Development of Apparel Industry Codes of Conduct  ( Chapter II)
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  Child Labor Report 2005

II. Codes of Conduct in the U.S. Apparel Industry

E. Development of Apparel Industry Codes of Conduct

1. Form and method of development of codes of conduct

The form that companies' policies take, and how they were developed, varies widely from company to company:

  • Some companies have developed special documents (which they typically refer to as "codes of conduct") outlining their values, principles and guidelines in a variety of areas, including child labor. These documents are a means for companies to clearly and publicly state the way in which they intend to do business to their suppliers, customers, consumers and shareholders. Some are intended for wide distribution, including posting in workplaces.

  • Other companies surveyed do not have a formal code of conduct, but have circulated letters stating their policies on child labor to all suppliers, contractors and/or buying agents.

  • Compliance certificates are yet another vehicle used by companies to state their policies regarding child labor. These certificates generally require suppliers, buying agents, or contractors to certify in writing that they abide by the company's stated standards prohibiting the employment of children.

  • Still others state their child labor policies in formal documents such as purchase orders or letters of credit, making compliance with the policy a contractual obligation for suppliers.

  • Some companies have both formal codes of conduct and contractual clauses or a certification form. Others' policies on child labor are exclusively contained in contracts or certification forms rather than in a formal code of conduct.

There are also differences among companies in how they have created their codes of conduct. Some of the pioneer companies in establishing codes of conduct designed their own codes independently, based on their needs and experiences and sometimes drawing on existing models such as multilateral codes of conduct (e.g., ILO and OECD), private sector initiatives (e.g., the maquiladora standards), and internationally-recognized labor standards set by the ILO. United States corporations that have adopted codes of conduct more recently have benefitted from the experiences of corporations that took this path earlier. In other instances, companies reported that they utilize the code of conduct or policy of a trade association or buying agent - either in lieu of, or in addition to, their own.

Based on the information provided by the respondents to the survey, including follow-up telephone interviews:

  • Thirty-three out of 42 companies that provided reportable responses have corporate codes of conduct, statements of principles, or compliance certificates specifically addressing child labor in overseas production;73

  • Twelve respondents do the same through contract requirements contained in purchase orders, letters of credit, or buying agent agreements;

  • Nine respondents use a combination of both type of policy; and

  • Six respondents have no policy on overseas child labor.

Table II-2 shows what type of policy has been adopted by respondents. It should be noted that the categorization in Table II-2 is based upon the information provided by the respondents to the Department of Labor. Policies may also have evolved since the time of the survey and follow-up interviews.

The survey results also suggest that the development of codes of conduct is a dynamic field, with quite a bit of experimentation going on:

  • Some companies have policies that are applied to both domestic and international production, while others have policies that only refer to domestic production and have not yet developed a comparable policy for overseas manufacturing.

  • Many of the companies have recently revised their codes of conduct or policies, usually expanding them to include new features, such as implementation strategies. These revisions reflect the fact that many companies are learning how to promote and implement a code as they go along.

  • Several companies indicated that they are in the process of reviewing their existing code or considering the introduction of a code.

2. Basic Elements/Standards of Codes of Conduct

Corporate codes that address labor standards vary from company to company with regard to the specific labor standards included. All or some of the following elements are found in various corporate codes:

  • prohibitions on child labor;

  • prohibitions on forced labor;

  • prohibitions on discrimination based on race, religion, or ethnic origin;

  • requirements to ensure the health and safety of the workplace environment;

  • provisions on wages, usually based on local laws regarding minimum wage or prevailing level in the local industry;

  • provisions regarding limits on working hours, including forced overtime, in accordance with local laws; and

  • support for freedom of association and the right to organize and bargain collectively.

TABLE II - 2

Type of Policy Prohibiting Child Labor

( Based on Responses to Department of Labor Questionnaire )

Code of Statement of PrinciplesA Purchase Order RequirementB NoneC
Ames Department Stores     .
Burlington Coat Factory     .
County Seat Stores, Inc.*      
Dayton Hudson Corporation .    
Dillard Department Stores . .  
Dollar General Corporation   .  
The Dress Barn, Inc. .    
Family dollar Stores     .1
Federated Department Stores .    
Fruit of the Loom .    
The Gap .    
Hartmarx Corporation .1    
Home Shopping Network, Inc. . .  
JC Penney Company .    
Jones Apparel Group .    
Kellwood Company .    
Kmart Corporation . .  
Kohl's Corporation**      
Land's End, Inc. .    
Levi Strauss & Co. . .  
The Limited .    
Liz Claiborne .    
The Marmaxx Group**      
May Department Stores*      
Mercantile Stores Company .    
Montgomery Ward Holding Company     .3
Neiman Marcus Group*      
Nike, Inc. .    
Nordstrom . .  
Oxford Industries .    
Phillips-VanHeusen .    
Price/Costco   .  
Ross Stores, Inc.     .
Russell Corporation .    
Salant Corporation .    
Sara Lee Corporation . .  
Sears Roebuck & Company . .  
Shopko Stores**      
Spiegel, Inc. .    
Stage Stores, Inc. .4    
The Talbots, Inc. . .  
Tultex Corporation .    
Venture Stores . .  
VF Corporation .    
Waban Inc.     .
Wal-Mart Stores .    
Warnaco Group .    
Woolworth Corporation   .  


*
No response received


**
Designated as business confidential therefore information reportable.


a
Company has a formal code of conduct, statement of principles or compliance certificate.


b
Company has a purchase order, letter of credit, or buying agent agreement, which contains a specific prohibition child labor in overseas production.


c
Company has no specific prohibition on child labor in overseas production any document, although it may have a general reference to compliance with all applicable laws or U.S. labor laws in its purchase order.


1
Company subscribes to the National Retail Federation (NRF) code, which does not specifically mention child labor.


2
Company subscribes to the American Apparel Manufacturers Association (AAMA) code.


3
Company says that it does not tolerate the use of child labor in the manufacture of imported goods and has put its vendors on notice that they are bound by the policy, but did not provide any documentation. Also subscribes to NRF code, which does not specifically mention child labor.


4
Company subscribes to the Associated Merchandising Corporation (AMC) code.

3.Definitions

Although many of the corporate codes of conduct address the same set of labor standards, there are significant differences on how these standards are defined. In some instances, the corporate codes follow international definitions of labor standards (e.g., those promulgated in ILO Conventions). In other instances, the corporate codes of conduct themselves define the standard. In still other instances, the codes of conduct do not provide any guidance on the definition of the standard.

Almost all of the companies responding to the survey have a general policy requiring their business partners to comply with all applicable laws and standards of the host country and/or industry. Most of the companies' child labor policies also define what is meant by child labor and require that business partners comply with this standard.

However, the definition of child labor varies from company to company. For example, a company's policy statement may: (1) state a minimum age that must be met by all employees who produce their products, (2) refer to the national laws of the host country regarding the minimum age of employment or compulsory schooling, (3) refer to international standards,74 or (4) use some combination of the three. In some cases, companies' policies prohibiting child labor in the production of their goods do not contain any definition of child labor at all, leaving the standard open for interpretation by their business partners. Table II-3 describes how respondents to the survey define child labor in their policies.

TABLE II - 3

Company Definitions of Child Labor

( Based on Responses to Department of Labor Questionnaire )

Company Own DefinitionA Law of Host CountryB International StandardC No DefinitionD
Ames Department Stores       .
Burlington Coat Factory       .
County Seat Stores, Inc. *        
Dayton Hudson Corporation (14) .    
Dillard Department Stores   .    
Dollar General Corporation     .  
The Dress Barn, Inc. (15) .    
Family dollar Stores       .
Federated Department Stores   .    
Fruit of the Loom (15) and not under compulsory age of schooling .    
The Gap (14) .    
Hartmarx Corporation       .1
Home Shopping Network, Inc.   .    
JC Penney Company   .    
Jones Apparel Group   . .  
Kellwood Company (14) and not under compulsory age of schooling .    
Kmart Corporation       .
Kohl's Corporation**        
Land's End, Inc.   .    
Levi Strauss & Co. (14) and not under compulsory age of schooling .    
The Limited   .    
Liz Claiborne (15) .    
The Marmaxx Group**        
May Department Stores*        
Mercantile Stores Company   .    
Montgomery Ward Holding Company       .
Neiman Marcus Group*        
Nike, Inc.   .    
Nordstrom not under compulsory age of schooling .    
Oxford Industries   .    
Phillips-VanHeusen (14) .    
Price/Costco   .    
Ross Stores, Inc.       .
Russell Corporation   .    
Salant Corporation (16) .    
Sara Lee Corporation (16) .    
Sears Roebuck & Company   .    
Shopko Stores**        
Spiegel, Inc.   . .  
Stage Stores, Inc. (14) not under compulsory age of schooling2 .    
The Talbots, Inc. (15) .    
Tultex Corporation   .    
Venture Stores   .    
VF Corporation (14) not under compulsory age of schooling .    
Waban Inc.       .
Wal-Mart Stores (15) not under complusory age of schooling .    
Warnaco Group (16) not under complusory age of schooling .    
Woolworth Corporation


*
No response received


**
Designated as business confidential therefore information reportable.


a
The company's policy specifies a minimum age and/or other specific definition of child labor.


b
The compnay refers to the host country's law in defining child labor.


c
The company refers to an international standard - most often United Nations conventions - to define child labor.


d
The Company has no policy on child labor, or has a policy but does not define child labor, or subscribes to the National Retail Federation (NRF) code, which does not mention child labor


1
Company subscribes to the American Apparel Manufacturers Associations (AAMA) code, which mentinons but does not define child labor.


2
Company subscribes to the Associated Merchandising Corporation (AMC) code.

a. Minimum Age

  • The policies of three of the respondents - Salant Corporation, Sara Lee Corporation75 and Warnaco76 - require that workers producing goods for them be at least 16 years of age.

  • Salant Corporation's ('Salant') policy, which is in the form of a Vendor Compliance Certificate, also requires vendors to comply with all applicable child labor laws, rules and regulations.

  • Warnaco also requires that workers be older than the compulsory age to be in school.

  • Dress Barn, Inc. ('Dress Barn'), Fruit of the Loom, Liz Claiborne, The Talbots, Inc. ('Talbots') and Wal-Mart ('Wal-Mart') all require that workers in facilities that produce for them be at least 15 years of age.

  • Dress Barn similarly refers to the higher of local law and age 15.

  • Fruit of the Loom also requires that workers be over the age of compulsory schooling in the country of manufacture.

  • Wal-Mart first refers to the national laws of the country on minimum age and compulsory schooling, but has its own minimum age of 15 if the national laws permit work at a younger age or if national laws contain no provisions on child labor.

  • Six respondents (Dayton Hudson Corporation, The Gap, Kellwood Company, Levi Strauss, Phillips-Van Heusen and VF Corporation), as well as Associated Merchandising Corporation (AMC), whose code is used by Stage Stores, require that employees in overseas facilities that produce for them be at least 14 years of age.

  • Kellwood Company ('Kellwood') also requires that workers comply with the national minimum age for employment and the compulsory age to be in school, whichever is higher.

  • Levi Strauss, VF Corporation and AMC also require that workers be over the compulsory age to be in school, if that is higher than 14.

  • Phillips-Van Heusen, Dayton Hudson Corporation and The Gap require that workers be over the applicable minimum legal age requirement in addition to being at least 14.

  • Another group of respondents (Dillard Department Stores, Federated Department Stores, Home Shopping Network, JCPenney, Land's End, The Limited, Mercantile Stores Company, Nike, Oxford Industries, Price/Costco, Inc., Russell Corporation, Sears Roebuck & Co., Tultex Corporation and Venture Stores) require compliance with the applicable child labor law in the host country. Nordstrom requires that employees be over the national age for completing compulsory education.

  • Other respondents (Jones Apparel Group and Spiegel) require that their business partners comply with the host country's child labor law or United Nations standards, whichever is higher. Dollar General Corporation ('Dollar General') refers to international and human rights laws recognized by the United States or the United Nations.

  • Finally, the policy statements of a few respondents (Kmart Corporation and Woolworth), as well as the AAMA's "Statement of Responsibility," used by Hartmarx Corporation ('Hartmarx'), do not define child labor.

b. Additional Elements of the Child Labor Policies

Policies of some respondents go beyond prohibiting the employment of children and contain clauses specifying how the policy is to be implemented or what steps are to be taken in the case of non-compliance. In some instances, the policies also encourage additional efforts on behalf of children or youths. However, some companies that do not explicitly state these elements in their code may in practice require the same of their vendors.

The Gap and Phillips-Van Heusen's policies both contain clauses requiring that factories not only respect a minimum age, but also comply with all applicable child labor laws, such as those relating to hiring, wages, hours worked, overtime and working conditions.

Some companies' policies contain provisions specifying how factories are to document that none of their employees are underage, or requiring factories to make employment records available at all times for inspection.

  • The Gap, for example, requires that factories maintain official documentation verifying the date of birth for each worker or to use an "appropriate and reliable" assessment method in countries where such official documents are not available.

  • Land's End, Spiegel and VF Corporation, among others, state in their policies that they require business partners to provide them full access to their production facilities and relevant employment records.

  • Several companies, including Sears Roebuck & Co. ('Sears') and Dayton Hudson Corporation ('Dayton Hudson'), indicate in their policy statements that they reserve the right to inspect the facilities where their goods are produced.

  • Some policies, such as those of Federated, Kmart Corporation, and Nordstrom, set out the consequences that vendors will face if they violate the policy.

  • Several companies' codes also contain clauses encouraging business partners to support special educational opportunities for young workers. Several companies' policies on child labor also include provisions in support of legitimate workplace apprenticeship programs for younger persons.

  • Dayton Hudson, Levi Strauss, VF Corporation, Wal-Mart and Warnaco, as well as AMC, whose code is used by Stage Stores, all state their support of such apprenticeship programs. Both Dayton Hudson and AMC qualify their support of apprenticeship programs with the caveat that the child must not be exploited or given jobs that are dangerous to his/her health or safety.

  • The Gap encourages factories to develop "lawful workplace apprenticeship programs for the educational benefit of their workers," as long as all participants are at least 14 and comply with the minimum legal age requirement.

  • The Gap and Phillips-Van Heusen's codes contain a clause encouraging vendors to support night classes and work-study programs for young workers.

  • Four of the companies that responded to the questionnaire - Dress Barn, Levi Strauss, Liz Claiborne and Phillips-Van Heusen - provided a formal audit or survey form that contains all the information that is gathered from contractors and suppliers to determine whether they are in compliance with the company's labor policy, including the child labor provisions. These add transparency to the process in that they indicate how the companies are making their decisions on compliance.

  • Levi Strauss' Guidelines contain a statement of its commitment to continuous improvement in their implementation: "As we apply these standards throughout the world, we will acquire greater experience. As has always been our practice, we will continue to take into account all pertinent information that helps us better address issues of concern, meet new challenges, and update our tools, methods and Guidelines."

 

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This report was developed and provided by the U.S. Labor Department http://www.dol.gov/ILAB/media/reports/iclp/apparel/main.htm

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