Worker Rights Consortium (WRC) For the Enforcement of University Licensing Codes of Conduct

An Alternative to Company-Controlled Monitoring

Colleges and universities across the United States have adopted Codes of Conduct to govern the conditions under which their licensed goods are produced. University students have been advocating for these codes as a first step to improving the labor conditions under which university-licensed goods are produced. While the terms of those Codes will continue to be debated, the method for enforcing Codes has itself become a center of debate and protest.

The Worker Rights Consortium has been developed by United Students Against Sweatshops in consultation with workers and human rights groups. The intent is to provide a system for enforcing Codes that is straightforward, practicable, consistent with the mission and role of universities, and likely to have the most widespread effect in changing the actual behavior of licensees and their subcontractors. Most importantly, we believe that coupled with strong Codes of Conduct, this enforcement process will be most likely to benefit workers.



Key Principles

1. It is the responsibility of the licensee to ensure that workers are not exploited.

1.

Sweatshops are proliferating and the living standards of workers declining because the abuse of cheap labor is a competitive strategy of many companies in the industry. Reversing this trend requires that licensees themselves make dramatic changes in how they produce (or "source") their products.


2.
It is the University's role to define expected standards for treatment of workers and to hold licensees accountable. The test of the system is what happens to real workers in real factories.

Universities are responsible for enforcing contract provisions that require decent working conditions in factories producing their licensed products. Companies must develop their own internal process to comply with these provisions. The university's role should be limited to requiring outcomes: the decent working conditions mandated by their Codes of Conduct. As the verifier of compliance, the University should not have a stake in company-controlled monitoring, through its participation or endorsement.


3.
Information is critical to uncovering problems, evaluating violations of the Code, and verifying that improvements have been made.

Sweatshops flourish when they are hidden. Greater transparency is a core requirement of an effective verification system. Companies that are required to reveal their contractors will have greater incentive to assure that these contractors abide by the university principles.

Moreover, information gathered should be made available to workers and worker-allied groups in the producing regions, serving as an additional check on company-reported data.


4.
Enforcement should be based on citing companies for violations – and using the licensing agreement to hold the licensee accountable for such violations. The University should never be in the role of certifying "good" companies.

Given that there are tens of thousands of garment factories nestled in dozens and dozens of countries, it is impossible for the University to know with certainty that all factories are complying with conditions set by the Code. Experience has shown that factories are often "cleaned up" for short periods of time, but then return to significantly violating the Code. One-time investigations often just cover up poor working conditions. Hence, certifying "compliance" of an entire corporation or factory is ultimately impossible and only extends the probability that the name of the University will be lent to companies that are still be profiting off of abusive working conditions.


5.
Limited university funds can improve working conditions if channeled to bring the experiences of workers to the public. These resources must be managed completely independently of the licensees and the economic activity surrounding collegiate licensing, and by people whose clear mission is to be responsive to the concerns of workers.

There is a need for "responsive" investigations of alleged workplace abuses, so that workers and their allies have a way to substantiate claims of abuse. University decision-makers similarly need a way to verify workers’ complaints so that they can take action to enforce the licensing agreement.

Furthermore, there is a need for "pro-active" investigations, to shine the spotlight on workplaces in countries that suppress worker organization, and to do further fact-finding about the workplaces of licensees that have demonstrated patterns of violations.

The combination of maximum public information, and limited but completely independent investigations provides a powerful incentive to licensees to make systemic changes in how they source their products.


6.
When abusive conditions at a particular worksite are exposed to public view, the licensee company has an obligation to use its leverage to correct conditions – and not to "cut and run" from that site.

Failure to abide by this principle should be seen by Universities as a serious violation. Otherwise, there would be a perverse incentive for workers not to report conditions.


7.
Misreporting of factory locations and conditions by the licensees is a serious offense that undermines the possibility of enforcement.


8.
Verification procedures must be continually reevaluated.

Due to the highly varied and constantly developing situations in apparel-producing regions across the world, verification methods must be flexible and responsive. The Worker Rights Consortium will work to develop and revise its programs in consultation with workers, human rights groups, and other interests, including apparel-producing companies.



Worker Rights Consortium Verification Model

The three primary components of Worker Rights Consortium verification are: public disclosure, spot investigatory capacity, and the use of the licensing agreement as leverage.

1. Broad Public Disclosure, Self-Reported By Industry
As part of the licensing agreement, the University will require:

1. An affidavit by the licensee stating that all facilities producing goods for use under the licensing agreement comply with a strict Code of Conduct. The Code must include such provisions as a living wage, the right to organize and collective bargaining, protecting workers’ health and safety, compliance with local laws, protection of women’s rights, and prohibitions of child labor, forced labor, and forced overtime.

1.
Full public disclosure of the site locations of all facilities, including those run by contractors or subcontractors. Upon joining the Consortium, member colleges and universities that do not already require public disclosure of factory locations must notify their licensees that this information must be provided within three months.

2.
Full public disclosure of all objective measures of working conditions covered by the Code at these facilities, such as wage levels, benefits provided, scheduled and average work hours, policies, citations, etc.

3.
The failure to report or reporting false information will be grounds for a range of possible sanctions, including eventual termination of the licensing agreement.

4.
Access to relevant company records and the worksite shall be made available when requested for the purposes of a focused investigation on a worksite or sites.

Anticipated Impacts

From this system, a large amount of public, self-reported industry information will be generated. The following effects are anticipated:
* Licensees will have to adopt comprehensive management systems to regulate labor practices across their supply chains.

*
Licensees that genuinely have nothing to hide will be able to report conditions without embarrassment or repercussions. Licensees that fail to report or misreport will be vulnerable to pressure, public exposure, and economic penalties.

*
To a certain extent, the competitive pressure to slash labor standards will be reversed. In the long run, companies will be in a position to compete based on a public record of high labor standards, consistent with University Codes of Conduct.

The Consortium will play the role of sorting, tabulating and publicizing the reported information. The broad public disclosure of information allows stakeholders to compare firms and specifically utilizes public awareness of company practices to create incentives for improvements


1.
University resources devoted to truly independent investigations.

Instead of attempting to create a comprehensive monitoring regime in order to certify companies, the Worker Rights Consortium will use limited but carefully targeted investigatory resources to hold companies accountable. Comprehensive monitoring is ultimately a management tool for companies to use. Independent investigations, conducted on a spot-check basis, are nevertheless important because they put teeth into the licensing agreement and accountability into the relationship with licensees.

Coupled with broad-based public disclosure, spot investigations force each licensee to recognize that any plant located around the world can bring negative exposure at any time. Furthermore, a licensee that has been found to have factories with violations will feel even more pressure, since additional exposures will demonstrate a pattern of abuse and jeopardize the licensee’s relationship with universities.

Member colleges and universities will fund the Consortium with a percentage of licensing revenue. For a college or university that collects royalties from a licensing program, initial dues shall be 1% of its previous year's licensing revenues (but in no case less than $1,000 and with each year's dues payment capped at $50,000 for any individual college or university). For a college or university that does not collect royalties from a licensing program, annual dues shall be $1,000. These dues provisions will be reevaluated once the costs of running the Consortium become clearer.

The investigatory agency of the Worker Rights Consortium will operate on the following principles:
* The investigatory agency has full control over investigations. Licensees and representative of the industry have no influence over this process. Furthermore, the University’s licensing offices, which are vested in the business end of the process, will have an arm’s length relationship with the investigatory agency. Constituencies within the college and university community – administration, faculty, and students – will have influence over the investigatory agency.

*
The professional staff of the Consortium will (1) support and encourage workers in their efforts to improve conditions, and (2) maintain absolute integrity and truthfulness throughout the investigation process.

*
Investigations will be based on healthy relationships with workers. Even under the best circumstances, workers are unlikely to report violations by their bosses while in the workplace. Therefore, the agency will work with worker-allied groups—local NGOs, unions, and other organizations with knowledge of working conditions and established relationships with workers—and demonstrate commitment to the needs and sensitivities of workers in a given situation.

Because the methodology proposed is spot investigations rather than comprehensive monitoring, it will be possible to establish this system with comparatively little resources.

University resources for investigations shall be used in the following ways:
1. To verify worker complaints

One role for the investigatory agency is to verify complaints when they surface. In the debate on campuses, this has been referred to as the "fire alarm" method for triggering inspections: workers are empowered to pull the alarm, signaling to the agency and the public that a violation has occurred. The agency is then responsible for verifying the complaint. Both verification and pro-active inspections must include both on-site inspections and off-site worker interviews.


1.
To proactively investigate conditions.

Additional resources will go into unannounced spot investigations at the places most at risk: countries and regions that suppress workers’ rights, and companies with a pattern of violation. Again, the power of these investigations is that the licensees are expected to comprehensively change their labor and sourcing practices to ensure compliance – any violation is evidence of negligence or worse on the part of the licensee.


2.
To act as a watchdog once abusive conditions have been exposed.

Once violations at a site have been confirmed, the pressure on the licensee will be to improve conditions, rather than to shut down factories where violations have been found. Otherwise, there would be an incentive for workers not to report abusive conditions. Licensees will not be allowed to distance themselves from violations by claiming that fault lies with a subcontractor—instead, licensees are fully responsible for all factories producing their products. The Consortium will also play the critical role of keeping the spotlight on the licensee’s response to exposure of bad practices at specific sites. The Consortium will require reporting of remediation steps, will conduct further inspections, and will evaluate whether or not a company has adequately remediated identified violations.


3.
To catalyze research relevant to improving working conditions.

We recognize that there are many outstanding questions that require further research. It is the unique role of Universities to be centers of inquiry, and therefore one additional role of the Consortium is to promote research activities into questions such as setting living wages, methods for investigating workplaces, etc.


4.
To work in partnership with indigenous worker-allied groups when carrying out investigations and research initiatives, and to help build their capacity to further participate in and direct the process.

The Worker Rights Consortium does not aim to set up a permanent system of factory policing, contributing to the privatization of national labor law enforcement. Rather, the Consortium aims to build capacity and open up the space for workers and their allies to advocate on their own behalf. The Consortium will engage in efforts to educate workers about their own rights and consistently partner with local worker-allied groups for investigations. The scope of such educational efforts and the mechanisms by which workers will file complaints are still issues being debated by organizations in producing regions. These efforts will need to be responsive to the political dynamics specific to each area. They will be developed, reexamined, and revised based upon further consultation with worker-allied groups and practical experience.


2.
Penalties, including termination, under the licensing agreement.

Currently, the Worker Rights Consortium does not mandate specific penalties to be applied to licensees that are in violation of Codes of Conduct. Instead, it is left to the individual college or university to determine a plan of recourse. However, the Consortium will establish a system of guidelines for such penalties with which to advise participating universities that wish to impose sanctions in response to violations. Failure to disclose required information, along with Code violations, will instigate the recommendation of sanctions.

It must be noted that the ultimate penalty is termination of the licensing agreement when a pattern of violations is shown. It is likely there will be clear cases of such patterns, and termination of contract with specific licensees will motivate the rest of the industry to improve. Termination is not a first step in response to violations, but must be one that universities are willing to take.


Worker Rights Consortium Implementation Process

An Advisory Council is currently being assembled, consisting of representatives who have significant expertise in the issues surrounding worker abuses in the apparel industry and independent verification of labor standards in apparel factories. In the effort to end sweatshop abuses, the Advisory Council will serve as a mechanism for key actors to examine the many unresolved issues surrounding independent verification. The Advisory Council will also be charged with providing overall guidance to the investigatory agency and helping to establish the governing board.

A 12-person Governing Board will work toward implementing a system for discovering and disseminating information about factory compliance with the Codes of Conduct, based on these principles and taking direction from the Advisory Council. The Governing Board will be comprised of 3 students selected by the United Students Against Sweatshops, 3 university administrators chosen from among the participating colleges and universities, and 6 representatives from the advisory board.

The process will begin by establishing pilot projects in various regions, based on the model outlined in this document. These projects will inform further development of the Worker Rights Consortium. Of primary importance in the first stage will be gathering information from licensees about which factories are making university apparel.


Conclusion

The Worker Rights Consortium is a conceptual and practical alternative to industry-controlled monitoring organizations. United Students Against Sweatshops is convinced that, no matter how well-intentioned these organizations may be, their effect will be to relieve the pressure to clean up the industry, to cover up abuses, and to lend the credibility of a University’s name to the very companies that have created the global sweatshop system.

The Worker Rights Consortium outlined above is less grandiose, but significantly more potent. A critical mass of college and university members will create enough leverage to dictate the terms of the licensing agreements to the industry and implement tough Codes and a powerful enforcement process fully and quickly.

The Worker Rights Consortium is a way for universities to at once protect their good names and their licensing business, while catalyzing change in this industry on behalf of the workers who toil to sew t-shirts and glue together sneakers.



Appendix: Worker Rights Consortium Code of Conduct

The Worker Rights Consortium will use this Code of Conduct as the basis for its investigations into fair treatment in licensees’ factories. Universities may adopt this Code as the standard that it will require of its licensees.


1. Introduction: The Universities participating in the Workers’ Rights Consortium are each committed to conducting their business affairs in a socially responsible and ethical manner consistent with their respective educational, research and/or service missions, and to protecting and preserving the global environment. While the Consortium and the Member Institutions believe that Licensees share this commitment, the Consortium and the Member Institutions have adopted the following Code of Conduct (the "Code") which requires that all Licensees, at a minimum, adhere to the principles set forth in the Code.

1.

Throughout the Code the term "Licensee" shall include all persons or entities which have entered into a written "License Agreement" with the University manufacture "Licensed Articles" (as that term is defined in the License Agreement) bearing the names, trademarks and/or images of one or more Member Institutions. The term "Licensee" shall for purposes of the Code, and unless otherwise specified in the Code, encompass all of Licensees' contractors, subcontractors or manufacturers which produce, assemble or package finished Licensed Articles for the consumer.


2.
Notice: The principles set forth in the Code shall apply to all Licensees. As a condition of being permitted to produce and/or sell Licensed Articles, Licensees must comply with the Code. Licensees are required to adhere to the Code within six (6) months of notification of the Code and as required in applicable license agreements.


3.
Standards: Licensees agree to operate work places and contract with companies whose work places adhere to the standards and practices described below. The University prefers that Licensees exceed these standards.

1. Legal Compliance: Licensees must comply with all applicable legal requirements of the country(ies) of manufacture in conducting business related to or involving the production or sale of Licensed Articles. Where there are differences or conflicts with the Code and the laws of the country(ies) of manufacture, the higher standard shall prevail, subject to the considerations stated in Section VI.


1.
Employment Standards: Licensees shall comply with the following standards:

1. Wages and Benefits: Licensees recognize that wages are essential to meeting employees' basic needs. Licensees shall pay employees, as a floor, wages and benefits which comply with all applicable laws and regulations, and which provide for essential needs and establish a dignified living wage for workers and their families. A living wage is a "take home" or "net" wage, earned during a country’s legal maximum work week, but not more than 48 hours. A living wage provides for the basic needs (housing, energy, nutrition, clothing, health care, education, potable water, childcare, transportation and savings) of an average family unit of employees in the garment manufacturing employment sector of the country divided by the average number of adult wage earners in the family unit of employees in the garment manufacturing employment sector of the country.

1.
Working Hours: Hourly and/or quota-based wage employees shall (i) not be required to work more than the lesser of (a) 48 hours per week or (b) the limits on regular hours allowed by the law of the country of manufacture, and (ii) be entitled to at least one day off in every seven day period, as well as holidays and vacations.

2.
Overtime Compensation: All overtime hours must be worked voluntarily by employees. In addition to their compensation for regular hours of work, hourly and/or quota-based wage employees shall be compensated for overtime hours at such a premium rate as is legally required in the country of manufacture or, in those countries where such laws do not exist, at a rate at least one and one-half their regular hourly compensation rate.

3.
Child Labor: Licensees shall not employ any person at an age younger than 15 (or 14, where, consistent with International Labor Organization practices for developing countries, the law of the country of manufacture allows such exception). Where the age for completing compulsory education is higher than the standard for the minimum age of employment stated above, the higher age for completing compulsory education shall apply to this section. Licensees agree to consult with governmental, human rights and nongovernmental organizations, and to take reasonable steps as evaluated by the University to minimize the negative impact on children released from employment as a result of implementation or enforcement of the Code.

4.
Forced Labor: There shall not be any use of forced prison labor, indentured labor, bonded labor or other forced labor.

5.
Health and Safety: Licensees shall provide a safe and healthy working environment to prevent accidents and injury to health arising out of, linked with, or occurring in the course of work or as a result of the operation of Licensee facilities. In addition, Licensees must comply with the following provisions:

1. The Licensee shall ensure that is direct operations and any subcontractors comply with all workplace safety and health regulations established by the national government where the production facility is located, or with Title 29 CFR of the Federal Code of Regulations, enforced by Federal OSHA (Occupational Safety and Health Administration), whichever regulation is more health protective for a given hazard.

1.
The Licensee shall ensure that its direct operations and any subcontractors comply with all health and safety conventions of the International Labor Organization (ILO) ratified and adopted by the country in which the production facility is located.

6.
Nondiscrimination: No person shall be subject to any discrimination in employment, including hiring, salary, benefits, advancement, discipline, termination or retirement, on the basis of gender, race, religion, age, disability, ***ual orientation, nationality, political opinion, or social or ethnic origin.

7.
Harassment or Abuse: Every employee shall be treated with dignity and respect. No employee shall be subject to any physical, ***ual, psychological or verbal harassment or abuse. Licensees with not use or tolerate any form of corporal punishment.

8.
Freedom of Association and Collective Bargaining: Licensees shall recognize and respect the right of employees to freedom of association and collective bargaining. No employee shall be subject to harassment, intimidation or retaliation in their efforts to freely associate or bargain collectively. Licensees shall not cooperate with governmental agencies and other organizations that use the power of the State to prevent workers from organizing a union of their choice. Licensees shall allow union organizers free access to employees. Licensees shall recognize the union of the employees’ choice.

9.
Women’s Rights:

1. Women workers will receive equal remuneration, including benefits, equal treatment, equal evaluation of the quality of their work, and equal opportunity to fill all positions as male workers.

1.
Pregnancy tests will not be a condition of employment, nor will they be demanded of employees.

2.
Workers who take maternity leave will not face dismissal nor threat of dismissal, loss of seniority or deduction of wages, and will be able to return to their former employment at the same rate of pay and benefits.

3.
Workers will not be forced or pressured to use contraception.

4.
Workers will not be exposed to hazards, including glues and solvents, that may endanger their safety, including their reproductive health.

5.
Licensees shall provide appropriate services and accommodation to women workers in connection with pregnancy.


4.
Compliance and Disclosure: Licensees (for themselves and on behalf of their contractors, subcontractors or manufacturers) shall disclose to the Worker Rights Consortium, the University, and the public the information set forth in Sections A, B and C below.

5.
upon execution and renewal of the License Agreement and upon the selection of any new manufacturing facility which produces Licensed Articles, the company names, contacts, addresses, phone numbers, e-mail addresses and nature of the business association for all such facilities which produce Licensed Articles;

6.
at least sixty (60) days prior to the end of each contract year of the License Agreement, written assurance that (i) Licensees are in compliance with the Code and/or (ii) licensees are taking reasonable steps to remedy non-compliance in facilities found not to be in compliance with the code;

7.
at least sixty (60) days prior to the end of each contract year of the License Agreement, a summary of those steps taken to remedy material violations, and/or difficulties encountered, during the preceding year in implementing and enforcing the Code at all of Licensees' facilities which produce Licensed Articles.

1. Verification: It shall be the responsibility of Licensees (for themselves and on behalf of their contractors, subcontractors or manufactures) to ensure their compliance with the Code. The Worker Rights Consortium and its Member Institutions will undertake efforts to determine and clearly define the obligations associated with the development of adequate methods and training for independent external monitoring, as guided by the principles in the founding document of the Consortium.

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Labor Standards Environment: In countries where law or practice conflicts with these labor standards, Licensees agree to consult with governmental, human rights, labor and business organizations and to take effective actions as evaluated by the University to achieve full compliance with each of these standards. Licensees further agree to refrain from any actions that would diminish the protections of these labor standards. In addition to all other rights under the Licensing Agreement, the University reserves the right to refuse renewal of Licensing Agreements for goods made in countries where: (a) progress toward implementation of the employment standards in the Code is no longer being made; and (b) compliance with the employment standards in the Code is deemed impossible. The University shall make such determinations based upon examination of reports from governmental, human rights, labor and business organizations and after consultation with the relevant Licensees.

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Remediation: Remedies herein apply to violations which occur after the Effective Date of the Code. If a Licensee has failed to self-correct a violation of the Code the University will consult with the Licensee (for itself and on behalf of its contractors, subcontractors or manufacturers) to determine appropriate corrective action. The remedy will, at a minimum, include requiring the licensee to take all steps necessary to correct such violations including, without limitation, paying all applicable back wages found due to workers who manufactured the licensed articles, and reinstatement of any worker found to have been unlawfully dismissed. If agreement on corrective action is not reached, and/or the action does not result in correction of the violation within a specified reasonable time period, the University reserves the right to (i) require that the Licensee terminate its relationship with any contractor, subcontractor or manufacturer that continues to conduct its business in violation of the Code and/or (ii) terminate its relationship with any Licensee that continues to conduct its business in violation of the Code. In either event, the University will provide the Licensee with thirty (30) days written notice of termination. In order to ensure the reasonable and consistent application of this provision, the University will seek advice from the Worker Rights Consortium regarding possible corrective measures and invocation of options (i) and (ii) above.