BetterWork: 26ème Rapport de Synthèse sur la Conformité Juin 2022 - Juin 2023

HAITI 26th Compliance Synthesis Report June 2022 - June 2023 2 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Copyright © International Labour Organization (ILO) and International Finance Corporation (IFC) (2023) First published (2023) ILO publications benefit from copyright under Protocol 2 of the Universal Copyright Convention. However, their short excerpts may be reproduced without authorization because the source is indicated. For reproduction or translation rights, the 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 email pubdroit@ilo.org. The IFC and ILO welcome such applications. Libraries, institutions, and other users registered with reproduction rights organizations may make copies by the licenses 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: apparel industry 25th biannual synthesis report under the HOPE II legislation / International Labour Office; International Finance Corporation. - Geneva: ILO, 2023 1 v. ISSN 2227-958X (web pdf) International Labour Office; International Finance Corporation Clothing industry / textile industry / working conditions / workers’ rights / labour legislation / ILO Convention / international labour 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. 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. Catalogs 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 3 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Acknowledgments/Disclaimer Better Work Haiti receives financial support from the United States Department of Labor (USDOL). This publication's contents are the sole responsibility of Better Work Haiti and do not necessarily reflect the views or policies of the USDOL. The funding that is provided by the United States Department of Labor falls under cooperative agreement number IL-21187-10-75-K. 89 percent of the program's total costs in 2023 were funded by Federal funds, for a total of USD 14,537,735 during the program’s life cycle. This material does not necessarily reflect the United States Department of Labor's views or policies, nor does mention of trade names, commercial products, or organizations imply endorsement by the United States Government. 4 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Table of Contents Acknowledgments/Disclaimer................................................................................................................................. 3 List of Acronyms .......................................................................................................................................... 5 Section I: Introduction and Context ....................................................................................................... 7 1.1 Background ...................................................................................................................................................7 Haiti's apparel industry in numbers ..................................................................................................... 10 Section III: Highlights of the reporting period January 2023-June 2023 ............................. 14 Country Context ................................................................................................................................................ 14 Garment Industry Challenges ....................................................................................................................... 15 Decree suspending the 3x8 Law .................................................................................................................. 18 Section IV: Compliance situation in the Haitian garment industry .......................................... 19 The overall trend of non-compliances in the Haitian garment industry .........................................19 The highest rates of non-compliances in the Haitian garment industry ...................................... 23 Section V: Core labour standards non-compliance findings of the reporting period (January 2023 – June 2023) ................................................................................................................ 32 Freedom of Association: Violations of Collective Bargaining agreement .................................... 32 Freedom of Association: Strikes ................................................................................................................. 33 Discrimination: Race and Origin .................................................................................................................. 34 Discrimination: Sexual Harassment ......................................................................................................... 34 Discrimination/Gender ................................................................................................................................... 35 Freedom of Association/Strikes ................................................................................................................. 35 Forced Labor/Coercion ...................................................................................................................................36 Section VI: Better Work key activities during the reporting period ......................................... 38 Training ................................................................................................................................................................ 40 Collaboration with the government ............................................................................................................ 41 Factories in Detail ..................................................................................................................................... 45 List of Factories ................................................................................................................................................ 45 Findings from the Factories .......................................................................................................................... 46 Annex 1: The TAICNAR Project and Reporting Requirements under the HOPE II Legislation ................................................................................................................................................... 49 TAICNAR Program Component 1: Compliance Assessments and Remediation Support ....... 50 TAICNAR Program Component 2: Technical assistance to strengthen the legal and administrative structures for improving compliance in the industry ................................... 50 Annex 2. Better Work’s Service Delivery Model ............................................................................. 53 Annex 3. The Better Work Compliance Assessment Methodology .......................................... 56 Better Work Compliance Assessment Framework ............................................................................... 56 Annex 4: Factories findings ................................................................................................................... 72 5 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I List of Acronyms ADIH Association des Industries d’Haïti (Haitian Industry Association) BMST Bureau de la Médiatrice Spéciale du Travail (Office of Ombudsperson) 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) CTH Confédération des Travailleurs Haïtiens (Confederation of Haitian Workers) CTSP Confédération des Travailleurs des secteurs Publics et Prives (Confederation of Workers from the Public and Private Sectors) CTMO-HOPE Commission Tripartite de Mise en œuvre de la loi HOPE (Tripartite Commission for the Implementation of the HOPE Law) EA Enterprise Advisor GOSTTRA Groupement Syndical des Travailleurs-eusses du Textile pour Réexportation d'assemblage (Union Group of Textile Workers for Re- export of the Assembly) HELP Haiti Economic Lift Program HOPE Haitian Hemispheric Opportunity through Partnership Encouragement Act IOE International Organization of Employers ITUC International Trade Union Confederation MSDS Material Safety Data Sheet MAST Ministère des Affaires Sociales et du Travail (Ministry of Social Affairs and Labor) 6 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I OFATMA Office d’Assurance Accidents du Travail, Maladie etMaternité (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 PAP Port-au-Prince, Haiti PIC Parc Industriel de Caracol (Industrial Park of 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 SDT Table de Dialogue Social (Social Dialogue Table) ) TAICNAR Technical Assistance Improvement and Compliance Needs Assessment and Remediation USDOL United States Department of Labor 7 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I 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, respect of labor rights for workers, and to 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, Ethiopia, Egypt, Haiti, Indonesia, Jordan, Madagascar, Nicaragua, Pakistan, Sri Lanka and Viet Nam. Better Work is mainly operating in the apparel and footwear industry in the countries it is present. 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. In addition, according to the HOPE legislation, biannual reports must be published to indicate enterprise-level compliance performance. Further details on the components of the HOPE II law and specific requirements regarding biannual reports being published by the entity operating the TAICNAR program are quoted in annex 1 (HOPE II Legislation Reporting Requirements). This is the twenty-fifth report under the HOPE legislation. Detailed enterprise-level data of compliance performance as required by the HOPE II legislation is included in the Factory Tables section below. The two components of the HOPE II TAICNAR program aim to strengthen the labor compliance of Haiti's industry. The first of these elements focuses on assessing compliance with core labor standards and national labor law, supporting remediation efforts, and publicly reporting each factory’s progress 8 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I 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, raise awareness of workers’ rights, and train 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 the government of the United States' determinations, 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's non-compliance findings cannot, on their own, serve to impact preferential treatment under the HOPE Act. Better Work Haiti implemented the first component of the TAICNAR program from 2009 until 2017, while other ILO projects, particularly 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 also took on several elements of the second component of the TAICNAR program while carrying out activities covering TAICNAR component one. For the period 2022 to 2027, Better Work Haiti is focusing on its sustainability strategy, to ensure the continuation of program’s benefits. Better Work Haiti’s program’s strategy builds on the Better Work Global program’s strategy for the period 2017-22. As such, this strategy shares the same broad vision for the program as a catalyst for transformative change in global supply chains and the promotion of the country’s labor market governance and business practices that actively support decent work and balanced socio-economic development. Better Work Haiti seeks to establish and reinforce strategic partnerships with relevant stakeholders, to carry out Better Work Haiti activities, to reinforce the replication and scaling up of learning outcomes / implemented models, 9 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I focusing on social dialogue, promoting gender equality, and understanding national labor laws and international conventions, to improve working conditions and workers’ wellbeing. The Better Work program coordinates its work with the Labor Ombudsman and a tripartite Project Advisory Committee (PAC). This Committee meets with Better Work regularly to discuss the program’s activities. The PAC members represent the private sector, government and worker representatives, and the Labor Ombudsperson in line with the Committee's HOPE law's requirements. Therefore, Better Work follows this two-pronged approach at the country level to improve Haiti's garment industry's working conditions and competitiveness. On the one hand, direct factory-level interventions allow deep insight into each company’s compliance performance and assist in a tailored way. On the other hand, the program works with the tripartite constituents to address endemic challenges more substantially by bringing stakeholders together, sharing industry data, and offering technical assistance to address compliance challenges and capacity-building needs. 1 0 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Haiti apparel industry in numbers 31 Factories in the program 42,500 Workers employed (63% women) 8 Industrial zones hosting 90% of textile ~ $400 million Apparel exports in USD million YTD ( -24.58 in 2023) 36 Brands and Retailers 7 Government Partners 11 Active workers’ organizations 26 Industry Compliance Synthesis Reports 12 Better Work Haiti Staff 14 Years serving in Haiti 1 1 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Better Work Haiti continues to work with industry stakeholders, namely the workers’ and employers’ organizations and the government representatives, to not only safeguard jobs in the textile and apparel sector but also to multiply them through increased productivity and demands from international buyers. Better Work Haiti continues to engage with international buyers to address concerning issues and challenges such as a new decree regarding working hours and lunch break payment, persistent non-compliance in OSH and the country situation in general. The discussions around the renewal of the HOPE Law have given all actors an added incentive to work together to address the non-compliance issues that may affect the sector’s growth and productivity. The non-compliances related to social security have been a key point in the discussions for the renewal of the HOPE law. According to the data published in October 2022, by the US Department of Commerce Office of Textiles and Apparel (OTEXA), the Haitian textile industry exported approximated USD 400 Million worth of products to the United States for the period ending June 2023. This represents a decrease of nearly 24.6 percent for the same period. This reporting period shows 42,500 jobs in the sector, compared to approximately 58,500 during the last reporting period. Building on the strong partnerships Better Work has developed with the government, global brands, employers, and unions, over the years, the program plays a central role in realizing the full potential of the HOPE II Act – a preferential trade program with the US. Convening diverse stakeholders to tackle shared challenges and supporting institutions’ efforts to monitor and safeguard factory compliance with international labor standards will be top priorities. 1 2 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Key partners  Ministry of Social Affairs and Labor (MAST)  Office of the Labor Ombudsman (BMST)  National Insurance and Pensions Office (ONA)  Office for Employment Injury, Illness and Maternity (OFTMA)  Ministry of Commerce and Industry (MCI)  Ministry of Economic and Finance (MEF)  Office of the State Secretary for the Integration of People with Disabilities (BSEIPH)  Association of Haitian Industries (ADIH)  Private Sector Economic Forum (PSEF)  All Trade unions active in the garment sector (12), listed below:  Centrale Autonome des Travailleurs Haïtiens (CATH)  Comité Inter-Syndicale des Femmes (CISF)  Confédération des Forces Ouvrières Haïtiennes (CFOH)  Confédération des Travailleurs et Travailleuses des Secteurs Public et Privé (CTSP)  Confédération des Travailleurs Haïtiens (CTH)  Coordination Nationale des Ouvrières et Ouvriers Haïtiens (CNOHA)  Coordination Syndicale Haïtienne (CSH)  Entè Sendikal Premye Me - Batay Ouvriye (ESPM-BO)  Groupement des Syndicats des Travailleurs Textiles pour l’Exportation et l’Assemblage (GOSTRA)  Syndicat des Ouvriers de HANSAE Haïti S.A (SOHSA)  Syndicat des Ouvriers Haïtiens pour la Rénovation du Secteur Textile (SOHARST)  Union des Travailleurs Libres (UTL) 1 3 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I 1 4 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Section III: Highlights of the reporting period January 2023-June 2023 Country Context CONTEXT ANALYSIS Despite the Haitian government's efforts to achieve macroeconomic stability and sustainable private sector-led economic growth, the investment climate in Haiti is characterized by several challenges. These include an unstable national currency, the Haitian gourde (HTG), persistent inflation, high unemployment, political instability, and insecurity. At the time of writing, Haiti's economic situation has significantly deteriorated. Economic indicators such as high inflation and continuous depreciation of the Gourde against the US dollar have worsened. This depreciation, combined with limited foreign exchange reserves allocated primarily for fuel payments, has led to high and rising food prices. Consequently, the cost of living is rapidly increasing due to fluctuating prices of essential goods. The resulting economic crisis has led to a surge in unemployment as many businesses and services have closed their doors. Approximately 4.9 million Haitians are now experiencing food insecurity and urgently require humanitarian assistance 1 . This is attributed to rising prices, volatile currency exchange rates, a scarcity of US dollars, decreased private transfers and increased violence from armed gangs disrupting economic activities. The economic challenges have eroded the purchasing power of households, pushing poverty levels to around 60% 2 . The overall economic situation is closely tied to the country's security conditions. 1 https://fews.net/latin-america-and-caribbean/haiti/food-security-outlook/february-2023 2 https://www.worldbank.org/en/results/2020/01/08/haiti-providing-opportunities-for-all-haitians 1 5 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Condemning the escalating violence, criminal activities, and human rights violations in Haiti, the United Nations Security Council unanimously adopted Resolution 2692 (2023) to extend the mandate of the United Nations Integrated Office in Haiti (BINUH) until July 15, 2024. The resolution emphasizes the urgent need to improve security conditions in Haiti. These challenges have consequences for private sector activities. Displaced people may continue to migrate to more welcoming towns and communities, while others may join the exodus to other countries. Garment Industry Challenges The Haitian garment sector has been facing some significant challenges that started during the COVID-19 pandemic in 2020. Although the sector had bounced back after the pandemic and recovered thousands of lost jobs, the downturn in the global economy, coupled with internal socio-political strikes and natural disasters have seriously impacted the sector. Several factories have closed their doors and others have significantly reduced their workforce. In the Northeast alone, one factory reduced its workforce form a high of approximately 11,000 workers to around 6,500. Throughout this reporting period, Better Work Haiti managed a portfolio of 33 factories, which represents a reduction from the 38 factories included in the previous reporting period. The lack of security in the country has compelled certain factories to shut down due to gang-related activities in their vicinity, while others have been impacted by challenges related to receiving raw materials and shipping finished goods. In December 2022, two factories situated in the western region closed temporarily with plans to resume operations in January 2023. Unfortunately, these factories remained closed, primarily due to the proliferation of gang activities that significantly disrupted their daily production. Notably, one of these factories experienced multiple staff members falling victim to kidnappings in 2022. Additionally, a significant reduction in their production orders played a pivotal role in the decision to close these factories. Collectively, these two factories accounted for an estimated loss of 2,000 jobs. Subsequently, in 2023, two factories, one in Port-au-Prince and the other in CODEVI, also ceased their operations, resulting in an additional loss of 2,000 jobs within the sector. 1 6 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I BWH supplier hosted the 2023 AAPN’s regional tour. Twenty-four attendees from the Americas Apparel Producer's Network (AAPN) and six speakers, along with local hosts, participated in the 2023 AAPN CODEVI Haiti/Dominican Republic Regional & Tour, which was hosted by Grupo M from March 21 to 24. The program featured guided tours of the CODEVI industrial park, situated in Ouanaminthe, Haiti, just across the border from Dajabon, Dominican Republic. This industrial park houses over 15 global tenants and US brands. Mr. Anibal Capellan, a member of the AAPN's Board of Directors, and Mr. Joseph Blumberg, Managing Director of Grupo M/CODEVI, played instrumental roles in hosting the event. The agenda was carefully curated to showcase the vibrancy and potential of this industrial zone, which spans both the Dominican Republic and Haiti. Andrew Dreher of GC Moore expressed optimism, stating, " The Central American/Caribbean region as a whole has great potential." Claudine François, Program Manager of Better Work Haiti, seized the opportunity to highlight advancements in labor conditions and recent initiatives within Haiti's textile sector. These efforts aim to bolster the sector's growth through increased investment, constructive partnerships, and improved business performance. The AAPN has long advocated the concept that "Closer is Clearer," promoting networking among nearly 200 organizations operating within the apparel supply chain worldwide. This network encompasses suppliers, buyers, and various stakeholders seeking to establish a more stable and flexible sourcing model, ultimately simplifying, and enhancing business operations in the USA and the broader Americas. In May 2023, Better Work Haiti received an invitation to participate in a delegation to South Korea, aimed at studying the Eco-Industrial Parks (EIPs) established in the country. The delegation, comprised of representatives from SONAPI (Société Nationale des Parks Industriels), the Ministry of Finance (MEF), the Centre de Facilitation des Investissements (CFI), and the Free Zone (DZF), sought to gain insights from Korea's experience in implementing a national ECO Industrial Park program. This included studying relevant laws, institutions, technologies, financing mechanisms, and operational expertise. The on-site visits provided practical exposure to benchmark EIP cases in Korea and facilitated knowledge exchange among the delegations on topics such as EIP 1 7 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I development, EIP transformation, and the digital and green transformation of industries and industrial parks. The overarching objective of this initiative is to explore the feasibility of establishing eco-parks in Haiti. Such parks are envisioned to enhance economic performance, preserve finite natural resources, and improve quality of life, thereby boosting the competitiveness of industrial parks in Haiti. Strategies will be devised to promote industrial resilience and decarbonisation. The World Bank Group has commissioned a consulting firm to undertake the following tasks: 1. Analyze the current landscape of industrial parks in Haiti, providing an overview of potential EIP investments related to solar PV installations, waste and wastewater solutions, green buildings, and resilient buildings within Haiti's industrial parks. 2. Conduct a preliminary feasibility analysis of Eco Industrial Parks (EIP) in two industrial parks in Haiti. This analysis encompasses pre-feasibility assessments of industrial symbiosis (IS) networks, green building feasibility, and renewable energy solutions with mini/micro-grids, wastewater treatment facilities, infrastructure resilience, social infrastructure possibilities, and associated CAPEX/OPEX considerations. 3. Explore financial mechanisms to support the transition to EIPs, including mapping funding needs for various EIP interventions and identifying potential financing mechanisms. 4. Recommend measures for future development based on market conditions and international experience to chart a commercially viable and sustainable growth trajectory for EIPs in Haiti. Tragic incident at CODEVI Industrial Park On June 15, 2023, a tragic incident unfolded within the CODEVI industrial zone, resulting in the loss of two lives, both male workers, and leaving several others with physical injuries. This unfortunate event stemmed from a rapidly escalating conflict between certain workers and a security guard, culminating in a deeply regrettable outbreak of violence. In response to this distressing incident, stakeholders have 1 8 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I made appeals for calm, allowing the authorities to conduct thorough investigations and determine responsibilities. The management of CODEVI has proactively convened multiple meetings and consultations with various branches of the Haitian government, and they have taken on the responsibility of providing support to the families of the deceased workers. Better Work Haiti has initiated high-level discussions involving all relevant parties to explore strategies and necessary training for a comprehensive re-induction process aimed at fostering mature industrial relations within the facility. Additionally, a government report is expected to be released, focusing on preventive actions to avoid the recurrence of such a tragic incident in the future. Decree suspending the 3x8 Law On June 13, 2023, the Government of Haiti issued a decree announcing the immediate suspension of the 3*8 Law, officially known as the Law on the Organization and Regulation of the Twenty-Four (24) Hour Workday Divided into Three (3) Eight-Hour Shifts. The 3*8 law stipulated that the lunch break is considered an integral part of the eight-hour workday and should be compensated accordingly. However, the publication of the new decree suspends all provisions of the 3*8 law. Consequently, Better Work is no longer finding noncompliance for non-payment of the lunch break. The decree also reinstates several articles in the Labour Code, which were abrogated under the 3*8 Law. To allow factories time to effectively implement these reinstated provisions, Better Work Haiti is not finding noncompliance for the requirements in the reinstated articles during the current cycle and will apply them starting in January 2024. Better Work Haiti enterprise advisors are distributing copies of the decree to factories within their portfolio and providing advisory services that address this topic. 1 9 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Section IV: Compliance situation in the Haitian garment industry The overall trend of non-compliances in the Haitian garment industry This section provides an overview of the findings related to non-compliance in 31 participating factories, all of which underwent assessments at least once between July 2022 and June 2023. It's important to note that the data presented reflects the status of these factories based on their most recent assessment results. The overall non-compliance rate is calculated by considering the total number of factories that exhibit non-compliance in at least one compliance point, for at least one question 3 . During this reporting period, Better Work Haiti conducted a total of 2 fully virtual assessments, in addition to 5 hybrid and 17 in-person assessments, with the support of inspectors from the Ministry of Social affairs and labor. Verification of the factories' improvement plans took place either in person during on-site visits or virtually through the request for documentation during advisory services, along with discussions involving bipartite committee members, including both workers and management. The charts presented below depict the non-compliance findings for the 31 assessed factories, displaying non-compliance rates within parentheses. It is important to keep in mind that these reports are issued biannually, despite assessments occurring annually, resulting in issues being reported across two consecutive synthesis reports. 3 For instance, within the Occupational Safety and Health (OSH) cluster, there are eight distinct compliance points, each containing several compliance questions. Therefore, if a factory is non-compliant for even just one question within a compliance point, it is deemed non-compliant for that entire compliance point, and this is reflected in the broader cluster's non-compliance rate. Consequently, while the total number of factories classified as non-compliant in the cluster might be high, it does not necessarily imply that each of these factories is non-compliant for all the questions within a specific compliance point. 2 0 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I The industry's highest non-compliance rates continue to be observed within the Occupational Safety and Health (OSH) cluster, indicating that nearly every factory was found in non-compliance on at least one question within the respective compliance point. Since the total non-compliance rate within the cluster is derived from a compilation of questions, it is essential to delve into the specific questions responsible for the non-compliance rate. Under this cluster, the compliance point with the highest non-compliance rate is Chemicals and Hazardous Substances, which comprises seven compliance questions. Specifically, there are three issues causing the persistently high non-compliance rate.  Eighty-four percent of factories were found in non-compliance for failing to properly label chemical products. This typically involves chemical products that were not labelled or that had a label that was missing information such as a pictogram.  Chemical safety data sheets for the products used in the workplace were not available in 84% of assessed factories. The chemical safety data sheets give relevant information for the handling of the product, including specific instructions in case of an accident for this question.  Maintaining an inventory of chemical and hazardous in the workplace also has a high non-compliance rate of 84%. This is an area where factories often need Better Work support to improve. Factories sometimes fail to include all the chemical products they have in the workplace in the inventory list. Products that they do not use regularly may not be reported on the inventory, or management think that some products such machine oil are not chemical products, and do not include them in the inventory. In this reporting period, the number of factories that are non-compliant regarding training provided to workers to handle chemical and hazardous products continues to decrease. Data as of June 2023 indicates that 13% of the 31 factories are non-compliant.  The chart below outlines the questions in the Chemical and Hazardous Substances compliance point and the rate of non-compliance for each question. 2 1 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I  The other persistent non-compliance point in the OSH cluster is emergency preparedness, which contains ten compliance questions. The question on the emergency exits and escape routes has the highest non- compliance rate. However, Better Work Haiti has seen a significant decrease in non-compliance in this reporting period. Fifty-four percent, or 17 out 31 factories are non-compliant.  The other high area of non-compliance relates to firefighting equipment. In general, factories may have sufficient firefighting equipment, but they may not keep proper maintenance documents to certify that the equipment is regularly checked. In contrast, the non-compliance rate for accessible emergency exits is lower at 64.5%.  The non-compliance rates in the other seven questions in the compliance point are below 50%. The compensation cluster still shows a high rate of non-compliance in the aggregate. However, anecdotal evidence suggests that improvements have taken place in the period after the Better Work Haiti assessment and that non-compliance will likely reduce in the next reporting period because of the publication of the new decree, which removes the obligation to pay the lunch break.  In the compliance point related to paid leave, Better Work Haiti has found that 71% of factories pay the annual leave incorrectly, and that 77.4% of factories are in non-compliance for the correct payment of maternity leave. 100% of factories provided extra daily breaks to pregnant or breastfeeding women.  In the compliance point related to social security benefits, the payment of the lunch break will no longer be included in the calculation of the average daily earnings. Thus, factories that were in noncompliance because of the non-payment of the lunch break will no longer be non- compliant, if there are no other elements negatively impacting the calculation of the average salary. However, for this period, 87% of factories (27 out of 31) did not submit the accurate amount to OFATMA for work related accident insurance. Several factories made partial payments (Employers contribution 3%) per agreement with OFATMA but failed to provide assessors with an agreement letter from OFATMA during the assessment. Nineteen out of 31 factories (62.2%) were non- 2 2 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I compliant for failing to pay workers correctly for the annual salary supplement or bonus. It is important to note that despite the persistent non-compliance in some questions within the compensation cluster, no violations were found related to payment methods, minimum wage payments, overtime payments, or unauthorized deductions from workers' wages. 2 3 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I The highest rates of non-compliances in the Haitian garment industry 65 % Factories do not have adequate fire-fighting equipment Emergency preparedness non-compliance continues to be a top priority for Better Work Haiti. Within this cluster, it's noteworthy that 64% of factories lack adequate fire- fighting equipment, and 64% were also non-compliant regarding the accessibility, obstruction-free status, and unlocked state of emergency exits during working hours. These concerns will remain a focus for ongoing attention and remediation efforts by Better Work Haiti. 65 % Factories have issues internal work rules The most prominent non-compliance issue within the Employment Contracts cluster, standing at 64%, pertains to questions regarding internal work rules. Although many factories possess a document delineating their internal work rules, in some cases, this document lacks approval from the Ministry of Labor, as mandated by law. 61.2 % Factories have issues with annual salary supplement or bonus Non-compliance regarding social security and other benefits remains elevated at 94%. Nonetheless, it is anticipated that non-compliance in this area will decrease, given that the lunch break payment, which had been contributing to non-compliance in this cluster, is no longer mandatory. 84 % Factories have issues with properly labelling, keeping accurate inventory and material safety data sheets of their chemical products Non-compliance concerning the management of chemical and hazardous substances continues to be significant, standing at 100%. However, non- compliance related to the proper storage of chemicals is relatively low at 19% (8 out of 31), whereas 84% of factories were found to be non- compliant when it comes to proper labelling, keeping accurate inventory and material safety data sheets of their chemical products. 2 4 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I 0% 3% 0% 6% 3% 0% 0% 6% 0% 0% 32% 0% 0% 3% 0% 0% 20% 40% 60% 80% 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 Child Labour Discrimination Forced Labour Freedom of Association and Collective Bargaining Non-compliance rates by Compliance Point - July 2022 - June 2023 (Core Labour Standards Clusters) Non-compliance rate (n= 31) 2 5 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I 0% 0% 10% 87% 3% 94% 13% 16% 3% 71% 68% 100% 97% 100% 74% 94% 6% 97% 87% 39% 0% 77% 0% 20% 40% 60% 80% 100% 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 Compensation Contracts and Human Resources Occupational Safety and Health Working Time Non-compliance rates by Compliance Point - July 2022 - June 2023 (National Law Clusters) Non-compliance rate (n= 31) 2 6 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Details of the root causes of the non-compliances findings Non compliance issues by clusters and complaince Points Number of factories out of 31 Child Labour Documentation and Protection of Young Workers Did not have a reliable system to verify the age of workers prior to hiring 1 Compensation Overtime Wages Failed to pay 50% above the normal wage for all ordinary overtime hours worked 2 Failed to pay 50% above the normal wage for overtime hours worked on legally mandated holidays 1 Failed to pay 50% above the normal wage for overtime hours worked on weekly rest days 2 Paid Leave Failed to pay workers correctly for annual leave 22 Failed to pay workers correctly during the daily break 22 Failed to pay eligle workers correctly for sick leave 24 Failed to pay eligle workers correctly for maternity leave 24 Premium Pay Failed to pay 50% above the normal wage when workers work regular hours on legally mandated holidays 1 Failed to pay 50% above the normal wage when workers work regular hours on weekly rest days 1 Social Security and Other Benefits Failed to pay workers their annual salary supplement or bonus 19 Failed to pay the 3% of workers' salary to OFATMA for work-related accident insurance 27 Failed to collect and forward correcty the required workers’ and employers' contributions to OFTAMA for maternity and health insurance 28 2 7 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Failed to collect and forward correcty the required and employers' contributions to ONA 28 Failed to send the last workers' pay slip to OFATMA for sick leave or maternity leave payment 22 Wage Information, Use and Deduction Did not keep only one accurate payroll record 4 Contracts and Human Resources Contracting Procedures Did not comply with limits on the trial period for apprentices 1 Did not comply to at least one of the legal requirements for compensation, contracts, OSH and/or working time pertaining to non-production workers and/or sub-contracted workers 4 Dialogue, Discipline and Disputes Had any workers that has been bullied, harassed, or subjected to humiliating treatment 1 Employment Contracts Had contracts that do not fully comply with the labour code, collective agreement and internal work rules 6 Had internal work rules that do not fully comply with legal requirements 20 Had written employment contracts that do not specify the terms and conditions of employment 5 Termination Did not provide workers proper notice of termination when required, or pay workers during the notice period 17 Terminated workers for reasons that are invalid under national law 2 Failed to compensate workers correctly for unused paid annual leave when they resign or are terminated 21 Did not pay workers correctly their annual salary supplement or bonus upon termination 19 Discrimination Gender Had workers subject to sexual harassment 1 2 8 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Dismissed workers or force them to resign if they are pregnant, on maternity leave or nursing 1 Race and Origin Have race, colour or origin a factor in decisions regarding conditions of work 1 Forced Labour Coercion Did not allow workers to freely terminate their employment with reasonable notice, and to leave their jobs when their contracts expire 1 Punished workers for participating in a strike 1 Freedom of Association and Collective Bargaining Collective Bargaining Failed to implement any of the provisions of the collective agreement(s) in force 10 Strikes Punished any workers for participating in a strike 1 Occupational Safety and Health Chemicals and Hazardous Substances Did not properly label chemicals and hazardous substances 26 Did not properly store chemicals and hazardous substances 8 Did not have chemical safety data sheets for all the hazardous chemicals used in the workplace 26 Did not keep an inventory of chemicals and hazardous substances used in the workplace 26 Did not provide adequate washing facilities and cleansing materials in the event of exposure to hazardous chemicals 13 Failed to effectively train workers who work with chemicals and hazardous substances 4 Did not take action to assess, monitor, prevent and limit workers' exposure to chemicals and hazardous substances 14 2 9 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Emergency Preparedness Did not keep emergency exits and escape routes clearly marked and posted in the workplace 17 Did not safely store flammable materials 3 Did not appropriately safeguard possible sources of ignition 5 Did not keep emergency exits accessible, unobstructed and unlocked during working hours, including overtime 20 Did not have enough emergency exits 1 Did not conduct periodic emergency drills 14 Did not have fire detection and alarm system at the workplace 14 Did not have adequate fire-fighting equipment at workplace 20 Did not train an appropriate number of workers to use the fire-fighting equipment 9 Failed to inform and prepare workers for possible emergencies in the workplace 2 Health Services and First Aid Failed to provide annual medical checks to workers 15 Failed to provide free health checks to workers exposed to work-related hazards receive 18 Did not have the required onsite medical facilities and staff at the workplace 25 Failed to ensure there are a sufficient number of readily accessible first aid boxes/supplies in the workplace 20 Failed to provide first-aid training for workers 14 Did not provide the health cards within the first 3 months of hiring to workers 17 OSH Management Systems Failed to record work-related accidents and diseases and submit the record to OFATMA on a monthly 8 Did not develop mechanisms to ensure cooperation between workers and management on OSH matters 4 Did not perform an assessment of general occupational safety and health issues in the factory 7 Did not have legally required structural safety certificates 16 Welfare Facilities 3 0 2 6 T H C O M P L I A N C E S Y N T H E S I S R E P O R T U N D E R H O P E - H A I T I Failed to provide workers enough free safe drinking water 12 Did not have adequate accessible toilets in the workplace 20 Did not have adequate hand washing facilities and adequate soap in the workplace 8 Did not have an adequate eating area in the workplace 7 Worker Accommodation Failed to prepare adequately for emergencies in the accommodation 2 Failed to have accommodation to protect against fire 2 Worker Protection Did not post appropriate safety warnings in the workplace 4 Did not properly install or failed to maintain the electrica