Classification of social Non-Compliance
- Fully Compliant: In full compliance with the Gildan Code of Conduct provisions and the other Codes it adheres to, as well as legal requirements.
- Minor: Low risk issue. Improvement towards best practices. Remediation time frame: six months.
- Moderate: Negative impact on workers' rights and safety (non-critical). Remediation time frame: up to two months, depending on type of violation.
- Major: Serious violation of the Gildan Code of Conduct and the other Codes it adheres to and/or the law, resulting in a severe impact on individual rights and/or physical safety. Remediation time frame: immediate.
2012 Internal Social Compliance Audit Findings - Gildan Owned Facilities
A total of 270 labour-related non-compliances were found at Gildan owned facilities during 2012 internal audits (33 complete and follow-up internal audits at Gildan owned facilities in 2012) : 4 major (1.5%), 130 moderate (48.1%) and 136 (50.4%) minor. The number of non-compliances slightly increased this year, due to the ramp up of the Rio Nance V textile facility and the integration of our integrated facility in Bangladesh.
Most of the 2012 findings (approximately 70%) related to environment, health and safety issues. As this is a highly regulated area, it is the section of our assessment questionnaire that contains the most questions (57 % of our total checklist).
The 4 major findings at Gildan owned facilities in 2012 related to:
- Compensation and benefits, such as late payment of overtime hours
- The non-compliances found in two facilities were corrected in a timely manner and payments were done according to the law. Additionally, the compensation principle was strengthened with middle management to ensure this will not become a recurrent non-compliance.
- Verbal harassment
- The non-compliances found in two facilities were reported by employees who complained about the behavior of their direct supervisor. Human Resources and Corporate Citizenship departments immediately conducted a follow-up investigation to correct the non-compliance in a timely manner. Disciplinary warnings were given to the supervisors involved, as well as general training related to verbal abuse and people skills, such as leadership, personnel management, coaching and others. Additionally, our Harassment and Abuse policies were refreshed with this group.
In general, findings at Gildan owned facilities involved:
- Record keeping, such as incomplete employee contracts
- Human Resources employees training has been supplemented to ensure that employees are knowledgeable regarding all requirements of employee contracts.
- Hours of work, such as overtime in excess of the prescribed 60 hours per week
- Even though we continued in 2012 to observe this issue at our facilities, it was as a smaller percentage compared to 2011, and was mainly related to our indirect employees.
(For more details on this temporary issue and its remediation, please refer to the case study presented in the Remediation section)
- Fire safety, such as blocked aisles, blocked electrical panel and improper housekeeping
- We have found that non-compliances in this area are often linked to employee negligence. Raising our employees’ awareness, through the use of bulletin boards and refresher training courses, and reiterating rules and procedures during health and safety committee meetings, are various ways in which Gildan works toward improving compliance in this area.
- General cleanliness and sanitary conditions, such as cafeteria hygiene and overall upkeep and sanitation in facilities and bathrooms
- A sanitation procedure was developed for proper food handling and storage in cafeterias.
- Regarding overall upkeep and sanitation at our facilities, our quality team is working on developing cleaning manuals as well as a list of procedures to be posted in various areas.
- Machine safety, such as missing needles or eye guards, safety lights on lift-trucks and other missing or deficient safety devices on machines
- Refresher training in these areas is important in order to increase employee awareness of the essential nature of keeping these safety devices on the machine, to ensure their own safety.
- Informing the maintenance department when a safety device is missing on a machine is also a key safety element. Simultaneously, it is also important that the maintenance department replaces missing machine parts or safety items in a timely manner.
- Chemical safety, such as unlabelled containers
- For more details on this issue and its remediation, please click here.
In all of the above-mentioned issues, employees, supervisors and management accountability and discipline is very important in order to enforce rules and procedures established on that front. It is necessary to continually increase employee awareness of these rules and procedures. This is why environment, and health and safety training are essential. At the same time, when there is an obvious case of negligence, supervisors must also apply progressive disciplinary measures consistently as a demonstration of their commitment to Gildan values and practices.
In every non-compliance case, detailed remediation plans and, where indicated, in-depth root cause analyses were implemented.
Now that we have three year data related to our audit results in the Corporate Citizenship database and that we have reliable statistics to identify recurrent findings, a presentation was prepared for middle management levels and up in order to share these results and discuss on how we can improve and avoid recurrence. Our management teams will provide their input, share knowledge between facilities and increase awareness with regards to similar problems facilities are facing.
Third Party Manufacturing Contractor Facilities
A total of 348 labor-related non-compliances were found at our third party manufacturing contractor facilities during 2012. Of these non-compliances, 20 were major, 98 moderate and 230 minor. This number has significantly increased in 2012 due to new contractors which have been added as part of the Company’s recent acquisitions.
The findings reported only include findings at third party manufacturing contractors with which we conducted business over the course of 2012. Contractor facilities that have been audited, but for which no orders have been placed, are not included in the numbers reported here.
In order to assist facilities in the remediation of the non-compliances found during our audits, our internal auditor teams work with the facility management to ensure an action plan is in place. They also provide advice and feedback on how to better address the various issues. Since the vast majority of our production needs are manufactured internally at Gildan owned and operated facilities, we have developed an internal expertise on labour compliance management systems, policies and procedures. We transfer this knowledge to our contractor facilities management teams in order to ensure sustainable remediation and educate them on that matter. For more details on our capacity building initiatives at our contractor facilities, please refer to our Contractors and Suppliers section.
2012 information related to GRI indicators HR5-HR6-HR7
In its effort to ensure that no children are employed at its facilities and at the facilities of its contractors, Gildan’s Code of Conduct minimum working age provision has been set to 18 years. Even though in most countries it is legal to work at age 15 or 16, many restrictions apply to young workers (ILO Minimum Age Convention, 1973). For example, young workers are not allowed to perform hazardous duties or work at night (ILO Night Work of Young Person (Industry) Convention, 1919). According to our interpretation of the ILO convention on child labor, we believe that it is appropriate to exclude young workers from our facilities and have decided to set our minimum working age at 18 years. When we acquired our integrated facility in Bangladesh in 2010, a country identified as having significant risk for child labor incidents as it has not ratified ILO Convention 138 on child labor, we conducted a complete screening of employees to confirm that they were all above the age of 18.
Child labor is continually monitored through audits conducted by either Gildan’s internal or third party auditors in order to alleviate the risk of child labour incidents.
Gildan prohibits and continuously verifies that there is no use of forced or compulsory labour at its facilities, however two findings associated with it were found through an internal audit. One of the issues is related to a change in the working shift and even though employees do not consider it as forced labor, the Company must record the process and have formal employee approvals. The second issue was found at a new facility where no policies or procedures related to forced labor were yet implemented. This facility is in the process of adopting the Gildan culture regarding practices and procedures.
With regards to freedom of association, we experienced situations during the reporting period. For more details on these issues, please consult our Unions section.
Six minor findings were found at contractors with regards to documentation linked to meeting minutes between workers’ unions and management which were not maintained properly. All six findings were remediated and documentation has been provided to auditors for review.