Social Accountability

1. SA8000
Social Accountability

2. Course Objective
 Detail overview of SA 8000 standard
 To understand Social impact on the workplace
and “Globalization” trend
 Define the stakeholders for SA8000
 Interpret the intention of SA8000 elements
 Assess compliance with SA 8000 standard
through evaluation of case studies
 Recognize type of Objective Evidence
 To learn the role of NGO and 3rd parties

3. Course Modules
 Lecture
 Pre-Class reading and Discussion
 Interactive exercises on case studies
 SA 8000 audit role plays

4. Who is SAI
 Previous Named “CEPAA” (Council on Economic Priorities
Accreditation Agency)
 Established in May, 1997
 Monitors ongoing compliance of SA certification bodies
and their documented procedures
 Maintains list of accredited certification bodies available
to the public
 Review and resolve complaints against the auditors
and/or certification bodies

5. Structure
SAI
Registrar Registrar
Registrar

6. SA 8000 Scope
 Initial Focused on FTC (manufacturing)
 SA 8000 now applied for Agricultural industry
and Homeworker
 Certification based on scope definition
 Registrar must approve scope

7. SA 8000 Mission
 Improve working conditions globally
 Provide universal standard in all business and country
sectors
 Work in parallel with human rights and labor
organizations worldwide
 Provide incentive which benefits the business and
consumer community though a win/win approach

8. SA 8000 Basic Principles
 Senior Management led
 Aimed at continuous improvement
 Focused on preventive rather than
reaction
 In support of ILO conventions
 Declaration of human rights
 Rights of the child
 Promote ethical sourcing practices

9. Stakeholders
Unions
NGOs
Human Right
Groups
Certifying Bodies
Governments
Brokers
Consumers
Supply Chain
Multinationals
shareholders
Workers

10. Type of Assessment
 1st Party – Internal (self-reporting)
 2nd Party – Assessed by purchaser
(customer)
 3rd Party – Assessed by external body
(Registrar) with no vested interest

11. Corrective Action
 3 Categories of Audit Finding
 Major - Systemic Violation
 Minor - Oversight or non-systemic problem
 Observation – non mandatory (opportunity for
improvement)
 Recommendation for registration:
 No recommendation with a major finding
 Multiple Minor may be acceptable
 Focused on continued improvement

12. Standard Definition
 Company
 Supplier
 Subcontractor
 Remedial action
 Corrective action
 Interested 3rd Party
 Child
 Young worker
 Child Labor
 Forced Labor
 Remediation of
children
 NGO

13. Definition
 Child : Any person less than 15 years of age, unless local
minimum age law stipulates a higher age for work or mandatory
schooling, in which case the higher age would apply. If, however,
local minimum age law is set at 14 years of age in accordance with
developing-country exceptions under ILO Convention 138, the lower
age will apply.
 Young Worker : Any worker over the age of a child as defined
above and under the age of 18.
 Child Labour : Any work by a child younger than the age(s)
specified in the above definition of a child, except as provided for by
ILO Recommendation 146.

14. Definition
 Forced Labour : All work or service that is extracted
from any person under the menace of any penalty for which
said person has not offered him/herself voluntarily or for which
such work or service is demanded as a means of repayment
of debt.
 Remediation of Children: All necessary support and
actions to ensure the safety, health, education, and
development of children who have been subjected to child
labour, as defined above, and are dismissed.

15. Definition
 Homeworker : A person who carries out work for
a company under direct or indirect contract, other
than on a company’s premises, for remuneration,
which results in the provision of a product or service
as specified by the employer, irrespective of who
supplies the equipment, materials or other inputs
used

16. SA8000 Standard Requirement
 Child Labour
 Forced Labour
 Health and Safety
 Freedom of Association
 Discrimination
 Disciplinary Practices
 Working Hours
 Remuneration
 Management System

17. 1. Child Labor
 The Company
 shall not engage in or support the use of child labour
as defined above
 shall document and effectively communicate to
personnel and other interested parties policies and
procedures for remediation of children found to be
working in situations which fit the definition of child
labour above,
 shall provide adequate support to enable such
children to attend and remain in school until no
longer a child as defined above

18.  document, and effectively communicate to personnel and
interested parties policies & procedures for promotion of
education for children covered under ILO
Recommendation 146 and young workers who are
subject to local compulsory education laws or are
attending school, including means to ensure that
no such child or young worker is employed during school hours
combined hours of daily transportation (to and from and school),
school, and work time does not exceed 10 hours a day.
 shall not expose children or young workers to unsafe, or
unhealthy condition.
1. Child Labor

19. Objective Evidence
 Birth certificate/ passport / local record
 Company ID (showing picture and age)
 Report from certified health practitioner
 Governmental records
 National Statistic charts
 Information from Local NGOs
 Work site activities
 Posture, hands and behavior of child

20. Potential Industry Solutions
 If Children need to work, minimize risk to child from
chemicals, toxins, and excessive hours
 Assure adequate schooling and day care facilities
 Provide stipend, if child dismissed, to child to lessen
financial impact on family
 Provide training and employment for family members
 Work with local government and NGOs to set up long
term cooperative solution

21. 2. Forced Labor
 The company shall not engage in or
support the use of forced labour, nor shall
personnel be required to lodge ‘deposits’
or identity papers upon commencing
employment with the company.

22. Objective Evidence
 Security Guard contract matches service
 NGO information
 Record of Deposit Lodged
 No use of force evident at work site
 Workers free to come and go
 Interview with workers
 Worker reaction to guards
 Marks or bruises evident on workers

23. 3. Health and Safety
The company shall
3.1 provide a safe and healthy working environment and shall take
adequate steps to prevent accidents and injury to health arising out
of, associated with or occurring in the course of work
3.2 appoint a senior management representative responsible for
implementation of the Health and Safety elements of this standard.
3.3 ensure that all personnel receive regular and recorded health and
safety training, and that such training is repeated for new and
reassigned personnel.

24. 3.4 establish method to detect, avoid or respond to
potential threats to the health and safety of all
personnel.
3.5 provide, for use by all personnel, clean bathrooms,
access to potable water, and, if appropriate, sanitary
facilities for food storage.
3.6 if provided for personnel, dormitory facilities are
clean, safe, and meet the basic needs of the
personnel.
3. Health and Safety

25. Objective Evidence
 Blocked/Fire Exit
 Water Supply access
 Bathroom Clean and
adequate
 Food Storage
 Toxic Chemicals
 Protective Gear
 Worker Appearance
 Dormitory Facilities
 Ambient temperature
 Adequate Lighting
 Eating Facilities Clean
 Input from interviews
 Training programs
 First aid availability

26. 4. Freedom of Association
 The company shall
 respect the right of all personnel to form and join trade unions
of their choice and to bargain collectively.
 if collective bargaining are restricted under law, the company
must facilitate parallel means of independent and free
association and bargaining for all such personnel.
 ensure that representatives of such personnel are not the
subject of discrimination and that such representatives have
access to their members in the workplace.

27. Objective Evidence
 Review records of payments of workers who resigned
for “severance payments”
 Seek patterns of piece rate changed to reward or
punish production “lines”
 Seek any evidence of shift changes or other work
assignment changes which may punish worker.
 Look for differing treatment between union and non-
union workers
 Look for radical drops in regular income

28. 5. Discrimination
 The company shall
 not engage in or support discrimination :
 in hiring, remuneration, access to training, promotion,
termination or retirement based on race, caste, national
origin, religion, disability, gender, sexual orientation, union
membership, political affiliation, or age.
 Pregnancy testing in Mexico in Maquiladoras, Caste system
 not interfere with the exercise of the rights of personnel to
observe tenets or practices, e.g., national origin, religion beliefs,
union membership, or political affiliation.
 No form of worker harassment will be allowed or supported.

29. Objective Evidence
 Site Observations in production and rest
areas
 Procedures designed to prevent violations are
in place, known and supported by company
 Designated MR empowered to enforce
policies at the work site
 Wage records show pay discrepancies not
due to training and tenure issues
 Testimony of workers and/or NGOs

30. SA 8000 vs. Culture
 Some societies allow discriminatory
practices as part of culture
 Separate plant facilities for women. May be
acceptable if payments are equal to those of
men in same work field.
 Social differences (dress requirements) which
don’t violate fundamental human rights.

31. 6. Disciplinary Practices
 The company shall
 not engage in or support the use of corporal
punishment, mental or physical coercion, and
verbal abuse
 Evidence for reduced wages for sickness or
failure to meet quotas
 Unexplained pay reductions
 Signs of physical abuse
 Threats of dismissal or personal harm
 Interview off site

32. 7. Working Hours
 48 HOURS PER WEEK OR LOWER IF APPLICABLE UNDER
NATIONAL LAW
 Personnel shall be provided with at least 1 day off in every 7 day
period.
 All overtime work shall be reimbursed at a premium rate and
under no circumstances shall exceed 12 hours per employee per
week
 overtime work shall be voluntary and SHALL NOT BE
DEMANDED REGULARLY

33. Auditor Issues
 What constitutes exceptional short term
circumstances ?
 Is overtime voluntary or is there a threat of job
termination…?
 Are the wage records valid and accurate ?
 Do the production schedules and number of
machines agree with the pay records?
 Calculation of total production divided by workers
may be helpful in assessing need for overtime
 Is there evidence that work is being done at home to
avoid overtime restriction..?

34. 8. Remuneration
 The company shall
 ensure that wages paid for a standard working week meet at
least legal or industry minimum standards and shall be
sufficient to meet basic needs of personnel and to provide
some discretionary income.
 ensure that deductions from wages are not made for
disciplinary purposes
 ensure that wage and benefits composition are detailed
clearly and regularly for workers;

35. 8. Remuneration
 The company shall
 ensure that wages and benefits are rendered in full
compliance with all applicable laws and that
remuneration is rendered either in cash or check
form, in a manner convenient to workers.
 ensure that labour-only contracting arrangements
and false apprenticeship schemes are not
undertaken in an effort to avoid fulfilling its
obligations to personnel under applicable laws
pertaining to labor and social security legislation and
regulations.

36. Quota System
 Quota System should allow attainment of minimum
wage/industry norm
 100% of quota should equal at least minimum
wage/industry norm
 Separate sheet must be maintained to record both
piece rate and hours worked
 Overtime hours paid at premium rate

37. Wage should be sufficient to meet basic
needs and provide discretionary income
 Market basket survey (cost of food basket)
 Determine minimum wages/industry wage
norm
 Review records of average family size
 Consult NGOs
 Method of Payment
 Wage test of “reasonableness”
Remuneration

38. Remuneration Checklist
 Wages
 Understandable to workers
 Convenient for workers
 Cash or check form
 Frequency and method of payment
 Deductions are legitimate and accurate
 False schemes to avoid proper payment

39. Basic needs formula
 Determine basic food basket required to maintain an
adequate diet.
 2,100 calories per day (WHO)
 Local government standards
 Determine percent family income on food
 Determine mean number of family members for
formula calculation
 Source of Data Verification :
 Offices of WHO
 Desk Study of prices from country’s Ministry of Labor
 Data from ILO and World Bank
 Data confirmation from local unions and NGOs
 Annual stats published by ILO on food prices.

40. Determine Basic needs wage
 Obtain cost of market basket.
 Source : World Bank Poverty Assessments
Adjust for annual inflation
 Food component of Basket should be at least
2,100 calories per person
 Determined the average family sizes
 Source : UNDP; U.N. habitat; WB Poverty
Assess
 Add 10 % for discretionary income

41. Calculate Basic needs Wage
 Apply the formula :
 Cost of market basket X average family size X
110% (adjust if more than one income earner)
 Apply for different sub-regions:
 Economic or geographic sub-regions
 Urban or rural; and/or metropolitan area
 Adjust for inflation
 Adjust for single parent

42. Cross checking wage calculation
 Consult with NGOs and Unions
 Any dispute with the wage calculation should
be substantiated with analysis or alternative
data sources
 Cross-check Full compliance with SA
8000
 Where free association and collective
bargaining are effective, unions may be able to
verify that the wage meets basic needs.

43. Management Systems
 SA 8000 policy
 Management Review
 Company Reps
 Planning &
Implementation
 Control of Suppliers
 Corrective Actions
 Outside
Communication
 Access for
Verification
 Records Retention

44.  MANAGEMENT SYSTEMS TO PROVIDE :
 Policy and its Commitment
 Is publicly available
 Commitment to continual improvement
 Communicate to all personnel
 Management Review
 Company Representative (MR)
 Health and Safety Representative can be MR also
 Worker Representative (non-management level)
Management Systems

45.  MANAGEMENT SYSTEMS TO PROVIDE
 Planning and Implementation
 Clear definition of roles, responsibilities and authority
 Training of new and/or temporary employees upon
hiring
 Periodic training and awareness programs for existing
employees
 Continuous monitoring activities to the effectiveness
of system implementation
Management Systems

46.  MANAGEMENT SYSTEMS TO PROVIDE
 Control of Supplier/Subcontractors and Sub Supplier
 Evaluate and Select Suppliers who can meet the
requirement of the standard
 Maintain the appropriate record of Supplier/ Subcontractors
and Sub-Supplier commitment to the social accountability
 Including Homeworkers
 Addressing Concerns and Taking Corrective Action
 Remedial Action
Management Systems

47.  MANAGEMENT SYSTEMS TO PROVIDE
 Outside Communication
 Has a procedure for communicate regularly to all
interested parties data and other information
regarding performance against the requirements,
include management review and internal audit
results
 Access for Verification
 Records
Management Systems

48. Common Abuses
 Boot camp regimen
 Arbitrary fines
 Pay deductions
 No pay stubs
 Piece work rate
conversion
 Bathroom use
restriction
 Apprentice schemes
 No protection gear
 No safety instruction
 “Casualisation”
 Pregnancy firing
 “Old age” firing
 Required overtime

49. Certification Status
 Certification Process
 Certification Status
 Over all around 259 Companies
Certified as of 15th August 2003
 Brazil, Italy, China, and India are the
countries where sizable units are
certified

50.  Certification Process
 Set up of Systems
 Consultants are available for helping
companies setting up a system.
Complete freedom available to
companies to document the system.
Nothing specified in the standards
Certification Process

51.  Companies could choose to set up its own
systems if it has qualified personnel
 Auditing Process
 Auditing and Certification is done by
Certification Bodies accredited by SAI, USA
Certification Process

52. Audit Planning
 Auditor Selection
 Local Culture
 Language/dialect
 Gender diversity
 Critical data
gathering/laws and
statistics
 Subject matter expert
 Pre-Audit required
 Planning of worker
interviews
 Assurance of worker
anonymity
 Selection of NGOs
 Audit on pay day

53.  Auditing Activity
 Documented System of the company is
reviewed before the audit
 Pre Audit can be availed if the company
needs a pre- assessment before
Certification audit
 Certification Audit carried out
Audit Process

54. Pre-Audit Meetings
 Lead auditor conducted Pre-assessment
 Arrange interview with NGOs, or Unions
 Discussion with NGO’s and getting information on the
factory being audited specially any particular problem
 Obtain input on elements, concentrating on those
which are most applicable
 Determine audit team requirements
 Plan Audit schedule
 Consolidate wage, food data.

55.  Auditors
 Auditors have to undergo training from
SAI
 Need to qualify thereafter as auditors
 Each Certification body has its own
rules for qualification
Auditor Qualification

56.  SA 8000 Audit teams
 Audit Team has to be well balanced to
meet the following requirements
 Male/Female auditors based on gender
distribution in the work force
 Ability to speak the language spoken by
the workers
Audit team Selection

57.  Competence in Labour Laws applicable
to the site
 Competence in handling worker
interviews
Audit team Selection

58. Information needed by auditors
 Applicable Laws
 Political Situation
 Union Situation
 Food costs (market basket)
 Average family size for country
 Local NGOs
 Industry Profile
 Chronic industry problems

59. NGO Selection
 United Nation Agencies
 ILO, UNDP, UNICEF, UNIDO
 Local NGO offices
 Save the children
 Oxfam
 American friends service
 World bank
 Regional Development Banks

60. Worker Interview
 Anonymity critical for accurate response
 Group of 4-5 workers or individual
 Setting the stage with workers
 Offsite interview can be arranged
 Indirect questioning techniques
 Audit team select group of workers to be interviewed.

61.  Certification Process
 After successful completion of Certification
audit , company is recommended for issue of
Certificate by the auditors to its certification
body. Successful completion means that there
are no major non- conformities in the
Certification Audit and even if found have
been addressed and closed
Certification Process

62.  Certification Body reviews the audit
report and other documents from its
auditors and takes the decision to issue
the certificate
 Certificate valid for three years
 Renewal possible for another three
years via a re-cert audit
Certification Process

63.  During the Validity of the Certificate
Surveillance audits are performed to
monitor the continuing implementation ,
by the Certification Bodies
 First Surveillance audit is carried out
within six months of issue of Certificate
Certification Process

64.  Surveillance audit thereafter is
performed once a year if major non
conformities are not found
Certification Process

65. SA 8000 Training
Any
Questions?