BetterWork: 17ème Rapport de Synthèse Biannuel en Vertu de la Législation HOPE II Haïti

17th Biannual Synthesis Report Under the HOPE II Legislation Haiti REPORTING PERIOD October 2017 – October 2018 PRODUCED OCTOBER 2018 23 FACTORY ASSESSMENTS Copyright © International Labour Organization (ILO) and Inter - national Finance Corporation (IFC) October 2018 Publications of the ILO enjoy copyright under Protocol 2 of the Universal Copyright Convention. Nevertheless, short excerpts from them may be reproduced without authorization, on condition that the source is indicated. For rights of reproduction or translation, application should be made to the ILO, acting on behalf of both organizations: ILO Publications (Rights and Permissions), International Labour Office, CH-1211 Geneva 22, Switzerland, or by email: pubdroit@ilo.org. The IFC and ILO welcome such applications. Libraries, institutions and other users registered with reproduc - tion rights organizations may make copies in accordance with the licences issued to them for this purpose. Visit www.ifrro.org to find the reproduction rights organization in your country. ILO CATALOGUING IN PUBLICATION DATA Better Work Haiti. 17 th Synthesis Report under HOPE II Legislation International Labour Office synthesis report / labour law / hope legislation / haiti / garment labor / garment / industry / compliance October 2018 The designations employed in this, which are in conformity with United Nations practice, and the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the IFC or ILO concerning the legal status of any country, area or territory or of its authorities, or concerning the delimitation of its frontiers. The responsibility for opinions expressed in signed articles, studies and other contributions rests solely with their authors, and publication does not constitute an endorsement by the IFC or ILO of the opinions expressed in them. Reference to names of firms and commercial products and processes does not imply their endorsement by the IFC or ILO, and any failure to mention a particular firm, commercial prod - uct or process is not a sign of disapproval. ILO publications can be obtained through major booksellers or ILO local offices in many countries, or direct from ILO Publica - tions, International Labour Office, CH-1211 Geneva 22, Switzer - land. Catalogues or lists of new publications are available free of charge from the above address, or by email: pubvente@ilo.org Visit our website: www.ilo.org/publns Cover photo: ©ILO/IFC Printed by ILO COPYRIGHT Copyright © International Labour Organization (ILO) and International Finance Corporation (IFC) (2018) First published (2018) Publications of the ILO enjoy copyright under Protocol 2 of the Universal Copyright Convention. Nevertheless, short excerpts from them may be reproduced without authorization, on condition that the source is indicated. For rights of reproduction or translation, application should be made to the ILO, acting on behalf of both organizations: ILO Publications (Rights and Permissions), International Labour Office, CH-1211 Geneva 22, Switzerland, or by email: pubdroit@ilo.org. The IFC and ILO welcome such applications. Libraries, institutions and other users registered with reproduction rights organizations may make copies in accordance with the licenses issued to them for this purpose. Visit www.ifrro.org to find the reproduction rights organization in your country. ILO Cataloging in Publication Data Better Work Haiti: apparel industry 16th biannual synthesis report under the HOPE II legislation / International Labour Office; International Finance Corporation. - Geneva: ILO, 2018 1 v. ISSN 2227-958X (web pd7f) International Labour Office; International Finance Corporation Clothing industry / textile industry / working conditions / workers’ rights / labor legislation / ILO Convention / international labor standards / comment / application / Haiti 08.09.3 The designations employed in this, which are in conformity with United Nations practice, and the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the IFC or ILO concerning the legal status of any country, area or territory or of its authorities, or concerning the delimitation of its frontiers. The responsibility for opinions expressed in signed articles, studies and other contributions rests solely with their authors, and publication does not constitute an endorsement by the IFC or ILO of the opinions expressed in them. Reference to names of firms and commercial products and processes does not imply their endorsement by the IFC or ILO, and any failure to mention a particular firm, commercial product or process is not a sign of disapproval. ILO publications can be obtained through major booksellers or ILO local offices in many countries, or direct from ILO Publications, International Labour Office, CH-1211 Geneva 22, and Switzerland. Catalogues or lists of new publications are available free of charge from the above address, or by email: pubvente@ilo.org Visit our website: www.betterwork.org 1 B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 3 Table of Contents List of Tables and Charts ............................................................................................................ 4 List of Acronyms ........................................................................................................................... 5 Section I: Introduction and Context .......................................................................................... 6 1.1. Background ........................................................................................................................................ 6 1.2. Country Context and Industry Updates .........................................................................................7 Section II: Highlights from the Reporting Period ................................................................. 10 2.1. Compliance Situation in Haiti’s Exporting Garment Sector ................................................... 12 2.2. Compliance Performance with regards to International Core Labor Standards ..............14 Child Labor ................................................................................................................................................ 14 Discrimination .......................................................................................................................................... 14 Forced Labor ............................................................................................................................................. 15 Freedom of Association and Collective Bargaining ................................................................... 15 2.3. Compliance Performance with regards to National Labor Standards ................................ 17 Compensation .......................................................................................................................................... 17 Contracts and Human Resources ................................................................................................... 20 Occupational Safety and Health ....................................................................................................... 21 Working Time ........................................................................................................................................... 23 2.4. Advisory and Training Services in the Reporting Period .......................................................24 Better Work Advisory Services .......................................................................................................... 24 Better Work Trainings............................................................................................................................ 27 Section III: Conclusion and Next Steps ................................................................................... 28 Annex 1. The TAICNAR Project and Reporting Requirements under the HOPE II Legislation ...................................................................................................................................30 Annex 2. Better Work’s Service Delivery Model .................................................................... 33 Annex 3. The Better Work Compliance Assessment Methodology ................................... 36 Better Work Compliance Assessment Framework ......................................................................... 36 Calculating Non-Compliance & Public Reporting ...........................................................................42 Limitations in the Assessment Process .............................................................................................43 Annex 4: Factories in Detail .....................................................................................................46 List of Factories ....................................................................................................................................... 46 Findings from the Factories .................................................................................................................. 47 B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 4 List of Tables and Charts Chart 1: Non-compliance rates for 28 factories assessed between September 2017 and August 2018 over two Better Work cycles …………………………………………………………….. 14 Table 1: Factory’s PICC Status .............................................................................................................................. 25 Table 2 : Better Work compliance assessment framework ......................................................................... 37 Table 3 : List of factories in the Haitian apparel sector which have been assessed between April 2017 and March 2018 ................................................................................................................................................ 45 B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 5 List of Acronyms ADIH Association des Industries d’Haïti (Haitian Industry Association) BMST Bureau de la Médiatrice Spéciale du Travail CAOSS Conseil d’Administration des Organes de Sécurité Sociale (Board of Social Security Bodies) CP Compliance point CSS Conseil Supérieur des Salaires (Wages High Council) CTMO-HOPE Commission Tripartite de Mise en œuvre de la loi HOPE EA Enterprise Advisor HELP Haiti Economic Lift Program HOPE Haitian Hemispheric Opportunity Through Partnership Encouragement Act ITUC International Trade Union Confederation MSDS Material Safety Data Sheet MAST Ministère des Affaires Sociales et du Travail (Ministry of Labor and Social Affairs) OFATMA Office d’Assurance de Travail, de Maladie et de Maternité (Office for Work, Health and Maternity Insurance) ONA Office Nationale d’Assurance Vieillesse (National Office for Old-Age Insurance) OSH Occupational safety and health PAC Project Advisory Committee PIC Parc Industriel de Caracol PICC Performance Improvement Consultative Committee PIM Parc Industriel Métropolitain (also referred to as SONAPI) PPE Personal Protective Equipment SC/AFL-CIO Solidarity Center/American Federation of Labor - Congress of Industrial Organizations TDS Social Dialogue Table (Table de Dialogue Social) TAICNAR Technical Assistance Improvement and Compliance Needs Assessment and Remediation USDOL United States Department of Labor B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 6 Section I: Introduction and Context 1.1. BACKGROUND Better Work – a collaboration between the United Nations’ International Labour Organization (ILO) and the International Finance Corporation (IFC), a member of the World Bank Group – is a comprehensive program bringing together all levels of the garment industry to improve working conditions and respect of labor rights for workers, and boost the competitiveness of apparel businesses. The program was launched in Haiti in June 2009 as part of the global Better Work program with country operations in Bangladesh, Cambodia, Haiti, Indonesia, Jordan, Nicaragua, and Vietnam. To date, Better Work is focusing its efforts on the apparel and footwear industry in the countries it operates in. However, companies from other industries may benefit from Better Work services in some particular country contexts.1 In Haiti, the program is mandatory for all apparel producers exporting their products to the US market under the HOPE II legislation. The HOPE II law requires that Haiti in cooperation with the ILO establishes a Technical Assistance Improvement and Compliance Needs Assessment and Remediation Program (TAICNAR) which (i) assesses Haitian apparel factories exporting under the HOPE II law on compliance with international core labor standards and national Haitian labor law, (ii) assists these factories on their remediation efforts and (iii) provides capacity building to the Government of Haiti on these aspects. According to the HOPE legislation, biannual reports have to be published to state enterprise level compliance performance. Further details on the components of the HOPE II law as well specific requirements with regards to biannual reports being published by the entity operating the TAICNAR program are quoted in annex 1 (HOPE II Legislation Reporting Requirements). This is the second of these two annual reports under the HOPE legislation to be published in 2018. Detailed enterprise level data of compliance performance as required by the HOPE II legislation is included in the factory tables in annex 4. The two components of HOPE II’s TAICNAR program aim at strengthening labor compliance of the industry in Haiti. The first of these elements focuses on assessing compliance with core labor standards and national labor law, supporting remediation efforts, and publicly reporting on the progress of each 1 In Haiti for example, a plastics factory is participating voluntarily in the program by paying a market price for the Better Work services. B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 7 factory on the Labor Ombudsman’s register. The second element of the TAICNAR program consists of technical assistance to strengthen the legal and administrative structures for improving compliance in the industry. The scope of these services is extensive, encompassing technical assistance from the ILO in reviewing national laws and regulations to bring them into conformity with international standards, raising awareness of workers’ rights, and training labor inspectors, judicial officers and other government personnel. To encourage compliance with core labor standards and national labor law, the legislation indicates that preferential treatment may be withdrawn, suspended, or limited by the President of the United States from producers who – even after assistance has been provided - fail to come into compliance with the core labor standards and national labor law that is related and consistent with those standards. Removal of benefits is based on determinations made by the government of the United States, based primarily on non-compliance identifications made by the U.S. Department of Labor (USDOL). While Better Work Haiti reports are consulted as USDOL carries out its mandate to implement HOPE II, Better Work Haiti non-compliance findings cannot, on their own, serve to impact preferential treatment under the HOPE Act. Better Work Haiti has been implementing the first component of the TAICNAR program from 2009 until 2017 while other ILO projects, in particular the ILO- MAST capacity building project worked on the second component. As of 2018 with the start of the third phase of the Better Work Haiti project (2018 - 2022), Better Work will also take on several elements of the second component of the TAICNAR program while continuing carrying out activities covering TAICNAR component one. The Better Work program is coordinating its work with the Labor Ombudsman and a tripartite Project Advisory Committee (PAC). This committee meets with Better Work on a regular basis to discuss the activities of the Better Work program. The members of the PAC represent the private sector, government and worker representatives and the Committee is chaired by the Labor Ombudsperson in line with the requirements of the HOPE law. 1.2. COUNTRY CONTEXT AND INDUSTRY UPDATES President Moïse set an ambitious reform agenda for the new government. The focus lies on the following seven priority areas: State reform and political stability; investments; agricultural production and the environment; energy, road and port infrastructure; water and sanitation infrastructure; education; and promoting stability through social projects. Moïse also called for better alignment of international assistance to Haiti with national priorities. B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 8 During the reporting period, several political and socio-economic demonstrations took place in Haiti due to various issues. The announcement of cuts to gasoline subsidies in Haiti in July fueled violent street protests and led to the resignation of the Prime Minister and his cabinet. The resurgence of the Petro Caribe funds issue in national debates has also fuelled protests and heightened tensions. The new Prime Minister, Jean-Henry Céant, and his cabinet were installed in September. Total export revenues from the textile and garment industry in Haiti continue to account for approximately 90% of national export earnings and 10% of national GDP. Since the expansion of tariff benefits under the HOPE/HELP preference programs, apparel exports from Haiti to the US have more than doubled, growing from US$ 412.4 million in 2008 to a high of US$ 895.3 million in 2015. In 2016 and 2017, Haitian apparel exports to the US showed a slight decrease to US$848.7 million and 865 million respectively. The apparel industry is also among the largest employers within Haiti, creating jobs for approximately 52,000 people according to data from August 2018 from the employers association ADIH. The workforce in this industry therefore saw a growth of roughly 20 percent since January 2017 when this figure still stagnated at 40,000 (since mid-2015). Most workers (about 65-70%) are women who support several family members. It has to be noted that ADIH includes management staff in these calculations. Based on Better Work’s data collection over more than six years in Haiti’s apparel industry, one can say that management staff accounts for approximately 10-15% in the factories. Therefore, the number of production workers lies at around 42,000-47,000. ADIH continues to update these figures based on statistics provided by its member companies several times a year. Currently, the biggest companies in the sector remain S&H Global and CODEVI which together employ approximately 20,000 workers. Both are located in Haiti’s North East. 31 exporting factories are currently registered with BWH with three of them being newly registered facilities for which no data is included in this report yet. There are also strong indications that a number of new investors are planning to start operations in Haiti in the near future. More and more foreign direct investment is being put in the garment sector, especially from groups that also have facilities in other countries in the region, especially in Central America. There continues to be a general trend in shift of production from the capital in Port-au-Prince to the North of the country. The combined workforce of the factories in the North represents now almost 45 per cent of the total employment in the sector. B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 9 Tensions in the garment sector around the minimum wage and other concerns by the union movement added to the overall politically volatile situation in Haiti in the reporting period. Various governments have updated their website’s travel information reflecting this security situation. The UN continues to call its members to exert caution and be particularly vigilant during this period of political instability. Demonstrations and sporadic civil unrest cause frictions in country. Road blocks and frequent restrictions of movement continue to impact the daily lives of the population. The second quarter saw several protests of workers requesting the Government to publish the new minimum wage. Workers were requesting an increase to 1000 Gourdes from the current level of 350 Gourdes per 8 hours of work. Overall, the unions made the following demands to the government and the employers: 1. Minimum wage of 1000 Gourdes to be announced by presidential decree; 2. No increase of production quotas in garment factories to be mentioned in minimum wage decree; 3. Budgeting of social services for the new fiscal year including social housing, transportation and food subsidies; 4. Resuming the labor law reform process; 5. Increase the HTG 60,000 threshold for non-payment of taxes for earnings under this amount to HTG 125,000; 6. Improvement of social security services by the two social security institutions ONA and OFATMA; 7. Reinstatement of dismissed workers in several factories; 8. For the government to provide the social benefits promised (Transportation, housing and food); 9. Legitimate representativety of the trade unions in the tripartite councils (CSS, CAOSS) 10. MAST to abide by the HOPE LAW and play role as authority with the private sector. During the time of writing this report, the Government published the new minimum wage which for the garment sector increased from 350 to 420 Gourdes per eight hours or work. B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 1 0 Section II: Highlights from the Reporting Period Over the past months, Better Work continued delivering core services – assessment, advisory and training services – to all participating factories. In addition, Better Work continued its partnerships with various other actors to move specific projects forward in the garment industry in Haiti. Highlights from the reporting period include:  The Productivity Accelerator project continues to be implemented in Haiti and Nicaragua. Regular advisory visits by the team of experts were conducted in both countries on a biannual basis. The volatile situation in Haiti over the past 3 months caused some challenges in terms of planning of the visits. The regular in factory visits` focused on identifying the non-value-added activities in production that impact productivity, as well as how the current quality system may be playing an important role into the productivity components for which awareness on quality at the source must be created. Factories and brands continue to provide positive feedback on the project. During the Regional Buyers Forum in Hong Kong, project progress was presented and participating brands provided positive feedback on the results and encouraged Better Work to scale this work. Other productivity enhancement pilot projects are implemented in other BW countries. In 2019, Better Work will evaluate which tools and measures could be incorporated into the standard Better Work service offer.  A joint mission of the International Trade Union Confederation (ITUC), of the Confederation of Workers of the Americas (CSA), of the Bureau for Workers' Activities (ACTRAV) of the ILO and Better Work (BW) was conducted in September 2018, in Port-au-Prince, with a view to discuss various points concerning the trade union situation in the garment sector. The objective of the mission were as follows: o Consult and reach agreement with Haitian trade unions on principles of representation for the garment industry (which can support similar efforts at national level) and a mechanism for electing new union representatives to the Better Work Project Advisory Committee (PAC). B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 1 1 o Assess the current capacity building needs of trade unions representing workers in the Haitian apparel industry, as a basis for defining the key priorities of a workplan of all included partners to complement the current 5-year strategic phase of the Better Work Haiti Programme. o Identify the key barriers towards the advancement of Freedom of Association and meaningful social dialogue at sectoral and national levels in Haiti, as a means towards proposing recommendations to the ILO’s Programme of Work in Haiti.  With the new phase of the Better Work Haiti program from 2018 – 2022, capacity building of all tripartite constituents – including Government partners – has become a key area of focus for the program. Hence, activities conducted and initiated under the ILO/MAST program are being continued and completed by BWH: o BWH collaborated with MAST to develop and implement a national training plan for ONA, OFATMA and labor inspectors. Currently, MAST trainers have conducted 6 training sessions in five departments of the country (West, North, North-east, South and Center department). A total of 173 inspectors of ONA, OFATMA and MAST regional office have been participating in these training sessions. o BWH supported Labor Administration to develop and implement a national labor inspection plan. So far, labor inspectors from West Department have carried out 13 inspections. o BWH facilitates the execution of several administrative reform activities within the Labor Administration, such as the development of an archiving system for the labour administration system, the set up of a call centre, the development and design of three types of communication products (Banners, Flyers and audio spot) to facilitate the Core Labor Standard and National Labor promotion campaign, as well as the MAST website. o BWH support the government to increase social security coverage and the quality level of services of ONA and OFATMA for workers in the garment sector. In the reporting period more B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 1 2 factories have comply to register their workers in collaboration with ONA and OFTMA gradually more present in the sector. 2.1. Compliance Situation in Haiti’s Exporting Garment Sector All factories registered with the Better Work program in Haiti are assessed once per year. This assessment is conducted after an initial advisory period of about 100 days and follow up advisory visits and trainings are offered after the assessment to facilitate continuous learning and improvement. For more information on the Better Work service delivery model as well as the Better Work assessment methodology, please consult annex 2 and annex 3 respectively. This section presents the results of assessments, advisory and training services provided to all 28 participating factories in the period between September 2017 and August 2018. The first chart presents non-compliance findings for the 28 assessed factories in Haiti showing non-compliance rates in brackets. A factory is found non- compliant in a compliance point if it is found out of compliance on any one aspect of it. Please note that as these reports are issued biannually, yet assessments are being done on an annual basis, issues are reported in two consecutive reports. In the individual factory tables in Annex 4 of this report, progress on the remediation of non-compliance issues can be followed in further detail. Persistent noncompliance issues in areas related to compensation (social security) and OSH (Chemicals management and emergency preparedness) continue to be a concern for the sector. In addition to the focus on management systems during advisory and training, Better Work is working closely with the Ministry of Labor and Social Affairs, ONA and OFATMA to address these issues in a sustainable way. In fact ensuring that all parties involved in labor inspection are aligned on the way to assess and address these issues is key to solving them. A first OSH training was organized by Better work and MAST for OFATMA inspectors in October 2017. Also, a joint workshop was organized in May 2018 with inspectors from MAST, ONA and OFATMA to review the legal framework on social security and agree on the approach for assessing compliance in this area. Better Work is also supporting the Ministry of labour in the implementation of a national training plan for MAST, ONA and OFATMA inspectorate to reinforce their capacity in compliance assessment. All these efforts should contribute to reduce the rates of persistent noncompliance by 2019 as several actors will be actively involved in the monitoring of these issues. B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 1 3 7% 0% 4% 7% 7% 21% 39% 4% 75% 18% 14% 21% 29% 25% 89% 96% 100% 71% 75% 100% 86% 7% 21% 39% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Child Labourers Documentation and Protection of Young Workers Hazardous Work and other Worst Forms Gender Race and Origin Religion and Political Opinion Bonded Labour Coercion Forced Labour and Overtime Prison Labour Collective Bargaining Freedom to Associate Interference and Discrimination Strikes Union Operations Method of Payment Minimum Wages/Piece Rate Wages Overtime Wages Paid Leave Premium Pay Social Security and Other Benefits Wage Information, Use and Deduction Contracting Procedures Dialogue, Discipline and Disputes Employment Contracts Termination Chemicals and Hazardous Substances Emergency Preparedness Health Services and First Aid OSH Management Systems Welfare Facilities Worker Accommodation Worker Protection Working Environment Leave Overtime Regular Hours Child Labour Discrimina tion Forced Labour Freedom of Association and Collective Bargaining Compensation Contracts and Human Resources Occupational Safety and Health Working Time Chart 1: Non-compliance rates by Compliance Point - September 2017 - August 2018 (28 factories) Non-compliance rate (n= 28) B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 1 4 2.2. Compliance Performance with regards to International Core Labor Standards During the last round of assessments between August 2017 and September 2018 in 28 factories, the following results with regards to core labor standards have been observed. CHILD LABOR During the period under review, there were two findings related to child labor. Although no child was found working in any of these two factories, these non- compliance issues are due to the fact that both factories failed to request proper identification for some workers during the hiring process. Keeping a reliable system in place to verify the age of workers prior to hiring is a key element to prevent child labor in garment factories. DISCRIMINATION One case of gender discrimination was found during the reporting period. The factory found in non-compliance has a policy on sexual harassment, has organized sexual harassment prevention training at all levels of management and workers, and has followed through with termination when such incidents occurred. Also, all supervisors and managers are trained on sexual harassment and required to commit to respect the factory's policy on this matter. However, this policy has been undermined through management discretion at the module level to rehire a known offender. In addition, it was found that male management staff was conducting random bathroom checks at the same factory which has created a humiliating work environment for workers. At the time of the assessment visit, there was no evidence that specific measures have been put in place to ensure that known harassers are not rehired or that HR staff do not abuse their power, or that bathroom checks if necessary are only conducted by a person of the same sex in a respectful manner. The factory took immediate action following the assessment visit to terminate the harassers. BWH is providing additional advisory and training services to help the factory improve its current procedures. Also, a new training on sexual harassment is being implemented at several factories since August 2018 in order to prevent sexual harassment and raise workers awareness. B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 1 5 FORCED LABOR There are no findings under the Forced Labor Cluster in this reporting period. F REEDOM OF A SSOCIATION AND C OLLECTIVE B ARGAINING There are two cases of non-compliance under the cluster for Freedom of Association and Collective Bargaining, all under the compliance point of Interference and Discrimination. These two cases were already reported in the April 2018 report. The details of remediation efforts on these cases, are available in individual factory tables in Annex 4 of this report. As previously mentioned, Better Work recommended to reinstate the terminated workers with compensation for back pay. Better Work also made the following industry wide recommendations after a series of strikes in 2017:  The employers and Trade Union Representatives that are present on the Social Dialogue Table (ideally in consultation with employers and unions that are not titular members of the Social Dialogue Table) should consider a review and amendment - as necessary - of the Terms of Reference of the Social Dialogue Table, to ensure that it is functionally representative of employer and worker interests in the export garment and textile industries and that it meets on a regular basis with clear outcomes.  Review and revise as necessary provisions in the Labor Law Guide relating to strikes, so that they fully and accurately reflect Haitian Law and international labor standards.  In the ongoing Labor Law reform process, the Government of Haiti and the social partners should work to ensure that there is adequate protection for factory level trade union officers in carrying out their representative functions, with adequate protection against acts of anti- union discrimination, including during recruitment, hiring, employment and termination.  In collaboration with the ILO, the Government of Haiti, in partnership with the social partners in Haiti, may consider a review and amendment of the Terms of Reference of the Superior Council of Wages (Conseil Superior des Salaires, or CSS), including the selection process and mandate of representatives. The trade unions in the sector, with the support of ILO ACTRAV and the Global Unions, may consider B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 1 6 establishment of a labor caucus for the preparation of, and follow-up to decisions of the CSS.  Haitian Employers’ and Workers’ Organizations may wish to consider a review of the lessons learned from collective bargaining at the enterprise level in Haiti, and if appropriate, request support from the ILO on technical assistance on examining models of collective bargaining that may be most relevant to the garment and textile industry in Haiti, including with respect to representative voices of workers and employers in the process.  Factories and trade unions that have negotiated and implemented FOA policies and protocols may consider engaging with workers and other relevant stakeholders, (with ILO support) to determine lessons learned and areas of improvement for better industrial relations.  The ILO and MAST should focus on consolidation of the existing collaboration between the Better Work Haiti Program and the Labor Inspectorate Garment Sector Task Force, and develop recommendations for sharing lessons learned and strategies for ensuring maximum effectiveness, efficiency and independence of the inspectorate with other MAST departments.  ADIH and Trade Union Federations should provide support to factories and enterprise level union representatives on developing the capacity of employers and unions to resolve rights and interest disputes in line with Haitian law and international labor standards, with the support of the Haitian Labor Ombudsperson and the ILO. These recommendations were presented to Better Work Haiti’s stakeholders and assisting partners on these issues is part of the new workplan of the program for the next five years. As a results, the following actions were taken :  The consultations related to the Labor Law reform process, resumed in August 2018. The ILO is supporting the process by providing administrative and logistical support. The Government of Haiti and the social partners are expected to ensure that there is adequate protection for factory level trade union officers in carrying out their representative functions, with adequate protection against acts of anti-union discrimination, including during recruitment, hiring, employment and termination. B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 1 7  The Government of Haiti appointed a new member to the Superior Council of Wages (Conseil Superior des Salaires, or CSS), in order to ensure that this committee is able to fulfill its mission.  As mentioned above, a high level mission with representatives from Better Work Global and ITUC was conducted in September 2018 in order to discuss challenges faced by trade unions in Haiti.  Better Work hired a former ILO projet officer working on the ILO-MAST capacity building project in order to continue the work related to the consolidation of the existing collaboration between the Better Work Haiti Program and the Labor Inspectorate Garment Sector Task Force. Lessons learned and strategies for ensuring maximum effectiveness, efficiency and independence of the inspectorate with other MAST departments are being discussed in regular meeting with MAST management. 2.3. Compliance Performance with regards to National Labor Standards Better Work’s compliance assessment framework is based on eight clusters, four related to international core labor standards (see previous section) and four with regards to national labor legislation. Each cluster consists of several compliance points and each compliance point is made up of several questions (see Table 3 in the annex for further detail on the structure of the Better Work compliance assessment tool). In this section, selected compliance points will be analysed in further detail. Chart No. 1, which gives an overview of the compliance performance of the full set of factories in the sample, shows that the same compliance points tend to remain at high non-compliance rates of over 50% from one cycle to the next. Most of these so-called persistent non-compliance (PNCs) points have been analysed in detail in past reports. Therefore, some compliance points with lower non-compliance rates will be included in further detail in this edition of the report. COMPENSATION In the Compensation cluster, the highest non-compliance rates persist in the compliance point of Social Security and Other Benefits (75%), as well as the B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 1 8 compliance point on Paid Leave (39%). 21% of factories were found in non- compliance with regards to overtime wages. In general there is significant progress related of these points in comparison to previous years. The progress observed in the compensation cluster is due to the fact that the government clarified the issues related to the average daily salary for piece rate workers both in a note published in, March 2017 and in the labor law guide published by BW in collaboration with the government in December 2017. BWH Enterprise advisors were able to be more effective in their advisory work with these new written guidelines as the factories started to apply them. Also, the recent collaboration with both ONA and OFATMA helped reduce the number of non- compliance cases related to social security. Notable efforts were observed in the number of factories registering with the new maternity and health insurance offered by OFATMA. Five factories were also found in noncompliance for not keeping one accurate payroll record. These findings were in general related to the fact that time records were inconsistent with the payrolls for overtime or hours of work performed during weekly rest days. All assessed factories are in compliance with regards to the payment of the legally required minimum wage. Further details on the compliance points of overtime wages and paid leave are provided below. OVERTIME WAGES Compliance Question # of factories found NC NC Rate by Question Does the employer pay workers 50% above the normal wage for all ordinary overtime hours worked? 6 21% Does the employer pay workers 50% above the normal wage for overtime hours worked on legally mandated holidays? 0 0% Does the employer pay workers 50% above the normal wage for overtime hours worked on weekly rest days? 0 0% Six factories were found in non-compliance for not paying workers 50% above the normal wage for all ordinary overtime hours worked. In fact, in four of these factories, assessors found that overtime hours are not always recorded for workers in the sewing lines. In one of the facilities, assessors also found that several workers categorized as apprentices were subjected to overtime hours. During interviews, these workers confirmed that they regularly work beyond normal working hours but receive only the apprentice salary, which is 40% of the minimum wage with no compensation for the overtime hours worked. B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 1 9 In the other two factories, although overtime hours are recorded, they are not paid due to internal procedures. For example, in one factory workers receive the production bonus for reaching their daily quota for which the occasional extra overtime hours was necessary. Management explained that the bonus is more favorable to workers than the overtime payment since it is higher. In the other one, any time worked after 4 pm without prior approval is not compensated. As a result, in the attendance, the actual exit time is different than the exit time considered by the factory to be compensated. Management said that they only allow 1 hour overtime except in case of inventory or emergency, although workers might voluntarily choose to stay after 5 pm, in order to reach their quota. Interviewed workers said they were not aware of overtime payment conditions. PAID LEAVE Compliance Question # of factories found NC NC Rate by Question Does the employer pay workers correctly during breastfeeding breaks? 0 0% Does the employer pay workers correctly during sick leave? 6 21% Does the employer pay workers correctly during the daily break? 0 0% Does the employer pay workers correctly for annual leave? 1 4% Does the employer pay workers correctly for legally mandated holidays? 4 14% Does the employer pay workers correctly for maternity leave? 6 21% Does the employer pay workers correctly for weekly rest days? 4 14% Six factories were found in non-compliance for inaccurate payment of sick leave. In fact, the calculation of sick leave payments for workers entitled to incentives is based on the minimum wage of reference instead of average earnings as required by the law under Article 148. The other non-compliance issues under paid leave such as the payment for legally mandated holidays, maternity leave and the weekly rest days are also related to the fact that the payments were based on the minimum wage instead of average earnings. In all these cases, management stated that they were not aware of this requirement and informed the Better Work assessors that the necessary modification in the payroll system will be made. However it is important to note that the new law published in September 2017 on the organization of the B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 2 0 working hours in three shifts of eight hours eliminated the requirements to pay for non-working weekly rest days and legally mandated holidays. However most factories are not applying this new regulations due to the fact that such benefits are already included in their current work contracts or internal work rules. This new law also require the payment of the daily break for a minimum of 30 minutes. The new legal requirement is also not yet applied. Management explained that they have not yet implement the new law related to the organizing and regulating work over a 24-hour period divided into three segments of eight hours. Documentation review, management and workers interview confirmed that the employers still provide benefits that are no longer required under the new law on working hours such as payment for the weekly rest day or non-working holidays. Therefore, Better Work is not finding non- compliance for the non-payment of the daily break for this cycle. CONTRACTS AND HUMAN RESOURCES In the cluster on Contracts and Human Resources, an average of 17% of factories were cited in non-compliance under the compliance point termination for different questions. Further details are outlined in the tables below. TERMINATION Compliance Question # of factories found NC NC Rate by Question Does the employer compensate workers for unused paid annual leave when they resign or are terminated? 2 7% Does the employer comply with legal requirements before suspending workers or reducing the size of the workforce due to changes in operations, lack of materials, force majeure, or accident resulting in an immediate work stoppage? 0 0% Does the employer pay workers their annual salary supplement or bonus upon termination? 4 14% Does the employer provide workers proper notice of termination when required, or pay workers during the notice period? 4 14% Does the employer terminate workers for reasons that are invalid under national law? 0 0% Has the employer complied with any orders to reinstate or compensate workers who were found to be unjustly terminated? 0 0% B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 2 1 Two factories were found in non-compliance for not properly compensating workers for unused paid annual leave when they resign or are terminated. Workers are entitled of 1.25 days of annual leave per month. However, in the first factory, documentation review revealed that as of October 2017, only 6.25 days are paid to workers regardless of the duration of their employment. Management explained that this mistake was due to a change in their payroll procedures and confirmed that they would address this issue immediately. In the second factory, the documentation available did not have any evidence for payment of unused annual leave upon resignation or termination. Management said that they did not pay workers for unused annual leave upon resignation or termination because they had a different understanding of the legal requirement and thought that workers needed to complete 1 full year of employment to become eligible for annual leave payment. This can be explained by the fact that this new factory had not yet recruited a qualified Human Resources Manager at the time of this first assessment visit at this facility. Four factories were found in non-compliance for the payment of the annual salary supplement or bonus upon termination. In fact, it was found that the method used to calculate these payments were incorrect in both factories. Both employers agreed to verify their payroll system and fix the issues. Four factories were found in non-compliance for inaccurate payment of the notice of termination when required. In fact, the calculation of the notice of termination payments for workers entitled to incentives is based on the minimum wage of reference instead of average earnings as required by the law under Article 148. OCCUPATIONAL SAFETY AND HEALTH The non-compliance rates for Occupational Safety and Health remains high in the Haitian garment industry (average 76.5%). The highest levels on non- compliance in that cluster is related to the compliance points of emergency preparedness, health services & first aid, chemicals and hazardous substances and the workers’ protection and working environment compliance points. CHEMICALS AND HAZARDOUS SUBSTANCES Compliance Question # of factories found NC NC Rate by Question Are chemicals and hazardous substances properly labelled? 18 64% B E T T E R W O R K H A I T I – 1 7 T H S Y N T H E S I S R E P O R T 2 2 Are chemicals and hazardous substances properly stored? 10 36% Does the employer have chemical safety data sheets for all the hazardous chemicals used in the workplace? 22 79% Does the employer keep an inventory of chemicals and hazardous substances used in the workplace? 17 61% Does the employer provide adequate washing facilities and cleansing materials in the event of exposure to hazardous chemicals? 16 57% Has the employer effectively trained workers who work with chemicals and hazardous substances? 2 7% Has the employer taken action to assess, monitor, prevent and limit workers' exposure to chemicals and hazardous substa