)new            Completed
                                                               (such as gloves, eye protection, hearing protection,         use PPE, such as mask,                                                               inspection.                      proper use of protective equipments and          2005                      program                                                     training records                     all employees including new              worker's
                                                               respiratory protection, etc.) to prevent unsafe exposure     gloves and earplug. And                                                                                               enforce proper and consistent use.      2)                                 2)Correct use of PPE is posted on notice boards on the      2)Posters on the                     employees regarding why and how to       training
                                                               (such as inhalation or contact with solvent vapors,          some workers use those                                                                                                Include in the briefing of new workers                                     floor                                                       notice board                         use PPE.                                 records
                                                               noise, dust, etc.) to hazardous elements including           PPE in an improper way.                                                                                                                                                                                                                                                                           2) Visual inspection and interview       2)Posters on
                                                               medical waste.                                                                                                                                                                                                                                                                                                                                                 with workers found all employees         the notice
                                                                                                                                                                                                                                                                                                                                                                                                                              understand the importance of PPE,        board
                                                                                                                                                                                                                                                                                                                                                                                                                              and can use them properly.
Machinery Maintenance                                          All production machinery and equipment shall be              Part of the sewing                                                                   Visual                           1) Install needle guards and protective     Nov. 30,                       1)Needle guards in place wherever applicable                1)Picture of needle   On-going       1) Based on the internal HSE audit,      Internal audit   Completed
                                                               maintained, properly guarded, and operated in a safe         machines don’t have                                                                  inspection.                      cover for moving parts. 2) Brief workers on 2005                           2)Supervisors are responsible for coaching workers on       guards installed                     machine safety guards are being          records
                                                               manner                                                       needle guard and                                                                                                      the importance of needle guards.      3)                                   use of needle guards.                                       2)Internal audit                     inspected regularly.
                                                                                                                            protective cover                                                                                                      Arrange a regular inspection and                                           3)The inspection of the safety guards is part of internal   checklist                            2) Visual inspection found all sewing
                                                                                                                                                                                                                                                  maintenance of sewing machines                                             SoE audit                                                                                        machines are equipped with needle
                                                                                                                                                                                                                                                                                                                                                                                                                              guards properly. And confirmed
                                                                                                                                                                                                                                                                                                                                                                                                                              through worker interviews that all
                                                                                                                                                                                                                                                                                                                                                                                                                              employees are well informed about
                                                                                                                                                                                                                                                                                                                                                                                                                              the importance of the proper machine
                                                                                                                                                                                                                                                                                                                                                                                                                              safety guards.
Sanitation in Facilities                                       All facilities including factory buildings, toilets, canteens, Found toilet has bad odor.                                                         Visual                           Arrange a regular cleaning and disinfecting      Nov. 30,                  1) Factory is assigned workers to check toilets once        1)toilet checklist and Completed
                                                               kitchens, and clinics, shall be kept clean and safe and                                                                                           inspection.                      schedule of all toilets                          2005                      every two hours                                             inspection records
                                                               be in compliance with applicable laws                                                                                                                                                                                                                         2) Checklist is posted inside toilet so that worker can
                                                                                                                                                                                                                                                                                                                             record when they check restrooms.




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        4
                                                                                                                                                                        IEM Findings                                                                                                                                   Remediation                                                                     [Status]                                    Update                                                              Update                                                               Update                                                      Update
FLA Code/ Compliance issue    Country Law/Legal Reference                        FLA Benchmark                               Non-compliance          Risk of Non-compliance     Evidence of      If not    Sources/Docum        Notable                  PC Remediation plan                   Target      Factory                        Company follow up                        Documentation     Completed;              Company Follow Up              Documentation   Completed;           Company Follow Up          Documentation      Completed;        Company Follow Up            Documentation      Completed;         Company Follow Up       Documentation   Complete
                                                                                                                                                                                   Non-      corroborated, entation used for    Features                                                     Completion   Response                         (June 05, 2006)                                           Pending; On-           (September 21, 2006)                            Pending; On-          (July 12, 2007)                              Pending; On-        (July 21 2008)                                Pending; On-         (July 6, 2009)                           d;
                                                                                                                                                                                compliance    explain why   corroborating    implemented                                                        Date      (Optional)                                                                                    going                                                                  going                                                              going                                                             going                                                   Pending;
                                                                                                                                                                              (uncorroborate                                   by Factory                                                                                                                                                                                                                                                                                                                                                                                                                                   On-going
                                                                                                                                                                                    d)                                       Management
                                                                                                                                                                                                                              or Company
7. Freedom of Association and Collective Bargaining
Employers will recognize and respect the right of employees to freedom of association and collective bargaining


                                                            FLA Comment: The Chinese constitution guarantees
                                                            Freedom of Association; however, the Trade Union Act
                                                            prevents the establishment of trade unions
                                                            independent of the sole official trade union – the All
                                                            China Federation of Trade Unions (ACFTU).
                                                            According to the ILO, many provisions of the Trade
                                                            Union Act are contrary to the fundamental principles of
                                                            freedom of association, including the non-recognition
                                                            of the right to strike. As a consequence, all factories
                                                            in China fall short of the ILO standards on the right to
                                                            organize and bargain collectively. Recently, however,
                                                            the government has introduced new regulations that
                                                            could improve the functioning of the labor relations
                                                            mechanisms.
                                                            The Amended Trade Union Act of October 2001 does
                                                            stipulate that union committees have to be
                                                            democratically elected at members’ assemblies and
                                                            trade unions must be accountable to their members.
                                                            The trade union has the responsibility to consult with
                                                            management on key issues of importance to their
                                                            members and to sign collective agreements. It also
                                                            grants the trade union an enhanced role in dispute
                                                            resolution. In December 2003,the Collective Contracts
                                                            Decree introduced the obligation for representative
                                                            trade unions and employers to negotiate collective
                                                            agreements, in contrast to the previous system of non-
                                                            negotiated administrative agreements.


8. Wages and Benefits
Employers recognize that wages are essential to meeting employees’ basic needs. Employers will pay employees,
as a base, at least the minimum wage required by local law or the prevailing industry wage, whichever is higher, and
will provide legally mandated benefits

Payroll reporting                                           Accurate and reliable payroll reporting, including pay     Working hours recorded in                                                           record review                    1) Issue instruction to punch-in and punch-      Nov. 30,                  1) Factory has posted notice to instruct how to punch    1)Public notice      Completed
                                                            stubs will be provided.                                    payroll were different from                                                                                          out the time cards properly and clear            2005                      time records correctly                                   2)meeting minutes on and
                                                                                                                       time card records for                                                                                                guidelines on how working hours will be                                    2) Relevant persons have been briefed on how to collect briefing              ongoing
                                                                                                                       January, we found working                                                                                            computed. Ensure that guidelines are in                                    working hours record and transfer into payroll records   3)pay documents
                                                                                                                       hours in payroll to be                                                                                               accordance with law. 2) Brief all                                          3) According to record review for hours of work and
                                                                                                                       higher than the ones in                                                                                              employees, with particular attention to the                                payment, workers are paid exactly according to the hours
                                                                                                                       time cards (as per                                                                                                   payroll staff, about the guidelines. 3)                                    worked.
                                                                                                                       calculations).                                                                                                       Post copy at all working areas
Legal benefits               Article 72, PRC Labor Code, Employers will provide all legally mandated benefits to       The factory buys social                                                             worker                           1) Calculate properly the levels of              Nov. 30,                  1)100% workers are covered by work-related accident      1) Factory social     Ongoing       Based on the social insurance           1) Factory      Ongoing        1) Based on the social            1)Factory social   Ongoing       1) 100% workers are         1) Factory social      Ongoing        1) 100% workers are          1) Social      Ongoing
                             the sources of social        all eligible workers                                         insurance for 436                                                                   interview,                       social/medical insurance contributions and       2005                      and injury insurance as required by law                  security insurance                  receipt, and confirmed through          social security                insurance receipt, and            security insurance               provided with work-         security insurance                    provided with work injury,   insurance
                             insurance funds shall be                                                                  employees only.                                                                     management                       any pension fund payment, and ensure that                                  2)100% workers are covered by medical insurance.         plan                                workers and management interview,       insurance plan                 confirmed through workers and     plan                             related accident and        plan                                  medical and maternity        receipts.
                             determined according to the                                                                                                                                                   interview,                       all workers are enrolled in the various                                    3)100% eligible female workers are covered by            2)Certificates from                 all 3000 workers were provided with     2)Certificates                 management interviews, all        2)Certificates and               medical health insurance;   2) Certificates and                   insurance;                   2) Insurance
                             branches of insurance, and                                                                                                                                                    record review                    schemes according to law                                                   commercial insurance on pregnancy and delivery.          local social security               work-related accident injury and        and receipt                    workers were provided with        receipt from local               100% female workers         receipt from local                    2) Still only 838 (34%)      records and
                             an overall raising of social                                                                                                                                                                                   2) Quarterly and yearly plan should be in                                  4) Currently [the majority of] workers are covered by    department                          medical insurance. All 699 female       from local                     work-related accident, and        social security                  were provided with          social security                       workers are registered       website
                             insurance funds shall be                                                                                                                                                                                       place to increase the level of social security                             pension scheme mandated by local labor department. In    3)Insurance records                 workers were provided with maternity    social security                medical health insurance. All     department                       maternity insurance;        department                            with the pension scheme.     system.
                             practiced step by step. The                                                                                                                                                                                    coverage among factory population.                                         addition, factory is planning to raise the coverage of   and posted notice by                insurance as required by law.           department                     female workers were provided      3)Insurance                      33% workers are             3) Insurance records                  Factory will increase the    3) Government
                             employing unit and laborers                                                                                                                                                                                                                                                               pension 10% each year.                                   management.                         Factory only provides 765 workers       3)Insurance                    with maternity insurance as       records and                      provided with pension       and posted notice by                  percentage to 37% by the     permission
                             must participate in social                                                                                                                                                                                                                                                                                                                                                             with pension, and has a plan to         records and                    required by the local law. In     posted notice by                 plan.                       management.                           end of 2009.                 letter.
                             insurance and pay social                                                                                                                                                                                                                                                                                                                                                               increase the coverage of pension at     posted notice                  addition, factory management      management.                      2) The approval issued      4) Approval from local                3) The government            4) workers and
                             insurance premiums in                                                                                                                                                                                                                                                                                                                                                                  least 10% per year. PC will verify in   by                             has provided 940 workers with     4) Approval from                 by local social insurance   social insurance                      permission letter            management
                             accordance with the law.                                                                                                                                                                                                                                                                                                                                                               Dec. 06 the total number of workers     management.                    a pension plan. Currently,        local social                     bureau demonstrated         bureau.                               demonstrates factory has     interview.
                                                                                                                                                                                                                                                                                                                                                                                                                    who were registered with insurance                                     factory management has a plan     insurance bureau.                that the factory has met    5) Workers and                        met the local requirement
                                                                                                                                                                                                                                                                                                                                                                                                                    throughout 2006.                                                       to increase the coverage of                                        the local requirement       management interview                  regarding social
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           their pension plan by at least                                     regarding social                                                  insurance.
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           10% of workers per year. PC                                        insurance.
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           will continue to verify the
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           improvement regarding
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           insurance coverage.
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           2) The approval issued by local
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           social insurance bureau
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           demonstrated that the factory
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           has met the local requirement
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           regarding social insurance.


Voluntary Use of Benefits    No. 489, under the             All workers have a right to use or not to use employer     The factory directly                                                                record review,                   a) Management to inform workers of all           30-Nov-05                 1)Workers have signed agreement before employment.       1)Signed agreement Completed
                             Temporary Provision of         provided services, such as housing or meals.               deducts fees for dormitory,                                                         workers                          potential deductions prior to hiring worker.                               2) Workers have a choice to eat in or outside            between workers and
                             Salary Payment. Article 15,                                                               meal, electricity and water                                                         interview,                       b) workers to sign written agreement                                       3) According to the agreement, workers will not be       factory regarding
                             the employer should not                                                                   from workers' wages                                                                 management                       consenting to automatic deductions. c) if a                                deducted if they choose to dine outside                  meal service
                             deduct from the worker's                                                                  without any written                                                                 interview                        worker does not use the factory meal                                                                                                deduction
                             salary for the following                                                                  agreements from workers.                                                                                             service, the meal fee will not be                                                                                                   2) Interview with
                             circumstances: 1)personal                                                                                                                                                                                      automatically deducted from the pay slip.                                                                                           workers confirmed
                             income tax 2)social                                                                                                                                                                                                                                                                                                                                this practice and they
                             insurance not afforded by                                                                                                                                                                                                                                                                                                                          can choose to eat
                             the individual 3) the fine/fee                                                                                                                                                                                                                                                                                                                     out if they like.
                             requested in a judgment/trial                                                                                                                                                                                                                                                                                                                      3) Workers living or
                             4) other expenses as ruled                                                                                                                                                                                                                                                                                                                         dining outside have
                             by law.                                                                                                                                                                                                                                                                                                                                            no deduction for meal
                                                                                                                                                                                                                                                                                                                                                                                or housing on their
                                                                                                                                                                                                                                                                                                                                                                                payroll records.




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                                                                                                                                                                   IEM Findings                                                                                                                                    Remediation                                                                        [Status]                                    Update                                                              Update                                                     Update                                               Update
FLA Code/ Compliance issue     Country Law/Legal Reference                        FLA Benchmark                           Non-compliance       Risk of Non-compliance          Evidence of      If not    Sources/Docum        Notable                 PC Remediation plan                 Target      Factory                         Company follow up                          Documentation     Completed;              Company Follow Up              Documentation   Completed;           Company Follow Up          Documentation      Completed;     Company Follow Up     Documentation   Completed;     Company Follow Up       Documentation   Complete
                                                                                                                                                                                  Non-      corroborated, entation used for    Features                                                  Completion   Response                          (June 05, 2006)                                             Pending; On-           (September 21, 2006)                            Pending; On-          (July 12, 2007)                              Pending; On-     (July 21 2008)                      Pending; On-     (July 6, 2009)                           d;
                                                                                                                                                                               compliance    explain why   corroborating    implemented                                                     Date      (Optional)                                                                                       going                                                                  going                                                              going                                                going                                               Pending;
                                                                                                                                                                             (uncorroborate                                   by Factory                                                                                                                                                                                                                                                                                                                                                                                                                  On-going
                                                                                                                                                                                   d)                                       Management
                                                                                                                                                                                                                             or Company
9. Hours of Work
Except in extraordinary business circumstances, employees will (i) not be required to work more than the lesser of
(a) 48 hours per week and 12 hours overtime or (b) the limits on regular and overtime hours allowed by the law of
the country of manufacture or, where the laws of such country will not limit the hours of work, the regular work week
in such country plus 12 hours overtime; and (ii) be entitled to at least one day off in every seven day period


Overtime Limitations     According to Article 41 PRC         Except in extraordinary business circumstances,                               There are over 10 nights per                                   worker                           1. Capacity should be based on regular      Nov. 30,                    1)Factory has made very strict policy on 60 work week       1)Employee COC       On-going       1) Based on the time records and        1) Workers'     On-going       Based on time records and        1) Workers' time   Completed
                         Labor Code, The employing           employees will (i) not be required to work more than the                      month when workers need to                                     interview                        work week, not on excessive overtime.       2005                        and one day of rest per seven which is inside the           pocket card.                        confirmed through workers and           time records                   production records reviewed,     records from
                         unit may extend working             lesser of (a) 48 hours per week and 12 hours overtime                         work until 11pm or 12pm, 3 to                                                                   2. Devise systems to deal with overtime                                 worker's COC card.                                          2)Public notice in                  management interview: the maximum       of June, July                  and confirmed through worker     September 2006
                         hours as necessitated by its        or (b) the limits on regular and overtime hours allowed                       4 overnights in this May and                                                                    problems through cross training and shift                               2)Workers have a right to report the violation to senior    show window                         working hours per week is 60 hours,     and August or                  and management interviews,       to June 2007.
                         production or business              by the law of the country of manufacture or, where the                        June.                                                                                           work.                                                                   management through established grievance channels           3)Meeting minutes                   one day off per seven is guaranteed     2006.                          factory has been working a       2) Working hours
                         operation after consultation        laws of such country will not limit the hours of work, the                                                                                                                    3. Track and control the number of working                              3)Factory has called up meeting with all department         4)Posted Notice at                  and all overtime work is voluntary.     2) Working                     maximum of working 60 hours      policy and
                         with the trade union and            regular work week in such country plus 12 hours                                                                                                                               hours per week and ensure that weekly                                   managers and supervisor to detail the requirements of       factor site.                        2) Factory management mentioned         hours policy                   per week, including a maximum    procedures
                         laborers, but the extended          overtime; and (ii) be entitled to at least one day off in                                                                                                                     working hours are not in excess of 60 hours                             overtime work.                                                                                  they will keep on reducing working      and                            of 3 hours of overtime during    3) Production
                         working hours per day shall         every seven day period. An extraordinary business                                                                                                                             in total, and daily maximum working hours                               4)Factory is posting fixed weekly working schedule on                                           hours through internal capacity         procedures                     the regular workday. It was      records and
                         generally not exceed one            circumstance is a temporary period of extra work that                                                                                                                         are not more than 11hours.                                              the production floor.                                                                           building of their internal Human                                       also confirmed that workers      payroll records
                         hour; if such extension is          could not have been anticipated or alleviated by other                                                                                                                        4. Factory should regularly train and coach                             5) Based on payroll records for March, April & May,                                             Resource management system and                                         receive one day off in seven.    (for cross
                         needed for special reasons,         reasonable efforts                                                                                                                                                            department managers and line supervisors                                number of weekly working hours were below 60 per                                                by improving their productivity.                                       All overtime in the factory is   checking).
                         under the condition that the                                                                                                                                                                                      on daily and weekly hours limit and                                     week. Maximum number is 60.                                                                                                                                            voluntary.
                         health of laborers is                                                                                                                                                                                             voluntary overtime work policies.
                         guaranteed, the extended
                         hours shall not exceed three
                         hours per day. However, the
                         total extension in a month
                         shall not exceed thirty six
                         hours. According to
                         Regulations about Employee
                         Work Time by the State
                         Government - May 1, 1997,
10. Overtime CompensationArticle#3 Employees shall
In addition to their compensation for regular hours of work, employees will be compensated for overtime hours at
such premium rate as is legally required in the country of manufacture or, in those countries where such laws will not
exist, at a rate at least equal to their regular hourly compensation rate.
Accurate recording of OT                                     Employees will be paid for all hours worked in a                              According to time cards,                                       record review,                   1) Issue instruction to punch-in and punch-   Nov. 30,                  1) Factory has posted notice to instruct how to punch       1)Public notice      Completed
hours worked                                                 workweek. Calculation of hours worked must include all                        workers' working hours are                                     management                       out the time cards properly and clear         2005                      time records correctly                                      2)meeting minutes on and
                                                             time that the employer allows or requires the worker to                       more than 8 hours for                                          interview                        guidelines on how working hours will be                                 2) Relevant persons have been briefed on how to collect     briefing             ongoing
                                                             work                                                                          dayshift. But the factory                                                                       computed. Ensure that guidelines are in                                 working hours record and transfer into payroll records      3)pay documents
                                                                                                                                           counts it as 8 hours, the                                                                       accordance with law. 2) Brief all                                       3) After cross-checking the hours records and payroll for
                                                                                                                                           management explained that it                                                                    employees, with particular attention to the                             March & April, no mismatch in working hours was found.
                                                                                                                                           is because workers come                                                                         payroll staff, about the guidelines. 3)
                                                                                                                                           back to workstation right after                                                                 Post copy at all working areas
                                                                                                                                           lunch, but just rest, no work.
                                                                                                                                           Working hours of night shift
                                                                                                                                           workers were wrong due to
                                                                                                                                           computer system problem in
                                                                                                                                           July, so working hours in
                                                                                                                                           payroll and time cards are
                                                                                                                                           different, it is impossible to
                                                                                                                                           confirm the actual working
                                                                                                                                           hours of those workers.
Miscellaneous




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