Right Respect Best Practices: Timberland
For the last few decades, globalization has been a vehicle of economic and sustainable development throughout the world. With their vast economic power, corporations have the unique ability to end the exploitation of foreign laborers. Timberland, a boot manufacturer, has proved itself as a pioneer in the field by subjecting its suppliers to a strict Code of Conduct in accordance with the Universal Declaration of Human Rights and International Labor Organization’s (ILO) conventions establishing international human and labor rights. Timberland strives to provide its employees with a fair, safe and non-discriminatory work environment in which an employee is ensured the opportunity to develop both as a worker and as a human being. Today, the Code of Conduct Team comprises 15 individuals responsible for the action, decisions, choices, program design and strategy at Timberland. The Code is available in over 20 languages to employees around the world. The following exploration of Timberland’s Code of Conduct summarizes some of the challenges faced by Timberland in upholding the Code and how they overcame those challenges. Finally, the importance of adopting such a Code will be discussed and collaborative solutions presented to ensure a brighter future for workers.
I. A Strong Code of Conduct
To advance human rights, Timberland has created a specific set of provisions that all of its corporate affiliates must follow. The provisions include:
1. Voluntary Employment
2. Freedom of Association
3. Fair and Equal Treatment
4. Child Labor
6. Working Hours
7. Health and Safety
8. Right of Review
Though slavery has been abolished in the United States, it is still a prevalent labor practice throughout the world. To combat modern slavery, Timberland requires that each employee work voluntarily and with a meaningful option to terminate employment. Basically, this provision requires that all factory employment be at will.
Freedom of Association
Freedom of association enables workers to unionize or band together so that their voices can be heard. This is an important right because it creates an internal dialogue between workers and management, which has the effect of protecting or promoting the interests of the labor force. In other words, it acts as another check against the exploitation of the workers by the management. However, as in the United States, the right to unionize or engage in collective bargaining practices can be restricted due to the importance of a given industry to the viability of the economy at large. In those instances, Timberland has required that there be an alternative means for workers to express their grievances to the management in a manner that is equally as effective as unionization.
Fair and Equal Treatment
A hallmark of human rights is that each individual be treated in a fair and equal manner. To promote fairness in the workplace, Timberland’s Code requires that no factory employee be disciplined through corporal punishment, harassed, abused, or run the risk of employer retribution on the basis of expressing grievances predicated on the violations of basic human rights. To promote equality, Timberland’s Code prohibits status discrimination based upon race, color, sex, religion, political opinion or for any other reason.
Essentially this provision gives foreign workers the same protections that United States factory workers enjoy under such acts as the Americans with Disabilities Act (ADA) and the Civil Rights Act. Both acts forbid employers and state and local governments from discriminating against workers in all aspects of employment. The former prohibits employers from discrimination against persons who are or may become disabled while the latter prohibits discrimination based on race, color, religion, sex, national origin, disability, or age. The effect of this provision is to give workers rights that they may not otherwise enjoy under the applicable local laws.
Sensitive to the fact that whether an individual is a child or an adult is largely a local, cultural and economic determination; Timberland has provided for some flexibility in that determination. They define a child to be one that is younger than 16 years of age or the age at which education ceases to be compulsory, whichever is greater. This provision has the virtue of respecting local customs and rules but at the same time realizing that some people are too young to fully understand the consequences of their choices.
This provision helps guarantee that each worker earns a livable wage and hopes to close any possible loopholes for a foreign factory owner to not give fair compensation. Timberland’s Code requires that each worker be paid a minimum local wage and be given all mandated benefits. In addition, the Code prohibits a factory owner from categorizing employment as being conditional in order to justify paying a lower or no wage to a worker. As in the United States, the Code requires all overtime hours to be paid at a premium rate that is no lower than local law. Though Timberland cannot directly dictate what wages ought to be paid, it can ensure that local law is not violated and try to prevent the further proliferation of modern slavery in the factories in which its goods are manufactured.
Timberland’s Code limits the workweek to 6 days with a maximum of 60 hours, including overtime. This restriction has proven to be particularly difficult to enforce because the workers themselves may not want to jeopardize their jobs or may want to work longer hours to provide necessities for themselves and their families. However, at the same time, allowing an individual to work as many hours as he or she may wish to can lead to adverse consequences to their physical and mental well being, and risk unhealthy work/life balance, and hinder overall productivity.
Timberland also prohibits an employer from mandating overtime. This in effect limits the workweek to 48 hours and acts as a check on factory owner and manager. Consequently, this reduces the risk of alienating workers from their families, humanity, and the like.
Health and Safety
The health and safety provision of Timberland’s Code ensures that the workplace, including all residential facilities, comply with the recognized international standards of the ILO. Furthermore, this provision requires paid training on workplace safety practices. This provision benefits workers on the frontlines, the ultimate consumers of the finished products, and in theory, management by limiting their potential legal liability. This provision also helps ensure that workers are provided a safe working environment that does not force individuals to expose themselves to unnecessary risk.
Right of Review
Lastly and most importantly, Timberland’s Code establishes a right to review for compliance amongst all business partners. Timberland subjects all of its business partners to ongoing audits, requires them to provide full and open access, provide the workers the opportunity to voice any violations of workplace standards, and make information on compliance programs available publicly. By doing so, Timberland seeks to ensure that all of the above provisions are enforced meaningfully and not just confined to a piece of paper.
II. Code in Practice: Challenges
A. From Compliance Audits to Collaborative Assessments
In 1994, with the belief that all of their employees deserve the right to a fair, safe and nondiscriminatory workplace, Timberland formalized its workplace Code of Conduct. In 1998, Timberland joined forces with Verite, a nonprofit, to perform compliance audits of off shore factories making Timberland products. Initially, Verite only audited footwear vendors, apparel vendors, and some licensees’ facilities but beginning in 2000, expanded its operations to all facilities including tanneries and major component suppliers.
In 2005, after finding that improvements after an audit did not last long, Timberland supplemented their factory compliance audits with collaborative assessments. So, rather than merely policing factories for compliance, Timberland decided to add an assessment process in which they worked alongside their suppliers and their workers to create positive, sustainable change. By collaborating with factories to not only identify the root problems but also to implement change, workplace quality significantly improved.
Instead of formal question and answer interviews with factories, Timberland now employs a participatory method with workers and management that enables a free flowing dialogue. In addition, when specific violations are discovered, the assessment committee immediately assigns the factory a “high priority” status and alerts Timberland’s management that immediate action is required. Ultimately, Timberland shifted its focus from reactive to proactive.
At the outset, these changes proposed a challenge for Timberland because it was unclear how much time training would take and how well people would adjust to the changes. Also, as a pioneer, they were uncertain of how to measure the impact the changes would have because of the lack of empirical data at the time. However, despite these challenges, Timberland stayed committed to the new process, and to the workers. Though the collaborative assessment process requires more energy on the post assessment front, the benefits of sustainable workplace improvements far outweigh the relatively nominal costs to multinational corporations’ balance sheets.
B. Labor Compliance Overtime
In addition to the above challenges, Timberland has also had to battle serious violations of their working hours provision. Timberland’s strong belief in a work life balance for its factory workers led them to adhere to the International Labor Organization’s general rule for working hours, stating that workers not work more than 8 hours a day or more than 48 hours a week. Timberland also requires that all workers be given at least 1 day off after 6 consecutive workdays and that all overtime be voluntary. Timberland follows industry best practice to limit total working hours (including overtime) to 60 hours a week or 12 hours a day, but unlike other brands, has shown a low tolerance for such violations.
As discussed above, working hours are harder to comply with because the workers themselves may want to work more than the 60 hours weekly cut off laid out in the Timberland Code of Conduct in order to adequately provide for themselves, especially if they have to travel a long distance to their workplace as seasonal workers. Furthermore market pressures to remain competitive have presented serious challenges to limiting working hours and other improvements to workplace standards.
In 2006, after Timberland noticed that its suppliers were unable to meet their requirements, Timberland undertook several initiatives to explore the external and internal causes of excessive working hours. The first of these was a case study performed in one of their factories.
While assessing a sourced factory, Timberland discovered that one of the major problems contributing to excessive overtime was that total demand exceeded the factory’s production capacity during peak production months. In order to battle this problem, Timberland underwent major changes. One change that helped decrease excessive overtime was reducing the number of changes allowed to sample specifications to allow sample rooms to have better information earlier and thus more manufacturing time.
Timberland also discovered that there were internal causes to excessive overtime. First, the tendency to launch multiple new products around the same time created an imbalance in production that caused factories to utilize excessive overtime to meet the demand. Second, Timberland discovered that there were large amounts of time spent on new development, which translated to more time spent on the learning curve and a lower production capacity to meet the demand. To battle the first problem, Timberland launched a project to determine how many new products can be introduced into a factory without a major impact on overall production volumes. As to the latter, Timberland launched a project to determine the true capacity for Timberland’s development resources and then lower the time allotted to meet that capacity. These changes lowered excessive hours because it gave factories an understanding of the impact those activities had on overall production capacity and recalibrated expectations.
With respect to factory management of working hours, Timberland discovered an effective solution; real time information of employee’s working hours. Essentially, the Human Resources department developed a system to monitor weekly hours and developed a plan whereby Plant Management is made aware of the number of hours each employee has worked as of the fourth working day each week. This report includes an estimation of the hours to be worked as of the fifth day, normally Friday, so that Managers are aware of how many hours each employee is available to work overtime if need be without exceeding the 60 hour maximum. In the case of a violation, the Supervisor or Manager must give written explanation and there exists grounds for disciplinary action for further violations.
Since adopting the Code of Conduct, Timberland has not wavered in its commitment to upholding the Code’s provisions. Despite facing several challenges, Timberland has been able to ensure the standards set forth in its Code are met in the over 300 factories around the world where its boots are made because they personally take responsibility to remedy the situation when a supplier fails to meet the Code. Timberland, by leaving a Chinese factory in 2006 that accounted for over 17% of its production, has demonstrated their deep commitment to the Code where a partnership is no longer tenable. Finally, by opening up the lines of communication and sharing the responsibility for whatever problems may arise, Timberland has been able to successfully improve workplace standards and achieve the goals set forth by the Code.
Globalization demands that human rights be extended to everyone. No longer can the developed world rely on its own markets to drive their economies. By implementing a Code of Conduct such as Timberland’s, it is a step towards the installation of human rights and ultimately meaningful, significant and lasting economic growth. By working collaboratively, corporations can pool their resources together to maximize time spent on actual implementation of solutions to the root cause of human rights violations, rather than on simply identifying those problems. Implementation and remediation are the necessary steps to achieving change. Industry or brand collaboration on assessments of facilities abroad is essential to realizing sustainable change in workplaces and the sooner businesses start working together, the sooner everyone wins. Right Respect commends Timberland for their efforts in this regard.
To read more about Timberland, click here.
- California’s Call to go “Conflict-Free”
April 7th, 2011
- Guiding Principles for Business and Human Rights from the United Nations
January 3rd, 2011
- President Obama Proclaims Human Rights Day, Bill of Rights Day and Human Rights Week
December 10th, 2010
- Ruggie Releases Draft Guiding Principles on Business and Human Rights
December 6th, 2010
- Promoting Corporate Citizenship by Crowdsourcing Market Power
November 29th, 2010
- Political Advertising and Corporate Responsibility: A Call for Shareholder Action
November 8th, 2010