Compliance Choices: Challenges and Red Herrings

 

by Mil Niepold, Director of Policy at Verité

 

While we are often lost in the debate around what social compliance really means and whether or how to certify such a condition, we never lose sight of the desired end result, which is to increase the role that workers play in making improvements in the global workplace. If corrections are to be sustainable over the long-term, workers must be provided with the appropriate circumstances in which they can learn to use their voices.

 

Independent monitors are asked to use any number of the myriad codes that are in place today to judge social and legal compliance: the Ethical Trading Initiative (ETI); SA8000; Fair Labor Association (FLA); Organization for Economic Cooperation and Development (OECD); Guidelines for Multinational Enterprises (MNEs); the UN’s Global Compact and individual company codes, to name a few. There are, however, several core issues that are common to most of these codes:

 

Compliance with National and Local Labor Laws

Forced Labor

Contract Labor

Debt Bonded Labor

Prison Labor

Child Labor

Freedom of Association and Collective Bargaining

Wages and Benefits

Harassment/Abuse

Non-discrimination

Health and Safety

Hours of Work

Overtime Compensation

 

Increasingly we are seeing the most progressive codes include issues such as women’s rights (regarding reproductive health and privacy), migrant or contract labor, environmental concerns (particularly those that intersect with core health and safety standards), and living wage provisions.

 

At Verité, we consider violations on all of these issues to be a part of what we call “hidden production systems.” It has been our experience in over 57 countries thus far that the most egregious violations are those that are the least obvious during a quick visual factory inspection. It is increasingly apparent that the same flexibility and responsiveness that allows factory owners to meet the needs of international consumers make many of them adept at developing mechanisms for masking systemic or institutionalized abuses that are a part of their workplaces.

 

For example we often find:

 

  • Factories keeping a double set of accounts or none at all
  • “Showpiece” facilities that in reality subcontract all their production
  • Pay stubs written in a language that the workers don’t understand
  • Workers coached on how to respond to auditors’ questions
  • Interference in auditors’ attempts to interview workers and in some cases the refusal to permit any on-site access

 

Verité has pioneered a model of off-site confidential worker interviews because we feel that there is no credible auditing possible without input from workers to check the veracity of information obtained from management, factory conditions when auditors are not present, payroll analyses, working conditions, human rights abuses and other issues.

 

Going beyond the snapshot...

There is a growing problem emerging in the area of verification involving both corporate and factory behavior. The emphasis thus far has been on which code of conduct, system and verifier to use and not on the end purpose for such an undertaking. However, auditing only provides a snapshot of conditions – it does not in and of itself provide relief to workers or bring factories up to legal standards. Only verification mechanisms that include worker input, provide transparency and emphasize remediation will begin to make sustainable, culturally relevant and economically viable improvements a reality.

 

Verité is at times asked to certify factories. A full understanding of our methodology would clarify why we do not certify factories. Verité's comprehensive factory evaluations are based on an ever-growing and evolving list of standards derived from International Labor Organization (ILO) core conventions, the Universal Declaration of Human Rights, Occupational Safety and Health Association (OSHA) (as a benchmark), local and national legislation and, where laws are silent, on best practices identified during our six years of auditing. In our experience with factories that often change management personnel, or are subject to frequent national currency devaluations or other economic disruptions, it is virtually impossible to draw a line in the sand and state that as of a particular date, a given factory is "compliant." Conditions can change within a matter of days of an audit. When a factory is faced with a downturn, labor is one of the few variable costs that can be squeezed.

 

What compliance means and how to certify it are two red herrings that detract from the urgent need for improvements in factories both at home and abroad. The literal application of these terms can often lead compliance program participants to believe that further action or continuous improvement is unnecessary. The process of bringing a factory into compliance is actually more organic, long-term, and complicated, made up of layers of improvements that require the on-going participation of management personnel and, importantly, workers.

 

Without worker input, "northern" codes, monitoring systems and guidelines will face thorny challenges offered by what are often deep-rooted and complicated socio-economic and cultural systems, in areas such as wage levels, minimum age requirements, weakened governmental enforcement, harmful macroeconomic investment incentives, and women's rights issues.

 

Having monitored workplace conditions in hundreds of factories, our consistent finding is that workers must be allowed to play a role in identifying problems and developing solutions to workplace violations for meaningful change to take place.

 

Worker education and training is the most urgent need we have identified in the countries where we’ve been monitoring. As Verité moves forward into its seventh year, all of our education programs will focus on this area. Our current programs in China and Vietnam now include over 1,000 workers in education, labor rights and life skills training. In 2002 we will be launching a new program focusing on worker nutrition in factories.

 

 

 

Adapted from Mil Niepold’s article in "Human Rights and Business Matters" Amnesty International (UK) Business Group Newsletter No. 5, 2001.