Better Work Haiti: Garment Industry 9 th Biannual Synthesis Report Under the HOPE II Legislation

Transcription

1 Better Work Haiti: Garment Industry 9 th Biannual Synthesis Report Under the HOPE II Legislation Produced on 16 October Better Work Haiti is supported by the US Department of Labor.

2 Copyright International Labour Organization (ILO) and International Finance Corporation (IFC) (2014) First published (2014) Publications of the ILO enjoy copyright under Protocol 2 of the Universal Copyright Convention. Nevertheless, short excerpts from them may be reproduced without authorization, on condition that the source is indicated. For rights of reproduction or translation, application should be made to the ILO, acting on behalf of both organizations: ILO Publications (Rights and Permissions), International Labour Office, CH-1211 Geneva 22, Switzerland, or by pubdroit@ilo.org. The IFC and ILO welcome such applications. Libraries, institutions and other users registered with reproduction rights organizations may make copies in accordance with the licences issued to them for this purpose. Visit to find the reproduction rights organization in your country. ILO Cataloguing in Publication Data Better Work Haiti: garment industry 9 th biannual synthesis report under the HOPE II legislation / International Labour Office; International Finance Corporation. - Geneva: ILO, v. ISSN X (web pdf) International Labour Office; International Finance Corporation clothing industry / textile industry / working conditions / workers rights / labour legislation / ILO Convention / international labour standards / comment / application / Haiti The designations employed in this, which are in conformity with United Nations practice, and the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the IFC or ILO concerning the legal status of any country, area or territory or of its authorities, or concerning the delimitation of its frontiers. The responsibility for opinions expressed in signed articles, studies and other contributions rests solely with their authors, and publication does not constitute an endorsement by the IFC or ILO of the opinions expressed in them. Reference to names of firms and commercial products and processes does not imply their endorsement by the IFC or ILO, and any failure to mention a particular firm, commercial product or process is not a sign of disapproval. ILO publications can be obtained through major booksellers or ILO local offices in many countries, or direct from ILO Publications, International Labour Office, CH-1211 Geneva 22, and Switzerland. Catalogues or lists of new publications are available free of charge from the above address, or by pubvente@ilo.org Visit our website:

3 Acknowledgements Better Work Haiti is supported by the US Department of Labor. The Better Work global program is supported by the following institutions (in alphabetical order): Australian Government Levi Strauss Foundation Netherlands Ministry of Foreign Affairs State Secretariat for Economic Affairs, Switzerland (SECO) United States Council Foundation (funds provided by The Walt Disney Company) This publication does not necessarily reflect the views or policies of the organizations or agencies listed above, nor does mention of trade names, commercial products, or organizations imply endorsement by them

4 Table of Contents List of Acronyms... 6 Section I: Introduction and Methodology Structure of the report Context The Better Work compliance assessment methodology Section II: Findings Compliance Assessment Findings (9th round of assessments) Detailed Findings Core labour standards Working conditions Compliance effort Section III: Better Work Haiti Advisory Services and Training Better Work Haiti Advisory Services Better Work Haiti Training Services Related activities Section IV: Conclusions and Next Steps Conclusion Next Steps Section V: Factories in Detail List of factories Findings from the factories Factory Tables Annex 1. HOPE II Legislation Reporting Requirements Annex 2. Minimum Wage Law (CL ) Annex 3. Presidential Decree on Minimum Wage Increase as of 1st May

5 List of Tables and Charts In Focus 1: Social Security and Other Benefits In Focus 2: Paid Leave In Focus 3: Dialogue, Discipline and Disputes In Focus 4: Termination In Focus 5: Health Services and First Aid In Focus 6: Working Environment In Focus 7: Welfare Facilities In Focus 8: Emergency Preparedness In Focus 9 : Worker Protection In Focus 10: Chemicals and Hazardous Substances In Focus 11: Overtime Chart 1: Non-compliance rate Chart 2: Compliance Effort Table 1: Better Work compliance assessment framework Ta le 2 : Pie e rate orkers eighted a erage ear i gs a ross all fa tories assessed Better Work Table 3: Number of workers in factories registered to Better Work Haiti Table 4: List of factories in the Haitian garment sector registered with Better Work as of August

6 List of Acronyms ADIH CAOSS CATH CFOH CNOHA CODEVI CP CSH CSS CTH CTMO-HOPE EA HELP HOPE ITUC MSDS MOISE MAST OFATMA ONA OSH PAC PIC PICC PIM PPE SC/AFL-CIO SKOA TAICNAR USDOL Asso iatio des I dustries d Haïti Haitia I dustr Asso iatio Co seil d Ad i istratio des Orga is es de é urité o iale (Social Security Institutions Advisory Committee) Centrale Autonome des Travailleurs Haïtiens (Haitian Workers Central) Confédération des Forces Ouvrières Haïtiennes (Haitian Workforce Confederation) Centrale Nationale des Ouvriers Haïtiens (Haitian Workers National Central) Compagnie de Développement Industriel (Industrial Development Company) Compliance point Coordination Syndicale Haïtienne Conseil Supérieur des Salaires (Wages High Council) Confédération des Travailleurs Haïtiens (Haitian Workers Confederation) Co issio Tripartite de Mise e œu re de la loi HOPE (Tripartite HOPE Commission) Enterprise Advisor Haiti Economic Lift Program Haitian Hemispheric Opportunity Through Partnership Encouragement International Trade Union Confederation Material Safety Data Sheet Mouvement des Organisations Indépendantes Intégrées aux Syndicats Engagés (Movement of Independent Organisations integrated to Committed Unions) Ministère des Affaires Sociales et du Travail (Ministry of Labour and Social Affairs) Offi e d Assura e de Tra ail, de Maladie et de Mater ité Offi e for Work, Health and Maternity Insurance) Offi e Natio ale d Assura e Vieillesse Natio al Offi e for Old-Age Insurance) Occupational safety and health Project Advisory Committee Parc Industriel de Caracol Performance Improvement Consultative Committee Parc Industriel Métropolitain (also referred to as SONAPI) Personal Protective Equipment Solidarity Center/American Federation of Labour - Congress of Industrials Organisations Sant Kompetitivite Ouvrye Aisyen Technical Assistance Improvement and Compliance Needs Assessment and Remediation United States Department of Labor - 6 -

7 Section I: Introduction and Methodology Better Work Haiti, a partnership between the International Labour Organization (ILO) and the International Finance Corporation (IFC), was launched in June The program aims to improve the working conditions and competitiveness of the apparel industry by increasing respect of the Haitian labour code and of the ILO Declaration on Fundamental Principles and Rights at Work and strengthening economic performance at the enterprise level. Better Work Haiti targets the apparel industry in Haiti, especially in the capital Port-au-Prince and in the north-east region of the country. In 2013, total export revenues from the textile and garment industry accounted for 91% of national export earnings and 10% of national GDP. The apparel industry is also among the largest employers within Haiti, creating jobs for over 30,000 people. Most workers (66%) are women who support a number of family members. The program assists participating factories by conducting independent compliance assessments and providing advisory services and training. This report presents the results of assessments conducted between April and August 2014 in 25 participating factories, which in turn form the basis for customized advisory services. As part of its mandate to share information with all stakeholders in the program and encourage continuous improvement, Better Work Haiti produces twice yearly synthesis reports aggregating information on the performance of all participating factories in the period. 1.1 Structure of the report This is the ninth report to be produced by Better Work Haiti in the framework of the HOPE II legislation. This synthesis report provides an overview of the working conditions of 25 factories during the period March August Twenty-three of these factories were included in the eight synthesis report published in April The first section of this report gives an overview of the HOPE II legislation and the origin of the Better Work program in Haiti. This section also includes an explanation of the Better Work methodology, including the reports produced in the framework of the Better Work program and the HOPE II legislation. The second section of the report outlines the compliance assessment findings from the ninth round of factory assessments, conducted between April and August This section also includes an analysis of compliance effort since the previous synthesis report. The third section of the report describes Better Work Haiti advisory and training services in the period from March-August The fourth section of the report outlines the priorities of the Better Work Haiti program in the upcoming months. Finally, the last section of the report describes the efforts made by the factories to correct the compliance needs identified in the Better Work Haiti compliance assessments. Information provided for each of the participating factories includes: compliance needs for each compliance cluster and each compliance point; details of non-compliance; improvement priorities; efforts made by the factory to remedy the compliance needs as verified in the Better Work Haiti assessment visit; and with respect to non-compliance areas that have not been remediated, the amount of time that has elapsed since the non-compliance was first reported publicly. The two newly registered factories, H&H Textiles and Industrial Revolution II, are included in the overall analysis of the sector over the past months and the last assessment cycle. However, since they have each only been assessed once, data from these factories has not been included in Sections - 7 -

8 2.3 (Compliance Effort) and 5.2 (Findings from the factories/ Factories in detail) as a minimum of two assessments is required for inclusion in these sections Context The HOPE II legislation and the TAICNAR project In 2006, the United States Congress enacted the Haiti Hemispheric Opportunity for Partnership Encouragement Act of 2006 (HOPE), expanding preferences for Haitian apparel established under the Caribbean Basin Economic Recovery Act, thus enabling the Haitian garment industry to benefit from new duty-free preferences. In 2008, these preferences were further expanded through legislation known as HOPE II, which also established new standards and programs strengthening and monitoring working conditions in the garment sector. On 24 May 2010, the Haiti Economic Lift Program of 2010 HELP A t as sig ed i to la to e pa d e isti g prefere es e e ore to o tri ute to Haiti s economic growth and development in both the textile and apparel sectors. Among its provisions, the HELP Act extended almost all of the trade preferences established under HOPE and HOPE II until 2020, and significantly expanded the tariff preference level limits for knit and woven apparel. In order to benefit from HOPE/HOPE II/HELP, Haiti was required to establish an independent Labour Ombudsman appointed by the President of the Republic in consultation with the private sector and the trade unions. Haiti was also required to work with the ILO, to develop a program to assess and promote compliance with core labour standards and national labour law in the factories that are eligible for tariff advantages under HOPE II. This was referred to in the legislation as the Technical Assistance Improvement and Compliance Needs Assessment and Remediation (TAICNAR) program. Finally, Haiti needed to develop a mechanism for ensuring that all producers benefiting from the HOPE II trade preferences participated in the TAICNAR program. There are two components to the TAICNAR program. The first of these consists of technical assistance to strengthen the legal and administrative structures for improving compliance in the industry. The scope of these services is extensive, encompassing technical assistance from the ILO in reviewing national laws and regulations to bring them into conformity with international standards, raisi g a are ess of orkers rights, a d trai i g la our i spe tors, judi ial offi ers a d other government personnel. The second element of the TAICNAR program focuses on assessing compliance with core labour standards and national labour law, supporting remediation efforts, and publicly reporting on the progress of each factory on the Labour Ombudsman s register. To encourage compliance with core labour standards and national labour law, the legislation indicates that preferential treatment may be withdrawn, suspended, or limited by the President of the United States from producers who fail to come into compliance with the core labour standards and national labour law that is related and consistent with those standards. Better Work Haiti, which is a partnership of the ILO and the IFC, is implementing the TAICNAR program in collaboration with the Labour Ombudsman and the HOPE Commission, a presidential tripartite commission comprising three members of the Haitian government, three members of the Haitian private sector and three members of national orkers orga izatio s. It is super ised a President and guided by an Executive Director. Recent Developments This section of the report presents the changes and developments that have occurred during the last six months which have an impact on the Better Work Haiti program and broadly on the apparel sector in Haiti

9 Two new factories which registered to the Better Work Haiti program in early 2014 have been assessed for the first time in this past 9 th cycle of BWH assessments. In the context of mandatory participation, factories register and engage in the program as soon as production begins. All factories joining the Better Work Haiti program obtain access to a service package of assessment, advisory and training services. The Conseil Supérieur des Salaires (CSS) which was established in August 2013 presented its report to the Government of Haiti in November 2013 recommending an increase in the minimum wage classified by sectors. In the report, the CSS recommended to increase the minimum wage of reference in the garment industry from 200 to 225 Gourdes per day. This suggested increase was made effective through a presidential decree as of 1 st May 2014 (see annex 3). A new USAID funded project (LEVE) is mandated to improve the competitiveness of value chains in three different sectors in Haiti (apparel, construction and agribusiness) and at assisting these sectors in creating employment. With regards to the apparel industry, an assessment of the sector in Haiti has been conducted in spring Currently, USAID project activities under LEVE are being planned. One specific project component together with CTMO-HOPE is to restructure the former Haitian apparel centre into an advanced coordination and resource centre which acts as a service provider for the industry. Various technical trainings could be offered through this facility to serve the apparel sector. Potential partnerships with CTMO-HOPE, Better Work Haiti and other stakeholders are currently being explored. The partnering ILO project which is supporting the labour inspectorate of the Ministry of Labour and Social Affairs (MAST) and which has been launched in March 2014, started its activities. A task force within the Ministry has been set up and a thorough human resources review has been completed including the elaboration of a comprehensive job profile for labour inspectors. Several initial trainings for the Ministries mediators, conciliators and labour inspectors have been provided since June in collaboration with the Labour Ombudsperson and Better Work Haiti. Training activities will be continuing until the end of the year. In the MAST, Mr. Renan Hédouville was officially appointed to replace Maitre Mondésir as Director of the Labour Department in the Ministry. The lawyer Mr. Hédouville is also a member of the CSS and he has already occupied the position of Director of the Labour Department in MAST from Following the release of the report of the CSS in November, workers walked off the job in Port-au-Prince in early December 2013, calling for a higher increase in the minimum wage. The protests disrupted production and resulted in some violence. A number of workers from different factories were dismissed in connection with these events. Complaints from three factories for property damage e plo ers side and by workers for wrongful dismissals were filed with the MAST and remain unresolved as of the writing of this report. In the case of one factory, MAST stated that it was not the competent authority to adjudicate the case and the matter was transferred to the High Labour Court of Arbitration for resolution. That case is still pending. In April, an outbreak of the chicungunya virus affected the Caribbean and Haiti. The virus is transmitted by mosquitoes, leads to a few days of high fever and longer lasting effects such as joint pain, insomnia and headaches. Factories reported up to 20% absenteeism in the months of April, May and June due to the chicungunya virus which affected delivery of orders

10 Industrial Relations in the Haitian garment industry At the time of writing, 18 officially recognised factory level unions are present in the apparel factories. These union cells are affiliated to 6 centrals/confederations and are present in 18 out of the 25 currently operating factories in Haiti that are part of the Better Work Haiti program. Thus, 70% of those participant apparel factories in the country now have a union presence. 1 In 2013, the Haitian labour movement benefited from the support of two international trade union organizations, namely Solidarity Center/AFL-CIO and the International Trade Union Confederation (ITUC). ITUC no longer has an international representative in Haiti in 2014 but continues to support their affiliates in country. Solidarity Center/AFL-CIO, which is primarily assisting the unions in the apparel sector, continues its program activities in Haiti in 2014 with an office in country. Unions and employers have expressed a need for mass capacity building and awareness raising among workers about industrial relations in general terms. Better Work Haiti together with other key stakeholders in the sector such as CTMO-HOPE, the Office of the Labour Ombudsperson, ADIH, the unions, AFL-CIO and others will work together to assist the industry on gaining more mature industrial relations. Better Work Haiti will be designating an Industrial Relations Officer as of January This person will liaise with national partners to assist the sector in these efforts and to further strengthen social dialogue. The Better Work Haiti Industrial Relations Officer will work closely with the social dialogue roundtable of the garment industry in Haiti. The Social Dialogue Roundtable was created by representatives of the employers, unions, government, ILO and Better Work Haiti in July 2012 as a space for exchange, consultation and negotiation to harmonize relations between employers and workers' organizations. The members of the social dialogue roundtable have been working on a Memorandum of Understanding since its creation. The Memorandum of Understanding has been signed by the different actors engaged in the process as well as by a number of observers during an official ceremony in the Directorate General of SONAPI in Port-au-Prince on 27 March The Labour Ombudsman, CTMO-HOPE and Better Work Haiti have facilitated the signing ceremony of this Memorandum of Understanding. As per its MoU, the table will serve as a forum for exchange and negotiation between employers and workers... in order to strengthen the competitiveness of a sector creating employment and contributing to the Haitia e o o through the pro otio of de e t ork. 2 In June, the executive secretariat of the table has been established. It consists of four members, two employer representatives and two union representatives. In September, the executive secretariat hosted its first self-organised social dialogue table meeting. The ILO is also looking into ways to provide additional trainings on relevant topics such as effective grievance mechanisms, which would be of great value to the sector. The work of the Office of the Labour Ombudsperson is being appreciated by all partners, and a number of cases were successfully remediated since the Labour Ombudsperson took on her office. 1 This information is based on information provided by the Solidarity Center, AFL-CIO Haiti Office. Note that union presence in additional factories exists and has been previously reported but these additional factory-level unions have not yet attained official recognition and therefore are not included in the calculation. 2 Memorandum of Understanding, Social Dialogue Roundtable, Apparel Sector in Haiti, p

11 Labour law reform Since 2011, the ILO has been providing technical assistance to reform the Haitian Labour Code thanks to financial support from Canada and by using its own resources. As a result, based on inputs from MAST and social partners, a first draft of the Labour Code was prepared. Following tripartite discussions, 11 out of 38 chapters from the draft Code were adopted in October Unfortunately, this tripartite consultation process has been on hold since then, mainly because of the tense discussions around the minimum wage. However, social partners, and in particular the MAST, have recently indicated that they are focusing their attention to the labour code in order to complete the reform process. The ILO is currently looking at ways and resources to support them, with the first step being to resume the tripartite discussions on the whole 38 chapters in the draft Code The Better Work compliance assessment methodology Better Work compliance assessment framework The Better Work program assesses factory compliance with core international labour standards and national labour law. Following assessments, a detailed report is shared with the factory presenting findings on eight clusters, or categories, of labour standards, half of which are based on international standards and half on national legislation. Core labour standards: The ILO Declaration on Fundamental Principles and Rights at Work, adopted in 1998, calls upon Member States to respect and promote these principles and rights in four areas, whether or not they have ratified the relevant conventions. These categories, or clusters, are: freedom of association and collective bargaining, the elimination of forced or compulsory labour, the abolition of child labour and the elimination of discrimination in employment and occupation. The conventions on which the 1998 Declaration is based are Nos. 29, 87, 98, 105, 100, 111, 138, 182, and they form the reference base in assessing factory compliance with fundamental rights for all the Better Work programs in various countries. For some issues, such as minimum legal working age, provisions in national law specify requirements for the application of international conventions. If national law is not consistent with international standards pertaining to core labour standards, the international standards are applied. Haiti has ratified all eight core Conventions listed above. According to the Haitian Constitution, ratified conventions become self-executing and therefore part of Haitian law. Working Conditions: The four other clusters assess conditions at work, including compensation, contracts and human resources, occupational safety and health, and working time. The compliance points covered in these clusters are largely consistent across countries; however each compliance point contains specific questions that may vary from country to country due to differences in national legislation. National legislation is used as a reference point even if it is not in accordance with the international conventions that have been ratified by the country. In countries where national law either fails to address or lacks clarity around a relevant issue regarding conditions at work, Better Work establishes a benchmark based on international standards and good practices

12 Table 1: Better Work compliance assessment framework Compliance clusters Compliance Points Core Labour Standards Working Conditions 2 Discrimination 3 1. Child Labourers 1 Child labour 2. Unconditional Worst Forms 3. Hazardous Work 4. Documentation and Protection of Young Workers 6. Religion and Political Opinion 7. Gender 5. Race and Origin 8. Coercion 3 Forced Labour 9. Bonded Labour 10. Forced Labour and Overtime 11. Prison Labour 4 Freedom of Association and Collective Bargaining 5 Compensation 6 Contracts and Human Resources 7 Occupational Safety and Health 8 Working Time 12. Freedom to Associate 13. Union Operations 14. Interference and Discrimination 15. Collective Bargaining 16. Strikes 17. Minimum Wages Overtime Wages 19. Premium Pay 20. Method of Payment 21. Wage Information, Use and Deduction 22. Paid Leave 23. Social Security and Other Benefits 24. Employment Contracts 25. Termination 26. Dialogue, Discipline and Disputes 27. Contracting Procedures 28. OSH Management Systems 29. Chemicals and Hazardous Substances 30. Worker Protection 31. Working Environment 32. Health Services and First Aid 33. Welfare Facilities 34. Worker Accommodation 35. Emergency Preparedness 36. Regular Hours 37. Overtime 38. Leave Calculating non-compliance In public synthesis reports, Better Work reports on aggregate non-compliance in the participating industry as shown in Chart 1. Non-compliance is reported for each subcategory (compliance point, or CP ) of the eight labour standards clusters. A factory is reported as non-compliant in a subcategory if it is found to be out of compliance on any issue addressed within the subcategory. With respect to 3 In Better Work country-specific questio aires, a o plia e poi t Other Grou ds a e i luded u der the Discrimination cluster. This category is intended to assess specific discrimination issues that are covered in national labour law, and are considered to be aligned with the objectives of the relevant ILO conventions (100 and 111), but which are not explicitly named in the conventions, e.g., age, HIV/AIDS status, disability, etc. The questionnaire for Haiti does not include the Other Grou ds o plia e poi t e ause the Haitia la our law does not identify grounds for discrimination beyond those cited in Conventions 100 and Since the 8 th Better Work Haiti synthesis report, Better Work Haiti only reports non-compliance with the minimum wage of reference of 200 (225 Gourdes as of 1 st May 2014) Gourdes. The reporting on the production wage of 300 Gourdes will e do e ith spe ifi details o ea h fa tor s per e tages of orkers a erage ear i gs i the fa tor ta les i se tio V of the report

13 the figures presented in synthesis reports, for example, a non-compliance rate of 100% means that all participating factories were found to have at least one violation in that area. The non-compliance rate does not sufficiently describe the specific issues that Enterprise Advisors (EAs) observe during assessments. In order to address this, tables presenting non-compliance findings in more detail are also prese ted i e tio II see I Fo us ta les. These ta les allow the reader to fully appreciate specific challenges in compliance identified in factory assessments. In Focus tables report the number of factories found to be non-compliant with respect to each highlighted question. Better Work and public reporting The Better Work program supports fair and transparent public reporting. In all Better Work country programs, synthesis reports on the industry are prepared on the basis of the individual factory assessment reports and published twice a year. Evidence shows that public reporting of this kind helps encourage continuous improvement and reduces the probability of reversing compliance gains. Gathering and reporting these data over time enables factories to demonstrate their efforts to improve working conditions. In July 2010, Better Work Haiti published an initial compliance synthesis report, which featured aggregated compliance information based on factory assessments conducted by the program between October and December In October 2010, Better Work published its first Biannual Report under the HOPE II legislation, the first report produced under the requirements of the legislation (see Annex 1). Subsequently, Better Work Haiti produced the second (April 2011), third (October 2011), fourth (April 2012), fifth (October 2012), sixth (April 2013), seventh (October 2013), and eighth (April 2014) Biannual Reports, as required by the HOPE II legislation. The current report includes aggregated industry compliance data, as well as detailed factory-level analysis of compliance needs, priorities for remediation identified by the factory and efforts made to address compliance needs. 5 Limitations in the assessment process The factory-level assessments carried out by Better Work Haiti follow a thorough checklist of more than 250 questions covering the abovementioned labour standards. Information is gathered through a variety of sources and techniques, including document review, observations on the shop floor, and interviews with managers, workers and union representatives. The information collected is compiled and analyzed to produce a detailed assessment report. Before the reports become official, factories are given seven calendar days to provide feedback. Worker interviews conducted during the assessment process are held onsite, either in a private room within the factory building or outside the building (yard, eating area), and take place either in small groups or individually. Interviews are conducted in Creole, the primary language of the workers. Workers may be suspicious and feel uneasy about sharing information on their workplaces with people who are not well known to them. Nevertheless, after nine assessments conducted over 5 Reports produced under the HOPE II legislation differ in two ways from Better Work public reporting elsewhere: they include (1) factory names and compliance information from the first assessment (other Better Work country programs name factories after one year of engagement and two assessments); and (2) more details on compliance needs and factory remediation efforts

14 several years, Better Work Haiti EAs have become more experienced at collecting information and interviewing workers, which together with other activities led by Better Work Haiti have contributed in creating an environment where workers are more comfortable discussing working conditions. Interviews with workers cover many aspects of life at work and last approximately 20 minutes. An average of 40 workers representing different sections of the factories, as well as union representatives, is interviewed. A o g the issues o ered i Better Work Haiti s o plia e assess e t tool, se ual harassment, similarly to other countries, is one of the most sensitive and most difficult to detect during factory assessments. The assessment of sexual harassment in the workplace by Better Work Haiti is likely to underreport the extent of its occurrence. This issue has been considered seriously by employers. Thus, in 2013, Better Work Haiti contracted an American NGO which has been working in Haiti for many years, Heartland Alliance International, to conduct a qualitative study on sexual harassment in the garment sector. Better Work is following up on the findings by developing further tools to address the issue. Better Work Haiti staff received training on the detection of sexual harassment issues in the workplace in May Assessing compliance with freedom of association at the enterprise level also presents challenges, in part because some labour unions are organised at the sectoral level rather than at the factory level where small union cells predominate

15 Section II: Findings 2.1. Compliance Assessment Findings (9th round of assessments) Non-compliance rates Chart 1 presents non-compliance findings for the 25 assessed factories in Haiti, showing noncompliance rates as well as the number of factories in non-compliance in brackets. Key findings are provided in Section 2.2 below. In Focus Tables provide additional information for Compliance Points, at the question level, where a significant number of factories was out of compliance

16 Chart 1: Non-compliance rate * * A factory is found non-compliant in a compliance point if it is found out of compliance on any one aspect of it

17 2.2. Detailed Findings 1. Core labour standards During the last round of assessments, which took place between April 2014 and August 2014 in 25 factories, the following results have been observed. A. CHILD LABOUR Child Labour is virtually non-existent in the apparel sector in Haiti. There are no findings under the Child Labour cluster in the reporting period. B. DISCRIMINATION There was one finding of non-compliance in the Discrimination cluster for Gender. During an assessment, one factory was found to have sexual harassment of workers in the workplace. Several female workers reported having been asked for sexual favours from factory supervisors. During the assessment and in the prese e of the fa tor s HR Ma ager, Better Work Haiti Enterprise Advisors found a complaint in a suggestion box from one worker who claimed to have been repeatedly asked by a supervisor to have a relationship with him. At the time of the assessment, the factory had no policy in place against sexual harassment. Factory management had expressed that while they were aware of these concerns, they were lacking evidence. However, following the assessment factory management took immediate action and launched an investigation. A zero tolerance policy was drafted based on a template provided by Better Work Haiti. Supervisors were briefed on and asked to sign the policy. In addition to this, the factory requested Better Work s supervisory training to be conducted. This training covers issues relating to sexual harassment and trains supervisors on soft skills with regards to adequate behaviour towards workers, including but not limited to abstaining from sexually harassing workers. During subsequent advisory services, the factory showed great openness to deal with and address the issue. Better Work Haiti will further develop its tools to assist factories on preventing and addressing sexual harassment. The fact that the note was found in the suggestion box and that the concern was taken seriously by the factory also testifies of a functioning grievance mechanism at this factory. Better Work is recommending well functioning grievance mechanisms to address issues in a systematic manner. C. FORCED LABOUR There are no findings under the Forced Labour cluster in this reporting period. D. FREEDOM OF ASSOCIATION AND COLLECTIVE BARGAINING There are two instances of non-compliance in this reporting period under the Cluster for Collective Bargaining and Interference and Discrimination. Both Collective Bargaining and Interference and Discrimination have non-compliance rates of 4% each. In one factory, as illustrated in previous public reports, the non-compliance finding is due to a failure to implement certain provisions of the CBA in force. In another factory, the employer had terminated two union representatives. Through intervention of the Labour Ombudsperson and mediation between the parties, the dismissed workers were reinstated but were subsequently subjected to threats, intimidation and harassment. As a consequence, seven out of the nine union members at this factory resigned from the union. 17

18 2. Working conditions E. COMPENSATION The Social Security and Other Benefits CP has a 52% non-compliance rate. The issues are detailed in the table below. In Focus 1: Social Security and Other Benefits Question # factories out of compliance Does the employer collect the required contribution to OFATMA from all workers? 0 Does the employer collect the required social insurance contribution to ONA from all workers? 3 Does the employer forward workers contributions to OFATMA? 0 Does the employer forward workers contributions to ONA? 9 Does the employer pay 3% of workers' basic salary to OFATMA for maternity and health insurance? 0 Does the employer pay 3% of workers' basic salary to OFATMA for work-related accident insurance? 4 Does the employer pay the required employer contribution to ONA? 9 Does the employer pay workers their annual salary supplement or bonus? 2 The number of factories that are in non-compliance on ONA (pension funds) payments is highest in this compliance point with a total of 9 factories not forwarding employer and worker contributions to ONA. However, it has to be noted that factories pay the contributions but all of these non-compliances are due to late payments of the required ONA contributions. The Labour Law requires payments (6% of basic salaries from employees and 6% of basic salaries from employers) to be made before the 10 th of each month. From the four factories that are in non-compliance on the payments for work-related accident insurance, two factories are not paying OFATMA contributions at all while the other two non-compliances relate to late payments. Paid Leave had a 24% non-compliance rate because 6 factories were non-compliant. In Focus 2 below shows the non-compliances at the question level. In Focus 2: Paid Leave Question # factories out of compliance Does the employer pay workers correctly during breastfeeding breaks? 0 Does the employer pay workers correctly during sick leave? 0 Does the employer pay workers correctly for annual leave? 2 Does the employer pay workers correctly for legally mandated holidays? 0 Does the employer pay workers correctly for maternity leave? 1 Does the employer pay workers correctly for weekly rest days? 5 Five out of 6 factories did not pay workers correctly for weekly rest days. The law stipulates that workers who have worked 48 hours or 6 consecutive days are to be granted a paid weekly rest day which these five factories did not comply with. 18

19 Two factories did not pay annual leave correctly. In both cases, the review of payroll records showed that workers who had been on maternity leave were not paid their annual leave correctly. Maternity leave payments had not been included in annual leave calculations which lead to annual leave pay being calculated on a lower amount and subsequently being less than the amount the worker should have received. In both cases, management acknowledged the error in the calculation. The CP for Wage Information, Use and Deduction had a 20% non-compliance rate because five factories did not keep an accurate payroll record. Two factories did not pay workers 50% above the normal wage when workers worked regular hours on legally mandated holidays. There were 2 instances of non-compliance for the minimum wage of reference. As outlined above, the minimum wage of reference has been increased from 200 to 225 Gourdes as of 1 st May 2014 per day for ordinary hours of work to all full-time workers. As announced in the 8 th biannual public synthesis report, the compliance point on the production wage pie e rate has ee re o ed fro Better Work s o plia e assess e t tool. Ho e er, Better Work continues to collect data from each factory on the percentages of piece rate workers earning / /300 and more Gourdes per day (for payrolls checked after May, the new minimum wage of reference of 225 Gourdes is being applied). Table 2 : Pie e rate orkers weighted average earnings across all factories assessed by Better Work 6 Average % of workers earning between 200/225 and 249 in 8 regular hours Average % of workers earning between 250 and 299 in 8 regular hours Average % of workers earning 300 Gourdes or more in 8 regular hours 33% 30% 37% F. CONTRACTS, AND HUMAN RESOURCES The highest non-compliance rating in this cluster is for Termination (40%) and Dialogue, Discipline and Disputes (32%). In Focus 3: Dialogue, Discipline and Disputes Question # factories out of compliance Did the employer resolve grievances and disputes in compliance with legal 0 requirements? Do the disciplinary measures comply with legal requirements? 6 6 Better Work collects the percentages of piece rate workers per factory who earn 200/ Gourdes, Gourdes or 300 Gourdes or more during eight hours of work (excluding workers who have been recruited within the past 3 months, or those who have been using their equipment for 3 months or less). The calculations are based on average earnings, meaning that if a worker earns 300 Gourdes per 8 hour day on nine out of ten days and then earns 250 Gourdes on the tenth day, the average earnings over the ten days would be recorded under the Gourdes category. Please note that the percentages provided in this table are being calculated as weighted averages, taking into consideration the different factory sizes and their respective number of piece rate workers. 19

20 Have any workers been bullied, harassed, or subjected to humiliating treatment? 5 Six factories are found in non-compliance on disciplinary measures which do not comply with legal requirements. In most ases, dis ipli ar easures ere ot i a orda e ith the fa tories i ter al ork rules. In one factory, workers who did not come to work on Fridays were systematically being denied work on the following Saturday. The five cases of factories being in non-compliance on bullying, harassment or humiliating treatment relate to supervisors inappropriate treatment towards workers. In particular verbal abuse, shouting and harsh language have been reported by workers in these five factories. The supervisors concerned are both Haitian and foreign supervisors and all factories have acknowledged the situation. The supervisory skills training offered by Better Work is popular among factories as it helps in addressing this issue. So far, almost 200 supervisors in Haiti have been trained by Better Work Haiti. Three of the factories who had noncompliances related to bullying in the last cycle have already signed up for the training. In Focus 4: Termination Question # factories out of compliance Do workers have an opportunity to defend themselves before they are terminated based on their conduct or performance? 3 Does the employer compensate workers for unused paid annual leave when they resign or are terminated? 1 Does the employer comply with legal requirements before reducing the size of the workforce due to changes in operations? 3 Does the employer notify the labour ministry when suspending operations due to lack of materials, force majeure, or accident resulting in an immediate work stoppage? 2 Does the employer only terminate workers for valid reasons? 8 Does the employer pay judicially ordered damages for wrongful termination? 0 Does the employer pay workers their annual salary supplement or bonus upon termination? 0 Does the employer provide workers proper notice of termination when required, or pay workers during the notice period? 1 Has the employer complied with any orders to reinstate or compensate workers who were found to be unjustly terminated? 0 Under Termination, three cases of non-compliance were found for factories which did not give workers the opportunity to defend themselves before they were terminated based on their conduct or performance. Three factories were equally non-compliant on legal requirements before reducing the size of the workforce due to changes in operations. In such a case, a prior notification including the reason for the reduction of the size of the workforce needs to be submitted to MAST. A relatively high number of non-compliance points were found with regards to valid reasons for terminations. In all cases, assessors discovered files of terminated workers which either did not contain any reasons to justify their dismissal or they contained reasons that were not valid. Under Employment Contracts, three factories did not comply with the legal requirement of having internal work rules. There were no non-compliance findings for the compliance point for Contracting Procedures. 20

21 G. OCCUPATIONAL SAFETY AND HEALTH (OSH) The CPs for Health Services and First Aid and Working Environment both have a non-compliance rate of 100%. In Focus tables 4-5 highlight the key areas of non-compliance at the question level. In Focus 5: Health Services and First Aid Question # factories out of compliance Do workers have a medical check within the first three months of hiring and annual medical checks? 18 Do workers who have been exposed to work-related hazards receive free health checks? 8 Does the employer address safety and health risks to pregnant or nursing workers? 0 Does the workplace have required onsite medical facilities and staff? 24 Has the employer ensured there are a sufficient number of readily accessible first aid boxes/supplies in the workplace? 6 Has the employer provided first-aid training for workers? 3 A total of 18 factories were non-compliant on conducting medical checks within the first three months of hiring and annual medical checks. According to the Haitian Labour Code, the annual medical exams are the responsibility of the Haitian institution OFATMA. Yet, these services are still not sufficiently delivered. All but one factory failed to provide the required number of medical facilities and staff as required by the Haitian Labour Law. The requirements of the law are quite demanding and many factories chose to not hire the required number of medical staff as according to them there is not sufficient work for them. Law requires one onsite nurse for factories with between 50 and 200 workers, two nurses for factories with between 200 and 500 workers and one additional nurse for every additional 200 workers in the factory. Moreo er, fa tories ith fe er tha 200 orkers should pro ide eekl do tor s isits, a d fa tories ith more than 200 workers should have permanent on-site medical services. Better Work has observed improvements regarding the hiring of doctors, but the number of nurses remains substantially below the requirements, resulting in non-compliance. Some factories also have made arrangements with nearby medical facilities and provide workers free access to medical services there. On first-aid training for workers, improvements can be noted. From previously 7 non-compliant factories in the last cycle, this cycle only saw 3 factories not having provided first-aid training to the required 10% of the workforce. In Focus 6: Working Environment Question # factories out of compliance Are noise levels acceptable? 11 Is the temperature in the workplace acceptable? 17 Is the workplace adequately lit? 19 Is the workplace adequately ventilated? 4 With regards to the Working Environment, Better Work measures noise, light and temperature levels at the factory in different sections and on different times of the day. Better Work standards are based on the ILO Code of Practice and ILO Caribbean Office OSH Program materials. Noise levels are too high in 11 factories. Most factories run music and/ or messages over a sound system which often is the cause for being over the maximum of 90 db which BW recommends. Temperature levels 21

22 were measured too high in 17 factories. Better Work recommends a maximum of 30 degree Celsius. Light levels have different standards depending on the section in which the lux levels are measured. A total of 19 factories were found to be non-compliant on light levels. And in 4 factories, ventilation systems need to be improved. Light, temperature and ventilation levels often relate to structural conditions of the factory buildings. In the case of rental buildings, factory management is not willing to invest substantial amounts in structural changes most of the time. In Focus 7: Welfare Facilities Question # factories out of compliance Does the employer provide workers enough free safe drinking water? 2 Does the workplace have adequate accessible toilets? 22 Does the workplace have adequate hand washing facilities and adequate soap? 9 Does the workplace have all required facilities? 0 Does the workplace have an adequate eating area? 11 Is the workplace clean and tidy? 3 Welfare facilities remain with high non-compliance le els o the u er of toilets a d fa tories eati g areas. Similar to the requirements of the Haitian Labour law on the number of medical staff, the number of toilets that must be available in the workplace is equally demanding. One toilet is required for every 25 men and one toilet for every 15 women. Better Work recommends that existing toilets are well maintained in order to compensate for insufficient numbers. During assessments, Better Work therefore verifies the functioning of the toilets and also observes if there are lines in front of the bathrooms, which is rarely the case. The issue on drinking water in two factories where non-compliance was found is based on the water quality being found to not be satisfactory. All factories provide drinking water to workers. The non-compliance on adequate washing facilities and adequate soap in nine factories all relates to insufficient soap being provided at all times. Adequate hand washing facilities were available in all factories. Eleven factories are found to be in non-compliance on the eating area. Four factories are completely missing an eating area. The other seven have an eating area, but it is not sufficient to accommodate all workers. Three factories were not found to be sufficiently clean and tidy. In Focus 8: Emergency Preparedness Question # factories out of compliance Are emergency exits and escape routes clearly marked and posted in the workplace? 12 Are flammable materials safely stored? 1 Are possible sources of ignition appropriately safeguarded? 3 Are the emergency exits accessible, unobstructed and unlocked during working 7 hours, including overtime? Are there enough emergency exits? 3 Does the employer conduct periodic emergency drills? 3 Does the workplace have a fire detection and alarm system? 14 Does the workplace have adequate fire-fighting equipment? 11 22