Haglofs AB, LK International AG (Kjus), Complaint 196

CONCERNING LABOUR STANDARDS
Payment of a living wage Reasonable hours of work
STATUS
Closed
DATE
2016-09-20

The complainant claimed that since this year the factory delays workers´ payments quite often, with the longest delay being 3 months. Furthermore, workers have to work excessive overtime hours till 23:00 Mondays through Saturdays (8:00 to 12:00; 14:00 to 18:00; and OT: 19:00 to 22:00/23:00); working 11 to 12 hours a day. In a case of tight delivery, workers worked for the entire month without a rest day.
They also worked on 15 September 2016, which is an annual holiday (Mid-autumn festival). Management did not announce OT premiums for that day, which would be 300% according to local legislation.

Findings and conclusions

On 20 September 2016, FWF received a complaint from a worker currently employed at the factory. The complainant claimed that the factory delays workers´payments quite often, with the longest delay being three months. Furthermore, workers have to work excessive overtime hours. The complainant said that altogether workers have had approximately 10 days off since the beginning of this year until now.

FWF notified Haglofs and Kjus. Haglofs and Kjus contacted the supplier and the factory sent payslips as evidence as to when wages were paid. The case was investigated through off-site worker interviews at the end of February and management interviews at the end of March. Management is committed to improving productivity to reduce workers’ excessive overtime hours and they were open to workers’ opinions on the overtime hours. If workers are not willing to do overtime, they will be free to decline. Management additionally confirmed that wages were delayed last year because of an internal management problem.

Member companies should offer reasonable lead times and change production planning to low season where possible. The factory will work on improving productivity and efficiency by better production planning. The July 2017 verification audit report and CAP showed there were little improvements made.There are still issues of payments' delays and excessive overtime hours. During 2018 Brand Performance Check, the brand said they are shifting some of the production to another production since this factory still has overtime and delays issues.

Overview of the complaint investigation

2017-05-09 Investigation

FWF informed Haglofs and Kjus about the case. Haglofs and Kjus have contacted the supplier and asked for a reply within one week. The factory sent payslips as evidence which dates wages were paid to workers.

2017-05-09 Conclusion of the investigation

The case has been investigated by doing off site worker interviews end of February and management interviews end of March.
The factory was very transparent to share its working hour’s situation with the investigator. The general working hour’s situation at The factory is that workers work 11 hours a day for 5 to 6 days a week and have 4 days off in a month in normal season, In peak season, workers only have 2 days off per month. This is confirmed by observations of the off site worker interviewer end of February. Management is committed to improve the productivity to reduce workers’ excessive overtime hours and they were open to workers’ opinions on the overtime hours. If workers are not willing to do overtime, they will be free to decline. Factory management promised they will not punish workers who do not follow OT arrangements, and additionally will consult with workers on the overtime schedule to get approval beforehand.
With regard to the statutory holiday payment, The factory confirmed they paid workers the appropriate 200 RMB on top of the piece wage for workers’ OT for the mid-autumn festival.
Management additionally confirmed that wages have been delayed last year, because of an internal management problem. internal corruption case. This resulted in the managment team not able to accessing the system for automatic retrieval of wage data of Sept and Oct 2016. Therefore The factory management had to ask all workshop supervisors to make manual calculations of workers’ wages, which took more time.

2017-05-09 Remediation

Member companies should offer reasonable lead times and change production planning to low season where possible. They can ask the factory about available production capacity to take this into account when planning orders. The factory will works on improving productivity and efficiency by better production planning.

2017-05-09 Evaluation of the complaint

The complainant said that if the factory is able to make payments on time by the 22th from now on, and statutory holidays are paid per legal requirements, workers will be very happy.
They appreciated FWF’s support.

2018-06-13 Verification

July 2017 verification audit showed issues were still present in the factory. During 2018 Brand Performance Check, the brand said they are shifting some of the production to another production since this factory still has overtime and delays issues.

2018-06-13 Closed

This complaints is now closed.