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					FLA Audit Profile
Country                                                              United States
Factory name                                                         070082519F
IEM                                                                  Accordia Global Compliance Group
Date(s) in facility                                                  Feb 26-27, 2007
PC(s)                                                                Nike
Number of workers                                                    252
Product(s)                                                           Hosiery
Production processes                                                 Knit, Seam, Dye, Boarding, Pairing, Package

FLA Code/Benchmark                                                   Compliance status   if non complaint, risk of non complaince or           Sources/Documentation used for         Notable Features implemented by Factory
                                                                                         uncorroborated - explain why                          reference (ref country law) and        Management or Company
                                                                                                                                               corroborating
1. Code Awareness
GEN 2 Ensure that all Company factories as well as contractors   non compliance          Management and workers at the facility have not           Worker and management interviews
and suppliers inform their employees about the workplace                                 received training on workplace standards. In our
standards orally and through the posting of standards in a                               interviews with management and workers, we were
prominent place (in the local languages spoken by employees and                          told that Nike has not provided training on the code.
managers) and undertake other efforts to educate employees about                         We also did not find training records on this subject.
the standards on a regular basis.                                                        The only positive indicator was the Nike poster being
                                                                                         on the wall near the break room. Also, the requirement
                                                                                         for GEN 2 is not only to post the code but to “orally and
                                                                                         through the posting of standards in a prominent place
                                                                                         (in the local languages spoken by employees and
                                                                                         managers) and undertake other efforts to educate
                                                                                         employees about the standards on a regular basis.”
                                                                                         We did not find that there was any verbal/oral training
                                                                                         on Nike’s part nor was there any “other efforts” or
                                                                                         “regularity” in their approach.
GEN 3 Develop a secure communications channel, in a manner           non compliance      No evidence was found to show that Nike has provided Worker and management interviews
appropriate to the culture and situation, to enable Company                              a secure means of communication between for
employees and employees of contractors and suppliers to report to                        workers to report noncompliance to the Code.
the Company on noncompliance with the workplace standards, with
security that they shall not be punished or prejudiced for doing so.

2.Forced Labor
There will not be any use of forced labor, whether in the form of
prison labor, indentured labor, bonded labor or otherwise
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.




                                                                                                                                                                                                                      1
FLA Code/Benchmark                                        Compliance status   if non complaint, risk of non complaince or                   Sources/Documentation used for         Notable Features implemented by Factory
                                                                              uncorroborated - explain why                                  reference (ref country law) and        Management or Company
                                                                                                                                            corroborating
H&A2 Discipline/Progressive Discipline                    non compliance      There is only a documented statement related to               Records review and worker interviews
                                                                              discipline and attendance problems with workers. As a
                                                                              practice, the facility utilizes a form "Employee
                                                                              Counseling Record" to document the disciplinary
                                                                              action taken with an employee. This form, in the
                                                                              opinion of the Monitor, is used "after the fact" when a
                                                                              worker has already been accused of behavior that is
                                                                              subject to disciplinary action. The intent of the FLA is to
                                                                              have the information about the policy and practice
                                                                              know to the workers "before the fact" prior to a worker
                                                                              being alledged of unacceptable behavior. Additionally,
                                                                              the Monitor has found from management interview and
                                                                              worker interview that supervisors handle discipline
                                                                              differently. The Monitor deems this practice to not be
                                                                              objective (no clear definitions of acceptable behavior).
                                                                              The practice is deemed to be progressive as
                                                                              evidenced by review of disciplinary records that
                                                                              showed various levels of discipline are issued. The
                                                                              practice is deemed to not be fair since workers are not
                                                                              advised nor is there clarity related to the behavior that
                                                                              may lead to various levels of disciplinary actions.
H&A4 Discipline/Fair and Non-discriminatory Application   non compliance      There is only a documented statement related to             Records review and management
                                                                              discipline and attendance problems with workers. As a interviews
                                                                              practice, the facility utilizes a form "Employee
                                                                              Counseling Record" to document the disciplinary
                                                                              action taken with an employee. This form, in the
                                                                              opinion of the Monitor, is used "after the fact" when a
                                                                              worker has already been accused of behavior that is
                                                                              subject to disciplinary action. The intent of the FLA is to
                                                                              have the information about the policy and practice
                                                                              know to the workers "before the fact" prior to a worker
                                                                              being alledged of unacceptable behavior. Additionally,
                                                                              the Monitor has found from management interview and
                                                                              worker interview that supervisors handle discipline
                                                                              differently. The Monitor deems this practice to not be
                                                                              objective (no clear definitions of acceptable behavior).
                                                                              The practice is deemed to be progressive as
                                                                              evidenced by review of disciplinary records that
                                                                              showed various levels of discipline are issued. The
                                                                              practice is deemed to not be fair since workers are not
                                                                              advised nor is there clarity related to the behavior that
                                                                              may lead to various levels of disciplinary actions.




                                                                                                                                                                                                                   2
FLA Code/Benchmark                                                        Compliance status        if non complaint, risk of non complaince or                 Sources/Documentation used for    Notable Features implemented by Factory
                                                                                                   uncorroborated - explain why                                reference (ref country law) and   Management or Company
                                                                                                                                                               corroborating
H&A5 Discipline/Written Disciplinary System                               non compliance           There is only a documented statement related to             Records review and management
                                                                                                   discipline and attendance problems with workers. As a interviews
                                                                                                   practice, the facility utilizes a form "Employee
                                                                                                   Counseling Record" to document the disciplinary
                                                                                                   action taken with an employee. This form, in the
                                                                                                   opinion of the Monitor, is used "after the fact" when a
                                                                                                   worker has already been accused of behavior that is
                                                                                                   subject to disciplinary action. The intent of the FLA is to
                                                                                                   have the information about the policy and practice
                                                                                                   know to the workers "before the fact" prior to a worker
                                                                                                   being alledged of unacceptable behavior. Additionally,
                                                                                                   the Monitor has found from management interview and
                                                                                                   worker interview that supervisors handle discipline
                                                                                                   differently. The Monitor deems this practice to not be
                                                                                                   objective (no clear definitions of acceptable behavior).
                                                                                                   The practice is deemed to be progressive as
                                                                                                   evidenced by review of disciplinary records that
                                                                                                   showed various levels of discipline are issued. The
                                                                                                   practice is deemed to not be fair since workers are not
                                                                                                   advised nor is there clarity related to the behavior that
                                                                                                   may lead to various levels of disciplinary actions.

H&A6 Discipline/Worker Awareness-Participation of Workers                 non compliance           There is only a documented statement related to             Records review and management
                                                                                                   discipline and attendance problems with workers. As a interviews
                                                                                                   practice, the facility utilizes a form "Employee
                                                                                                   Counseling Record" to document the disciplinary
                                                                                                   action taken with an employee. This form, in the
                                                                                                   opinion of the Monitor, is used "after the fact" when a
                                                                                                   worker has already been accused of behavior that is
                                                                                                   subject to disciplinary action. The intent of the FLA is to
                                                                                                   have the information about the policy and practice
                                                                                                   know to the workers "before the fact" prior to a worker
                                                                                                   being alledged of unacceptable behavior. Additionally,
                                                                                                   the Monitor has found from management interview and
                                                                                                   worker interview that supervisors handle discipline
                                                                                                   differently. The Monitor deems this practice to not be
                                                                                                   objective (no clear definitions of acceptable behavior).
                                                                                                   The practice is deemed to be progressive as
                                                                                                   evidenced by review of disciplinary records that
                                                                                                   showed various levels of discipline are issued. The
                                                                                                   practice is deemed to not be fair since workers are not
                                                                                                   advised nor is there clarity related to the behavior that
                                                                                                   may lead to various levels of disciplinary actions.

H&A7 Discipline/Training of Management                                    risk of non compliance   HR Manager has been in his position for six months.        Management interviews
                                                                                                   He has been promoted from within the organization.
                                                                                                   He has not received specific training in relation to legal
                                                                                                   compliance requirements. The previous HR Manager
                                                                                                   is still employed with the company and she is available
                                                                                                   as needed for consultation in HR and worker matters.

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.
6. Health and Safety



                                                                                                                                                                                                                                 3
FLA Code/Benchmark                                                       Compliance status        if non complaint, risk of non complaince or           Sources/Documentation used for      Notable Features implemented by Factory
                                                                                                  uncorroborated - explain why                          reference (ref country law) and     Management or Company
                                                                                                                                                        corroborating
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
H&S10 Safety Equipment and First Aid Training                            risk of non compliance   Inpection of first aid kit found supplies that were    Visual Observation
                                                                                                  beyond expiration date (burn ointment, eye wash, gel).

7. Freedom of Association and Collective Bargaining
Employers will recognize and respect the right of employees to
freedom of association and collective bargaining
FoA.24 Grievance Procedure                                               risk of non compliance   No evidence found that workers have an appropriate     Worker and management interviews
                                                                                                  and suitable method to report grievances. There is an and review of published employee
                                                                                                  open door policy, however, this is more of an informal handbook.
                                                                                                  process that does not meet the strength and intent of
                                                                                                  the FLA benchmark. Company has a written policy in
                                                                                                  the Policies and Benefits Manual (page 3 titled
                                                                                                  Unionism). The policy explains the worker's right to
                                                                                                  free association but also states that the company will
                                                                                                  oppose unions by every legal means. The company
                                                                                                  offers the open door policy as an alternative to
                                                                                                  unionization.
8. Wages and Benefits/Overtime
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
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




                                                                                                                                                                                                                            4
FLA Audit Profile
Country                                                      United States
Factory name                                                 070082519F
IEM                                                          Accordia Global Compliance Group
Date(s) in facility                                          Feb 26-27, 2007
PC(s)                                                        Nike
Number of workers                                            252
Product(s)                                                   Hosiery
Production processes                                         Knit, Seam, Dye, Boarding, Pairing, Package

                                                                                                                               Remediation                                                             [Status]
FLA Code/Benchmark                                     PC Internal PC Remediation plan                                 Target Completion   Factory Response   Company follow Documentation         Completed;
                                                       Audit                                                           Date                (Optional)         up (Cite date of                     Pending; On-
                                                       Findings                                                                                               follow up)                           going
                                                       (Optional)
GEN 2 Ensure that all Company factories as well as                 The management team will review the contents of     September 4, 2007                      July 13, 2007   Training plan or      completed
contractors and suppliers inform their employees about             the Nike Contractor Compliance manual, which                                                               training record.
the workplace standards orally and through the posting             includes the Nike Code of Conduct and Nike CLS                                                             Training rosters have
of standards in a prominent place (in the local                    requirements. Ensure that the COC is                                                                       been provided to
languages spoken by employees and managers) and                    predominantly posted and develop an integrated                                                             Nike.
undertake other efforts to educate employees about the             training program to provide employees with regular
standards on a regular basis.                                      training/information on vendor compliance program
                                                                   requirements, general activities, etc. on an annual
                                                                   frequency or as needed (i.e. for new hires).

GEN 3 Develop a secure communications channel, in a                    Nike compliance person to leave contact           September 4, 2007                    June 30, 2007   Nike communication completed
manner appropriate to the culture and situation, to                    information available for employees with a                                                             memorandum
enable Company employees and employees of                              communication of purpose detailing how grievances                                                      provided, included in
contractors and suppliers to report to the Company on                  will be handled.                                                                                       EE handbook &
noncompliance with the workplace standards, with                                                                                                                              discussed with EE
security that they shall not be punished or prejudiced for                                                                                                                    population.
doing so.
H&A2 Discipline/Progressive Discipline                                 POLICY: To be reviewed and ensure that it            September 4, 2007                 July 31, 2007   Disciplinary policy  on going
                                                                       specifies the company's expectation of professional                                                    (sanction), training
                                                                       behavior, citing specific examples where zero                                                          records or plans.
                                                                       tolerance could apply and extending to govern work                                                     Policy has been
                                                                       practices/behaviors beyond attendance problems.                                                        developed 07/07/07 -
                                                                       The policy should specify the progression/escalation                                                   training to be
                                                                       of disciplinary sanctions. Management team can                                                         planned. Training
                                                                       also stipulate the potential for acts significant                                                      rosters have been
                                                                       enough to warrant management review. Will be                                                           provided to Nike.
                                                                       addressed on a case-by-case basis and decisions
                                                                       rendered in a fair/transparent manner. The policy
                                                                       should also provide EE's with a process to review
                                                                       any discplinary sanctions which are perceived as
                                                                       being unjustified the process by which disciplinary
                                                                       action. TRAINING: Skills development for
                                                                       managers/supervisors on the content of the policy
                                                                       and consistent application, practical
                                                                       examples/training exercises. Ensure that policy
                                                                       revision is communicated to the employee
                                                                       population and included if possible alongside the
                                                                       posting of the Harassment/Abuse & Non-
                                                                       Discrimation policies.




                                                                                                                                                                                                        5
                                                                                                                               Remediation                                                                  [Status]
FLA Code/Benchmark                                  PC Internal PC Remediation plan                                    Target Completion   Factory Response   Company follow Documentation              Completed;
                                                    Audit                                                              Date                (Optional)         up (Cite date of                          Pending; On-
                                                    Findings                                                                                                  follow up)                                going
                                                    (Optional)
                                                                PRACTICE: Ensure that training program is
                                                                available for review/refresher training & for auditing
                                                                purposes, maintain training records, ensure regular
                                                                refresher training/new hire/promotion training is
                                                                conducted and that disciplinary actions are
                                                                documented consistently (consider form generation)
                                                                and conserved in appropriate records. **this
                                                                revision will be communicated & posted to EE until
                                                                the manuals are reprinted (within 12 months)


H&A4 Discipline/Fair and Non-discriminatory                     See above                                                                                     July 13, 2007   Policy has been           completed
Application                                                                                                                                                                   created.
H&A5 Discipline/Written Disciplinary System                     See above                                                                                     July 13, 2007   Policy has been           completed
                                                                                                                                                                              created.
H&A6 Discipline/Worker Awareness-Participation of               See above                                                                                     July 13, 2007   Training roster           completed
Workers                                                                                                                                                                       provided to Nike.
H&A7 Discipline/Training of Management                          See above                                                                                     July 13, 2007   Training roster           completed
                                                                                                                                                                              provided to Nike.
H&S10 Safety Equipment and First Aid Training                   POLICY: Ensure that it is communicated that first- June 30, 2007         Factory has         May 29, 2007     Inspection sheet          completed
                                                                aid/safety equipment are on a regular internal                           included this                        shown to Nike
                                                                inspection schedule. Ensure that first-aid inventory                     component on their                   specialist and
                                                                checklist is referenced. Include verification of                         monthly inspection                   inspection of first-aid
                                                                expiration dates on the document. TRAINING:                              sheet & restricted                   stations showed no
                                                                Communicate this past omission to inspection team                        access to materials                  expired products.
                                                                and H&S committee. Include a notation in the                             to prevent outside
                                                                minutes to be posted to the EE population.                               products being
                                                                PRACTICE: Use revised inspection forms to                                placed inside.
                                                                conduct regular inspections of this equipment &
                                                                notification protocol in the event anything needs
                                                                replacement.
FoA.24 Grievance Procedure                                      POLICY: Separate employee grievance policy from September 4, 2007                             July 31, 2007   Grievance procedure completed
                                                                current unionism statement. Develop a stand-alone                                                             has been developed,
                                                                confidential grievance procedure (i.e. identify a                                                             training to be
                                                                person in HR to be the confidential                                                                           planned. Training
                                                                contact/administrator of the practice to ensure that                                                          roster has been
                                                                employees can submit their issues in a confidential                                                           provided to Nike.
                                                                manner protected from potential retribution).
                                                                Develop a method to track informal grievances
                                                                brought to the attention of HR to ensure that issues
                                                                are remediated. Ensure that access & information
                                                                on the process is readily available/posted to EE
                                                                population. TRAINING: Train administrator on the
                                                                developed procedure. Communicate process to
                                                                managers/supervisors and the employee
                                                                population. Regular refresher training should be
                                                                scheduled/available. PRACTICE: The grievance
                                                                procedure should be easily tracked through
                                                                documentation. Grievances should be submitted in
                                                                writing. Once received, submitted to the appropriate
                                                                department/person for review/consideration (this
                                                                should be tracked). Time frames should be
                                                                specified and resolutions communicated to the
                                                                employee population either via posting, meeting


                                                                                                                                                                                                            6
                                                                                                          Remediation                                                       [Status]
FLA Code/Benchmark   PC Internal PC Remediation plan                                              Target Completion   Factory Response   Company follow Documentation   Completed;
                     Audit                                                                        Date                (Optional)         up (Cite date of               Pending; On-
                     Findings                                                                                                            follow up)                     going
                     (Optional)
                                (conservation of minutes) or similar communication
                                method. If it is a confidential written grievance, it should be
                                assured that a written response will be supplied by
                                management.




                                                                                                                                                                            7
FLA Audit Profile
Country                                                 United States
Factory name                                            070082519F
IEM                                                     Accordia Global Compliance Group
Date(s) in facility                                     Feb 26-27, 2007
PC(s)                                                   Nike
Number of workers                                       252
Product(s)                                              Hosiery
Production processes                                    Knit, Seam, Dye, Boarding, Pairing, Package

                                                           [Status]                 Updates (Cite Date of Follow up)                     Third-Party Verification         Company Verification Follow up
FLA Code/Benchmark                                      Completed; Company Follow up                                 Documentation   External      Documentation    Company Follow up       Documentation
                                                        Pending; On-                                                                 Verification                   (Cite date of planned
                                                        going                                                                        (Date)                         or follow up visit, if
                                                                                                                                                                    appropriate)
GEN 2 Ensure that all Company factories as well as        completed   Onsite follow up/discussion May 29, 2007
contractors and suppliers inform their employees about
the workplace standards orally and through the posting
of standards in a prominent place (in the local languages
spoken by employees and managers) an


GEN 3 Develop a secure communications channel, in a     completed     Onsite follow up/discussion May 29, 2007
manner appropriate to the culture and situation, to
enable Company employees and employees of
contractors and suppliers to report to the Company on
noncompliance with the workplace standards, with securi


H&A2 Discipline/Progressive Discipline                  on going      Onsite follow up/discussion May 29, 2007
H&A4 Discipline/Fair and Non-discriminatory             completed     Onsite follow up/discussion May 29, 2007
Application
H&A5 Discipline/Written Disciplinary System             completed     Onsite follow up/discussion May 29, 2007
H&A6 Discipline/Worker Awareness-Participation of       completed     Onsite follow up/discussion May 29, 2007
Workers
H&A7 Discipline/Training of Management                  completed     Onsite follow up/discussion May 29, 2007
H&S10 Safety Equipment and First Aid Training           completed     Onsite follow up/discussion May 29, 2007
FoA.24 Grievance Procedure                              on going      Onsite follow up/discussion May 29, 2007




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