WAGES AND BENEFITS STANDARD
Suppliers will comply with all local wage and benefit laws. Overtime pay shall be calculated at the legal rate whether compensated by hour or piece rate.
Retrenchment Policy – Guidance strategy for factory downsizing or restructuring due to loss of business or other significant circumstances. The policy identifies severance payout requirements; when employee layoffs may occur; and assistance opportunities for workers.
Illegal Deductions – Improper deductions of wages, including disciplinary deductions, fees for tools or Personal Protective Equipment (PPE), fines for excessive lateness or absenteeism.
Employment Eligibility Fees - Fees associated with employment eligibility such as health checks, visas, and employment registration or work permit fees.
FACTORY ACTION PLAN
1. Policies & Procedures – Factory should establish policies and procedures that ensure the following:
a. All workers are paid the legal minimum wage or higher (regardless of piece rate quotas) and are compensated with all benefits that are mandated by local law.
b. Overtime work should be properly recorded and should be paid at the legally mandated rate.
c. There is only one time-keeping system that records all working hours – both regular and overtime hours.
d. No illegal deductions are made to employee wages.
e. Pay slips are provided each pay period to all employees that identify their wages, all working hours, pay rate, pay period, deductions, additional compensation (bonuses), vacation or holiday pay, etc.
f. All terms of the Collective Bargaining Agreement in regards to wages, working hours, benefits and possible severance are met.
g. No Employment Eligibility Fees are deducted from employee wages.
h. Union dues, fees, or fines are only deducted from employee wages with the express written consent from employees.
i. A Retrenchment Policy has been established to deal with potential downsizing or cutbacks.
j. Probationary wages will meet minimum wage requirements and the appropriate overtime pay as required by law.
k. There is written employee consent for deductions made that are not legally mandated, such as retirement plan, insurance, savings, or additional benefits.
l. There should be explicit policies & procedures regarding holidays, sick leave, annual leave, maternity leave, and menstrual leave if applicable.
m. Legally mandate postings in regards to wages or benefits are posted appropriately and easily accessible by employees.
2. Training – All employees should be properly trained on Wages & Benefits upon hire and annually thereafter. Specifically, they all must receive training on how to read and understand their pay slips and how to deal with any discrepancies they may have with their working hours reporting or the rate of pay.
3. Documentation- All policies and protocols in regards Wages & Benefits should be posted and/or included in the Employee Manual. Legally mandated posting regarding wages are posted in areas that are easily accessible to workers. All working hours & payroll records should be kept on site for a minimum of three years.
HOW TO ENSURE COMPLIANCE
Review all legal requirements regarding wages and benefits periodically to ensure that all are being met
Ensure that overtime wages are being paid as per legal requirement
Audit your payroll to ensure that overtime is properly paid according to overtime hours worked
Do not take any illegal deductions (such as fines) for being late, working equipment, or PPE (Personal Protective Equipment)
Record all hours in one time-keeping system
Ensure that pay slips are in the language of workers and that workers have been trained to understand their pay slips
RESPONSIBILITIES
Factory Manager must ensure that factory follows all policies & procedures regarding Wages & Benefits
Human Resource/Payroll Representatives must establish, train, and administer the policies & protocols regarding Wages & Benefits. Ensure that legal mandates are met and that proper record keeping is maintained.
Managers and Supervisors must ensure that they follow all policies & protocols in regards to Wages & Benefits. Ensure that workers are properly clocking in and out to ensure proper payment.
Employees must properly clock in and out, review their pay slips regularly, and ensure they have requested or signed up for benefits that may be available to them.
Except where specifically identified as a recommended practice, this standard sets minimum standards – contractors must comply with any applicable higher legal requirement and are encouraged to continue to develop their own practices which provide greater protection for their employees.
