ESG Metric: Labour rights
Ease of implementation: High
Suitable for: All businesses
Suggested functional lead: HR
Summary
The aim of a Supplier Code of Conduct is to instil social and financial transparency within your supply chain. The allows organisations to create accountability and disclosure on health and safety, human rights and environmental impacts. To create a Supplier Code of Conduct it is important to research and understand the overall responsibilities businesses have in this regard. Discuss the risks that are present with your supplier and use these to establish the foundations of your Supplier Code of Conduct. It is also good practice to read through publications from other organisation either in your industry or of similar size. Once a good understanding of the requirement for the code of conduct are established, draft the labour rights guidelines. Distribute the draft across your supply chain and organisation to allow other input. Also ensure the code of conduct is reviewed by a legal expect to ensure you are abiding by the law. Allow for regular monitoring of the execution of the Supplier Code of Conduct and aim to publish your reports and findings.
Implementation Steps
Research and understand overall business ethical responsibility
Read and understand the UN OHCHR Guiding Principles on Business and Human Rights linked here. It outlines foundational and operational principles for human rights protection, corporate responsibility to respect human rights and access to remedy. Explore specific areas for your sector and any regulations and laws your supplier must abide to in specific countries.
Discuss risk with suppliers
Get in touch with your supplier and identify risk.
Establish main foundation of the Supplier Code of Conduct
We suggest using the UN Global Compact’s four categories for human rights: environment, anti-corruption, human rights and labour rights. For this initiative you want to focus on the labour rights in your supplier code of conduct.
Read and understand other companies Supplier Code of Conduct
Examples include:
Click here for the UK Government Supplier Code of Conduct
Click here for Neste Supplier Code of Conduct
Click here for Sonos Supplier Code of Conduct
Assign responsibility to draft labour rights guidelines
Assign responsibility to a senior leadership employee to be accountable for the supplier code of conduct. Ensure the guidelines are realistic, transparent and measurable to increase transparency. Ensure the draft is reviewed by a legal counsel and other leadership employees in your organisation. Consider abiding by the SA8000 standards to aim for a high social standard of working and their certification.
Specific guidelines for Labour rights include:
Keeping record of wages and working hours, outlining normal hours vs overtime
Everyone should be entitled to breaks, sick leave, parental leave, annual leave ad rest time with records kept of these
All overtime must be consensual
Employee contracts are written and signed in language all parties understand
Employees enter the work contract. Freely agreeing to the terms and conditions
You do not employ children under the age of 15 with a procedure in place to verify this
No hazards tasks should be deployed to young workers, this includes nights working, early hours and conflict with schooling hours
Employees are free to terminate their employment whenever
Discrimination is not tolerated, where policies so not discriminate against certain views either
Harassment is not tolerated whether physical, phycological, sexual, verbal or acts of embarrassment, with reporting channels in place
Recognize and respect employees right to freedom
In absence of legal minimum wage, an industry standard must be taken
Regular training to all employee on how to detect forced labour
Distribute code of conduct throughout your supply chain
Once finalized and approved, distribute the code of conduct throughout your supply chain ensuring employees and teams are responsible and held accountable for implementing, measuring and monitoring the execution.
Regular monitoring
Regularly monitor the code of conduct through audits, open conversation with supplier and risk assessments. Make any changes necessary to ensure it is being followed appropriately.
Report and publish
Publish your Supplier Code of Conduct to promote transparency and report on the monitoring of the conduct annually.