Takko Holding GmbH, Complaint 560

Payment of a living wage Reasonable hours of work Legally binding employment relationship

A worker filed a complaint to Fair Wear on the 19 December 2018. The complainant complained that:
1) The factory refused to share the unit price with them, so they had no idea how much they could make in a month;
2) The factory always delayed their payments;
3) They were required to do excessive overtime hours; in total they worked 80 or more hours a week, 12 hours/day Mondays through Saturdays plus additional 8.5 hours on Sunday once every two weeks. They only had 2 days off in a month and worked consecutively for more than 7 days.

Overview of the complaint investigation

2019-01-02 Investigation

The brand reached out to the factory and the factory told us that the wage of October was indeed delayed some days due to the special period, but the factory had informed the workers about the reason for it before. Furthermore, factory had solved it and paid the salary to workers before the complaint was filed on 21.10.2018. Factory understood that this worker was unhappy with delayed payment of their wages and why they filed the complaint. Factory confirmed to pay more attention to it and to make sure that the problem would be avoided in the future.

For the other points, the factory stated that they follow FWF regulations. All unit prices are open and transparent to all the workers.

Takko checked the amount of working hours with the factory, but factory stated that they never ask the workers to work 12 hours per day. They stated that workers work no more than 10 hours per day and they have every Sunday off work.

2019-01-08 Conclusion of the investigation

The factory confirmed the late payment of wages for October 2018. However, the factory denied that the unit price was not clear to workers and that workers were asked to work excessive overtime hours. They claimed that the workers work no more than 10 hours per day and have every Sunday off.

After FWF reached out to the complainant, they were informed that indeed the salary of October 2018 was paid, but that according to the complainant nothing has improved in this factory so far.

2019-01-09 Remediation

FWF asked Takko to take urgent action and remediate. The following remediation activities were suggested:

1) Share the unit price with the workers before production starts
2) Immediately pay the salary of November 2018. All wages of December 2018 should be paid before the end of January 2019 (before Chinese New Year), which is in a couple of weeks, so these workers can celebrate New Year with their families.
3) Reduce overtime to start with giving all workers 1 day off a week. After that, steps should be taken to gradually reduce working time to 11 hours a day.

FWF requested the factory to send proof of the action taken.

2019-01-11 Verification

Takko asked the factory to remediate and received the following response:
1) Regarding the lack of clarity surrounding the piece price, which leads to the workers being unsure of how much money they can make in a month: The factory stated again that the unit price is open to workers. They stated that if the worker is unsatisfied with their salary to encourage them to come and check the details with the management. The payment is really open to everyone. It is unnecessary for the factory to cover the payment, because if the workers get the salary and it is not in accordance with what the factory told them before, they will not stay and work in the factory anymore.
2) The delayed payment of wages was not solved. Takko mentioned that, at this moment, the delayed payment of wages is the factory's biggest problem. Takko is waiting for the factory to confirm that the wages will be paid as soon as possible.
3) The complaint that workers are required to work excessive overtime hours: Again the factory told Takko that the workers work for 10 hours per day with an absolute maximum of 10.5 hours.

2019-03-12 Verification

FWF received an overview of the factory's payrolls of the last 6 months from Takko, on 5 February, which was Chinese New Year. After Chinese New Year FWF responded that the payroll showed most workers worked 10 hours for 6 days a week, which contradicted the complainant's statement, that they worked 12 hours/day for 6 to 7 days. It could not be verified that these payroll sheets were correct. Therefore, FWF suggested to verify the three points of the complaint during the planned audit in March 2019.

It was mentioned to Takko that factory transparency would help tremendously to resolve this complaint and improve the labour conditions in the factory step by step.

2019-03-21 Verification

During the FWF audit in March it was verified that since Chinese New Year 2019 workers have been paid on time.

However, issues concerning lack of awareness regarding calculation of wages and excessive overtime are yet to be addressed.