Appendx 4 Understandng FLA s Assessment Methodology FLA s Sustanable Complance methodology (SCI) dentfes root causes of noncomplance so that sustanable solutons can be developed and mplemented. SCI assessments consst of a number of actvtes undertaken by the assessment team whch are conducted pror to the vst to the workplace, durng the vst, and after the vst. These actvtes are depcted n the dagram below. Rather than rgd steps that must be completed sequentally, they are more akn to components of a system that underles assessments and may be conducted n parallel. In the descrpton that follows, these actvtes are organzed nto those that are conducted pror to the vst to the workplace (pre-onste assessment), those that are conducted durng the vst to the workplace (onste assessment), and those that are conducted after the vst to the workplace (post-onste assessment). Desktop Research -New local labor laws -Local labor market -Hstory of labor relatons Root Cause Analyss and Reportng Identfyng underlyng systemc ssues and report wrtng Polcy & Procedures Revew -Revew of Polces & Procedures -Revew of documents related to management functons Closng Meetng Overvew of factory condtons and prelmnary fndngs Cross Checkng and Trangulaton -Gong deeper wth dentfed rsks -Connectng the dots SCI Assessment Steps Task & Rsk Mappng -Identfy rsks by EF -Prortze EFs for assessment Openng Meetng Introduce the assessment process and expectatons Observaton and Documentaton Revew Sensoral observaton and revew of worker fles, payroll, etc. Workflow Mappng -Understandng factory process n each employment functon -Identfy further rsks Management and Worker Intervews Identfcaton of management and workers to partcpate n the ntervew process based on EFs 1
Pre-Onste Assessment 1. Desktop Research The SCI approach to assessment begns wth desktop research on the natonal and local labor market, the ndustral sector and the company concerned. Here are examples of the types of ssues that the assessor should look nto: Have any new labour laws been adopted recently that may affect the employment relatonshp n the faclty to be assessed? What about the laws/ legslaton on envronment and health and safety? What are the known ssues surroundng the employment relatonshp n ths labor market? Ths ncludes structural and systemc ssues. Structural ssues mght nclude over- or undersupply of labor, a hgh percentage of mgrant workers, or a tradton of chld labor. Systemc ssues mght nclude labor laws that do not meet ILO standards, weaknesses of labor nspecton systems or hgh socal charges that companes typcally try to avod. Are there any partculartes n the local labour market that represent a rsk that mght need to be assessed? An example mght be provdent fund payments n the North of Inda, the Sumangal scheme n the South-east of Inda or an envronment of employer-controlled labor unons and protecton contracts. Are there any rsks assocated wth the ndustral sector/product category of whch the company forms part? For example, s the producton process known to nvolve extensve use of chemcals? Does t nvolve labor-ntensve detaled processes susceptble to homework? Does the partcular company to be assessed have any known ssues wth ts handlng of the employment relatonshp? What s the ndustral relatons stuaton n ths labour market? Are trade unons present? Are there any collectve barganng agreements n the area? Has there been labor unrest n the past year? Has there been fre, factory collapse or serous work accdents n the past months/years? What are the recent envronmental ncdents and problems n the regon? 2. Polces and Procedures Revew At the tme the assessment team s assgned to conduct an SCI assessment, t should send a request for documents to the workplace to be assessed. An llustratve standard lst of documents to be requested n advance s provded below. In partcular, the request should cover polces and procedures regardng each of the employment functons (EF) and other documentaton ncludng, but not lmted to, company s general nformaton, employee handbook, nternal rules and procedures, suggeston box or open door polces, collectve barganng agreements, and records of recent vsts by labor nspectors or by brand audtors. The assessment team should revew the documents pror to arrvng at the ste to determne f the workplace has the necessary polces and procedures requred to regulate the employment relatonshp n a sustanable and complant manner. 1. Polces and Procedures a Recrutment, Hrng and Personnel Development (ncludng tranng records (tranng plan and tranng documents)) Sample of Applcaton form Sample of Employment contract Lst of documents n a standard worker fle (contnues on next page) 2
(contnued from prevous page) b c d e f g v v v v h Wages & Benefts Pay slp format Hours of Work Termnaton & Retrenchment Workplace Conduct & Dscplne Grevance System Health & Safety Specfc H&S forms and records Rsk assessment report of the workplace Fre rsk assessment report of the workplace Number of medcal and frst ad traned staff Number of frst ad kts and nformaton on content Emergency response/busness contnuty plans Structural safety certfcate of the buldngs (factory/dormtory) Envronmental Protecton Waste management plan Waste water analyss report Emssons report 2. Company Data a b c d e f g h j k Busness Regstraton Records (permts & lcenses) Bref hstory of the factory Map/layout of the factory and mmedate surroundngs Lst of brands n producton FLA afflated companes' Code of Conduct Lst of operatons wthn the factory/monthly capacty for each operaton Lst of subcontractors where the man producton functons take place (such as cuttng, sewng, sttchng, etc.) Organzatonal Chart Ongong lawsuts aganst company (f there s any) Accdent records (for the last 3 years) Recent audt reports (self assessments, government, thrd partes and brands reports for the last 12 months) 3. FOA and Worker Representaton a b c d e Polcy and procedures on FOA (f applcable) Actual CBA (f applcable) Names of the unons (f present) Lst of worker representatves Lst of worker representatve commttees (EHS/Dscplnary/etc.) 3
3. Task and Rsk Mappng Once the desktop research and polces and procedures (and related documentaton) revew have been completed, a task-and-rsk map of the faclty should be drawn-up. The mappng should lst all the functons nvolved n the producton process and attach a rsk to each. The rsks may be generc (such as the ntrnsc occupatonal health and safety rsk assocated wth a process nvolvng chemcals) or workplace-specfc (such as the rsk posed by the lack of polces and procedures on a certan Employment Functon). The rsks should then be prortsed. The task and rsk mappng s a partcularly strategc moment n plannng the assessment because t wll determne the startng pont and the order of the nvestgaton. SCI assessments should not smply follow a standard sequence such as the chronologcal order for example of the employment relatonshp, from hrng to termnaton. Instead, the lead assessor should study the task-and-rsk map and determne the most pertnent pont of entry based on the severty of the rsks evdent from the desktop research and the probable cause-effect relatonshp of those rsks. Let us look at a few examples: In a labor market wth hgh socal charges, companes can be expected to attempt to mnmze the use of regular employees wth full benefts. One way to do so would be to hre more shortterm or casual workers n order to reduce labor costs. Ths could manfest tself n the faclty havng a hgh number of apprentces or tranees, or the extended and even abusve use of these categores of workers. The company could also outsource certan functons, or use sub-contractors to perform those functons n-house. These knds of measures can also be expected n hghly volatle product markets snce companes can never be sure what level of orders they wll have n the future and hence how many workers they wll need. Where these structural, systemc or cyclcal factors are features of the labor market and the company to be assessed, then the lead assessor should prortze a revew of the contractual status of the workers and ther correspondng benefts and wages. Workers on precarous contracts may be excluded from certan socal securty schemes, pad less than other workers and overlooked for tranng or promoton. The assessment would therefore follow the tral of consequences that flow from precarous contracts. A labour market or company wth a hgh percentage of foregn mgrants may be subject to a number of rsk factors; f rsks assocated wth mgrant workers outwegh others on the task-andrsk map, the assessment should start by lookng at ths category of workers. How were they recruted? Were recrutment fees pad? If so, by whom and to whom? Is the mgrant worker n debt to anyone? Does the worker s mgrant status affect hs or her wages, benefts, tranng, promoton, freedom of movement and elgblty to jon trade unons? Should t appear from the task-and-rsk map that there may be producton functons performed offste, the lead assessor would need to develop a plan to establsh whch functons are at ssue, where the work s performed, and by whom. Does the work potentally nvolve homework? Could chldren be nvolved? Are there health, safety or envronmental rsks to be assessed? Based on the task and rsk mappng, the lead assessor can prepare the assessment plan for the onste vst. The plan should nclude: Formaton of the assessment team wth respect to the dentfed rsks. Confrmed logstcal arrangements related to travel to the faclty and stay n the area, as well as the avalablty of crtcal documents/records and people. A tmelne, ncludng a prelmnary meetng schedule, as well as the estmated tme requrements for assessng each employment functon and prorty ssues lnked to t. Assgnment of tasks for each member of the assessor team. A lst of (addtonal) documents and records to be revewed pror to and durng the assessment. Faclty management and other manageral staff to be ntervewed. Number of workers to be ntervewed, ncludng detals of work shfts, crtera for selecton, locatons (dormtores, etc.), and language sklls requred, etc. Lst of key questons and areas of dscusson for management and workers. 4
Onste Assessment Snce most of the company s polces and procedures should have been revewed pror to arrvng to the workplace, these should not need to be revsted onste unless there was a very recent change n polcy and procedures. The onste work of the assessment team should focus on: Investgatng the hgh-rsk areas; Testng the mplementaton of polces and procedures; and Evaluatng the regulaton of all EFs. 4. Openng Meetng The onste assessment should start wth openng ntervews wth management and worker/unons representatves (f possble) n order to explan the nature of the assessment and to agree on the schedule for the assessment. It s essental that the assessment team explan to management and workers representatves the dfferences between an assessment and an audt, and secure cooperaton from all concerned. For example, one of the notceable dfferences between the two approaches s the moblty of the assessment team. The assessment team wll assess features/ssues where they occur, not remotely. Whereas audt teams typcally occupy a meetng room and have documents and ntervewees brought to them, SCI assessors wll move to the relevant locatons wthn the workplace and evaluate the rsks by observng how the functons are performed n practce. The assessment team should also revew mportant aspects of the assessment such as the specfc areas to be addressed, and how the report wll be prepared and delvered. It s essental that the followng objectves are acheved durng the openng meetng: To obtan an understandng of management vews/approach towards the mportance of havng a sustanable employment relatonshp wth employees (through employment functons that operate n a sustanable manner). To buld a courteous and professonal relatonshp between the assessment team and management staff and workers/unon representatves. It s however also mportant that the assessment team assert ts control over the assessment process. To verfy and/or refne prorty ssues dentfed durng the preparatory phase of the assessment. 5. Assessment Workflow Mappng After the openng meetng, and buldng on the document revew, the assessor team wll develop a workflow mappng by employment functon. The SCI workflow mappng s a process an assessor uses to better understand how each EF actually s mplemented n the workplace: What gets done? When? Where? And who s responsble for each step. Whle developng the assessment workflow mappng, the assessors become very actve and must move around the workplace snce the sources of nformaton are spread all over dfferent locatons, from the guards at the gate, to human resources staff, accountng department, producton managers, department chefs, supervsors and workers. The workflow mappng helps and gudes the assessor about where he or she needs to go, wth whom to speak and even when to do so. It also gves the assessor the raw data to start cross-checkng nformaton and sources. 6. Management and Worker Intervews In most cases, the assessment of mplementaton of EFs s through ntervews askng managers and workers how they do ther jobs and determnng whether ther testmony conforms to the relevant standards envsaged by the law, the polcy and the procedure. Ths wll obvously not be establshed through a seres of drect questons wth yes/no answers. Sklled ntervewers and assessors wll ask the subjects to descrbe how they perform ther functons or experence partcular aspects of lfe at work and n the case of worker ntervews wll also gauge awareness of each employment functon. The assessor wll then decde whether the nformaton conveyed n the testmony s consstent wth the stuaton envsaged by the law, polcy and procedure. For management ntervews, assessors should focus on obtanng responses that enable accurate evaluaton of past and current operatng practces, n a manner that s senstve to the anxety and nervousness that management staff may experence. The assessment team should conduct ntervews, as approprate, wth staff from the followng categores of management: General manager. Ste manager. Producton manager. Envronment manager/responsble staff. 5
Health and safety managers/responsble staff. Qualty manager. Internal socal complance manager/audtor. Labor relatons manager / Welfare manager. Human resources manager/admnstratve manager. Fnance manager/payroll manager. Legal affars manager. Procurement manager/supply chan manager. Supervsors/Techncans. Onste medcal staff. Management ntervews can be conducted wthn a group, n conjuncton wth the openng meetng, or separately. The preparatory work that has been done, as well as the FLA tools avalable to assessors, ncludng the SCI Assessment Gude (n-factory prompts); wll gude assessors as to what ssues to rase wth management. It s crucal for assessors to dscuss the ssues they have observed wth the management as t wll greatly help understand the root causes and motve behnd them. Worker ntervews are ntended to get an n-depth vew of how workers perceve the faclty s managed and to gauge f they feel ther expectatons wth regard to the terms and condtons of ther employment have been met. The assessment team wll select workers for ntervews throughout the assessment. Intervews wll be conducted n a prvate space. Intervewees wll be selected from a range of workers ncludng permanent, temporary, subcontract labor, securty, cleaners, food preparaton staff, etc. The pool of workers to be ntervewed wll also nclude new workers at less sklled postons, workers from varous departments and shfts, and workers of both genders, and should nclude worker representatves as approprate. Ideally, half of the ntervews should be ndvdual, the other half conducted as group ntervews. The number of worker ntervews conducted and the number of worker records revewed depends on the number of workers at the faclty. For both knds of ntervews (management and workers), as the object of an SCI assessment s to establsh to what degree each EF s beng properly regulated, t s mportant for the assessor to understand the strengths and weaknesses n the way EFs are appled and then to explan why. Wthout determnng the why, the assessment team wll not be able to make recommendatons for sustanable solutons. It s also mportant to remember the need for moblty of the assessment team, as well as for adaptablty and flexblty. Intervews have to be conducted n parallel to the observaton and records revew accordng to the specfc fndngs. For example: If the contractual status of workers s a hgh rsk, then one member of the assessment team should go to the Human Resources department and select and revew fles of a number of workers whle another assessor conducts ntervews wth the manageral staff at dfferent levels to understand the actual practces. At the same tme, specalzed worker ntervewers should ask workers n the hgh-rsk postons about how they were recruted and hred, how ther terms and condtons were decded and how they are managed. The ntervewers should also assess how aware the workers are of ther legal enttlements. The results of the records revew and the nformaton gathered n the ntervews should be cross-checked and further nvestgatve steps f necessary should be determned. Cross-checkng, vtal to the assessment, should be conducted several tmes a day. 7. Observaton and Records Revew In SCI assessments, sensoral observaton s key, partcularly when assessng the health and safety and envronment EFs. Observaton s mportant to gan an understandng of the workplace envronment and synerges across dfferent departments. Also as part of ths actvty, the assessors wll revew documentaton (see below) that typcally would not be made avalable durng the preparatory stage of the assessment due to confdentalty. It s mportant for the assessment team to spend some tme revewng the ste s records before ntervewng the staff and workers or undertakng an observaton tour, because the nformaton obtaned wll determne to some degree the questons to prortse durng ntervews and the ssues to prortse when undertakng an observaton tour. The assessors should be thorough n the revew of records. However, ths does not mean that every sngle 6
record needs to be revewed. The assessor s free to use statstcal or other samplng n the revew. Where the assessor does not revew every record and there s a fndng, the assessor must reflect the samplng method n the statement of fndng. The followng documents and records, coverng at least the prevous 12 months where applcable for the type of record, must be avalable on-ste for assessors to revew: Factory lcenses and regstraton (operatonal, envronmental, chemcal, etc.). Personnel records (employee contracts, appontment letters, work permts, etc.). Wage records (payroll, wage slps, payment of legally mandated deductons/contrbutons to socal securty nsttutons and relevant others, etc). Tme records (punch cards, etc.). Leave records (sck leave, annual leave, bereavement leave, leave wthout pay, etc.). Apprentceshp/young workers records. Internal regulatons, employee handbooks, factory crculars, etc. Safety and health records (fre drll and evacuaton records and plans, work njury records, certfcates of nspecton for relevant equpment, records related to chemcals n use). Lcenses for specal staff, where legally requred (techncal staff, such as electrcans, medcal staff, cooks, etc.). Contracts wth servce provders (sub-contractors, drnkng water, dormtory rental contract, etc.). The desktop-based and onste record and documentaton revews wll provde assessors wth crucal nformaton as to how well the systems that mplement employment functons are defned and whether expected outcomes are ndeed realsed. A record revew therefore plays an mportant part n assessng whether employment functons operate n a sustanable manner. 8. Cross Checkng and Trangulaton SCI assessments requre the assessment team to move actvely around the workplace premses. It s therefore essental that the assessment team meet at least twce a day or even more often to debref on nformaton gathered from dfferent sources. Cross checkng nformaton, gathered through ntervews wth workers, supervsors, department chefs, and managers or from documentaton revewed before and durng the assessment, s essental to test the mplementaton of polces and procedures, dentfy patterns and valdate rsks dentfed n the task and rsk map. Meetngs can also be used to measure progress of the assessment, dscuss emergng fndngs, and detect areas where addtonal nformaton, assessment or follow up s needed. 9. Closng Meetng The onste actvtes assocated wth an assessment end wth a closng meetng wth management and workers representatves (f possble) amed at explanng prelmnary fndngs (ssues n the factory that requrement mmedate attenton and ssues for sustanable mprovement) and potental root-causes by employment functon. Durng the closng meetng, the assessor team should also offer management and worker representatves the opportunty to ask any queston related to the assessment. Durng the closng ntervew the assessor team should also reterate the warnng to management of non-retalaton aganst workers who mght have partcpated n ntervews. Should the assessor team dentfy fndngs that requre mmedate acton, they should be presented n wrtng to management and provded by emal to the afflated company wthn 24 hours. Assessors should also share postve fndngs and areas for mprovement. Post-Onste Assessment 10. Root Cause Analyss and Reportng In an SCI assessment, fndngs are not consdered solated events, but rather the result of systemc falure wthn an EF. Fndngs are symptoms of underlyng problems whch can only be corrected or ther recurrence prevented f root causes are addressed. Consder, for example, the case of workers not wearng hearng protecton equpment n a hgh nose area. The most expedent concluson mght be that the worker dd not use the hearng protecton equpment because such equpment was not provded by management. If ths were ndeed the 7
case, t would n tself be a symptom of a problem falure to provde personal protecton equpment. However, upon a more thorough evaluaton of avalable nformaton, the assessor mght fnd that the worker was ndeed suppled wth hearng protecton equpment and wth wrtten nformaton about the mportance of wearng hearng protecton. In other words, n ths nstance the systems governng the safety and health employment functon appeared to be n place and operatng properly. Seekng a root cause, the assessor examned the health and safety polcy and procedures and found they were avalable, but the procedures dd not nclude specfc language on PPE use. Furthermore, by connectng the dots, the assessor notced that there was no tranng and communcaton of the polcy and procedures, so for ths partcular example, even f PPE use was lsted n the procedures, workers never would hear about proper use or when to use them because management does not make them publc and workers are not traned on ts use. The assessor notced that tranng and communcaton of the polces and procedures was found lackng not only wth respect to health and safety, but also wth regard to other employment functons, as management smply dd not have a worker tranng program at all and t only communcates basc polces and procedures durng nducton/orentaton. In the above nstance, therefore, the root cause for the observed fndng of non-use of hearng protecton equpment was not just confned to a sngle system n a sngle employment functon but also affected all other employment functons. Assessors wll use the FLA platform to complete the onlne reportng tool, respondng to each queston arranged by employment functon. Once the nformaton has been entered, the assessors are expected to generate fndngs, ncludng root causes, that were detected durng the assessment. In creatng the fndngs, the assessor would look for the sub-group of questons that would be most relevant and descrbe the gap, pullng together observatons from dfferent employment functons and management functons ncludng the root causes of the fndng. To each fndng created, the assessor would assgn one of the followng ndcators: mmedate acton requred, sustanable mprovement requred and notable performance. Assessors should keep n mnd that the number of fndngs n an assessment s NOT a performance ndcator, and that fndngs must be related across management functons by combnng those that are smlar and dentfyng root causes wthn the employment functon. 8