Docstoc

Findings

Document Sample
Findings Powered By Docstoc
					FLA Audit Profile
Country                              Dominican Republic
Factory name                         100019330E
IEM                                  ALGI
Date(s) in facility                  August 30- 31, 2006
PC(s)                                Phillips-Van Heusen, Inc.
Number of workers                    1,270
Product(s)                           Shoes
Production processes                 Sole injection, cutting, sewing, assembly, QC, packing,
                                     warehousing, shipping



                                                                                                                   IEM Findings                                                                                                                     Remediation                                                                                    [Status]

FLA Code/ Compliance issue           Country Law/Legal Reference    FLA Benchmark                                  Non-compliance                       Risk of Non-compliance    Evidence of    If not    Sources/Documentation     Notable        PC Remediation plan                    Target           Company follow up      Documentation   Completed;
                                                                                                                                                                                 Non-            corrobora used for corroborating    Features                                              Completion    (Jan 2007 & March 2007)                   Pending; On-
                                                                                                                                                                                 compliance      ted,                                implemented by                                        Date                                                    going
                                                                                                                                                                                 (uncorroborat   explain                             Factory
                                                                                                                                                                                 ed)             why                                 Management or
                                                                                                                                                                                                                                     Company
1. Code Awareness
Code posting/information                                            FLA Principle of Monitoring, Obligation        P.V.H. Code of Conduct is not                                                          Walkthrough of the                        The code of conduct ( in English and October        During the follow up      Auditors viewed Completed
                                                                    of Companies: Establish and articulate         posted on two of four buildings at                                                     facility and factory's                    Spanish ) will be posted in all plants. 15, 2006    conducted in January      posters in the
                                                                    clear, written workplace standards.            [Factory] Manufacturing Ltd. A                                                         internal rules reviewed.                                                                      2007, auditors found that factory
                                                                    Formally convey those standards to             third building has the code posted                                                                                                                                                   this issue has been
                                                                    Company factories as well as to licensees,     in English and the fourth one has                                                                                                                                                    corrected.
                                                                    contractors and suppliers.                     the code posted in Spanish.




Worker/management awareness                                         FLA Principle of Monitoring, Obligation        The Company has communicated                                                           Management and                            We have programmed 42 sessions         December During the follow up           Auditors viewed Completed
of Code                                                             of Companies: Ensure that all Company          code obligations directly to                                                           workers interviews                        of training, for 30 employees by       15, 2006 conducted in January           supporting
                                                                    factories as well as contractors and           management but not to the                                                                                                        session, with an average of two                 2007, auditors found that      documentation
                                                                    suppliers inform their employees about the     workforce.                                                                                                                       hours long.                                     this issue has been            and interviewed
                                                                    workplace standards orally and through the                                                                                                                                                                                      corrected.                     workers
                                                                    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.


Confidential non-compliance                                         FLA Principle of Monitoring, Obligation        PVH has not established a                                                              Management/employe                        This will be implemented               October      This issue has been        Confidential    Completed
reporting channel                                                   of Companies: Develop a secure                 confidential noncompliance                                                             e interviews and                          immediately by the PC.                 2006         corrected by the PC.       complaint
                                                                    communications channel, in a manner            reporting mechanism for the                                                            walkthrough of the                                                                                                       phone system
                                                                    appropriate to the culture and situation, to   workers.                                                                               facility.                                                                                                                has been
                                                                    enable Company employees and                                                                                                                                                                                                                                   implemented
                                                                    employees of contractors and suppliers to                                                                                                                                                                                                                      and workers
                                                                    report to the Company on noncompliance                                                                                                                                                                                                                         are aware on
                                                                    with the workplace standards, with security                                                                                                                                                                                                                    how to
                                                                    that they shall not be punished or                                                                                                                                                                                                                             communicate
                                                                    prejudiced for doing so.                                                                                                                                                                                                                                       with PC

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.
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.




                                                                                                                                                                                                                                                                                                                                              1
                                                                                                                     IEM Findings                                                                                                                        Remediation                                                                                        [Status]

FLA Code/ Compliance issue         Country Law/Legal Reference      FLA Benchmark                                    Non-compliance                         Risk of Non-compliance    Evidence of    If not    Sources/Documentation    Notable        PC Remediation plan                         Target           Company follow up       Documentation   Completed;
                                                                                                                                                                                     Non-            corrobora used for corroborating   Features                                                   Completion    (Jan 2007 & March 2007)                    Pending; On-
                                                                                                                                                                                     compliance      ted,                               implemented by                                             Date                                                     going
                                                                                                                                                                                     (uncorroborat   explain                            Factory
                                                                                                                                                                                     ed)             why                                Management or
                                                                                                                                                                                                                                        Company
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
Evacuation Procedure                   Dominican Republic              All applicable legally required or            1) Some aisles in Plant I and Plant                                                      Facility walkthrough                       1) The aisles of plant I and II were      Immediatel During the follow up          Auditors verified Completed
                                       Hygiene and Industrial          recommended elements of safe evacuation       II were found obstructed with                                                                                                       checked and cleared immediately.          y          conducted in January          this
                                       Safety Regulations Art. 78 (such as posting of evacuation plans,              boxes, fans and work in process.                                                                                                    The management committed to                          2007, auditors found that     improvement
                                       (Aisles): At any place of the unblocked aisles/exits, employee                2) One emergency exit on second                                                                                                     maintaining the aisles clear at all                  this issue has been           through
                                       factory is forbidden to         education, evacuation procedures, etc.)       level of Plant II opens outwards,                                                                                                   times. 2) Health and Safety                          corrected.                    observation and
                                       accumulate machinery, raw shall be complied with and workers shall be         directly to a stairway                                                                                                              Department to inspect all the                                                      walkthrough
                                       materials, waste materials or trained in proper safety, first aid, and                                                                                                                                            emergency exits of [Factory] to
                                       other objects in that way that evacuation procedures                                                                                                                                                              confirm that all of them open in the
                                       interfere with free circulation                                                                                                                                                                                   egress direction.
                                       of workers and the normal
                                       functioning of the industry, in
                                       order to avoid hazardous
                                       contacts or risks for
                                       personnel transit. These
                                       aisles should be no lesser
                                       than 80 cms.


Safety Equipment                                                    All safety and medical equipment (such as        1) One fire extinguisher on second                                                       Facility walkthrough                       The machinery that were not in use Immediatel During the follow up                 Auditors verified Completed
                                                                    fire fighting equipment, first aid kits, etc.)   level of Plant I was found                                                                                                          and were blocking the fire           y        conducted in January                 this
                                                                    shall be in place, maintained as prescribed      obstructed with machines that are                                                                                                   extinguishers were moved                      2007, auditors found that            improvement
                                                                    and accessible to the employees                  not in use.                                                                                                                         immediately to an area in Plant I             this issue has been                  through
                                                                                                                     2) One of the fire alarm buttons                                                                                                    assigned for equipments that are not          corrected.                           observation and
                                                                                                                     was observed blocked with a                                                                                                         in use. The management                                                             walkthrough
                                                                                                                     table.                                                                                                                              commmitted to maintain at all times
                                                                                                                                                                                                                                                         the fire extinguishers unobstructed.




PPE                                Dominican Republic               Workers shall wear appropriate protective        1) Some pneumatic and precursor                                                          Facility walkthrough,     On December      1) Personnel will be supplied with        1)           During the follow up        Auditors verified Completed
                                   Hygiene and Industrial           equipment (such as gloves, eye protection,       machines operators were found                                                            employees interviews      1, 2006 at the   PPE according with the needs and          December     conducted in January        this
                                   Safety Regulations Arts.         hearing protection, respiratory protection,      working without ear protectors.                                                          and records reviewed      latest and       risks of the operation. They will be      12, 2006     2007, auditors found that   improvement
                                   20-21-77-117 (Ear                etc.) to prevent unsafe exposure (such as        According to measurements taken                                                                                    after this       trained and communicated the              3)           this issue has been         through
                                   protection-Warning signs-        inhalation or contact with solvent vapors,       by the internal Safety Department,                                                                                 revision, a      importance of the use of the PPE.         December     corrected.                  observation,
                                   Respiratory protection):         noise, dust, etc.) to hazardous elements         the noise reaches up to 97dBs in                                                                                                    The health and safety department in       1, 2006                                  walkthrough
                                   Companies must protect           including medical waste.                         some areas. 2) Some machines                                                                                                        coordination with the                     4)                                       and workers'
                                   their personnel from ear                                                          and tasks are not properly                                                                                                          Communications Department will            September                                interviews
                                   injuries by providing safety                                                      designated as hazardous. 3)                                                                                                         enforce the identification of the areas   16, 2006
                                   equipment. Any sound                                                              Guidelines for compulsory use of                                                                                                    that needs obligatory use of PPE. 2)
                                   higher than 90 db must be                                                         PPE is not posted on the areas                                                                                                      On September 26, 2006, the health
                                   considered as harmful for                                                         where workers are at risk. 4) It was                                                                                                and safety department started
                                   their ears. When necessary,                                                       observed on a sector of Plant II                                                                                                    monitoring for high risk equipments.
                                   posters and warning signs                                                         that lint produced by one of the                                                                                                    A precaution sign will be posted on
                                   must be located on factory's                                                      processes greatly affects workers                                                                                                   all equipment identified as high risk
                                   walls in order to advise                                                          in the surrounding area. However,                                                                                                   according to the risk the equipment
                                   employees about hazards.                                                          only the machine operator has                                                                                                       generates. 3) The company
                                   When contamination or dust                                                        adequate PPE (mask).                                                                                                                compromise to post signs in the
                                   concentration compromises                                                                                                                                                                                             areas that requires the mandatory
                                   the health of personnel who                                                                                                                                                                                           use of PPE. 4) All the employees
                                   not work directly at the place                                                                                                                                                                                        that work in the areas where lint is
                                   which dust is originated, the                                                                                                                                                                                         generated and also the employees
                                   factory must install an                                                                                                                                                                                               exposed around 2 meters radius of
                                   aspiration system to                                                                                                                                                                                                  these work stations were
                                   eliminate this contamination                                                                                                                                                                                          communicated the importance of the
                                   elements                                                                                                                                                                                                              use of PPE and all were provided
                                                                                                                                                                                                                                                         masks. The malfunction equipments
                                                                                                                                                                                                                                                         that were causing an excess of lint
                                                                                                                                                                                                                                                         were repaired.




                                                                                                                                                                                                                                                                                                                                                        2
                                                                                                                     IEM Findings                                                                                                                        Remediation                                                                                        [Status]

FLA Code/ Compliance issue         Country Law/Legal Reference       FLA Benchmark                                   Non-compliance                          Risk of Non-compliance    Evidence of    If not    Sources/Documentation     Notable        PC Remediation plan                      Target            Company follow up       Documentation   Completed;
                                                                                                                                                                                      Non-            corrobora used for corroborating    Features                                                Completion     (Jan 2007 & March 2007)                    Pending; On-
                                                                                                                                                                                      compliance      ted,                                implemented by                                          Date                                                      going
                                                                                                                                                                                      (uncorroborat   explain                             Factory
                                                                                                                                                                                      ed)             why                                 Management or
                                                                                                                                                                                                                                          Company
Chemical Management                Dominican Republic                All chemicals and hazardous substances          1) Every building at [Factory] has a                                                      Worker interviews,                        1) Taking into consideration that the    1)            During the follow up        Auditors verified Completed
                                   Hygiene and Industrial            should be properly labeled and stored in        chemical storage area. It was                                                             facility walkthrough and                  actual chemical storage areas were       November      conducted in January        this
                                   Safety Regulations Arts.          accordance with applicable laws. Workers        noticed these areas are too close                                                         records review                            presented and approved previously,       15, 2006      2007, auditors found that   improvement
                                   91-123 (Flammable liquids         should receive training, appropriate to their   to production workers.                                                                                                              the management has delegated             2) February   this issue has been         through
                                   and Toxic substances): All        job responsibilities, in the safe use of        2) There are no safety measures                                                                                                     again to identify a place in the park    23, 2007      corrected                   observation,
                                   flammable liquids must be         chemicals and other hazardous substances        in case of a spill and no warning                                                                                                   that can be useful as a temporary        3)                                        walkthrough
                                   stored on tanks built                                                             posters are available.                                                                                                              warehouse of chemical products.          November                                  and workers'
                                   especially for this purpose                                                       3) Some employees who                                                                                                               2) The health and safety department      30, 2006                                  interviews
                                   and isolated from the rest of                                                     manipulate chemicals are not                                                                                                        created a procedure for handling         4)
                                   the building. The factory                                                         properly trained on safety issues                                                                                                   chemical spillage. This procedure        December
                                   must put in place necessary                                                       or on the correct use of chemical                                                                                                   was approved on September 29,            17, 2006
                                   measures in order to avoid                                                        products.                                                                                                                           2006 and will later be implemented
                                   spills in that way that can not                                                   4) MSDS are not available on the                                                                                                    and communicated.         3) Based on
                                   reach to drainages, sewers                                                        point of use and some of the                                                                                                        work program sent by INFOTEP, the
                                   or basements. Every                                                               chemical containers are not                                                                                                         trainings will be conducted and all
                                   container of toxic                                                                properly labeled.                                                                                                                   the employees that handle
                                   substances must have a                                                                                                                                                                                                chemicals will be trained
                                   label that indicates safety                                                                                                                                                                                           (appropriate documentation sent to
                                   measures to use the                                                                                                                                                                                                   PC's local office).    4) All the MSDS
                                   substance, first intoxication                                                                                                                                                                                         will be posted at the area where the
                                   symptoms, first aids in case                                                                                                                                                                                          modules which work with chemicals
                                   of excessive exposure and                                                                                                                                                                                             are placed.
                                   safety conditions to dispose
                                   empty containers


Ventilation/Electrical/facility    Dominican Republic                All ventilation, plumbing, electrical, and      1) 11 employees interviewed                                                               Employees interviews,                     The maintenance department will         December During the follow up              Auditors verified Completed
maintenance                        Hygiene and Industrial            lighting services shall be provided and         mentioned that the work area was                                                          facility walkthrough and                  provide a report with the status of the 18, 2006 conducted in January              this
                                   Safety Regulations Arts.          maintained to conform to applicable laws        very warm. Audit team observed                                                            records reviewed                          areas that requires adjustments to               2007, auditors found that         improvement
                                   13-17-18 (Ventilation):           and prevent hazardous conditions to             exhaust fans are missing in some                                                                                                    improve the work place temperature.              this issue has been               through
                                   There must be adequate            employees in the facility                       areas. Auditors observed the work                                                                                                   If modifications are required they will          corrected                         observation,
                                   atmospheric conditions at                                                         area temperature is high and                                                                                                        be made during the vacations period.                                               walkthrough
                                   facilities in order to avoid                                                      internal measurements taken by                                                                                                                                                                                         and workers'
                                   insufficient supply of air,                                                       Industrial Safety Manager confirm                                                                                                   The health and safety department                                                   interviews
                                   excessive cold or heat and                                                        that the temperature reaches up to                                                                                                  will evaluate again the temperatures
                                   suddenly temperature                                                              103º Fahrenheit at some areas of                                                                                                    of the working areas to verify that
                                   changes. Humidity and                                                             the facility.                                                                                                                       they don’t exceed the levels allowed
                                   temperature must not                                                              2) Areas were chemicals are                                                                                                         by law.
                                   interfere on employees job                                                        stored or used require additional
                                                                                                                     ventilation.

Machinery Maintenance              Dominican Republic         All production machinery and equipment                 1) It was observed on the injury                                                          Records reviewed and                      1) Starting October 15, 2006, the        1) October    During the follow up        Auditors verified Completed
                                   Hygiene and Industrial     shall be maintained, properly guarded, and             record that some accidents were                                                           management                                health and safety department will be     15, 2006      conducted in January        this
                                   Safety Regulations Art. 97 operated in a safe manner                              caused by employees that                                                                  interviews                                doing constant revisions (weekly) of     2)            2007, auditors found that   improvement
                                   (Machinery maintenance):                                                          modified the to two button                                                                                                          the working area to assure the use of    December      this issue has been         through
                                   It is compulsory for every                                                        operated machinery (one of the                                                                                                      the safety devices in the                11, 2006.     corrected                   observation and
                                   worker to advise factory's                                                        buttons is permanently on) in                                                                                                       machineries.       2) The                                                          review of
                                   management of any                                                                 order to improve their speed.                                                                                                       maintenance department                                                             relevant
                                   damage on machinery                                                               2) It was observed on plant I that                                                                                                  compromise to study and respond to                                                 documentation
                                   safety devices                                                                    the elevator is operated without                                                                                                    the improvements to avoid non-
                                                                                                                     applicable safety measures: the                                                                                                     planned access to the elevator.
                                                                                                                     access to the area below the
                                                                                                                     elevator shaft is not restricted.

7. Freedom of Association and Collective Bargaining
Employers will recognize and respect the right of employees to freedom of association and collective
bargainingand Benefits
8. Wages
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
Timely Payment of Benefits                                       All legally mandated deductions for taxes,          At the time of the audit, the factory                                                     management                                The payment to Social Security has       Completed During the follow up            Auditors verified Completed
                                                                 social insurance, or other purposes will be         was behind on the payments to                                                             interviews and records                    been made (appropriate                             conducted in January            this
                                                                 deposited each pay period in the legally            the "Instituto Dominicano del                                                             reviewed                                  documentation sent to PC's local                   2007, auditors found that       improvement
                                                                 defined account or transmitted to the               Seguro Social" (IDSS). On August                                                                                                    office).                                           this issue has been             through review
                                                                 legally defined agency. This includes any           30th the factory paid for May 2006.                                                                                                                                                    corrected                       of relevant
                                                                 lawful garnishments for back taxes, etc.                                                                                                                                                                                                                                   documentation
                                                                 The employer will not hold any of these
                                                                 funds over from one pay period to the other
                                                                 unless the law specifies that deposits are to
                                                                 be made less frequently than pay periods
                                                                 (e.g., monthly deposits, weekly pay). If the
                                                                 law does not specify, then deposits will be
                                                                 made before the next pay period in all
                                                                 cases




                                                                                                                                                                                                                                                                                                                                                        3
                                                                                                                    IEM Findings                                                                                                                      Remediation                                                                                  [Status]

FLA Code/ Compliance issue          Country Law/Legal Reference     FLA Benchmark                                   Non-compliance                         Risk of Non-compliance    Evidence of    If not    Sources/Documentation    Notable        PC Remediation plan                 Target           Company follow up       Documentation   Completed;
                                                                                                                                                                                    Non-            corrobora used for corroborating   Features                                           Completion    (Jan 2007 & March 2007)                    Pending; On-
                                                                                                                                                                                    compliance      ted,                               implemented by                                     Date                                                     going
                                                                                                                                                                                    (uncorroborat   explain                            Factory
                                                                                                                                                                                    ed)             why                                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
Meal breaks                          Title II, Chapter I, Art. 157 Employers will ensure reasonable meal            Although Factory's internal rules                                                        Employee interviews,                     • Review the present schedule with January       During the follow up        Auditors verified Completed
                                     (Meal break): Hours of work and rest breaks, which, at a minimum, must         state that employees have one                                                            payroll records and                      the external lawyers (by October   2007          conducted in January        this
                                     must be interrupted by a rest comply with local laws                           hour for lunch, currently                                                                management                               2006)                                            2007, auditors found that   improvement
                                     period which can not be                                                        employees have 45 minutes lunch                                                          interviews                               • Communicate to our employees the               this issue has been         through review
                                     lesser than one hour, after                                                    break                                                                                                                             decisions about the schedule                     corrected                   of relevant
                                     four hours uninterrupted of                                                                                                                                                                                      (November 2006). New Schedule to                                             documentation
                                     work, and one hour and a                                                                                                                                                                                         start in 2007.
                                     half after five hours of work

Overtime Limitations                Title II, Chapter I, Art. 155   Except in extraordinary business                The last weeks of July and first                                                         Employee interviews,                     • At the urging of the Company,    October 9,    During the follow up        Auditors verified Completed
                                    (Overtime): Overtime is         circumstances, employees will (i) not be        weeks of August, an average of                                                           payroll records and                      Facory has established a policy of 2006          conducted in January        this
                                    regulated under the             required to work more than the lesser of (a)    250 employees exceeded the                                                               management                               Urgent Necessities of Work                       2007, auditors found that   improvement
                                    following conditions: same      48 hours per week and 12 hours overtime         maximum number of overtime                                                               interviews                               (appropriate documentation sent to               the factory is working      through review
                                    employee can not work           or (b) the limits on regular and overtime       hours allowed by FLA                                                                                                              PC's local office).                              diligently on correcting    of relevant
                                    overtime more than 80           hours allowed by the law of the country of      Benchmarks and DR labor law.                                                                                                      • The Human Resources                            this issue, however, have   documentation
                                    hours on a three months         manufacture or, where the laws of such          Employees have been working up                                                                                                    Department will give a weekly                    not reached the goal yet.   and employees'
                                    period.                         country will not limit the hours of work, the   to 24 overtime hours per week                                                                                                     summary hour report to the Manager               Another follow up is        interviews
                                                                    regular work week in such country plus 12       (including Saturdays and                                                                                                          of Production with the purpose of                scheduled to verify their
                                                                    hours overtime; and (ii) be entitled to at      Sundays).                                                                                                                         checking or reviewing the extra                  progress. During the
                                                                    least one day off in every seven day period.                                                                                                                                      amount of hours of each employee                 follow up visit in March
                                                                    An extraordinary business circumstance is                                                                                                                                         who can exceed the 80 quarterly                  2007, hours have been
                                                                    a temporary period of extra work that could                                                                                                                                       ones. This process begins the week               decreased and the issue
                                                                    not have been anticipated or alleviated by                                                                                                                                        of October 9th 2006.                             has been corrected.
                                                                    other reasonable efforts




Sunday Work                         Title II, Chapter I, Art. 163   Except in extraordinary business                In August 2006 an average of 160                                                         Employee interviews,                     • The Management has implemented Immediatel During the follow up             Auditors verified Completed
                                    (Day off): Every employee       circumstances, employees will (i) not be        people have been working on                                                              payroll records and                      a policy that all workers will not work y   conducted in January             this
                                    must enjoy at least of 36       required to work more than the lesser of (a)    Saturdays and 40 people have                                                             management                               longer than 6 days without a day off.       2007, auditors found that        improvement
                                    hours of rest uninterrupted     48 hours per week and 12 hours overtime         been working on Sundays. At the                                                          interviews                               No employee will work on a Sunday,          the factory is working           through review
                                    per week.                       or (b) the limits on regular and overtime       time of the audit, many of them                                                                                                   should that be the 7th continuous           diligently on correcting         of relevant
                                                                    hours allowed by the law of the country of      have worked three weeks without                                                                                                   day.                                        this issue however have          documentation
                                                                    manufacture or, where the laws of such          a day off.                                                                                                                                                                    not reached the goal yet.        and employees'
                                                                    country will not limit the hours of work, the                                                                                                                                                                                 Another follow up is             interviews
                                                                    regular work week in such country plus 12                                                                                                                                                                                     scheduled to verify their
                                                                    hours overtime; and (ii) be entitled to at                                                                                                                                                                                    progress. During the
                                                                    least one day off in every seven day period.                                                                                                                                                                                  follow up visit in March
                                                                    An extraordinary business circumstance is                                                                                                                                                                                     2007, issue has been
                                                                    a temporary period of extra work that could                                                                                                                                                                                   corrected.
                                                                    not have been anticipated or alleviated by
                                                                    other reasonable efforts




Overtime Limitations                Title II, Chapter I, Art.150    Except in extraordinary business                Security guards work on a 12                                                             Employee interviews,                     • Make consultation with external   November     During the follow up        Auditors verified Completed
                                    Resolution 04/93                circumstances, employees will (i) not be        hours shift and usually work at                                                          payroll records and                      lawyers                             15, 2006     conducted in January        this
                                    (Intermittent jobs): For        required to work more than the lesser of (a)    least one of their days of rest. The                                                     management                               • Make all the changes needed                    2007, auditors found that   improvement
                                    intermittent jobs as security   48 hours per week and 12 hours overtime         accumulated hours of work                                                                interviews                                                                                the factory is working      through review
                                    guards, the maximum             or (b) the limits on regular and overtime       exceeds the maximum number of                                                                                                                                                      diligently on correcting    of relevant
                                    regular shift must be 10        hours allowed by the law of the country of      regular hours allowed by                                                                                                                                                           this issue however have     documentation
                                    hours per day.                  manufacture or, where the laws of such          Dominican Republic Labor Code.                                                                                                                                                     not reached the goal yet.   and employees'
                                                                    country will not limit the hours of work, the                                                                                                                                                                                      Another follow up is        interviews
                                                                    regular work week in such country plus 12                                                                                                                                                                                          scheduled to verify their
                                                                    hours overtime; and (ii) be entitled to at                                                                                                                                                                                         progress. During the
                                                                    least one day off in every seven day period.                                                                                                                                                                                       follow up visit in March
                                                                    An extraordinary business circumstance is                                                                                                                                                                                          2007, issue has been
                                                                    a temporary period of extra work that could                                                                                                                                                                                        corrected.
                                                                    not have been anticipated or alleviated by
                                                                    other reasonable efforts




10. Overtime Compensation
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.



                                                                                                                                                                                                                                                                                                                                               4
                                                                                                                     IEM Findings                                                                                                                              Remediation                                                                                      [Status]

FLA Code/ Compliance issue           Country Law/Legal Reference      FLA Benchmark                                  Non-compliance                        Risk of Non-compliance            Evidence of    If not    Sources/Documentation     Notable        PC Remediation plan                     Target           Company follow up       Documentation   Completed;
                                                                                                                                                                                            Non-            corrobora used for corroborating    Features                                               Completion    (Jan 2007 & March 2007)                    Pending; On-
                                                                                                                                                                                            compliance      ted,                                implemented by                                         Date                                                     going
                                                                                                                                                                                            (uncorroborat   explain                             Factory
                                                                                                                                                                                            ed)             why                                 Management or
                                                                                                                                                                                                                                                Company
OT Compensation                      Title II, Chapter I, Arts. 156- The factory shall comply with applicable        Regular shift ends on Fridays at                                                                Employee interviews,                      • Make consultation with external       November     During the follow up        Auditors verified Completed
                                     157: Regular shift ends on law for premium rates for overtime                   4:00 pm. Hours performed on                                                                     payroll records and                       lawyers (by October 2006)               2006         conducted in January        this
                                     Saturdays at noon and after compensation                                        Saturdays (day of rest) are paid at                                                             management                                • Make all the changes needed                        2007, auditors found that   improvement
                                     that (which is weekly rest                                                      a premium rate of 35% .                                                                         interviews                                                                                     the factory is working      through review
                                     time), overtime must be                                                                                                                                                                                                                                                        diligently on correcting    of relevant
                                     compensated to employees                                                                                                                                                                                                                                                       this issue however have     documentation
                                     with a premium rate of 100%                                                                                                                                                                                                                                                    not reached the goal yet.   and employees'
                                                                                                                                                                                                                                                                                                                    Another follow up is        interviews
                                                                                                                                                                                                                                                                                                                    scheduled to verify their
                                                                                                                                                                                                                                                                                                                    progress. During the
                                                                                                                                                                                                                                                                                                                    follow up visit in March
                                                                                                                                                                                                                                                                                                                    2007, issue has been
                                                                                                                                                                                                                                                                                                                    corrected.

Miscellaneous
Other (Labor Contracts)              Title II, Art. 24. Terms and                                                    On labor contracts it is not                                                                    Review of facility labor                  • Immediately, we will put the exact    November     During the follow up        Auditors verified Completed
                                     conditions of labor contracts.                                                  specified the wage (exactly in                                                                  contracts.                                pay on each person’s contract and       30, 2006.    conducted in January        this
                                     Labor contract must read "                                                      RD$) the employee will receive.                                                                                                           expect to finish by November.                        2007, auditors found that   improvement
                                     … the payment which                                                                                                                                                                                                                                                            the factory is working      through review
                                     employee will receive by                                                                                                                                                                                                                                                       diligently on correcting    of relevant
                                     time unit, piece rate or any                                                                                                                                                                                                                                                   this issue however have     documentation
                                     other way…"                                                                                                                                                                                                                                                                    not reached the goal yet.
                                                                                                                                                                                                                                                                                                                    Another follow up is
                                                                                                                                                                                                                                                                                                                    scheduled to verify their
                                                                                                                                                                                                                                                                                                                    progress. During the
                                                                                                                                                                                                                                                                                                                    follow up visit in March
                                                                                                                                                                                                                                                                                                                    2007, issue has been
                                                                                                                                                                                                                                                                                                                    corrected.



Other (Internal Labor Regulations) Chapter V, Title II, Art.                                                         [Factory] Manufacturing Ltd.                                                                    Review of facility                        • Internal Work Code was reviewed       Immediatel During the follow up          Auditors verified Completed
                                   133, “Internal regulations                                                        Internal Labor Regulations were                                                                 internal regulations and                  and approved by the Labor               y          conducted in January          this
                                   must be submitted to                                                              not available for review during the                                                             management                                Department.                                        2007, auditors found that     improvement
                                   Department of Labor for                                                           days of the visit. The reason given                                                             interviews                                                                                   this issue has been           through review
                                   their approval…. This                                                             by management was that the H.R.                                                                                                                                                              corrected                     of relevant
                                   disposition also applies in                                                       manager passed away two                                                                                                                                                                                                    documentation
                                   case of modifications or                                                          months ago and the document
                                   changes to the Internal                                                           was not found.
                                   Regulations document”


Others:                                                               AI - Section 3I.1 (Subcontracting): Does                                             Factory has a written                                     Review of commercial                      • Guard contract to be reviewed and     October      During the follow up        Auditors verified Completed
AI - Section 3I.1 (Subcontracting)                                    the factory have someone overseeing the                                              contract with "Guardianes                                 contract between                          finalized. (appropriate                 31, 2006     conducted in January        this
                                                                      subcontractors to ensure their contracts are                                         Imperial S.A.", which is a                                Factory and                               documentation sent to PC's local                     2007, auditors found that   improvement
                                                                      implemented in compliance with the code?                                             subcontractor for security                                Subcontractor and                         office)                                              this issue has been         through review
                                                                                                                                                           services. The contract                                    management                                                                                     corrected.                  of relevant
                                                                                                                                                           does not mention                                          interviews                                • The company administration will                                                documentation
                                                                                                                                                           compliance with labor                                                                               elaborate a document to be
                                                                                                                                                           regulations or Code                                                                                 delivered to the subcontractors in
                                                                                                                                                           benchmarks. After the                                                                               relation to the fulfillment of social
                                                                                                                                                           B.A.S.C. Certification,                                                                             and legal responsibilities.
                                                                                                                                                           Human Resources
                                                                                                                                                           Manager visited
                                                                                                                                                           "Guardianes Imperial S.A."
                                                                                                                                                           offices in order to test level
                                                                                                                                                           of compliance with
                                                                                                                                                           Dominican Labor Laws
                                                                                                                                                           (PVH CoC was not
                                                                                                                                                           included in the
                                                                                                                                                           surveillance).




                                                                                                                                                                                                                                                                                                                                                            5

				
DOCUMENT INFO