Nudie Jeans Co., Complaint 188

CONCERNING LABOUR STANDARDS
Payment of a living wage Reasonable hours of work Safe and healthy working conditions
STATUS
Resolved
DATE
2016-10-27

The complainants claimed that all employees had to work overtime and that overtime payments were delayed for between one to four months. The complainants furthermore claimed that that bonus payments were also often delayed, the bathrooms are normally dirty, and that having migrant workers in the factory meant that a language barrier prevented many workers from expressing grievances internally.

Findings and conclusions

On 27 and 28 October 2016, Fair Wear Foundation (FWF) complaints handler in India received separate complaints from three workers employed by a factory. The complainants claimed that all employees had to work overtime but that overtime payments were delayed between one and four months.The complainants furthermore claimed that that bonus payments were also often delayed, the bathrooms are normally dirty, and that having migrant workers in the factory meant that a language barrier prevented many workers from expressing grievances internally. FWF declared the complaint admissible and informed Nudie Jeans, the FWF member brand sourcing at this factory. Nudie Jeans reached out to factory management and requested a response. A FWF audit was already planned in the factory for 24 and 25 November 2016, which was used as an opportunity to investigate further. FWF confirmed that all payments had been settled at the time of the audit. However, the audit could not confirm excessive overtime hours or forced overtime. While toilet facilities were clean during the audit, interviewed workers confirmed that they are generally not well kept. FWF was unable to verify whether the complainants resigned (as documents by the factory suggest) or whether they were dismissed and forced to sign a resignation letter (as claimed by the complainants). In terms of remediation, the factory needs to ensure that policies for all relevant procedures like bonus calculation, leave resignation etc. are clearly documented and communicated to workers in a language they can understand, and applied by staff according to Indian legislation. All payments must be paid on time at all times. The brand should clarify continuously whether the factory is able to do this. The factory should also set up a functioning communication and grievance channel that is also accessible to migrant workers. FWF verified that the individual complainants had received their pending payments and that all pending payments for other workers had been settled. Nudie Jeans asked FWF to facilitate mediation meetings between the workers and management. As a result of this process, management agreed to pay additional compensation to the workers in June 2017. FWF verified the receipt of this payment as well. This complaint has been resolved

Overview of the complaint investigation

2017-07-17 Investigation

FWF informed Nudie Jeans, the FWF member brand sourcing at this factory about the case. Nudie Jeans asked their supplier about a response to the complaint, which was forwarded to FWF.

As a FWF audit had already been planned an audit for 24 and 25 November, the audit was used as an opportunity to investigate further.

The names of the complainants were not disclosed to factory management, but FWF’s audit team verified the individual records relevant to the complaint.

After the audit, FWF called the complaints to confirm whether they had received all pending payments.

2017-07-17 Conclusion of the investigation

Based on the investigation, FWF concludes the following points:

- Delay of overtime payments: Factory management had confirmed that overtime payments had been delayed in recent months due to cash flow problems after the loss of a large client. FWF confirmed that all payments had been settled at the time of the audit. The audit could not confirm excessive overtime hours or forced overtime.

- Bonus payments: During the audit, FWF confirmed that all bonus payments were compliant with legal requirements, including the ones of the complainants. At the same time, bonus payments for the last year were not uniform and most workers were not sure how bonuses were calculated.

- Cleanliness of toilet facilities: While toilet facilities were clean during the audit, interviewed workers confirmed that they are generally not well kept.

- Grievance channels for migrant workers: The audit confirmed that most workers, but especially migrant workers, are not aware about factory policies and procedures like bonus and salary payments or leave and resignation policies. Management confirmed that they do not have staff that speaks the language of migrant workers in the factory, but felt that they had been managing well enough with Hindi.

- Relationship of HR department and workers: Management confirmed that there had been a shift of personnel in the factory. They denied that any staff would tell workers who approach them with grievances to leave the factory. The audit found that interviewed workers felt that the relation between the workers and HR and Welfare Officer had improved over the past couple of months.

- Dismissal of complainants: FWF was unable to verify whether the complainants resigned (as documents by the factory suggest) or whether they were dismissed and forced to sign a resignation letter (as claimed by the complainants). FWF did verify that they received a legally complaint full and final payment if it is assumed that they resigned. In case of dismissal, the factory would need to pay notice pay and retrenchment compensation. This was not included in the final payment.

2017-07-17 Remediation

The remediation points have been included in the corrective action plan of the audit.

The following points are specifically relevant:
- The factory needs to ensure that policies for all relevant procedures like bonus calculation, leave resignation etc. are clearly documented, communicated to workers in a language they can understand and applied by staff according to Indian legislation.

- All payments must be paid on time at all times. The brand should clarify
continuously whether the factory is able to do this.

- The factory should set up functioning communication and grievance channels that are also accessible to migrant workers.

- Management should meet with the complainants to agree on a compromise regarding the final payment. FWF can facilitate such a meeting on request.

2017-07-17 Verification

FWF verified that the individual complainants had received their pending payments and that all pending payments for other workers had been settled. Nudie Jeans asked FWF to facilitate mediation meetings between the workers and management. As a result of this process, management agreed to pay additional compensation to the workers in June 2017. FWF verified the receipt of this payment as well.

2017-07-17 Evaluation of the complaint

FWF was unable to reach all the complainants, but one of the complainants confirmed that he/she had received his/her payment and that the others had confirmed the same.

2017-07-17 Resolved

This complaint has been resolved.