Parent Company name (of the site): N/A SMETA Audit Type: 2 Pillar 4 Pillar. Date of Audit th of May 2015

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1 Supplier name: UNICART EOOD Site country: BULGARIA Site name: MULTIPRINT OOD Parent Company name (of the site): N/A SMETA Audit Type: 2 Pillar 4 Pillar Date of Audit th of May 2015 Audit company: INTERTEK BA EOOD Report reference: A Date: May

2 Audit Company Name: INTERTEK BA Report Owner (payee): UNICART EOOD Sedex Company Reference: (only available on Sedex System): Sedex Site Reference: (only available on Sedex System) S: t available Facility is not yet registered in the Sedex System and Sedex platform P: t available Facility is not yet registered in the Sedex System and Sedex platform Audit Conducted By Commercial NGO Trade Union Multi stakeholder Purchaser Retailer Brand Owner Combined Audit (select all that apply) Auditor Reference Number: (If applicable) N/A SMETA Declaration I declare that the audit underpinning the following report was conducted in accordance with SMETA best practice guidance. Any exceptions to this must be recorded here (e.g. different sample size): ne Auditor Name(s) (please list all including all interviewers): Lead auditor: Gergana Georgieva Auditor: Veronika Grozdanova Interviewers: Gergana Georgieva Lead Auditor; Veronika Grozdanova Auditor. Date: 15 May 2015 Audit company: INTERTEK BA EOOD Report reference: A Date: May

3 n Compliance Table Issue (please click on the issue title to go direct to the appropriate audit results by clause) Area of n Conformity (Only check box when there is a non conformity, and only in the box/es where the non conformity van be found) ETI Base Code Local Law Additional Elements (i.e. not part of ETI code ) Record the number of issues by line*: NC Obs GE 0 Management systems and code implementation Employment Freely Chosen Freedom of Association Safety and Hygienic Conditions Child Labour Wages and Benefits Working Hours Discrimination Regular Employment A Sub Contracting and Homeworking Harsh or Inhumane Treatment A Entitlement to Work B2 Environment 2 Pillar B4 Environment 4 Pillar C Business Ethics 0 0 *Please note the table above records the total number of n compliances (NC), Observations (Obs) and Good Examples (GE). This gives the reviewer an indication of problem areas but does not detail severities of each issue Reviewers need to check audit results by clause. Audit company: INTERTEK BA EOOD Report reference: A Date: May

4 Summary of Findings Summary of main findings: (positive and negative) (Please give a short summary of the main findings per clause) This audit was conducted by two auditors in 2.5 days. During the audit company operations were assessed against the ETI Base Code and the requirements of Bulgarian national and local legislation. The audit was SMETA 4 PILLAR. Audit started at 9:00 a.m. on the 14 th of May with an opening meeting during which the Lead Auditor explained the audit process. The factory was represented by: 1. Yordan Bonchev - General Manager; 2. Elena Boncheva Marketing manager 3. Temenuga Paunova HR officer 4. Georgi Ivanov H & S officer The audit team was presented by: 1. Gergana Georgieva Lead Auditor; 2. Veronika Grozdanova Auditor. The overall social compliance responsible person at the facility is Elena Boncheva. 26 time and payroll records were reviewed as a part of the audit process: for vember 2014 (peak); February 2015 (low); and March 2015 (last paid period). The main products manufactured by the factory are printed materials leaflets, books, magazines, postcards, calendars, posters, etc. Processes are receiving the raw materials, prepress, printing, cutting, folding, binding, quality control, packaging of finished products, storage of the finished products, storage of finished products.. Total number of employees is: 252 (165 production employees and 87 management and administrative staff). Male employees are total of 136, female employees are total of 116. The youngest employee in the facility is male production worker, 20 years old, who was born in There are no migrant workers employed by the facility. All workers are directly employed in the facility, there are no external HR agencies used. There is peak season in production October and vember calendars, Christmas campaigns. Standard maximum regular hours are 8 hours per day, 40 hours per week and 160 hours per month. 5 working days, from Monday to Friday, 2 rest days Saturday and Sunday. During the audit, based on the sampled payroll and time records and workers interviews it was noted, that there are no overtime hours, performed in the facility. Based on the sample the lowest wage observed is BGN net per month, and the highest wage observed is BGN net per month. During the audit a nice and calm environment was experienced. Management was very cooperative and supportive for the conduction of the audit. The attitude toward the auditors was excellent. Access was granted to all facility premises and relevant documentation for review. Photos were taken, upon the permission of the Management. Workers interviews were conducted privately, without the presence of the Management. During the audit no forms of child labour, forced labour, prison labour, discrimination, sexual harassment or any other forms of criminal behaviour were observed. There were no forms of bribery attempts, corruption or aggressive behaviour toward the auditors. During the audit 3 non-conformities and one observation were observed and raised. Good examples were also noted as below. n-conformities: 3: Working Conditions are Safe and Hygienic 1) During the facility tour, It was noted that the emergency evacuation escape routes are not marked in production unit 3. 2) During the facility tour it was noted that 2 out of 84 fire extinguishers were blocked in the main printing hall, Audit company: INTERTEK BA EOOD Report reference: A Date: May

5 first floor. 3) During the facility tour it was noted that there were 3 bottles with chemicals, left unattended and found in close range to machines in 2 production units. Observations noted: 1) During the audit, it was noted that the new version of ETI Base Code is not communicated to supply chain. Good examples noted: 5: Living Wages are paid 1) Additional bonuses are provided for all workers food stamps, bonuses. Additional auditor remark: This is the first SMETA 4 Pillar audit for the facility. It has passed a Disney Social compliance audit. Facility has QMS ISO 9001:2008 (certificate issued by Certification International on valid until ). Audit company: INTERTEK BA EOOD Report reference: A Date: May

6 Audit Details Audit Details A: Report #: A B: Time in and time out (SMETA Best Practice Guidance recommends hrs. if any different please state why in the SMETA declaration ) Day 1 Time in: 09:00 Day 1 Time out:18:00 Day 2 Time in: 09:00 Day 2 Time out:13:00 Day 3 Time in:n/a Day 3 Time out:n/a C: Number of Auditor Days Used: (number of auditor x number of days) 1 Lead auditor x 1.5 days 1 auditor x 1 day D: Audit type: Full Initial Periodic Full Follow up Partial Follow Up Partial Other Define E: Was the audit announced? (AAG recommends a window of three weeks for semi announced, this gives optimum results) Announced Semi announced: Unannounced F: Was the Sedex SAQ available for review? If, why not? (Examples would be, site has not completed SAQ, site has not been asked to complete the SAQ.) G: Any conflicting information SAQ/Pre- Audit Info to Audit findings? Facility is not yet registered in the Sedex System and Sedex platform, therefore the Sedex SAQ was not completed and available for review. If, please capture detail in appropriate audit by clause N/A - Facility is not yet registered in the Sedex System and Sedex platform, therefore the Sedex SAQ was not completed and available for review. H: Auditor name(s) and role(s): Gergana Georgieva, Lead auditor; Veronika Grozdanova - Auditor I: Report written by: Gergana Georgieva, Lead auditor J: Report reviewed by: Veronika Grozdanova, Tatyana Takeva K: Report issue date: L: Supplier name: UNICART EOOD M: Site name: MULTIPRINT OOD Audit company: INTERTEK BA EOOD Report reference: A Date: May

7 N: Site country: BULGARIA O: Site contact and job title: Yordan Bonchev General Manager P: Site address: (Please include full address) 10a Slavyanska Blvd., Kostinbrod / Bulgaria Site phone: Site fax: Site e mail: Q: Applicable business and other legally required licence numbers: for example, business license no, and liability insurance R: Products/Activities at site, for example, garment manufacture, electricals, toys, grower S: Audit results reviewed with site management? T: Who signed and agreed CAPR (Name and job title) U: Did the person who signed the CAPR have authority to implement changes? Elena@multiprint.bg , no validity period. Production of printed materials leaflets, books, magazines, postcards, calendars, posters, etc. Yordan Bonchev General Manager V: Previous audit date: 11 May 2014 W: Previous audit type: SMETA 2 pillar Full Initial SMETA 4 pillar Other Periodic Full Follow Up Audit Partial Follow Up Partial Other* *If other, please define: Disney Social compliance audit. Audit company: INTERTEK BA EOOD Report reference: A Date: May

8 Audit Scope/Actual Results Criteria Local Law (Please state legal requirement) Actual at the Site (Record site results against the law) Is this part of a Collective Bargaining Agreement? A: Standard/Contracted work hours: (Maximum legal and actual required working hours excluding overtime, please state if possible per day, week and month) Legal maximum: (As per Bulgarian Labour Code, Art.136, Para.1-3) - 8 hours per day - 40 hours per week - 8 hours per day - 40 hours per week hours per month average hours per month - maximum Trade Union and no Collective Bargaining Agreement in the facility. B: Legal Overtime hours: (Maximum legal and actual overtime hours, please state if possible per day, week and month) Legal maximum: (As per Bulgarian Labour Code, Art.146, Para.1-2) - 6 hours per week - 30 hours per month hours per year During the audit, based on the sampled payroll and time records and workers interviews it was noted, that there are no overtime hours, performed in the facility. Trade Union and no Collective Bargaining Agreement in the facility. C: Legal age of employment: (Minimum legal and actual minimum age at site) Legal minimum: 18 years 20 years D: Legal minimum wage for standard/contracted hours: (Minimum legal and actual minimum wage at site, please state if possible per hr, day, week and month) Legal minimum: As per Bulgarian government legal act (Regulation. 419/17 December 2014) the legal minimum wage for Bulgaria is 360 BGN (Bulgarian Leva) gross per month. Based on the sample taken, the lowest wage observed is BGN net per month. Trade Union and no Collective Bargaining Agreement in the facility. E: Legal minimum overtime wage: (Minimum legal and actual minimum overtime wage at site, please state if possible per hr,day, week and month) Legal minimum: (As per Bulgarian Labour Code, Art.262, Para.1) As per the sample payroll and time records reviewed, and Trade Union Audit company: INTERTEK BA EOOD Report reference: A Date: May

9 +50% for week days +75% for rest days +100% for holidays verified by the workers interviews and by the Management, there are no overtime hours in the facility. and no Collective Bargaining Agreement in the facility. Audit Scope (Please select the code and additional requirements that were audited against during this audit) 2 Pillar Audit 10B4: Environment 4 Pillar 10C: Business Ethics All groups of workers are included in the scope of this audit such as; Direct employees, Casual and agency workers, Workers employed by service providers such as security and catering staff as well as workers supplied by other contractors. All workers are directly employed by the facility te: The main focus of this ethical audit is on the ETI Base Code and local law. The additional elements will not be audited in such depth or scope, but the audit process will still highlight any specific issues. This report provides a summary of the findings and other applicable information found/gathered during the social audit conducted on the above date only and does not officially confirm or certify compliance with any legal regulations or industry standards. The social audit process requires that information be gathered and considered from records review, worker interviews, management interviews and visual observation. More information is gathered during the social audit process than is provided here. The audit process is a sampling exercise only and does not guarantee that the audited site prior, during or post audit, are in full compliance with the Code being audited against. The provisions of this Code constitute minimum and not maximum standards and this Code should not be used to prevent companies from exceeding these standards. Companies applying this Code are expected to comply with national and other applicable laws and where the provisions of law and this Code address the same subject, to apply that provision which affords the greater protection. The ownership of this report remains with the party who has paid for the audit. Release permission must be provided by the owner prior to release to any third parties. Audit company: INTERTEK BA EOOD Report reference: A Date: May

10 Audit Overview Audit Overview Management Worker Representatives Audit attendance Senior management Worker Committee representatives Union representatives A: Present at the opening meeting? B: Present at the audit? C: Present at the closing meeting? D: If Worker Representatives were not present please explain reasons why (only complete if no worker reps present) E: If Union Representatives were not present please explain reasons why: (only complete if no union reps present) F: Site description: (Include size, location and age of site. Also include structure and number of buildings) t applicable There is no trade union in the facility. MULTIPRINT OOD is located at 10a Slavyanska Blvd.., 2230 Kostinbrod, Bulgaria The facility was founded in The main products manufactured by the factory are printed materials leaflets, books, magazines, postcards, calendars, posters, etc. Total number of employees is 252 (165 production employees and 87 management and administrative staff). Male employees are total of 136, female employees are total of 116. Production capacity pieces per month. There are no migrant workers and no agency workers employed in the facility. All workers are ethnic Bulgarians with Bulgarian citizenship. All workers are directly employed by the facility. There are no external HR agencies used. The youngest worker is a male employee 20 years old who is born in 1995 and hired in February Working hours are organised as follows: There are two regular shifts for production workers from 05:30 to 14:00 and from 14:00 to 22:15, 8 hours per day, five days per week, from Monday to Friday, with one 30 minutes break and one or two breaks of 15 minutes. Saturday and Sunday are rest days. Management and administration, work from 08:00 to 17:00, 8 hours per day, five days per week, from Monday to Friday, with one 30 minutes break from 12:00 to 12:30. Saturday and Sunday are rest days. The facility has 9 buildings. They are made of concrete and metal, very well maintained and secured. Each production building has sufficient number of restrooms; there are also administration offices, canteen and storage area. The total area of the facility is square meters. There is no peak season in production. Pay Period: twice per month the 10 th and 25 th date of the following month. Last paid full salary is for Audit company: INTERTEK BA EOOD Report reference: A Date: May

11 the month of March Wages are calculated monthly. Electronic time recording system is in use for registration of working hours. Facility building Description Remark, if any premises 1 Floor 1 production area, Year of toilets Establishment: 1994 Floor 2 Administration Year of offices, conference Establishment: 1994 rooms, toilets Is this a shared building? none Facility premises 2 Floor 1 building Is this a shared building? Facility building premises 3 Floor 1 Is this a shared building? Description storage area Description storage area Remark, if any Year of Establishment: 1994 none Remark, if any Year of Establishment: 1994 none Facility premises 4 Floor 1 building Is this a shared building? Description storage area Remark, if any Year of Establishment: 1994 none Facility premises 5 Floor 1 building Is this a shared building? Description canteen restroom and Remark, if any Year of Establishment: 1994 none Facility premises 6 Floor 1 building Is this a shared building? Description production area Remark, if any Year of Establishment: 1994 none Facility building Description Remark, if any premises 7 Floor 1 production area Year of Establishment: 1994 Is this a shared none Audit company: INTERTEK BA EOOD Report reference: A Date: May

12 building? Facility premises 8 Floor 1 building Is this a shared building? Facility premises 9 Floor 1 building Is this a shared building? Description production area Description production area Remark, if any Year of Establishment: 1994 none Remark, if any Year of Establishment: 1994 none G: Site function: Agent Factory Processing/Manufacturer Finished Product Supplier Grower Homeworker Labour Provider Pack House Primary Producer Service Provider Sub Contractor H: Month(s) of peak season: (if applicable) Peak season in production is October and vember calendars, Christmas campaigns I: Process overview: (Include products being produced, main operations, number of production lines, main equipment used) The main products manufactured by the factory are printed materials leaflets, books, magazines, postcards, calendars, posters, etc. Processes are receiving the raw materials, pre-press, printing, cutting, folding, binding, quality control, packaging of finished products, storage of the finished products. The main machine list of the factory is as following (59 machines): 11 pre-press machines 11 printing machines 7 folding machines 18 cutting machines 12 machines for packaging The factory does not use subcontractors. J: Attitude of workers: (Include their attitude to management, workplace and the interview process. Both positive and negative information should be included) te: Do not document any information that could put workers at risk General attitude of the employees was very positive. Audit company: INTERTEK BA EOOD Report reference: A Date: May

13 26 workers were selected for interview including 11 male and 15 female employees; they were interviewed in 6 individual interviews and 5 groups of 4 workers. The workers were assured of confidentiality and they spoke freely of their views of the factory. All workers said they were very satisfied with their employment at the factory and with the current wages which in their opinion are in line with the wages in the country. They feel free to leave this employer and understand the notice period required. They have good relationships with their supervisors and managers who treat them with respect. They are able to make suggestions to their management directly or using the suggestion box, located in the facility. They feel able to complain directly to their supervisors, but also feel free to give their general concerns to the working conditions committee. Workers interviews were conducted privately, without the presence of the Management. During the audit no forms of child labour, forced labour, prison labour, discrimination, sexual harassment or any other forms of criminal behaviour were observed. K: Attitude of workers committee/union reps: (Include their attitude to management, workplace and the interview process. Both positive and negative information should be included) te: Do not document any information that could put workers at risk General attitude of the Worker representative was very positive. Based on the interview with the worker representative Mr.Georgi Vassilev it was noted that there is no Trade Union presented in the facility and no Collective Bargaining agreement in place. Additional bonuses are provided for all workers food stamps, bonuses. L: Attitude of managers: (Include attitude to audit, and audit process. Both positive and negative information should be included) Management was helpful and supportive during the audit process. During the audit a nice and calm environment was observed. The attitude toward the auditors was very good. Access was granted to all facility premises and relevant documentation for review. Photos were taken, upon the permission of the Management. There were no forms of bribery attempt, corruption or aggressive behaviour toward the auditors. Audit company: INTERTEK BA EOOD Report reference: A Date: May

14 Key Information Key Information (click on the key information title to go to appropriate section of the report) A: Do all workers (including migrant workers) have contracts of employment/employment agreements? (Go to clause 8 Regular Employment) B: Are maximum standard/contracted working hours clearly defined in contract/employment agreements? (Go to clause 8 Regular Employment) C: Were appropriate records available to verify hours of work and wages? (Go to clause 5 Living Wage) D: Were any inconsistencies found? (if yes describe nature) (Go to Wages Table) E: For the lowest paid production workers, are wages paid for standard/contracted hours (excluding overtime) below or above the legal minimum? (Go to clause 5 Living Wage) F: % of piece rate workers: (if applicable) G: Do the standard/contracted hours stated in a contract/employment agreement exceed the law or 48 hours per week? (Go to clause 6 Working hours) H: If yes, what are the standard/contracted hours per week as stated in the contract/employment agreement? (Go to clause 6 Working hours) I: Combined hours (standard/contracted plus overtime = total hours) over 60 per week found? (Go to Working Hours Analysis) Wages found: Below legal min Meet Above t applicable hrs/week N/A Poor record keeping Isolated incident Repeated occurrence Please indicate the breakdown of workforce according to earnings: 0 % of workforce earning under min wage _0 % of workforce earning min wage _100 % of workforce earning above min wage Approx. % of ALL workers on these contacted hours N/A J: Are workers provided with 1 day off in every 7-day-period, or 2 in 14-day-period (where the law allows)? 1 day in every 7-day-period 2 days in every14-day-period Other Audit company: INTERTEK BA EOOD Report reference: A Date: May

15 If Other, please explain: N/A K: Are the correct legal overtime premiums paid? (Go to Wages Table) L: Please state what actual OT is paid. (As a percentage of the workers standard rate) (Go to Working Hours Analysis) M: Is there any night production work at the site? N: % of workers living in site provided accommodation (if applicable): O: Age of youngest worker found: (Go to clause 4 Child labour) P: Workers under 18 subject to hazardous work assignments? (Go to clause 3 Health and Safety) N/A no overtime hours were observed during the audit based on the documents review and the workers interviews Please give details of overtime premium as a % of standard wages: 0% Up to 115% 116% 124% 125% 199% 200%+ N/A no overtime hours were observed during the audit based on the documents review and the workers interviews t applicable, no dormitories provided and/or operated by the facility 20 years % of under 18 s at this site (of total workers) 0 % Q: What form of worker representation/union is there on site? (Go to clause 2 Freedom of Association) R: Is it a legal requirement to have a union? (Go to clause 2 Freedom of Association) S: Is It a legal requirement to have a workers committee? (Go to clause 2 Freedom of Association) T: Is there any other form of effective worker/management communication channel? (Go to clause 2 Freedom of Association) (Other than union/worker committee) U: Are there any External Processes? (Go to clause 8A Sub contracting and Home working) Union Worker Committee Other (specify) ne Describe: Grievance procedure and suggestion box are in place. Workers are aware of these channels and they know how to use them. Sub Contracting Homeworking Other External Process external processes Audit company: INTERTEK BA EOOD Report reference: A Date: May

16 Management Systems Management Systems: A: Nationality of Management Bulgarian B: Gender breakdown of Management + Supervisors (Include as one combined group) Male: 60% Female: 40% C: Majority nationality of workers Bulgarians D: Number of workers leaving in last 12 months as a % of average total number of workers on site over the year (annual worker turnover) E: Were accurate records shown at the first request? 44 workers left in January-December 2014 (16%) 57 newly recruited workers in January-December 2014 (20%) F: If, why not? N/A G: In the last 12 months, has the site been subject to any fines/prosecutions for non compliance to any regulations? H: Do policies and/or procedures exist that reduce the risk of forced labour, child labour, discrimination, harassment & abuse? I: If, is there evidence (an indication) of effective implementation? Please give details. J: Have managers and workers received training in the standards for forced labour, child labour, discrimination, harassment & abuse? K: If, is there evidence (an indication) that training has been effective e.g. training records etc.? Please give details L: Are there published, anonymous and/or open channels available for reporting any violations of Labour standards and H&S or any other grievances to a 3 rd party? Please describe: Please describe: Internal Rules Handbook which integrates the main principles and clauses of ETI Base code and relevant local laws and prohibits child labour, forced labour, prison labour, discrimination, sexual harassment and abuse. Grievance procedure for anonymous complaints is in place in the facility. The Internal Rules Handbook and ETI Base code are respected. All workers are aware of their principles. Copies of ID cards are kept in the workers files. All workers are familiar with their job description. Please describe: Regular trainings are conducted, with the support of the company which conducts the regular risk assessment of the facility. Regular meetings are conducted as well for awareness of the workers and managers in these standards once in every three months. Written statement for conducted training 04 July Following the training the procedures for forced labour, child labour and discrimination have been updated. Please describe: There is a Suggestion box, located in the facility. There is procedure implemented for opening and reviewing the signals Audit company: INTERTEK BA EOOD Report reference: A Date: May

17 from the suggestion box, which is part of the internal rules of the facility. The suggestion box is opened regularly twice per month. M: If, are workers aware of these channels? Please give details. N: Have health and safety risks been identified e.g. through internal audits, formal risk analysis process, worker involvement etc.? O: If, has effective action been taken to reduce or eliminate these risks?. Workers are aware of this suggestion box and they know how to use it, which was confirmed during the workers interviews. Please describe: Risk assessment of the workplaces latest update: February/March Program to reduce the risk is prepared and implemented. Safety instructions are available to workers. PPE are provided to workers. Regular trainings are provided to all workers. P: Are accidents recorded? Please describe: A Injury log is available at the facility, registered with the local authorities. accidents are registered. Q: Has the auditor made a simple calculation to compare capacity with workers work load in order to identify possible unrecorded work hours? R: Does the site have all required land rights licenses and permissions (see SMETA Best Practice Guidance)? S; Does the site have any internationally recognised system certifications e.g. ISO 9000, 14000, OHSAS 18000, SA8000 (or other social audits). Please detail (Number and date). T: Is there a Human Resources manager/department? If, please detail. Please describe: Workers are operating production machines and there is no norm of work for them per day. This means that their work is recorded by the hours worked not by the production. Auditors crosschecked the production records with the machinery and workforce on site and concluded that there are no unrecorded work hours or processes. Business Licence no validity period Building construction and site plan latest update from March, Fire Safety certificates and permits latest update from vember, QMS ISO 9001:2008 (certificate issued by Certification International on valid until ). Please describe: Mrs. Temenuga Paunova is HR manager at the facility. Audit company: INTERTEK BA EOOD Report reference: A Date: May

18 Worker Analysis Worker Analysis Local Migrant Permanent Temporary Agency Permanent Temporary Agency Home workers Total Worker numbers male Worker numbers female Total Number of Workers interviewed Contractors: (Individuals supplying workers to site with the workers paid by contractors, not by site) A: Any contractors on site? B: If, how many workers supplied by contractors C: Are all contractor workers paid according to law? If, Please give evidence for contractor workers being paid according to law: N/A N/A N/A Migrant Workers: (Please see SMETA Best Practice Guidance for definitions of migrant workers) D: Originating Locations/Countries: N/A E: Type of work undertaken by migrant workers : F: Were migrant workers recruited through an agency? If yes, please give details. N/A Please describe: N/A Audit company: INTERTEK BA EOOD Report reference: A Date: May

19 If, is there a contract with the agency? Provide details of agencies and contractual arrangements including any fees lodged during the recruitment process. G: Does the site have a system for checking labour standards of agencies? If yes, please give details. H: Percentage of migrant workers in company provided accommodation: N/A Please describe: N/A The facility directly hires employees and does not use a labour agency. N/A There are no dormitories provided and/or operated by the facility Audit company: INTERTEK BA EOOD Report reference: A Date: May

20 Audit Results by Clause 0: Management systems and Code Implementation 0: Managements system and Code Implementation (click here to return to NC Table) 0.1 Suppliers are expected to implement and maintain systems for delivering compliance to this Code. 0.2 Suppliers shall appoint a senior member of management who shall be responsible for compliance with the Code. 0.3 Suppliers are expected to communicate this Code to all employees. 0.4 Suppliers should communicate this code to their own suppliers and, where reasonably practicable, extend the principles of this Ethical Code through their supply chain. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: HR matters of the facility are handled by Mrs. Temenuga Paunova HR manager. The company regularly tracks and analyses the turnover rates, absence rates and number of grievances. 57 workers have started working in the company, since January 2014 until the date of this audit. Mrs. Paunova is responsible to inform the facility management for all legal updates, related to employment. Internal checks of the HR documentation and personal files are conducted regularly, at least once a month. Mrs. Paunova works actively with the Workers Committee. She is also responsible for monitoring the working hours and remuneration of the workers. Facility has adopted its ETI Base Code and workers are aware of its requirements. Management has regular meetings with Workers Committee once in every six months. During the audit it was observed that the facility has not communicated the ETI Base Code in appropriate manner to all suppliers and subcontractors. Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): Written statement for the establishment of Workers Committee, 07 January 2014 Meeting records of worker committee Training records of worker committee Grievance mechanism and procedures latest update from January Internal Rules Handbook from January 2011 last update from January 2015 Procedure for hiring workers last update from January 2015 Resignation records for the worker turnover statistics Grievance mechanism and procedures last update from January 2015 Policy against discrimination part of the Internal Rules Handbook, last update from January 2015 Policy for prohibition of child labor and remediation in cases of child labor part of the Internal Rules Handbook last update from January 2015 Anticorruption policy part of the Internal Rules Handbook last update from January 2015 QMS ISO 9001:2008 (certificate issued by Certification International on valid until ). n compliance: Audit company: INTERTEK BA EOOD Report reference: A Date: May

21 1. Description of non compliance: NC against ETI/Additional Elements ne observed. Local law and/or ETI requirement: t applicable. NC against Local Law Objective evidence observed: (where relevant please add photo numbers) t Applicable Description of observation: ne observed. Local law or ETI requirement: t applicable. Comments: t applicable. Observation: Objective evidence observed: t Applicable Description of Good Example (GE): ne observed. Good Examples observed: Objective evidence observed: t Applicable Audit company: INTERTEK BA EOOD Report reference: A Date: May

22 1: Employment is Freely Chosen 1: Employment is Freely Chosen (Click here to return to NC table) ETI 1.1 There is no forced, bonded or involuntary prison labour. 1.2 Workers are not required to lodge deposits or their identity papers with their employer and are free to leave their employer after reasonable notice. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: Workers are recruited through a job advertisement published in the local newspaper and local state labour authorities. Workers are selected, based on their professional qualification and experience. All employees have a job interview, prior to starting job. All workers have signed individual labour contracts for employment. Labour Agents are used. Workers resign with 1 month notice. The facility has its own Internal Rules Handbook, which includes prohibition of forced labour and prison labour, discrimination and sexual harassment. Responsible manager for HR matters regularly checks all personal files, to guarantee that no personal documents are kept on site. loans are given to employees. This was also confirmed during the interviews. Evidence examined to support system description (Documents examin ed & relevant comments. Include renewal/expiry date where appropriate): Internal Rules Handbook latest update from January 2015 Procedure for hiring workers latest update from January All employees files contain Job Description, signed individual labor contract and other documents, as required by the law. Employees files for 26 workers reviewed. Employees confirmed they are free to leave their employer after reasonable notice, there is no forced labor, no deposits or withheld ID cards. Policies for prohibition of forced labor, prison labor, discrimination and sexual harassment latest update from January 2015 Mrs. Temenuga Paunova HR, manager is responsible for this chapter of the code n compliance: 1. Description of non compliance: NC against ETI NC against Local Law: ne observed. Local law and/or ETI requirement t applicable. Recommended corrective action: t applicable. Objective evidence observed: (where relevant please add photo numbers) t Applicable Audit company: INTERTEK BA EOOD Report reference: A Date: May

23 Observation: Description of observation: ne observed Local law or ETI requirement: t applicable. Objective evidence observed: t Applicable. Comments: t applicable. Good Examples observed: Description of Good Example (GE): ne observed. Objective evidence observed: t Applicable. Audit company: INTERTEK BA EOOD Report reference: A Date: May

24 2: Freedom of Association and Right to Collective Bargaining are Respected 2: Freedom of Association and Right to Collective Bargaining are Respected (Click here to return to NC table) (Click here to return to Key Information) ETI 2.1 Workers, without distinction, have the right to join or form trade unions of their own choosing and to bargain collectively. 2.2 The employer adopts an open attitude towards the activities of trade unions and their organisational activities. 2.3 Workers representatives are not discriminated against and have access to carry out their representative functions in the workplace. 2.4 Where the right to freedom of association and collective bargaining is restricted under law, the employer facilitates, and does not hinder, the development of parallel means for independent and free association and bargaining. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: Based on the Management interview, workers interview and documents review, it was noted that there is no Trade Union formed in the facility, and no Collective Bargaining Agreement in place. During the interviews workers stated that they feel free to join a union if and whenever interested in such representation. There is Worker Committee established in the facility, which deals with all matters, related to workers rights in the work place. The Workers Committee is established on 07January 2014, and it consists of 1 representative of the Management and 7 members, freely elected by the workers. The current members are Yordan Belchev General Manager, Georgi Vassilev Chairman, Bisser Vladimirov, Gabriela Georgieva, Petrana Antonova, Mario Grozdanov - workers. The Workers Committee conducts regular meetings, once in every 3 months. Latest meeting was conducted on 13 May During the workers interviews it was confirmed that the Workers Committee is effective. Further effectiveness was assured by the election of 2 nd responsible person for the grievance process of the facility. Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): Facility has policy for Freedom of association, updated in January There is a suggestion box, located in the facility. There is also procedure implemented for opening and reviewing the signals from the suggestion box, which is part of the internal rules of the facility. The suggestion box is opened regularly twice per month. Responsible person for the grievance process is Mrs. Elka Gesheva Written statement for the establishment of the Workers committee dated 07 January Last meeting of the Committee on 13 May n compliance: 1. Description of non compliance: NC against ETI NC against Local Law ne observed. Local law and/or ETI requirement: Objective evidence observed: (where relevant please add photo numbers) ne observed. Audit company: INTERTEK BA EOOD Report reference: A Date: May

25 t applicable. Recommended corrective action: t applicable. Observation: Description of observation: ne observed. Local law or ETI requirement: t applicable. Objective evidence observed: ne observed. Comments: t applicable. A: Name of union and union representative, if applicable: B: If no union what is parallel means of consultation with workers e.g. worker committees? C: Were worker representatives/union representatives interviewed N/A Worker representative and Labour Committee If, please state how many: 1 Is there evidence of free elections? Is there evidence of free elections? D: State any evidence that union/workers committee is effective? Specify date of last meeting; topics covered; how minutes were communicated etc. Last meeting of the Committee 13 May 2015 Topics - health and safety and fire safety topics Employees declared they can communicate with management in case of any issue. E: Are any workers covered by Collective Bargaining Agreement (CBA) F: If what percentage by trade Union/worker representation G: If, does the Collective Bargaining Agreement (CBA) include rates of pay N/A t applicable. N/A Good Examples observed: Description of Good Example (GE): t observed. Objective evidence observed: t observed. Audit company: INTERTEK BA EOOD Report reference: A Date: May

26 3: Working Conditions are Safe and Hygienic 3: Working Conditions are Safe and Hygienic (Click here to return to NC table) (Click here to return to Key Information) ETI 3.1 A safe and hygienic working environment shall be provided, bearing in mind the prevailing knowledge of the industry and of any specific hazards. Adequate steps shall be taken to prevent accidents and injury to health arising out of, associated with, or occurring in the course of work, by minimising, so far as is reasonably practicable, the causes of hazards inherent in the working environment. 3.2 Workers shall receive regular and recorded Health & Safety training, and such training shall be repeated for new or reassigned workers. 3.3 Access to clean toilet facilities and to potable water, and, if appropriate, sanitary facilities for food storage shall be provided. 3.4 Accommodation, where provided, shall be clean, safe, and meet the basic needs of the workers. 3.5 The company observing the code shall assign responsibility for Health & Safety to a senior management representative. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: The health and safety, as well as the fire safety of the facility are maintained at high level with some exceptions. There is effective risk assessment in place. Health and safety instructions are posted everywhere in the facility, health and safety trainings are regularly conducted for all workers. Machine safety checks are conducted regularly the facility has a dedicated machine maintenance schedule. Fire safety is well organized along with the fire fighting equipment as fire hoses and fire extinguishers. There is a centralized fire alarm system in place. Canteen, toilets and changing rooms are clean and hygienic. All workers are trained and provided with PPEs. Emergency evacuation plans in all 9 buildings are in place. Fire safety plan is implemented. Emergency response team is assigned for fire fighting, fire rescue and evacuation. Responsible person for Health and Safety and Fire Safety of the facility is Mr. Georgi Ivanov H & S officer. There is a first aid training program. There are total of 19 workers designated and trained for first aid assistance. Emergency evacuation drills are regularly conducted. There is external licensed occupational medical service which provides medicine service to the facility including annual medical checks. There are adopted procedures for managing of emergency situations like fire, earthquake, flood and other emergency situation. Procedures for health and safety training of the workers. Procedure for control and maintenance of the equipment in place. Workers Committee is in place and is dealing with health and safety and fire safety issues. Injury log is maintained. Procedure for reporting and investigation of accidents. The Workers Committee discusses and solves issues, related to health and safety. The Fire fighting equipment is inspected by external company - MBB Group OOD. The electrical installation of the facility is maintained and inspected by external company ELBI Puls OOD. The occupational medical service, responsible for the health of the employees of the company is Medika EOOD. Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): Audit company: INTERTEK BA EOOD Report reference: A Date: May

27 Through the factory tour, management interview, workers interviews and documents reviews it was noted that : Responsible for fire safety Mr. Georgi Ivanov, H & S officer. The members of the Workers Committee are trained in Health & Safety programs at the workplace on Last periodical inspection of the fire fighting equipment (hydrants,extinguishers) Last electricity grounding performed on 28 August 2014 There is a fire alarm and a fire detection system installed in the building. The factory has posted evacuation plans at each exit, indicating the escape routes and the location of the fire extinguishers, and hoses. Sufficient first aid kits, stocked with the necessary supplies are provided in the production areas. First aid trained workers total of 19 people, last training, conducted on 13 May 2015 Last fire safety training on 18 vember 2014 Last emergency evacuation drill written statement from 18 vember 2014 Potable water is available in the production area via dispensers with mineral water. Employees have access to clean toilets. Employees are provided with changing rooms and rest rooms. Last health and safety training conducted on 13 May 2015 Workers committee, consisting of 8 established in the facility. Last meeting, conducted on 13 May Documented Risk Assessment of the workplace February/March Medical examinations were performed on 13 December 2014 Written statements for the measurement of microclimate, noise and lighting of the work environment are available. Last check was conducted in March 2015 Injury records log no accidents are registered. PPE s are provided and to workers goggles, plastic gloves, earphones. The fire fighting equipment is inspected by external company - MBB Group OOD. The occupational medical service, responsible for the health of the employees of the company is Medika EOOD. The electrical installation of the facility is maintained and inspected by external company ELBI Puls OOD. Special equipment operators: 5 forklift operators, trained by Elbi Plus OOD, certificates dated 23 September n compliance: 1. Description of non compliance: NC against ETI NC against Local Law During the facility tour, it was noted that the emergency evacuation escape routes are not marked in production unit 3. Local law and/or ETI requirement Bulgarian law In accordance with Enclosure 2 to Ordinance RD 07/8, direction of evacuation must be noted with signs showing direction. Objective evidence observed: (where relevant please add photo numbers) Facility tour ETI Base Code 3.1 A safe and hygienic working environment shall be provided, bearing in mind the prevailing knowledge of the industry and of any specific hazards. Adequate steps shall be taken to prevent accidents and injury to health arising out of, associated with, or occurring in the course of work, by minimising, so far as is reasonably practicable, the causes of hazards inherent in the working environment. Recommended corrective action: The facility will mark the emergency evacuation escape routes in production 3. Audit company: INTERTEK BA EOOD Report reference: A Date: May

28 Responsible person: Georgi Ivanov H & S Manager Corrective action timescale: 60 days 2. Description of non compliance: NC against ETI NC against Local Law During the facility tour it was noted that 2 out of 84 fire extinguishers were blocked in the main printing hall, first floor. Facility tour Local law and/or ETI requirement Bulgarian law In accordance with Art 23 of BG Ordinance 8121з-647/ , fire extinguishers, hydrants and other fire fighting equipment must be easily accessible. ETI Base Code 3.1 A safe and hygienic working environment shall be provided, bearing in mind the prevailing knowledge of the industry and of any specific hazards. Adequate steps shall be taken to prevent accidents and injury to health arising out of, associated with, or occurring in the course of work, by minimising, so far as is reasonably practicable, the causes of hazards inherent in the working environment. Recommended corrective action: The fire extinguishers will be unblocked and the facility will implement a system to keep them free and accessible. Responsible person: Georgi Ivanov H & S Manager Corrective action timescale: 60 days 3. Description of non compliance: NC against ETI NC against Local Law During the facility tour it was noted that there were 3 bottles with chemicals, left unattended and found in close range to machines in 2 production units. Facility tour Local law and/or ETI requirement Bulgarian law In accordance with Art. 7. (1) of the Law on health and safety at work, workplaces must meet minimum requirements for ensuring healthy and safe working conditions. ETI Base Code 3.1 A safe and hygienic working environment shall be provided, bearing in mind the prevailing knowledge of the industry and of any specific hazards. Adequate steps shall be taken to prevent accidents and injury to health arising out of, associated with, or occurring in the course of work, by minimising, so far as is reasonably practicable, the causes of hazards inherent in the working environment. Recommended corrective action: Audit company: INTERTEK BA EOOD Report reference: A Date: May

29 Additional training will be provided for all employees, to enhance the provisions for safe handling of chemicals and improve the chemicals management system. Responsible person: Georgi Ivanov H & S Manager Corrective action timescale: 30 days Observation: Description of observation: ne observed. Local law or ETI requirement: t applicable. Objective evidence observed: ne observed. Recommended corrective action: t applicable. Good Examples observed: Description of Good Example (GE): ne observed. Objective Evidence Observed: ne observed. Audit company: INTERTEK BA EOOD Report reference: A Date: May

30 : Child Labour Shall t Be Used 4: Child Labour Shall t Be Used (Click here to return to NC table) (Click here to return to Key Information) ETI 4.1 There shall be no new recruitment of child labour. 4.2 Companies shall develop or participate in and contribute to policies and programmes which provide for the transition of any child found to be performing child labour to enable her or him to attend and remain in quality education until no longer a child. 4.3 Children and young persons under 18 shall not be employed at night or in hazardous conditions. 4.4 These policies and procedures shall conform to the provisions of the relevant ILO Standards. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: Main criteria for recruitment are relevant education or/and experience. The facility verifies all workers original ID cards at the time of recruitment and keeps photocopies of workers ID cards in the personal files. In Bulgaria the minimum age for starting work is 18 years old or 16 years old with restrictions. The facility does not hire people below 18 years old. The youngest at the facility is 20 year old, hired February There is very strict government control over the age of the workers, hired in facilities in Bulgaria, under the supervision of the Ministry of Labor and Social Policy. The Factory has its own Ethical Code, which prohibits Child labor. It was confirmed by the management, the workers and the workers representative that so far there have been no cases of child labor in the facility. Facility has a child remediation policy, January Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): There were no children found in the facility. The youngest employee is 20 years old. 26 workers files checked - ach file contains copy of ID, Job Description, Diplomas/ Certificates, signed individual labour contract etc. Internal rules handbook January, Facility follows the principles of ETI Base Code. Audit company: INTERTEK BA EOOD Report reference: A Date: May

31 n compliance: 1. Description of non compliance: NC against ETI NC against Local Law ne observed. Local law and/or ETI requirement: t applicable. Objective evidence observed: (where relevant please add photo numbers) ne observed. Recommended corrective action: t applicable. Observation: Description of observation: ne observed. Local law or ETI requirement: t applicable. Objective evidence observed: ne observed. Comments: t applicable. Good Examples observed: Description of Good Example (GE): ne observed. Objective Evidence Observed: ne observed. Audit company: INTERTEK BA EOOD Report reference: A Date: May

32 5: Living Wages are paid 5: Living Wages are Paid (Click here to return to NC table) (Click here to return to Key information) ETI 5.1 Wages and benefits paid for a standard working week meet, at a minimum, national legal standards or industry benchmark standards, whichever is higher. In any event wages should always be enough to meet basic needs and to provide some discretionary income. 5.2 All workers shall be provided with written and understandable information about their employment conditions in respect to wages before they enter employment and about the particulars of their wages for the pay period concerned each time that they are paid. 5.3 Deductions from wages as a disciplinary measure shall not be permitted nor shall any deductions from wages not provided for by national law be permitted without the expressed permission of the worker concerned. All disciplinary measures should be recorded. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: All employees reviewed in the sample size were paid above the minimum wage set up for the country which is 360 BGN gross per month. The Key Information field shows no (0%) workers paid the minimum wage. The contracted minimum wage for the facility is 360 BGN gross per month. There were no apprentices or trainees, employed by the facility in the reviewed period. As per workers and management interviews and sample payroll and time records reviewed, it was noted that there is no overtime in the facility. All employees receive paid annual leave. Tax deductions, health and social insurance are calculated correctly and paid monthly to the National Revenue Agency and National Insurance Institute. Record for bank transfer for the last paid social security has been provided to the auditor. deductions from wages are made as punishment (disciplinary measures). withhold of wages was observed, nor employees report for any withholdings during the interviews. Pay slips are distributed monthly to all workers. The information in the pay slips has been verified and checked with the manual time records. The information was consistent. This was also confirmed during the workers interviews. Additional bonuses are provided for all workers food stamps, bonuses Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): Workers pay slips for March 2015, February 2015 and vember 2014 for 26 workers. Internal rules handbook January, 2015 Internal rules for calculation of the wages at the facility, January, 2015 All employees are given detailed pay slips. This was confirmed also during the interviews. All employees were covered with social security and medical insurances as well as additional insurance. Monthly salaries are paid regularly twice per month the 10 th and the 25 th date of the following month, via bank transfer. Audit company: INTERTEK BA EOOD Report reference: A Date: May

33 n compliance: 1. Description of non compliance: NC against ETI NC against Local Law ne observed. Local law and/or ETI requirement: t applicable. Objective evidence observed: (where relevant please add photo numbers) ne observed. Recommended corrective action: t applicable. Observation: Description of observation: ne observed. Local law or ETI requirement: t applicable. Objective evidence observed: ne observed. Comments: t applicable. Good Examples observed: Description of Good Example (GE): Additional bonuses are provided for all workers food stamps, bonuses Wages analysis: Wages analysis: (Click here to return to Key Information) Objective Evidence Observed: Contract with food stamps provider Tombow; Payslips with bonuses included A: Sample Size Checked (State number of worker records checked and from which weeks/months and worker type should be current, peak and random/low: please see SMETA Best Practice Guidance) 26 wages were checked for March 2015 (current) 26 wages were checked for February 2015 (low) 26 wages were checked for vember 2014 (peak) B: Are there different legal minimum wage grades? If, please specify all. C: If there are different legal minimum grades, are all workers If, please give details: N/a If, please give details: N/a Audit company: INTERTEK BA EOOD Report reference: A Date: May

34 graded correctly? N/A D: What deductions are required by law, e.g. social insurance? Please state all types: social security health insurance income tax E: Have all of these deductions been made? Please list all deductions that have been made. If, please give details: social security; health insurance; income tax. F: Industry norm for this region: (please include time period e.g. hour/week/month) Wages table 360 BGN gross per month as of 01 January BGN gross per month until 31 December 2014 Wages table (Click here to return to Key information) Worker Type Process Operator (Lowest paid) Process Operator (Average paid) Process Operator (Highest paid) Select from individual worker records one worker from, lowest, average and highest wages and populate the boxes. Ensure comparison is made for same pay period (peak) and only uses full time workers. See SMETA Best Practice Guidance for completing this: A: Pay period: (State month selected) March 2015 March 2015 March 2015 B: Anonymous Employee Reference/Dept. Binding worker at the paper production worker Machine printing operator Binding machine operator C: Employee Gender Female Male Male D: Contracted/Standard working hours: (excluding OT please include time period e.g. hour/week/month) 20 working days 160 hours per month 20 working days 160 hours per month 20 working days 160 hours per month E: Contracted /Standard work pay rate: (excluding OT please include time period e.g. hour/week/month) 535 BGN gross per month 710 BGN gross per month 1100 BGN gross per month F: Standard day overtime hours: (please include time period e.g. hour/week/month) G: Standard day overtime wage: (please include time period e.g. 0 hours / month 0 hours / month 0 hours / month 0 BGN /month 0 BGN /month 0 BGN /month Audit company: INTERTEK BA EOOD Report reference: A Date: May

35 hour/week/month) H: Rest day overtime hours: (please include time period e.g. hour/week/month) I: Rest day overtime wage: (please include time period e.g. hour/week/month) J: Statutory Holiday overtime hours: (please include time period e.g. hour/week/month) K: Statutory holiday OT wages: (please include time period e.g. hour/week/month) L: Total overtime hours: (please include time period e.g. hour/week/month) 0 hours / month 0 hours / month 0 hours / month 0 BGN /month 0 BGN /month 0 BGN / month 0 hours / month 0 hours / month 0 hours / month 0 BGN/month 0 BGN /month 0 BGN/month 0 hours / month 0 hours / month 0 hours / month M: Incentives/Bonus/ Allowances etc.: (please include time period e.g. hour/week/month) 60 BGN in food stamps/ monthly/ Age and experience allowance 45 BGN Bonus BGN 60 BGN in food stamps/ monthly Age and experience allowance BGN 60 BGN in food stamps/ monthly Age and experience allowance BGN N: Gross wages: (please include time period e.g. hour/week/month) BGN gross per month BGN gross per month BGN gross per month O: Social insurance and other deductions; please list which and amount. Social Insurance BGN Health Insurance BGN Tax BGN Social Insurance BGN Health Insurance BGN Tax BGN Social Insurance BGN Health Insurance BGN Tax BGN P: Actual wage paid after deduction: (please include time period e.g. hour/week/month) BGN net per month 598 BGN net per month BGN net per month Comments: none (Please state here any specific reasons/circumstances that explain the lowest and highest gross wages) Different job positions and responsibilities, different work experience. Q: Is there a defined living wage: This is not normally minimum legal wage. If answered please state amount and source of info: Please specify amount/time period: N/A Audit company: INTERTEK BA EOOD Report reference: A Date: May

36 Please see SMETA Best Practice Guidance R: Are workers paid in a timely manner in line with local law? S: Is there evidence that equal rates are being paid for equal work: Details: kind of discrimination was noted regarding the payments. This was confirmed during the interviews with the workers. T: How are workers paid: Cash Cheque Bank Transfer Other If other explain: N/a Audit company: INTERTEK BA EOOD Report reference: A Date: May

37 6: Working Hours are not Excessive 6: Working Hours are not Excessive (Click here to return to NC table) (Click here to return to Key Information) ETI 6.1 Working hours must comply with national laws, collective agreements, and the provisions of 6.2 to 6.6 below, whichever affords the greater protection for workers. Sub clauses 6.2 to 6.6 are based on international labour standards. 6.2 Working hours, excluding overtime, shall be defined by contract, and shall not exceed 48 hours per week.* 6.3 All overtime shall be voluntary. Overtime shall be used responsibly, taking into account all the following: the extent, frequency and hours worked by individual workers and the workforce as a whole. It shall not be used to replace regular employment. Overtime shall always be compensated at a premium rate, which is recommended to be not less than 125% of the regular rate of pay. 6.4 The total hours worked in any 7 day period shall not exceed 60 hours, except where covered by clause 6.5 below. 6.5 Working hours may exceed 60 hours in any 7 day period only in exceptional circumstances where all of the following are met: this is allowed by national law; this is allowed by a collective agreement freely negotiated with a workers organisation representing a significant portion of the workforce; appropriate safeguards are taken to protect the workers health and safety; and The employer can demonstrate that exceptional circumstances apply such as unexpected production peaks, accidents or emergencies. 6.6 Workers shall be provided with at least one day off in every 7 day period or, where allowed by national law, 2 days off in every 14 day period. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: Working hours are stated at the Internal Rules Handbook of the facility and posted on the message boards. Electronic time records are implemented for registration of the working hours. Workers possess cards and swipe them every day upon arrival and work-leaving time. The regular working hours are 8 hours per day, 40 hours per week, 5 days per week from Monday to Friday. Saturdays and Sundays are days off. Official holidays are respected. Overtime hours are not observed in the sample size checked. The facility s policy on the working hours is included in the Internal Rules Handbook. It is posted in the main production are and available to all employees. Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): Internal rules Handbook January 2015 Electronic time records checked for 26 employees for vember 2014, February and March Audit company: INTERTEK BA EOOD Report reference: A Date: May

38 There are two regular shifts for production workers from 05:30 to 14:00 and from 14:00 to 22:15, 8 hours per day, five days per week, from Monday to Friday, with one 30 minutes break and one or two breaks of 15 minutes. Saturday and Sunday are rest days. Management and administration, work from 08:00 to 17:00, 8 hours per day, five days per week, from Monday to Friday, with one 30 minutes break from 12:00 to 12:30. Saturday and Sunday are rest days. Every production unit has its work time schedule posted on the message board. As per documentation review, it is strictly followed. n compliance: 1. Description of non compliance: NC against ETI NC against Local Law ne observed. Local law and/or ETI requirement: t applicable. Objective evidence observed: (where relevant please add photo numbers) ne observed. Recommended corrective action: t applicable. Observation: Description of observation: ne observed Local law or ETI requirement: N/A Comments: N/A Objective evidence observed: N/A Good Examples observed: Description of Good Example (GE): ne observed. Objective Evidence Observed:.t Applicable Working hours analysis Audit company: INTERTEK BA EOOD Report reference: A Date: May

39 Working hours analysis Please include time period e.g. hour/week/month (Go back to Key information) Systems & Processes A. What timekeeping systems are used: time card etc. B: Sample Size Checked (State number of worker records checked and from which weeks/months and type should be current, peak and random/low: See SMETA Best Practice Guidance) Describe: System to record working time electronic time-recording system 26 wages were checked for March 2015 (current) 26 wages were checked for February 2015 (low) 26 wages were checked for vember 2014 (peak) C: Do ALL workers have contracts/employment agreements? D: Are standard/contracted working hours defined in all contracts/employment agreements? E: Are there any other types of contracts/employment agreements used? If NO, state which type of workers do NOT have contracts: N/a If NO, please state which type of workers do NOT have standard hours defined in contracts/employment agreements. N/a If YES, Please complete as appropriate: 0 hrs Part time Variable hrs Other If Other, Please define: N/a - Only permanent workers contracts observed. Standard/Contracted Hours worked F: Do standard/contracted standard hours ever exceed the law or 48 hours per week? If YES give details and comparison (local law/48 hrs week) N/a G: What are the actual standard/contracted hours worked in sample (State per week/month) Highest hours: Lowest hours: 40 hours per week 160 hours per month 40 hours per week 160 hours per month H: Any local waivers/local law or If YES, Please give details Audit company: INTERTEK BA EOOD Report reference: A Date: May

40 permissions which allow averaging/annualised hours for this site? Overtime Hours I: Actual overtime hours worked in sample (State per day/week/month) Highest OT hours: Lowest OT hours: N/a t applicable overtime is observed in the facility t applicable overtime is observed in the facility J: Range of overtime hours over all workers/or as large a sample as possible. (State per week/month and details) 0 hours per month in March 2015 (Current) 0 hours per month in February 2015 (low) 0 hours per month in vember 2014 (peak) K: Approximate percentage of workers on highest overtime hours 0% L: Is overtime voluntary? Conflicting Information Please detail evidence e.g. Wording of contract/employment agreement/handbook/worker interviews/refusal arrangements: t applicable overtime is observed in the facility Overtime Premiums M: Is overtime paid at a premium? Please give details of normal day overtime premium as a % of standard wages: 0% Up to 115% 116% 124% % % 200%+ Any other comments: overtime is observed. N: ETI Code requires a prevailing standard to give greatest worker protection. If a site pays less than 125% OT premium and this is allowed under local law, are there other considerations? Please complete the boxes where relevant. Multi select is possible. Consolidated pay (May be standard wages above minimum legal wage, with no/low overtime premium) Collective Bargaining agreements Other Please explain any checked boxes in N above e.g. detail of consolidated pay CBA or Other. In accordance to Bulgarian Labor Law, Art.262, Para.1, overtime is paid: 150% for week days, 175% for rest days, 200% for holidays Rest Days Audit company: INTERTEK BA EOOD Report reference: A Date: May

41 O: Are workers provided with 1 day off in every 7 day period, or 2 in 14 day period (where the law allows)? Total Hours P: Range of total hours: (Quote highest and lowest please include time period e.g. hour/week/month) Highest total hours Lowest total hours Maximum number of days worked without a day off (in sample): 5 consecutive days 40 hours per week 160 hours per month 40 hours per week 160 hours per month R: If more than 60 total hours per week and this is legally allowed, are there other considerations? Please complete the boxes where relevant. Multi select is possible. Overtime is voluntary Onsite Collective bargaining allows 60+ hours/week Safeguards are in place to protect worker s health and safety Site can demonstrate exceptional circumstances Other reasons Please explain any checked boxes in R above t applicable. Comments: (please state here any specific reasons/circumstances that explain the highest working hours) The above hours information is based on the time records and payroll records provided by the factory, and the workers interviews. Audit company: INTERTEK BA EOOD Report reference: A Date: May

42 7: Discrimination is practiced 7: Discrimination is Practiced (Click here to return to NC table) ETI 7.1 There is no discrimination in hiring, compensation, access to training, promotion, termination or retirement based on race, caste, national origin, religion, age, disability, gender, marital status, sexual orientation, union membership or political affiliation. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: The rules of employment are regulated by the Internal Rules Handbook. In the facility male workers are more than the female workers - about 55%. Payment is the same for men and women on the same position. The middle management and supervisor staff is 60% men and 40% women. All workers are ethnic Bulgarians, with Bulgarian citizenship. There are no migrants and/or agency workers employed in the facility. There was no evidence of sexual harassment. There is a suggestion box with a grievance procedure. Responsible person is Elena Boncheva. The box is opened twice per month. Last opening of the box was on 02 May complaints recorded so far. s Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): Policy against discrimination, updated January Through employees interviews, management interview and documents review, it was noted that there is no discrimination in hiring, compensation, access to training, promotion, termination or retirement. Workers have the opportunity to celebrate their religious holidays. n compliance: 1. Description of non compliance: NC against ETI NC against Local Law ne observed. Local law and/or ETI requirement: t applicable. Recommended corrective action: t applicable. Objective evidence observed: (where relevant please add photo numbers) ne observed. Observation: Description of observation: ne observed. Local law or ETI requirement: t applicable. Objective evidence observed: ne observed. Audit company: INTERTEK BA EOOD Report reference: A Date: May

43 Comments: t applicable. Good Examples observed: Description of Good Example (GE): ne observed. Objective Evidence Observed: ne observed. Audit company: INTERTEK BA EOOD Report reference: A Date: May

44 8: Regular Employment Is Provided 8: Regular Employment Is Provided (Click here to return to NC table) (Click here to return to Key Information) ETI 8.1 To every extent possible work performed must be on the basis of recognised employment relationship established through national law and practice. 8.2 Obligations to employees under labour or social security laws and regulations arising from the regular employment relationship shall not be avoided through the use of labour only contracting, sub contracting, or home working arrangements, or through apprenticeship schemes where there is no real intent to impart skills or provide regular employment, nor shall any such obligations be avoided through the excessive use of fixed term contracts of employment. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: All workers have signed individual labour contracts for employment with the facility, and all of them have a copy of this contract. Apprentices or trainees are employed in the facility. migrant workers are employed in the facility. Labor providers are used. tice periods, working hours, wages, deductions, breaks, vacations, paid leaves, etc. are noted in the individual labor contracts. Rules for employment and termination of employment are stated also in the Internal rules Handbook of the facility. Facility hires its employees directly. Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): Employment contracts for 26 workers. There is no subcontracting or home working from the site. All employees files contain signed individual labour contract, job description and other documents, as required by the law. n compliance: 1. Description of non compliance: NC against ETI NC against Local Law ne observed Local law and/or ETI requirement: t applicable Recommended corrective action: t applicable Objective evidence observed: (where relevant please add photo numbers) t applicable Observation: Audit company: INTERTEK BA EOOD Report reference: A Date: May

45 Description of observation: ne observed. Local law or ETI requirement: t applicable. Objective evidence observed: ne observed. Comments: t applicable. Good Examples observed: Description of Good Example (GE): ne observed. Objective Evidence Observed: ne observed. Audit company: INTERTEK BA EOOD Report reference: A Date: May

46 8A: Sub Contracting and Homeworking: 8A: Sub Contracting and Homeworking (Click here to return to NC table) (Click here to return to Key Information) 8A.1. There should be no sub contracting unless previously agreed with the main client. 8A.2. Systems and processes should be in place to manage sub contracting, homeworking and external processing. te to auditor on homeworking: Report on whether it is direct or via agents. How many workers, relationship with site and what control systems are in place. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: The site tour showed that all production processes were present in the unit. The facility declares that no subcontractors used and it does not allow work to be taken at home as per their policy on sub-contracting. Orders and production records are available. Auditor crosschecked the production records with the workforce on site and concluded that there is no evidence for subcontracting. It was verified through document review, factory tour, management interview and employee interview that no subcontracting & Home-working is used at the facility. Facility has a very well organised system for keeping track of inventory and needs. Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): Site tour (Calculation on total production and estimated capacity) Production records Materials in/out records Workers daily schedule Management interview Policy on subcontracting, part of the Internal Rules Handbook of the facility. Last update January It was verified through document review, factory tour, management interview and employee interview that no subcontracting & Home-working is used at the facility. n compliance: 1. Description of non compliance: NC against ETI/Additional Elements ne observed. Local law and/or ETI /Additional Elements requirement: t applicable. NC against Local Law Objective evidence observed: (where relevant please add photo numbers) ne observed. Recommended corrective action: t applicable. Audit company: INTERTEK BA EOOD Report reference: A Date: May

47 Observation: Description of observation: ne observed. Local law or ETI/Additional elements requirement: t applicable. Objective evidence observed: ne observed. Comments: t applicable. Good Examples observed: Description of Good Example (GE): ne observed. Objective Evidence Observed: ne observed. Audit company: INTERTEK BA EOOD Report reference: A Date: May

48 Summary of sub contracting if applicable Summary of sub contracting if applicable A: If sub contractors are used, is there evidence this has been agreed with the main client? B: Number of sub contractors/agents used C: Is there a site policy on sub contracting? D: What checks are in place to ensure no child labour is being used and work is safe? E: What processes are sub contracted? If, summarise details: t applicable. 0 If, summarise details: t applicable. Policy on subcontracting, part of the Internal Rules Handbook of the facility. Last update January t applicable. t applicable. Summary of homeworking if applicable F: If homeworking is being used, is there evidence this has been agreed with the main client? If, summarise details: t applicable. G: Number of homeworkers Male: 0 Female: 0 Total: 0 H: Are homeworkers employed direct or through agents? I: If through agents, number of agents J: Is there a site policy on homeworking? K: How does site ensure worker hours and pay meet local laws for homeworkers? L: What processes are carried out by homeworkers? Directly Through Agents t applicable. t applicable. t applicable. t applicable. t applicable. Audit company: INTERTEK BA EOOD Report reference: A Date: May

49 M: Are written agreements in place for homeworkers that include regular employment? N: Are full records available at the site? t applicable. t applicable. Audit company: INTERTEK BA EOOD Report reference: A Date: May

50 9: Harsh or Inhumane Treatment is Allowed (Click here to return to NC table) 9: Harsh or Inhumane Treatment is allowed ETI 9.1 Physical abuse or discipline, the threat of physical abuse, sexual or other harassment and verbal abuse or other forms of intimidation be prohibited. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is /are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: During the interviews, employees confirmed that the atmosphere is friendly, they are treated with respect and understanding from the Management. They also stated that there is no inhumane treatment of them or their colleagues. All workers are familiar with the internal rules and job descriptions. In the Factory s Internal Rules Handbook and its own Ethical Code is stated that harsh and inhumane treatment is forbidden and will not be allowed at the facility. The disciplinary procedures are as follows: 1. Warning; 2. tice of dismissal; 3. Dismissal. Disciplinary sanctions can be applied only by the General Manager, after consulting the Accountant. In the personal files, checked by the auditor, there were no records for disciplinary measures. During the interviews, employees reported no disciplinary measures have been applied to them. There is an internal anonymous process for grievance - a suggestion box, where workers can report any grievances (harassment, discrimination, abuse etc.); received complaints will be handled by the management. Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): During the workers interviews, they confirmed that there is no inhumane treatment of them or their colleagues. All workers are familiar with the internal rules and job descriptions. Internal Rules Handbook January 2015 n compliance: 1. Description of non compliance: NC against ETI NC against Local Law ne observed. Local law and/or ETI requirement: t applicable. Objective evidence observed: (where relevant please add photo numbers) ne observed. Recommended corrective action: t applicable. Audit company: INTERTEK BA EOOD Report reference: A Date: May

51 Observation: Description of observation: ne observed. Local law or ETI requirement: t applicable. Objective evidence observed: ne observed. Comments: t applicable. Good Examples observed: Description of Good Example (GE): ne observed. Objective Evidence Observed: ne observed. Audit company: INTERTEK BA EOOD Report reference: A Date: May

52 10 A: Entitlement to Work and Immigration 10. Other Issue areas: 10 A: Entitlement to Work and Immigration (Click here to return to NC table) Additional Elements 10A1 Only workers with a legal right to work shall be employed or used by the supplier. 10A2 All workers, including employment agency staff, must be validated by the supplier for their legal right to work by reviewing original documentation. 10A3 employment agencies must only supply workers registered with them. 10A4 the supplier shall implement processes to enable adequate control over agencies with regards the above points and related legislation. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: There are no migrant workers employed by the facility. However migrants are allowed to work in the facility, only after having all relevant documents and permits, issued for residence and work in the territory of Bulgaria. All workers are ethnic Bulgarians, with Bulgarian citizenship. All workers are directly employed by the facility. There are no agency workers employed in the facility. Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): 26 Personal files of employees Hiring policy of the facility workers hired through agency. HR hiring policy for recruitment of workers (including migrant workers) included in the Internal Rules Handbook January 2015 n compliance: 1. Description of non compliance: NC against ETI/Additional Elements ne observed Local law and/or ETI /Additional Elements requirement: t applicable. NC against Local Law Objective evidence observed: (where relevant please add photo numbers) ne observed Recommended corrective action: t applicable. Observation: Audit company: INTERTEK BA EOOD Report reference: A Date: May

53 Description of observation: ne observed Local law or ETI/Additional Elements requirement: t applicable. Objective evidence observed: ne observed Comments: t applicable. Good examples observed: Description of Good Example (GE): ne observed Objective Evidence Observed: ne observed Audit company: INTERTEK BA EOOD Report reference: A Date: May

54 10. Other issue areas 10B4: Environment 4 Pillar (Click here to return to NC table) To be completed for a 4 Pillar SMETA Audit and remove the previous page which is 10B2 environment 2 pillar B.4. Compliance Requirements 10B4.1 Suppliers as a minimum should meet the requirements of local and national laws related to environmental standards. 10B4.2.Where it is a legal requirement, suppliers must be able to demonstrate that they have the relevant valid permits including for use and disposal of resources e.g. water, waste etc. 10B4.3. The supplier shall be aware of their end client s environmental standards/code requirements and have a system in place to monitor their performance against these. B4. Guidance for Observations 10B4.4. Suppliers should have completed the appropriate section of the SAQ and made it available to the auditor. 10B4.5. Suppliers should have an environmental policy, covering their environmental impact, which is communicated to all appropriate parties, including its own suppliers. 10B4.6. Suppliers shall be aware of the significant environmental impact of their site and its processes. 10B4.7. The site should measure its impacts, including continuous recording and regular reviews of use and discharge of natural resources e.g. energy use, water use (see 4 pillar audit report and audit checks for details). 10B4.8. Suppliers shall seek to make continuous improvements in their environmental performance. 10B4.9. Suppliers shall have available for review any environmental certifications or any environmental management systems documentation 10B4.10. Suppliers should have a nominated individual responsible for co ordinating the site s efforts to improve environmental performance. 10B Has the site recently been subject to (or pending) any fines/prosecutions for noncompliance to environmental regulations. te for auditors and readers. This environment section is intended to take not more than 0.25 auditor days. It is an assessment only and the main requirement is to establish whether a site is meeting applicable environmental laws and/or has any certifications or environmental management systems in place. Following this assessment the client/supplier may decide a full environmental audit is required (see also best practice guidance/environment and guidance for auditor) Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is/are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: According to the Bulgarian legislation the facility is not required to obtain special environmental permit. The facility has FSC Chain-of-Custody certificate, valid until 09 August 2015, issued by the SmartWood Program of the Rainforest Alliance. Responsible Manager for the protection of Environment is Mr. Georgi Ivanov H & S officer. The environmental awareness of the workers and the Management is regularly improving, by conduction of trainings, on regularly basis, which are part from the health and safety trainings. Trainings include following topics like separate collection and recycling of wastes, reaction in cases of chemical substances leakage, introduction to the MSDS of the chemical substances, etc. Environmental issues are also subject of discussion of the regular meetings of the Worker Committee. There is a waste disposal procedure implemented in the facility for separate collection and recycling of wastes. Separate collection of solid, industrial and domestic wastes is organized. Containers for different kinds of waste are placed in several places in the facility. MSDS are available in local language for all chemicals used in the facility. The facility uses the following chemicals water-based printing ink and developers. The collection and recycling of all wastes is managed by external licensed company called Repack OOD. Audit company: INTERTEK BA EOOD Report reference: A Date: May

55 All workers are specially instructed for the usage of chemicals and how to react in cases of emergency situation, caused by chemicals. The facility does not generate air emissions and does not use water in its working process. The discharged water is only from human usage, not for industrial purposes. The facility does not use gas-powered equipment. Evidence examined to support system description (Documents examined & relev ant comments. Include renewal/expiry date where appropriate): Internal Rules Handbook January, 2015 MSDS and Safety instructions available in the local language for the water-based printing ink Training records dated 07 January 2015 for 19 workers Environmental policy last updated January, 2015, part of the Internal rules. List of chemicals used last update from MSDS for water-based printing ink, posted in local language, provided by Kodak. Environmental emergency statement: (e.g. em ergency plan, ERT and Security Staff trained in environmental emergencies, regular drills, etc); Last emergency drill conducted on 18 vember 2014 Last training conducted for work with chemical agents and reactions in cases of chemical leakages for all workers engaged in chemical usage - 18 vember 2014 n compliance: 1. Description of non compliance: NC against ETI/Additional Elements ne observed NC against Local law Objective evidence observed: (where relevant please add photo numbers) Local law and/or ETI/Additional Elements requirement: t applicable ne observed Recommended corrective action: t applicable Observation: Description of observation: ne observed Local law or ETI/Additional elements requirements: t applicable Comments: t applicable Objective evidence observed: ne observed Good examples observed: Description of Good Example (GE): ne observed Objective Evidence Observed: ne observed Audit company: INTERTEK BA EOOD Report reference: A Date: May

56 Environmental Analysis Environmental Analysis (Site declaration only this has not been verified by auditor. Please state units in all cases below.) A; Responsible for Environmental issues (Name and Position): Mr. Georgi Ivanov H & S officer B: Does the site have a recognised environmental system certification such as ISO or equivalent? Please detail. C: Does the site have an Environmental policy? (For guidance, please see Measurement criteria ) Does the site have a Biodiversity policy? (For guidance, please see Measurement criteria ) Details: E: Is there any other sustainability systems present such as Chain of Custody, FSC, MSC etc.? Please detail. (For guidance, please see Measurement criteria ) F: Have all legally required permits been shown? Please detail. G: Is there a documentation process to record hazardous chemicals used in the manufacturing process? H: Is there a system for managing client s requirements and legislation in the destination countries regarding environmental and chemical issues? Details: The facility has FSC Chain-of-Custody certificate, valid until 09 August 2015, issued by the SmartWood Program of the Rainforest Alliance. Details: License Permit , issued by the Trade register of Bulgaria. N/A Details: Internal rules and regulations, Environmental policy, List of chemicals used in the facility. Details: Internal rules and regulations, Environmental policy, List of chemicals used in the facility. Usage/Discharge analysis Criteria Current year: 2015 Please state period: Previous Year: 2014 Please state period: Electricity Usage: Kw/hrs kwh kwh Renewable Energy Usage: Kw/hrs Gas Usage: Kw/hrs t applicable - such source used. t applicable - such source used. t applicable - such source used. t applicable - such source used. Has site completed any carbon Footprint Analysis? If, please state result N/A N/A Audit company: INTERTEK BA EOOD Report reference: A Date: May

57 Water Sources: Please list all sources e.g. lake, river, and local water authority. Kostinbrod Water Supply Municipal sewage Kostinbrod Water Supply Municipal sewage Water Volume Used: (m³) 56 m3/per month 64 m3/per month Water Discharged: Please list all receiving waters/recipients. Administration Canteen Toilet facilities Administration Canteen Toilet facilities Water Volume Discharged: (m³) 20 m3/per month 24 m3/per month Water Volume Recycled: (m³) t applicable - grey water usage t applicable - grey water usage Total waste Produced (please state units) Total hazardous waste Produced: (please state units) Waste to Recycling: (please state units) Waste to Landfill: (please state units) Total Product Produced (please state units) kg kg. 0 kg. 0 kg kg kg. 90 kg. 97 kg products/per month products/per month Audit company: INTERTEK BA EOOD Report reference: A Date: May

58 10C: Business Ethics 4 Pillar Audit 10C: Business Ethics 4 Pillar Audit (Click here to return to NC table) To be completed for a 4 Pillar SMETA Audit 10C. Guidance for Observations 10C.1. Suppliers should have completed the appropriate section of the SAQ and have made it available to the auditor. 10C.2. The supplier should have received and acknowledged preferably in writing the Business Ethics policy of the auditor/audit company. 10C.3. Suppliers shall seek to conduct their business ethically without bribery, corruption, or any type of fraudulent Business Practice. 10C.4. Suppliers shall be aware of any applicable laws, their end client s Business Ethics standards/code requirements and have a system in place to monitor their performance against these. 10C.5. Supplier should have a Business Ethics policy concerning bribery, corruption, or unethical Business Practice. This should be clearly communicated to all relevant parties. 10C.6. Suppliers should have a designated person responsible for implementing standards concerning Business Ethics 10C.7. Suppliers should have a transparent system in place for confidentially reporting, and dealing with unethical Business Ethics without fear of reprisals towards the reporter 10C.8. Suppliers should ensure that the staff whose job roles carry a higher level of risk in the area of ethical Business Practice e.g. sales, purchasing, logistics are trained on what action to take in the event of an issue arising in their area. te for auditors and readers. This Business Ethics section is intended to take not more than 0.25 auditor days. It is an assessment not an audit and the main requirement is to gather information on the relevant Business Ethics issues in a supply chain. All findings will be recorded as observations not n Compliances and the data collected will allow the membership to define appropriate standards over time as part of a continuous review process. Current Systems and Evidence Examined To complete current systems Auditors examine policies and written procedures in conjunction with relevant managers, to understand, and record what controls and processes are currently in place e.g. record what policies are in place, what relevant procedures are carried out, who is /are responsible for the management of this item of the code. Evidence checked should detail any documentary or verbal evidence shown to support the systems. Current systems: The facility follows the requirements of the ETI Base Code, and has implemented business ethics and practices, transparency, anti-bribery and anti-corruption systems and approaches. All workers receive training on these policies prior to starting job. The facility has zero tolerance practice against corruption, bribery, and other criminal acts in the facility. Additional acts like gifts to state authorities and donations to governmental structures, political parties, judicial system, NGO s and/or other 3 rd parties are strictly forbidden as well. The Labour Committee deals with issues related to bribery attempts, corruption, and integrity and business ethics Evidence examined to support system description (Documents examined & relevant comments. Include renewal/expiry date where appropriate): Internal Rules Handbook latest update from January 2015 Anti-bribery and Anti-corruption policy latest update from January 2015 Grievance procedure for anonymous signals January 2015 Observation Audit company: INTERTEK BA EOOD Report reference: A Date: May

59 Description of observation: ne observed Local law or ETI/Additional elements requirement: Objective evidence observed: ne observed t applicable Comments: t applicable Good examples observed: Description of Good Example (GE): t applicable Objective Evidence Observed: ne observed Audit company: INTERTEK BA EOOD Report reference: A Date: May

60 10C: Business Ethics 4 Pillar Audit Worker Interview Summary Worker Interview Summary A: Were workers aware of the audit? B: Were workers aware of the code? Worker Interview Summary C: Number of group interviews: (Please specify number and size of groups. Please see SMETA Best Practice Guidance) D: Number of individual interviews (Please see SMETA Best Practice Guidance) E: Total number of interviewed workers (Please see SMETA Best Practice Guidance) F: Interviews were done in private and the confidentiality of the interview process was communicated to the workers? G: In general, what was the attitude of the workers towards their workplace? H: What was the most common worker complaint? I: What did the workers like the most about working at this site? J: Any additional comment(s) regarding interviews: K: Attitude of workers to hours worked: Agency Workers 6 individual interviews 5 group interviews x 4 employees Male: 3 Female: 3 Male: 11 Female: 15 Favourable n favourable Indifferent complaints were reported. Very good attitude of the management. The environment in the company is friendly and open. additional comments were made. They have no complaints. Working hours are respected. There is no forced labour. There is no overtime in the facility declared during interviews. Audit company: INTERTEK BA EOOD Report reference: A Date: May

61 Agency Workers (workers sourced from a local agent who are not directly paid by the site) A: Number of agencies used (average): B: Were agency workers age/pay/hours included within scope of this audit C: Were sufficient documents for agency workers available for review? N/A agencies used. t applicable t applicable. Audit company: INTERTEK BA EOOD Report reference: A Date: May

62 Other findings Other Findings Outside the Scope of the Code ne observed. Community Benefits (Please list below any specific community benefits that the site management stated that they were involved in, for example, HIV programme, education, sports facilities) ne observed. Audit company: INTERTEK BA EOOD Report reference: A Date: May

63 Photo Form Factory view (1) Factory view (2) Production area (1) Production area (2) Production area (3) Production area (4) Audit company: INTERTEK BA EOOD Report reference: A Date: May

64 Fire extinguishers Fire extinguishers (2) Fire extinguisher and hydrant Emergency exit sign Emergency exit sign (2) Fire Alarm (1) Audit company: INTERTEK BA EOOD Report reference: A Date: May

65 Fire Alarm (2) Evacuation plan Evacuation plan (2) Evacuation exit Evacuation exit tice boards Audit company: INTERTEK BA EOOD Report reference: A Date: May

66 First aid kit Lockers Eyewash station Water dispenser Water dispenser (2) Bicycle stand Audit company: INTERTEK BA EOOD Report reference: A Date: May

67 Sanitary facilities (1) Canteen (1) Canteen (2) Stairs railguard installed Raw materials warehouse Raw materials warehouse (2) Audit company: INTERTEK BA EOOD Report reference: A Date: May

68 Packaging materials warehouse Vending machines Electrical switchboard n-conformity 1 n-conformity 2 n-conformity 3 Your feedback on your experience of the SMETA audit you have observed is extremely valuable. It will help to make improvements to future versions. You can leave feedback by following the appropriate link to our questionnaire: Click here for A & AB members: Audit company: INTERTEK BA EOOD Report reference: A Date: May