14539 ratool apparels ltd. bangladesh wrap fcr ar 13638

WRAP CERTIFICATION PROGRAM

Facility Certification Recommendation Monitor Report No. 13638 Factory’s WRAP ID No. 14539 To: WRAP Certification Board

We have conducted an independent compliance assessment of the facility listed below. As per WRAP Certification Program requirements, we find that practices consistent with the WRAP Production Principles have been in place for a period of not less than ninety (90) days prior to the inspection below.

Our independent assessment was made in conformance with the criteria of the WRAP

Facility Self-Assessment Handbook and the WRAP Monitors Manual, and done in keeping with the WRAP Policies for Recognition of Monitoring Partners. On May 30, 2013 ALGI Bangladesh, performed the (date of final inspection) (monitoring firm) WRAP compliance evaluation visit on the facility:

Ratool Apparels Ltd.-Bangladesh (Name and country of facility)

and hereby recommends it for certification under the WRAP Certification Program. Rasel Parves May 30, 2013 Name of Independent Lead Monitor Date

_____________________________________ Angelo Valdevitt Authorized Signature for Independent Monitoring Firm Name of Authorizing Official Date of Initial Compliance Visit: May 30, 2013 Date(s) of Corrective Action Plan Visit(s), (if relevant): __________________________

WRAP Audit Report ALGI version April 2013

PHOTOS

General Information

Factory Building Factory Gate

Cutting Section Sewing Section

2

Finishing Section Packing section

Boiler Room Generator Room

Fire Fighting Equipments First Aid Box

3

Evacuation Plan Accessories Store

Finished Goods Store Fire Hose Rill

Fire Alarm Dining Hall

4

Medical Room Child Care Room

WRAP COC Posted Fire Alarm Bell

Non Compliances Nil Best Practices Nil

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Facility Audit Report

Audit Details WRAP Registration #: 14539 Monitor REPORT #: 13638 Report Type: Recommendation CAP Audit Type: First-time certification Re-certification CAP follow up

Unannounced Audit Date(s): 1st audit May 30, 2013 Follow up 1 Follow up 2 Follow up 3 Was the audit unannounced? Yes No

If No, please state the reason(s) why: Was the Facility Self-Assessment Packet reviewed by the Lead auditor before the audit?

Yes No If No, why not?

Monitoring firm name and address: ALGI Bangladesh,A-6,11, Gausul Azam Avenue,Sec-14, Uttara, Dhaka-1230

Auditor Name(s) and role(s): Lead auditor Rasel Paves Audit team members Amirul Islam A.T.M. Anisuzzaman Technical experts N/A Trainee auditors* N/A Others N/A * Trainee auditors are only allowed to observe WRAP audits; they are not allowed to take any active part in the audit. Only WRAP accredited auditors’ time will count towards the man-day requirements for the audit.

Report written by: Rasel Parves Report reviewed by: Rashedul Karim Report issue date: June 09, 2013 Time in and out of the facility: Day 1 in 09:30 am Day 2 in Day 3 in Day 4 in

Day 1 out 05:30 pm Day 2 out Day 3 out Day 4 out Total number of man-days for this audit: Three auditors for one day. If a follow up audit, was a factory tour conducted?

Yes No N/A If No, why not?

Facility Name: Ratool Apparels Ltd. Country: Bangladesh Facility Main Contact and Title: Mohammed Mostofa-Managing Director Who signed and agreed CAP? (Name and title):

Mohammed Mostofa-Managing Director

Full Address of Site covered in this audit: (both English and Local language)

Choyadana, Joydebpur, Gazipur, Bangladesh

Registered Business name and address (in English, and, if needed, local language):

Ratool Apparels Ltd. Choyadana, Joydebpur, Gazipur, Bangladesh Are these the same as the facility name and address covered in this audit? Yes No If No, please explain:

Applicable business and other legally required licence numbers:

Factory Licence: 15457/Gazipur

Facility Phone #: +88-0682-9293087 Site E-Mail: [email protected] Products / Activities at Site e.g. garment manufacture, electrical, toys, service, other (please state):

Garments Manufacturer- Knit Item

Audit results reviewed with facility management?

Yes No If No, please explain:

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Policy and Procedures Table

Policy and procedures

Was the facility in compliance with the requirement to have:

Written Policies? Written Procedures?

1 Compliance with Laws and Workplace Regulations Yes No Yes No 2 Prohibition of Forced Labor Yes No Yes No 3 Prohibition of Child Labor Yes No Yes No 4 Prohibition of Harassment or Abuse Yes No Yes No 5 Compensation and Benefits Yes No Yes No 6 Hours of Work Yes No Yes No 7 Prohibition of Discrimination Yes No Yes No 8 Health and Safety Yes No Yes No 9 Freedom of Association and Collective Bargaining Yes No Yes No 10 Environment Yes No Yes No 11 Customs Compliance Yes No Yes No 12 Security Yes No Yes No

Non-Compliance Table

Issue

Area of Non-Conformity

(Only check box when there is a non-conformity)

WRAP Principles Local or National Law

1 Compliance with Laws and Workplace Regulations

2 Prohibition of Forced Labor

3 Prohibition of Child Labor

4 Prohibition of Harassment or Abuse

5 Compensation and Benefits

6 Hours of Work

7 Prohibition of Discrimination

8 Health and Safety

9 Freedom of Association and Collective Bargaining

10 Environment

11 Customs Compliance

12 Security

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Historic Non-Compliance Table

Issue

Area of Non-Conformity

(Only check box when there is a non-conformity)

WRAP Principles Local or National Law

1 Compliance with Laws and Workplace Regulations

2 Prohibition of Forced Labor

3 Prohibition of Child Labor

4 Prohibition of Harassment or Abuse

5 Compensation and Benefits

6 Hours of Work

7 Prohibition of Discrimination

8 Health and Safety

9 Freedom of Association and Collective Bargaining

10 Environment

11 Customs Compliance

12 Security

Audit Overview Site Description: (Include size, location, age, structure, number of buildings) The facility is located at Choyadana, Joydebpur, Gazipur, Bangladesh. The facility comprises of 1 building and 1 shed. Facility description is given below. Building # 1 (7 storied) Ground floor is occupied by child care, doctor room, bonded warehouse, finished goods store and boiler room. First floor is occupied by finishing section. Second floor is occupied by sewing section. Third floor is occupied by sewing section. Fourth floor is occupied by sewing section. Fifth floor is occupied by cutting section. Sixth floor is occupied by workers dining and prayer room. Shed # 1: is occupied by generator room. The facility is of concrete structure with a total built up area of about 3600 sq ft where production areas are about 30,200 sq ft and ware house areas are about 2,500 sq ft. The facility was established in the year 2011.

Total number of workers in the factory during the audit was 512 and total production space allocated by the factory for workers was 8456 cubic meter (30200*10=302,000 cubic feet*.028=8456 cubic meter). So space per worker was found 16.51 cubic meters where law requirement is 9.5 cubic meter and was found not overcrowded. Total number of emergency staircase of the factory was two for the building (50 inch both) adequate width. From physical observation, it can assume that worker can evacuate by using those staircase within very short time in case of emergency. Total employees of the

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factory was found trained on emergency evacuation and health and safety and total 250 fire fighter was found trained in the factory as per their documents. No other factory is located in the same premise.

Process Overview: (Include products being produced, main operations, number of production lines, chemicals – either for production, cleaning or fuel – used, main equipment used) Products being produced: All types of knit items. Main operation: Cutting, Sewing, Finishing & Packing. Production lines: 8 sewing lines. Production capacity: 250,000 pieces per month. Chemicals used: Lubricating oil, machine oil, detergent and spot lifter, Main equipment (with numbers): Plain machine: 76, Over lock machine: 76, Flat lock machine: 36, Rib cutter: 2, Hole stitch machine: 5, Button stitch machine: 2, Bartech machine: 1, Fit of the arm: 2, Back tab machine: 2, Kansai: 1, Cutting machine: 3, Fusing machine: 2, etc. Product produced for: Wal-Mart

Worker analysis

Permanent Temporary Migrant workers

(domestic or foreign) Agency Home

workers Worker numbers (male) 103 0 0 0 0 Worker numbers (female) 409 0 0 0 0 Total number of workers at the facility 512

Other personnel

Management 3rd party

service providers

Security personnel

Agency cleaners

Agency canteen staff

Others (please state) Cleaner

30 0 7 0 0 11

Worker interviews conducted

Permanent Temporary Migrant workers

(domestic or foreign) Agency Home workers

Number of individual interviews 15 0 0 0 0 Number of groups interviewed 15(3*5) 0 0 0 0

Site information

Were appropriate records available to verify hours of worker and wage compliance?

Yes

No

Describe nature of any inconsistencies found:

Poor record keeping No records Multiple records

Month(s) of peak season (if applicable):

Same round the year

Normal Work Days: e.g. Mon ─Sat

Saturday to Thursday

What is the level of lowest wages paid? Below legal minimum At legal minimum Above legal minimum

What is the % of piece rate workers (if 0

9

applicable)?

Are the correct overtime premiums paid? Yes No

Is there any night production work at the facility?

Yes No

What is the % of workers living in facility provided accommodation (if applicable)?

0

Age of youngest worker found: 19

Are workers under 18 subject to hazardous work assignments?

Yes No

What form of worker representation is there on site?

Union (name) Worker Committee Other (specify)

Is internal system monitoring conducted by the facility on a regular basis?

Yes No Internal audit conducted on April 02, 2013 and MRM on April 03, 2013 (conducted once in one month)

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PRINCIPLE 1 COMPLIANCE WITH LAWS AND WORKPLACE REGULATIONS

AUDIT QUESTIONS YES NO NA COMMENTARY

1.1 Does the facility obtain current information on local and national laws and regulations concerning each of the Principles and incorporate this information in its business practices?

The facility obtains current information on local and national laws and regulations concerning WRAP principles through: training program and posters posted on production floors in notice boards and in front of main entries. Responsible Person for communicating changes of laws and regulations and incorporating in the business practices: Position: Managing Director Name: Mohammed Mostafa Responsible since: November 01, 2011

1.1a Does the facility have written policies and procedures for current information on national and local laws and regulations on each of the following WRAP Principles? Compliance with Laws and Workplace Regulations

WRAP Policy & Procedure Manual No-01 Issue No-01 Rev 00

Prohibition of Forced Labor WRAP Policy & Procedure Manual No. 01 Issue No-01 Rev 00

Prohibition of Child Labor WRAP Policy & Procedure Manual No. 01 Issue No-01 Rev 00

Prohibition of Harassment or Abuse WRAP Policy & Procedure Manual No. 01 Issue No-01 Rev 00

Compensation and Benefits WRAP Policy & Procedure Manual No. 01 Issue No-01 Rev 00

Hours of Work WRAP Policy & Procedure Manual No. 01 Issue No-01 Rev 00

Prohibition of Discrimination WRAP Policy & Procedure Manual No. 01 Issue No-01 Rev 00

Health and Safety WRAP Policy & Procedure Manual No. 01 Issue No-01 Rev 00

Freedom of Association & Collective Bargaining

WRAP Policy & Procedure Manual No. 01 Issue No-01 Rev 00

Environment WRAP Policy & Procedure Manual No. 01 Issue No-01 Rev 00

Customs Compliance WRAP Policy & Procedure Manual No. 01 Issue No-01 Rev 00

Security WRAP Policy & Procedure Manual No. 01

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Issue No-01 Rev 00

1.2 Does the facility have a qualified person responsible for informing the facility of changes to laws and regulations, or access to current publications on national and local labor laws?

Name: Mohammed Mostafa Position: Managing Director Responsible since: November 01, 2011

1.3 Does the facility update its practices to incorporate revision to existing laws and regulations in a timely fashion?

Last revision – Minimum wage gazette for garments sector published on October 2010 effective from November 2010

1.4 Does the facility undertake internal monitoring of its management system (internal audits) to satisfy itself that the written procedures and processes are meeting the requirements of local law and WRAP Principles?

Internal audits have been conducted once on April 02, 2013 and the result showed it meets the local law requirement and WRAP Principles.

1.5 During the previous two years, has the facility had any notices of noncompliance levied against it (including any legal proceedings or outstanding allegations concerning the facility’s operations)?

N/A (no non compliance levied during past two years.)

1.6Is there a program to train relevant individuals regarding any new laws or revisions to existing laws and regulations?

Training planner document. Last training April 15, 2013 Subject/s of training: Minimum Wage Gazette published on October 2010, effective from November 2010

1.6a Are the materials used for this purpose appropriate? Training material used - Hand book given to

employees and WRAP principles translated

1.7. Document exceptions to local and national laws, rules, and regulations other than those specifically documented elsewhere in this report.

N/A

1.8 Does the facility have a written operating policy manual that include the following:

a. The national and local laws and regulations pertaining to the Principles?


b. The facility’s policies and procedures pertaining to the Principles?


c. Routine updates for revisions to existing laws and regulations? WRAP Policy & Procedure Manual No. 01

Issue No-01 Rev 00

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Subcontracting

1.9. Does the facility sub-contract any of its production operations?

The facility did not use any subcontractor as they have all the process in their factory premises.

1.10 Does the facility sub-contract any other operations?

All the processes are running in the factory premises. They do not have any subcontracting process.

1.11 How has the facility informed the sub-contractor of their obligations under the local labor law and WRAP Principle requirements?

The facility did not have any subcontracting process.

1.12 Does the facility keep evidence of how any sub-contractor has been made aware of these requirements?


1.13 Does the facility keep receipt of sub-contractor acknowledgement of these requirements?


1.14 Does the facility regularly review its list of sub-contractors to make sure it is up to date?


Best practices observed:

None

1. COMPLIANCE WITH LAWS AND WORKPLACE REGULATIONS

Facilities will comply with laws and regulations in all locations where they conduct business.

Non-compliances raised against this Principle Nil Historic Non-compliances raised against this Principle Nil

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PRINCIPLE 2 FORCED LABOR


2.1 Are all employees working at the facility voluntarily?

Interviews, document review and visual walkthrough of the facility did not reveal any form of indentured, bonded, or forced labor.

2.2Are there any indications that people's movements are being restricted? Workers are free to leave the factory during the

breaks.

2.3Are there exaggerated security measures or logistics being employed in the facility?

Walk through and worker interviews did not reveal excessive security arrangements or procedures being used.

2.4Were there any overt signs of fear or exaggerated obedience displayed by employees during the facility inspection?

No signs of fear seen among workers during walkthrough or interviews.

2.5Do security personnel act in a non-threatening manner? Attitude of security guards was judged to be

professional and courteous.

2.6 Are security guards posted for normal security reasons, in a proportionately logical number?

Walk through of the facility did not reveal any excessive security being deployed.

2.7 Are the doors and gates of the facility locked only for normal business and housing security reasons in compliance with applicable local and national fire codes?

Doors and gates remain open during the operational hours, from 8:00 am to 5:00 pm for. Factory runs through Saturday to Thursday and during overtime hours as needed.

2.8 Does the facility prohibit all relevant individuals, including any person under the facility's direction (such as security guards), from coercing employees in any way, or unnecessarily limiting employees' freedom of movements? Is employee freedom of movement unimpeded upon their shift's conclusion?

Policies, workers interviews and walkthrough of facility did not reveal restriction of movement or employees subjected to coercion. As per interviews and auditors’ observations, the employees are free to leave after the end of their shift.

2.9 Does the facility require all hiring documents (e.g. an employment application or contract) to: 1) include a statement affirming that applicants are seeking employment voluntarily and are not under threat of any penalty, 2) be signed by each applicant, and 3) be maintained in the employee’s personnel file?

Facility requires hiring documents, employment application and contracts to be signed by each applicant and maintained in the personnel files. Measure was corroborated with 30 personnel files reviewed. Contracts include a statement that reflects that employment is on a voluntary basis and not under threat of any penalty.

2.10 Does the facility obtain proof that anyone seeking employment is legally entitled to work in the country of manufacture in accordance with national immigration laws?

No immigration workers found in this facility.

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2.11 Does the facility obtain an executed statement from all labor brokers/agents used by the facility stating that the brokers/agents are not supplying labor that is involuntary or forced, and has the right to work in this country?

All hiring is done directly by the HR department.

2.12 Does the facility have a qualified person responsible for communicating, deploying and monitoring the practices of effectively prohibiting involuntary or forced labor?

Name Mohammed Mostafa Responsible since: November 01, 2011

2.13 Does the facility have a program and materials used to train relevant individuals, including all individuals responsible for the hiring process, on the facility’s policies and procedures prohibiting forced or involuntary labor?

Training document details training to be carried out for the year 2013 Last training on hiring process and prohibiting forced or involuntary labor was done on March 03, 2013

2.14 Are all security service agreements free of any language or terminology that may imply the existence of forced, indentured or involuntary labor conditions?

Security guards’ job responsibility clearly defines their responsibilities and does not include any language referring to force, indentured or involuntary labor enforcement.

2.15 Do job descriptions or individual contracts for security employees limit their tasks to normal security matters such as protection of facility property or facility personnel?

The job descriptions for security employees limit their tasks to normal security matters and protection of the company’s property.

2.16 Does the facility issue wages/compensation directly to employees, or in an unambiguous system that clearly shows that the employee controls the destination of his/her wages, and access to his/her wages?

All wages are paid directly to employees by cash. This was verified during worker interviews and through pay stubs.

2.17 Does the facility hold identification papers, travel documents or passports of their employees? If it does, please provide commentary on whether it is at the request of their employee and with the employee maintaining complete access.

As per workers’ interviews, facility requires copy of documents rather than original documents. Information verified during worker interviews (30) and review of personnel files (30).

2.18 Is any prison labor used in this facility? If so, please explain & provide information about local & national law, and industry standard(s).

Document review, management and employee testimony confirmed that no prison labor is used by the facility.

2.19 Are all work contracts signed by both parties (employer and employees)? For countries with at-will employment and/or no formal contracts, include a statement to that effect.

All work contracts are signed by both employer and employees. Workers receive a copy.

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None

2. FORCED LABOR Facilities will not use involuntary, forced or trafficked labor.


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PRINCIPLE 3 CHILD LABOR


3.1 Does the facility obtain proof of age documentation from all potential workers and review the documentation for authenticity prior to hiring?

Facility requires Government ID card from job applicants and checks the authenticity before hiring.

3.2 How does the facility manage the hiring practice documenting the age of potential employees with official country specific documents (e.g., birth certificates, identification cards, school records and/or immigration papers, medical records)?

Age proof documents reviewed: Birth Certificate, School Certificate and Dental Certificate provided by authorised doctor.

3.3Does the facility obtain and retain proof of age for each employee and maintain information in the employee personnel file regarding how long the employee has been working at the facility?

30 individual files reviewed which contain Birth Certificate, School Certificate and Dental Certificate as age proof document. Service record in Personnel file. Work contracts contain information reflecting the date of hire.

3.4 Does the facility assesses the authenticity of age documentation and makes comparisons with sample documents? Apply extra diligence in territories where child labor is common.

Authenticity is verified by comparing with similar sample documents and verifier’s work experience.

3.5 Does the facility ascertain the employee’s stated age through the interview process? Verify that the physical appearance of employees selected is consistent with their age and employment history as documented in their personnel file.

“Verification for young looking employees” is used during recruitment and compared with age proof documents

3.6 Does facility document the existence of an employment interview (e.g. a checklist indicating that the required questions were asked of the applicant)?

Interview checklist and “Verification for young looking employees” is used during recruitment and compared with age proof documents.

3.7 Does the facility require a completed and signed employment application or contract that includes the date of birth (inclusive of the employee signature, employee identification number and signature date)?

Appointment letter and Service record contains these information including date of birth. 30 contracts reviewed in personnel files contain this information including date of birth.

3.8Has the facility formally designated a qualified person with responsibility for communicating, deploying and monitoring child labor practices as they relate to the above requirements?

Name: Farjana Sultana Position : Officer (HR & Compliance) Responsible since: October 01, 2012

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3.9 Does the facility verify that the responsible person ensures that employee’s assigned tasks are appropriate for their age, where applicable?

No child or young looking employee was found in the factory premises.

3.10 Review the facility’s communications made to all relevant facility employees regarding child labor policies and procedures. Do the communications address each of the following requirements? 3.10a. Obtain proof of age documentation from all potential workers prior to hiring.

HR department informs the requirements when prospective employee contacts facility for employment or when called for interview.

3.10b. Critically examine the authenticity of age documentation.

Comparison of the age proof documents against sample documents. Alternate methods (like Dental check up) to verify age. Interview checklist : “Verification for young looking employees” is used during recruitment

3.10c. Question the authenticity of age documentation not conforming to facility practices.

Alternate methods (like Dental check up) to verify age. Interview checklist : “Verification for young looking employees” is used during recruitment

3.10d. Age documentation retained in employee personnel files. 30 Personnel files contained copy of age proof

document.

3.10e. Interviews with all prospective employees. “Verification for young looking employees” used for young looking workers.

3.11 Do the programs and materials used to train relevant individuals on the child labor practices, including all individuals responsible for the hiring process, cover requirements to obtain age documentation, review age documentation for authenticity, and interview all prospective employees?

Training planner which details training to be carried out for the 2013 includes Child Labour. Last training conducted on: April 02, 2013

3.12 Do all employees in the facility appear to be above the minimum age? If a reasonable suspicion exists that there are age-borderline employees, be extremely cautious and attentive to assessing this compliance. If you suspect the age of any individual(s) you view working in the facility, you MUST seek to include them in the review process for age authentication, including employee interview.

Young looking workers are selected for interview during the walk through the facility. No violations noticed.

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None 3. CHILD LABOR

Facilities will not hire any employee under the age of 14 or under the minimum age established by law for employment, whichever is greater, or any employee whose employment would interfere with compulsory schooling.


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PRINCIPLE 4 HARASSMENT OR ABUSE


4.1 Has the facility adopted a written policy on the prohibition of harassment, abuse and corporal punishment?

Policy No 04 of the Manual It was verified through document review.

4.2 Are the definition(s) of the non-compliant behavior(s) and management policy (es) towards them consistent with the intent to prohibit all forms of this behaviour?

Policy displayed in production floors and in front of the main entries. The definition of a noncompliant behaviour is available in the company procedure document on standing orders and intents to prohibit all forms of misbehaviour.

4.3 Does the policy include reasonable punitive repercussions for non-conformance and repeated non-conformance? Note: The policy must apply to the behaviour of all employees with special emphasis placed upon supervisory personnel.

Policy and procedure addresses this requirement and includes punitive repercussions if not complied with. This document has been signed by all workers, supervisors and managers as a token of understanding of this policy.

4.4 Has the facility’s management signed statements affirming their understanding of the facility’s anti-harassment and abuse policies? Note: If the facility has not required signed statements in the past, evidence of statements signed on a prospective basis, i.e., from a certain date forward, is acceptable.

Affirmation statement signed by staff, supervisor and managers. Each line supervisor and every employee in managerial level receive a copy of the procedures. Signed statements confirm receipt of the information.

4.5 Does the facility effectively prohibit all forms of harassment, abuse and corporal punishment through written policies and procedures?

The facility has a policy displayed in production floor prohibiting all forms of harassment, abuse and corporal punishment. Training carried out periodically on the subject Last training dated April 18, 2013

4.6 Does the facility communicate the policy on the prohibition of harassment and abuse to workers and third party services (e.g., security guards, kitchen services) that will have significant contact with facility employees?

Policy displayed on the production floor and in front of the main entrance. of the facility in English and local language.

4.7 Does the facility encourage employees to report instances of harassment or abuse, without fear of retribution, through effective communication of facility policies and a timely resolution of matters reported?

Suggestion boxes are placed near the rest rooms. The suggestion boxes are opened every week by the Administrative Manager and a representative of the grievance committee. The grievance committee meet once in three months to discuss such issues. Last meeting held on April 18, 2013

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4.8 Does the facility have an effective and mandatory program to train relevant individuals, including all individuals responsible for the supervision of workers, on the facility’s policies and procedures prohibiting all forms of harassment, abuse and corporal punishment?

Training planner document details training planned for the year 2013 Date of last training: April 18, 2013

4.9 Are all the materials used for this purpose appropriate for this training? WRAP documentation, displayed copies of

standing order.

4.10 While inspecting the plant, were any signs noted of physical abuse (including but not limited to shared physical characteristics evident in many workers), such as: a. bruising? Walk through did not reveal any such case.

b. obvious physical injuries (casts, or other corrective wraps, an exaggerated repetition of the same medical condition)?

Verified injury log and medical records did not reveal such cases.

c. isolated employees? None identified.

d. overt sights of corporal or psychological punishment? No signs seen during walkthrough and during

interviews

Best practices observed: None

4. HARASSMENT OR ABUSE

Facilities will provide a work environment free of supervisory or co-worker harassment or abuse, and free of corporal punishment in any form.


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PRINCIPLE 5 COMPENSATION AND BENEFITS


5.1 Does the facility have practices to ensure employees are compensated consistent with their terms of employment and in accordance with local laws and regulations?

Audit team reviewed payroll records and Electronic time records for last three months, and sampled 30 individual cases for April 2013, March 2013 and February 2013. The facility obtained current issues of Government Laws and Regulations. The local minimum wage standard is BDT 3000/month and is displayed in each workshop.

5.2 Does the lowest record of payment by the facility meet (or exceed) the legal minimum compensation?

Pay roll record and pay slip verified. All employees are compensated at least the minimum wage as required by local requirement, for this purpose the minimum wage is BDT 3000 per month.

5.3 Does the facility post legal minimum wage rates, benefit policies, and additional payment information in the native language(s) of the facility workers?

Minimum wages as per Government Gazette for garments worker published on October 2010 and effective from November 2010

5.4 Does the facility utilize and maintain an organized system of recordkeeping?

Audit team verified that the facility utilizes and maintains an organized record-keeping system for recording and computing proper compensation including overtime. Facility uses electronic attendance system to record employees’ working hours.

5.5 Does the facility produce and retain payroll records to support compensation, including overtime?

Audit team verified that facility has a computerized system to produce and retain payroll records.

5.5a In case the facility pays its employees through wire transfers, do they produce and retain proof of bank statements showing all the transactions in a verifiable way? Note: The name of the employee, salary amount, and the date of the transaction must appear on the bank slip showing the transaction, as well as the recipient’s bank name and account.

The salaries to workers are paid in cash at the facility.

5.6 Does the facility provide all employees with a pay record or stub that lists the components of the wages paid?

Pay stubs list employee name, hourly rate wage, regular hours, overtime hours, overtime compensation, holiday compensation, full attendance allowance, gross wage, lawful deductions, net wage and signature. All employees are provided with pay stubs a day prior to the disbursement of wages.

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5.7 Are all legally mandated withholdings - e.g., taxes, social security, etc. - remitted to the government?

All employees’ are covered under Employees’ Insurance.

5.8 Are there any piece rate workers in the facility? If so, review a sampling of the documentation for piece rate workers as compared to wage rate workers to ensure compliance with this Principle.

No piece rate workers in this factory

5.9 Has the facility formally designated a qualified person with responsibility for communicating, deploying and monitoring the payroll and benefit system and ensuring that the wage rates and compensation calculations are adequately communicated to all workers in the facility?

Name: Mohammed Mostafa Job position : Managing Director Responsible since: November 01, 2011

5.10 Does the facility have a written and coherent policy on piece rate compensation and does the piece rate compensation at least satisfy the minimum compensation prescribed by law?

No piece rate workers in this factory.

5.11 Are employees provided with adequate communication of their legally mandated minimum compensation rights? Do they sign off on material counts or random independent recounts for piece rate systems?

Employee hand book provided to all employees. Factory’s Act Abstracts are displayed. Worker training includes compensation Last training conducted on February 28, 2013

5.12Does the policy communication include all of the following: - a detailed description of the employees compensation and benefits at the time of employment? - both a written and verbal explanations of wage calculations provided at the time of employment? - a requirement that changes relating to compensation rates or methods of wage calculations will be communicated timely and effectively?

Employee hand book provided to all employees. Government Abstracts are displayed and training is provided. Last training: February 28, 2013

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Wages analysis: Sample size 30 Wage periods checked April 2013 March 2013 February 2013 Legal minimum wage for standard time BDT 3000 Actual minimum wage paid at this facility BDT 3000 Lowest wage paid in sample BDT 5500 Highest wage paid in sample BDT 5500 What deductions are required by law? Unauthorised absent deduction Have all of these been made? Yes No Have they been forwarded to the appropriate authority? Yes No Legal overtime premium for weekdays: 200% of regular working hour Legal overtime premium for rest days 200% of regular working hour Legal overtime premium for holidays 200% of regular working hour

Social insurance coverage

Types of Social Insurances Coverage (No. of employees & %age of total) Work-Injury All Medical All Pension None Unemployment None Maternity For whom applicable Housing None Others (please specify) None


5. COMPENSATION AND BENEFITS

Facilities will pay at least the minimum total compensation required by local law, including all mandated wages, allowances & benefits.


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PRINCIPLE 6 HOURS OF WORK


6.1 Has the facility formally designated a qualified person with responsibility for communicating, deploying and monitoring that no employee works more hours per day and per week than the legal limits?

Name: Md. Azizul Hoq Job position: Safety Officer Responsible since: October 01, 2012

6.2 Does the facility have a program and relevant materials to train all individuals, including all individual responsible for production coordination and scheduling, to ensure that employees work no more than the legal maximum, including overtime ceilings?

The facility has statutory displays communicating legal requirements on working hours and overtime. The employment document provides information on working hours. Regular working hours are displayed in the facility. This is also part of the training program. Last training conducted on April 03, 2013

6.3 Are all employees are made aware, at the time of hiring, of facility policies and procedures, specifically the legal limitations on the maximum hours of work per day, week and month, both regular and overtime, and the maximum number of consecutive days they can legally be required to work?

Methods of awareness provision: Induction training Employee hand book. Statutory displays.

6.4 Does the facility retain time records that reflect the day and date employees worked, the number of hours worked each day, and the employees’ acknowledgements of the same?

Facility maintains an electronic time record system for recording all hours worked.

6.5 Does the facility have a written, rational and well communicated policy defining "urgent business needs"? Note: The definition of 'urgent business needs’ cannot be vague or open ended. It must be limited to delays/interruptions in production caused by natural calamities, non-repetitive production deadlines or unforeseen circumstances beyond the employer’s control. A coherent and consistent rationale must be evident in the definition and infrequent deployment of 'urgent business needs'.

Definition of urgent business needs: ‘For delays caused by national calamities such as, cyclone, fire, draught or delays caused by political reasons such as ‘hartal’, strikes, etc. and for non-repetitive production deadlines of unforeseen circumstances beyond our control, the facility may engage workers in overtime work and this overtime work shall be voluntary. This overtime hours shall not exceed legal limits’. Number of days urgent business needs occurred during the past year NIL

6.6 Are notifications of maximum regular and overtime hour policies visibly posted in the native language(s) of the facility's workers and management personnel?

Government Abstracts of legal requirements posted in main entrance of facility in the native language of workers and management personnel

25


6.7 Are all new workers, at the time of hiring, required to be made aware of the facility's policies on required hours of labor?

Orientation training and employee handbook which includes working and overtime hours’ policies is given to new workers at the time of hiring.

Hours of Work Analysis Review Periods # samples

reviewed Weekly average hours including overtime for this period (the calculation should be based on all your samples in each review period)

Weekly max hours for this period (including OT hours per week)

Frequency of occurrence of max hours (including OT hours per week)

April 2013 30 57.6 60 2 March 2013 30 58.6 60 3 February 2013 30 58.6 60 3

Legal standard work week for this country/industry 48 Contracted standard work-week this facility (hrs) 48 Actual standard work-week averaged over sample (hrs) 48 Actual weekly overtime hours (averaged over entire sample) 10.26 Range of weekly overtime hours over all workers sampled (quote highest and lowest)

Review period1 H __12__ L _0___

Review period2 H _12___ L __0__

Review period3 H __12__ L ___0_

Lowest regular weekly hours worked in sample 40 Highest regular weekly hours worked in sample 60 Legally permitted overtime hours 12 Any local waivers for this site? None


6. HOURS OF WORK Hours worked each day, and days worked each week, shall not exceed the limitations of the country’s law. Facilities will provide at least one day off in every seven-day period, except as required to meet urgent business needs


26

PRINCIPLE 7 DISCRIMINATION


7.1 Does the facility have a written policy that explicitly prohibits discrimination?

Policy No. 07 In the WRAP Manual

7.2 Does the facility have procedures and practices to ensure compliance and remediation with the facility policy?

Policy displayed in every workshop. Affirmative statements are signed by employees understanding the consequences of violation of this policy. This is also part of the training program. Last training: April 05, 2013

7.3 Does the facility have their written policy visibly posted in the language(s) of the employees and management personnel?

Policy displayed in the shop floor in English and Bengali language.

7.4 Has the facility formally designated a qualified person with responsibility for communicating, deploying, and monitoring the non-discrimination policy?

Name: Mr. Mia Manik Job position: Safety Office Responsible since: October 01, 2012

7.5 Does the facility have an effective program and materials used to train relevant individuals, including all individuals responsible for the supervision of workers and for the hiring process, on their discrimination policy and practices?

Training Planner – WRAP Awareness Training Last training conducted on April 05, 2013

7.6 Are the facility’s policy, practices and procedures on discriminatory behaviour effectively communicated to all employees?

WRAP Policies displayed in production area and WRAP Awareness Training is conducted. Last training conducted on April 05, 2013

7.7 Does the facility effectively communicate in writing the requirements of this Principle to third parties (industrial parks, export processing zones, free trade zones, etc.) that may recruit and screen applicants its behalf?

All hiring is done directly through the Human Resources Department. No third party is involved in hiring procedures.

7.8 Has the facility had any discrimination charges filed against it by employees, regulatory agencies or any outside agency during the past two years? If so, please provide details.

Audit team did not uncover any discriminatory charges against facility by employees, regulatory agencies or any outside agency during the past two years.

7.9 Does the facility explicitly prohibit mandatory pregnancy testing as a condition of employment or continued employment?

As per interviews, hiring practices reviews and management interviews, facility explicitly prohibits mandatory pregnancy testing as a condition of employment or continued employment.

27


7.10 Are workers with the same job and seniority paid the same rate, irrespective of gender, age, or other characteristics?

Auditor reviewed payroll records and observed that all employees performing the same task and with the same seniority are equally compensated. Workers confirmed the same.

7.11 Do all employees sign statements (statements may be included in an employment application or contract), written in the native language(s) of the employees, affirming their receipt and understanding of the facility’s anti- discrimination practices?

Induction training and Employee Hand Book given at the time of appointment Signed Affirmation Statement by staff, supervisors and managers.


None

7. DISCRIMINATION Facilities will employ, pay, promote, and terminate workers on the

basis of their ability to do the job, rather than on the basis of personal characteristics or beliefs.


28

PRINCIPLE 8 HEALTH & SAFETY


8.1 Are all local and national government health and safety certificates/permits, insurance policies and any relevant correspondence or documents from government officials in order? Please identify and report any irregularities.

Facility holds valid Fire License, Boiler license, boiler operator and electrician certificate. Trade License- 1456 Factory License- 15457/Gazipur Fire license – Dhaka/22974/2011, Valid up to June 30, 2013 Boiler License-Ba: B:-3528, valid up to January 01, 2014 IRC- Ba-0223441 ERC-010826 Bonded Warehouse- 1449/2012

8.2 Does the facility comply with all national and local health and safety laws and regulations? The facility has a written health and safety plan

complying with local laws & regulations.

8.3 Does the facility properly track health and safety incidents?

Form No 28 – Accident and dangerous accident register. Log of injuries and records of employees’ visits to the doctor were presented for review

8.4 Has the facility formally designated a qualified person with responsibility for communicating, deploying and monitoring all compliant health & safety policies and practices?

Name : Farzana Sultana (Officer HR & Compliance) Responsible since: October 01, 2012

8.5 Does the facility have a program and materials to train relevant individuals, including all individuals responsible for the supervision of workers, on all of the relevant occupational safety and health issues?

Training Planner details training planned for the year. Last training carried out on: April 03, 2013

8.6 Does a physical inspection of the facility verify that the workplace is operated and maintained in a safe and healthy manner?

Physical inspection of workplace is conducted by the facility management periodically.

8.6a (If applicable) Is the facility’s canteen/cafeteria operated and maintained in a safe and healthy manner?

Canteen was located on the top floor of the building with valid fire inspection report.

8.6b (If applicable) Is the facility’s creche/child-care area operated and maintained in a safe and healthy manner?

Child-care area been identified in the facility with safe and healthy manner.

29


8.7 Are exits unlocked during times when the facility is occupied to allow free, unobstructed exit from the facility?

Minimum two exits in all covered areas. Exits are clearly marked and unobstructed.

8.8 (If applicable) Are exits unlocked during times when the dormitories are occupied to allow free, unobstructed exit from the dormitories?

No dormitories

8.9 During the facility visit, were any aisles and/or exits blocked or restricting easy access to emergency exits?

Aisles unobstructed and provide easy passage to exits.

8.10 (If applicable) During the dormitory visit, were any aisles and/or exits blocked or restricting easy access to emergency exits?

NA ( No dormitory facility)

8.11 Does the facility have a written safety program, including a fire safety plan? Evacuation Plan displayed at prominent locations

8.12 (If applicable) Does the dormitory have a written safety program, including a fire safety plan?

NA (No dormitory facility)

8.13 Does the facility maintain first aid supplies as recommended by a local medical provider or required by law?

First aid kit is provided in every workshop as prescribed by Factory Rules 1979.

8.14 Are first aid supplies available and accessible to all areas of the facility? At least one first aid kit in each workshop. There

are 30 first aid kits in the facility.

8.15 Is employee training conducted for first aid and safety?

Last training carried out on April 03, 2013 First Aid Responders – 12 Fire fighters - 250

8.16 Are the first aid responders/emergency safety personnel properly identified and trained? There are 12 first aid responders certified by

Company doctor.

8.17 Is there clean drinking water that is easily accessible at the facility? Water test certificate by ICDDRB

Dated: May 20, 2012

8.18 (If applicable) Is there clean drinking water that is easily accessible in the dormitories? N/A

8.19 Is water provided at no cost to employees? It was verified through worker interview that water is provided at no cost to employees.

8.20 Does a visual inspection verify that there is a safe work environment, which includes: proper lighting and ventilation, sanitary toilet areas, structurally sound and clean building facilities?

Safe work environment Toilets - Male 10 and Female 25

30


8.21 (If applicable) Does a visual inspection verify that there is a safe dormitory environment, which includes: proper lighting and ventilation, sanitary toilet areas, structurally sound and clean dormitory facilities?

N/A

8.22 Does the facility maintain a safety committee comprised of workers and management, which holds regular meetings and keeps minutes of proceedings?

It was verified that facility maintains a safety committee comprises of 16 workers and 8 management representatives, which holds meetings quarterly and keeps minutes of proceedings.

8.23 Are the following safety documents maintained by the facility? a. Health and safety reports

Form No 28 – Accident and dangerous accident register.

b. Heavy machinery inspection (boilers, compressors, etc.)

Boiler License-Ba: B:-3528, valid up to January 01, 2014

c. Maintenance reports

Machine maintenance card Generator maintenance card Fire extinguisher maintenance card Boiler maintenance card

d. Fire extinguisher records, noting date of inspection and expiration Fire extinguishers are inspected monthly and

inspection records are maintained by the facility.

e. Emergency drill records, noting date and detailed results

It was verified that facility conducts semi-annual emergency evacuation drills for fire emergencies. Last three occurred on May 25, 2013, April 02, 2013, March 10, 2013, Time taken: 3.40 minutes Workforce present: 500 Number of injured workers: 0 Fire alarm rang by: Md. Mia Manik Last person to evacuate: Md. Mia Manik Reason: To observe everyone is evacuated safely.

f. Work injury reports Form 28 Accident and dangerous accident register.

g. Clinic logs, noting date and reason for visit The facility has a clinic on site with a qualified doctor. Medical logs with details: name of person, nature of ailment/injury and medicine issued.

8.24 Have any government agencies inspected the facility for compliance with safety and health regulations during the past two years? If yes, verify that findings are available and re-examine any specific findings issued.

No government agencies inspected the facility during past two years.

31


8.30 Does the facility have a chemical safety program? The chemical usage is restricted to oils for

operating machines and spot cleaning.

8.26 Does the facility properly store hazardous/toxic materials?

The facility stores its oils in a separate store with spill containment. Spot cleaning cans are stored adequately.

8.27 Are employees trained on chemical safety, if required?

It was verified that employees using glue and diesel oil are trained on chemical safety. Mr. Tariqul Islam–store keeper is authorized to enter the chemical section for providing the chemicals to different departments. Last training was done on February 03, 2013

8.28 Does the facility maintain documentation for chemical labelling, chemical usage warnings, and proper handling instructions?

Material Safety Data Sheets (MSDS) for glue and diesel oil are available in the production workshop.

8.29 Does the facility have written emergency procedures to handle natural disasters, fire emergencies, and industrial accidents?

Emergency preparedness plan is established to handle nature disasters such as earthquake and typhoon, fire emergencies, work injury etc.

8.30 (If applicable) Does the facility have written emergency procedures to handle natural disasters, fire emergencies, and industrial accidents for dormitories?

NA

8.31 Have selected employees been trained on the proper use of fire extinguishers?

Fire fighters – 250 members (Male: 160; Female: 90) Last training was provided on February 03, 2013 Training conducted by Fire Service and Civil Defence Department.

8.32 Does the facility have an emergency evacuation plan in the native language(s) posted in view of the facility's workers?

Evacuation plan displayed in prominent locations. In Bengali (language)

8.33 Does the facility conduct semi-annual (at least) emergency evacuation drills?

It was verified that facility conducts semi-annual emergency evacuation drills for fire emergencies. Last one occurred on May 25, 2013.

8.34 Does a facility tour verify that there are an adequate number and location of unimpeded emergency exits?

It was verified that there is an adequate number of properly located unimpeded emergency exits (at least 2 per production area).

8.30 Does a facility tour verify that fire extinguishers are visible, appropriate in number and easily accessible?

It was verified that there are visible, appropriate, and accessible fire extinguishers. Number of fire extinguishers: 77 Number of fire hydrants: 00 Number of sand buckets: 14

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Number of hose reels: 07 Number of smoke detectors: 87 Number of fire alarm: 8 Number of fire alarm triggers: 16 Overhead sprinklers: 0

8.36 Does the facility conduct hazard assessments to determine if any personal protective equipment is required?

It was verified that facility conducts risk assessments of each work process including cutting, sewing, finishing, etc to determine if any protective equipment is required.

8.37 If personal protective equipment is required, is it provided to affected employees at no cost? Worker interview corroborates the availability of

PPE at no cost.

8.38 Verify if regular occupational health check is arranged for hazardous job duties.

Occupational health checks were arranged annually for workers exposed to chemicals in printing department.

8.39 What is the overall general appearance of this facility and (if applicable) dormitories:

Excellent

Good

Fair

Unacceptable

Facility

Dorm

Facility was in clean and tidy condition.

8.40 Is the overall general appearance of the maintenance shop acceptable and not in a condition that can cause serious injury or harm?

Adequate lighting, orderly and tidy.

8.41 Is there a policy to maintain safe and orderly work conditions? Related policies were included in the factory rules

and posted onsite.

8.42 Are the toilets and washrooms in the facility, and (if applicable) the dormitories, in sanitary in serviceable condition?

Adequate toilets in serviceable condition as per legal requirements – 25 Ladies toilets and 10 gent’s toilet.

8.43 Is trash properly disposed of both inside and outside the facility?

Waste disposal policy: Policy No. 08 The medical waste is disposed by local Solid Waste Disposal Unit. Domestic garbage is disposed by City Corporation Authority. Biological waste disposal: N/A as they have only cutting, sewing and finishing process. Number of trash cans inside the facility: 00 Number of trash cans outside the facility: 00

33


8.44 (If applicable) Is trash properly disposed of both inside and outside the dormitory facilities? NA

.

8.45 Does the facility addresses the following occupational safety and health needs in the minimum conditions and regulations of local law, if required, or in healthful operating conditions? heat stress Adequate ventilation and fans provided

paint spray/spot cleaning booths Operators provided with gloves, face mask and goggles.

welding safety No welding done

respirator safety Dust masks provided

blood borne pathogen program Work Instructions to first aid responders

hearing (noise control program) Ear plugs provided.

indoor air quality Well ventilated and exhausted

cotton dust ventilation Well ventilated and exhausted

sanitary waste disposal Disposal by M/S. Almas Traders


None

8. HEALTH & SAFETY Facilities will provide a safe and healthy work environment. Where residential housing is provided for workers, facilities will provide safe and healthy housing.

Non-compliances raised against this Principle In accordance with Bangladesh Labour Law 2006, Chapter- 6, Section – 62 In every establishment the doors affording exit from any room shall not be locked or fastened so that they can be easily and immediately opened from inside while any person is within the room and all such doors, unless they are of the sliding type, shall be constructed to open outwards or where the door is between two rooms, and all such doors, unless they are of the sliding type, shall be constructed to open outwards or where the door is between two rooms, in the direction of the nearest exit from the building and no such door shall be locked or obstructed while work is being carried on in the room.

34

It was noted during plant tour that in dining area is partially blocked by seating chair in 7th floor. Comments- Above nonconformity is corrected on audit date. Historic Non-compliances raised against this Principle Nil

35

PRINCIPLE 9 FREEDOM OF ASSOCIATION & COLLECTIVE BARGAINING


9.1 Does the facility have written policies and procedures that recognize and respect the right of employees to exercise their lawful rights of free association?

It was verified through review of Policy No. 09

9.2 Has the facility designated a qualified person with responsibility for communicating, deploying and monitoring the freedom of association practices as prescribed by labour law?

Name: Parvin Akter Job position: Vice President -WA Responsible since: May 02, 2013

9.3 Does the facility have a union, association or collective representation of employees? Note: The monitor is required to indicate whether there exists or not an informal or formal association of employees. If a lawful association of employees exists, the monitor is required to include a representative of such association in the interview process.

The facility is not unionized. The facility has a Worker’s Committee which comprises of 14 workers. The members are fairly elected each year. Parvin Akter is heading the committee. Meetings are conducted monthly and recorded. Last meeting conducted on January 05, 2013

9.4 If a union or collective association which represents the employees exists, does the facility consults with the workers representatives on any issues that are a requirement by law such as factory disclosures, mass lay-offs, restructuring of the business etc.?

Facility would consult Parvin Akter who is the representative of worker’s committee, if needed.

9.5 If the workers do have an organized group that addresses workplace issues, does this workers’ group operates free from coercion or illegal restrictions to its operations?

Worker’s committee address work place issues. Free of coercion or restrictions. Worker interview did not reveal any non compliance.

9.6 If a lawful association of employees exists, is there any bargaining agreement or labor-management negotiation on workplace issues?

No legal union and no CBA

9.7 Is there are formal communication procedures between worker representatives and management?

Regular meeting would be arranged for communication between both.

9.8 Does the facility enter into discussions with the workers representatives in an open manner and within the terms of local law?

Facility management would participate in the meeting and follow up the issues raised by workers.

9.9 Are the minutes of facility / worker representative meetings documented and available to the workers?

Meeting minutes can be provided for review.

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9.10 Are workers representatives elected on a free and confidential basis by the workers? If not, what is the election process?

Worker representatives were elected on a voluntary and free basis.

9.11 Does the facility discriminate against employees who form or participate in lawful associations?

No adverse comments during worker interview Interviews by audit team did not reveal any information that would indicate actions by facility to discriminate against employees who are union members.

9.12 Does the facility discriminate against those who choose not to join any association?

Workers free to join any association – worker interviews. Interviews by audit team did not reveal any information that would indicate actions by facility to discriminate against employees who choose not to join any association.

9.13 Does the facility communicate its policies and practices pertaining to this Principle to all facility employees and third parties (e.g., free zone office services, employment agencies) that may perform recruitment or screening of applicants?

Facility Employees

Third Parties

The facility recruits directly through HR department.


None

9. FREEDOM OF ASSOCIATION & COLLECTIVE BARGAINING

Facilities will recognize and respect the right of employees to exercise their lawful rights of free association and collective bargaining.


37

PRINCIPLE 10 ENVIRONMENT


10.1 Does the facility have an environmental management system relevant to its industry? The facility has an Environment Policy No. 10

10.2 Has the facility formally designated a qualified person with responsibility for communicating, deploying, and monitoring the environment practices elaborated upon in the environmental management system?

Name Mr. Mia Manik Job position: Safety Officer Responsible since: October 01, 2012

10.3 Does the facility have a program and materials to train relevant individuals on each practice of the environmental management system?

Training Planner Last training on April 03, 2013

10.4 Does the facility assess its ability to prevent and control harmful releases of industrial waste into the environment as a part of the environmental management system?

Facility test air and noise from Adroit Environment Consultants Ltd. Air test date: June 07, 2012 Noise test date: June 07, 2012

10.5 Does the facility maintain a detailed plan for handling accidental release or discharge of environmentally dangerous materials?

Hazardous material used is restricted to oils (diesel oil, lubricant oil) and spot lifting. Spot cleaning can and oils are stored separately with proper spill containment and Waste disposal policy.

10.6 Does the facility maintain records of emission events?

Facility maintains forms to record emission events (no cases occurred as of the date of the audit)

10.7 Does the facility environmental management system address where and how solid, chemical, sanitary and wastewater substances are disposed of?

Waste disposal policy: Policy No. 10 The medical waste is disposed by local Solid Waste Disposal Unit. Domestic garbage is disposed by City Corporation Authority

10.8 Does a review of all local government environmental inspection reports, certificates/permits, notices of deficiencies, and corrective action notices or plans held by the facility, as well as any correspondence from government officials, reveal any irregularities? If so, please comment on how the facility has addressed them.

No irregularities recorded.

10.9 Does the facility adequately communicate to all facility employees the relevant local and

Through training conducted monthly Last training on April 05, 2013

38


national laws and regulations as well as pertinent facility procedures concerning the environment Principle?


None

10. ENVIRONMENT

Facilities will comply with environmental rules, regulations and standards applicable to their operations, and will observe environmentally conscious practices in all locations where they operate.


39

PRINCIPLE 11 CUSTOMS COMPLIANCE


11.1 Does the facility keep copies of all applicable customs laws and regulations?

Export Policy The Customs Act of 1969 Mr. Zakir Hossain, Commercial Manager, is designated to update and keep copies of all applicable customs laws and regulations. Responsible since: October 01, 2012

11.2 Do the facility’s policies and procedures on customs compliance cover the following requirements? 11.2a Facility complies with all applicable customs laws and maintains practices to comply with customs laws regarding illegal transshipment of products (in the event possible illegal transshipment activity, appropriate host government agency will be notified).

Customs Policy SC/ 11

11.2bMonitors its productions on a per style basis.

Facility maintains an organized system of production documentation by separating each purchase order and monitors its productions on a per style basis. Documents reviewed: Purchase Order, Contract sheet, Planning sheet, Packing Instruction and Production Records.

11.2cTraces country of origin using records such as production, shipping, verification reports, quality control reports, and individual piecework sheets, for all inputs.

It was verified by audit team through randomly selected sets of records for 03 different products. Following documents were reviewed: Bill of Lading/Airway Bill Certificate of Origin GSP Form A - Europe Single Country /multiple country Declaration – US Packing List Inspection reports – in process and final 10+2 Importer Security Filing Worksheet – US

11.2dVerifies production on an on-going basis on-site and at sub-contracting facilities.

Inspection reports- in process, final inspection and inward inspection for subcontracted processes.

11.2e Maintains a facility machine inventory and updates it annually.

The facility machine inventory is kept and update annually by Mr. Zakir Hossain-Commercial Manager. Last update was conducted in February 03, 2013.

40


11.2fEnsures that the proper category designation is determined for all goods destined for the US market.

Category and HS code are mentioned on the invoices. The HS Code is 61.05.100000

11.2gIf the goods are subject to US quotas ensures that the country of origin for quota purposes is correct through methods such as seeking guidance from importer of record, submitting category and/or country of origin ruling requests to the US Customs service, having a trained category and country of origin specialist on staff.

Not subject to US Quotas

11.3 Does the facility maintain an organized system of production documentation? Are the following records maintained? 11.3aRecords of the country of origin for all goods produced in the facility.

Facility maintains an organized system of production documentation, by separating each purchase order with its proper packing list, bill of lading, shipping, importing records, style number, etc. Following documents were reviewed: Certificate of origin Single Country /multiple country Declaration – US GSP Form A

11.3bA production profile of any subcontracting facility (the facility requests documents from the subcontractors when questions regarding goods produced at those facilities arise).

No subcontracting process.

11.3cProduction/purchase orders (with information such as conditions of production, payment, and finished product specifications).

Purchase orders contain the details as required.

11.3dRaw material invoices (indicating country/origin/manufacturing facility).

Incoming material receipts contain the detail of the facility from where the material is being purchased.

11.3eShipping/receiving documents (outgoing and incoming records of components/ inputs sent to or received from another facility).

All incoming/outgoing materials are accompanied by a delivery notes which contains details of the materials and is recorded in inward / outward register maintained at the security office

11.3fEmployee work records – accurate records of employee work hours that can be linked to the production of specific products.

Production records and time card can be linked.

11.3gQuality control records (which may include facility name and address, purchase order number, style number, date of the quality check, buyer, name, stamp or signature of inspector, comments on production).

Final Inspection report available for every shipment and contains all the details.

41


11.3hExport documents (including, where applicable, copies of the quota and visa, if the facility is the quota provider, packing list, manifest, bill of lading/airway bill from truck, ship, plane or train indicating the export date, exporting entity, destination, shipping lines, importing entity, and any charges incurred).

Following documents were reviewed: Invoice Packing List Certificate of Origin GSP Form A - Europe Single Country /multiple country Declaration - US Bill Of Lading/Airway Bill Inspection Report 10+2 Importer Security Filing Worksheet effect

11.3i Outward processing production (if applicable, copies of the outward processing program designated by the domestic government, copies of compliance review reports, documentation demonstrating the flow of goods from one facility to another).

The outgoing and incoming materials are accompanied by Delivery Challan as per the requirements of the local law.

11.3jNumber of Units produced marked with a traceable mark. 15,000

11.3kMachine inventory records, updated at least once a year. Machine inventory records were kept and updated

at least once a year.

11.3l Documented US quota requirements for the host country. Not subject to US Quotas

11.3m Documented confirmation of the correct category and country of origin for goods through verification of correct country of origin such as binding rulings from the US Customs Service, confirmation with purchasing company, knowledgeable/trained staff, etc.

Category and HS code are mentioned on the invoices. The HS Code is 61.05.100000

11.3n Documentation on how the qualified person with responsibility for this Principle communicates deploys and monitors the facility’s customs compliance policies.

Custom Compliance Policy No. 11 in the Manual

11.4 Do the facility’s production records include verification of sub-contractor performance?

If applicable, what records are used?

Date and location of the verification

Product(s) verified

Purchasing company

Style number

No subcontracted operators within the facility

42


Phase of production

Reference indicator for employee(s) performing operation

Name/stamp or signature of verifying official

11.5 Does the facility have a designated person responsible for this Principle?

Name Mr.Zakir Hossain Job position: Commercial Manager Responsible since: October 01, 2012

11.6 Does the responsible person ensure that origin determining documents are maintained for at least the period of record retention required by law?

Control of records – 03 years retention period

11.7 Does the responsible person ensure that all subcontracting facilities complete a production profile, and keeps such profiles on file?

No subcontracting process in the facility.

11.8 Does the facility verify production at subcontracting facilities when necessary through the review of requested documentation or personal visits (recording such instances of production verification and keeping on file)?

Supplier Evaluation Incoming inspection reports.

11.9 Does the responsible person stay current with possible illegal transshipment activity in the host country through communication with appropriate bodies such as the host government, quota council or issuing agency, trade association, contact with U.S. Customs, corporate importing office etc., and be responsible for maintaining files on any known trans shippers or transshipment activities determined to be in the host country or with a country from which facility sources?

10+2 Importer Security Filing Worksheet effect for US & Canada.

43


None

11. CUSTOMS COMPLIANCE

Facilities will comply with applicable customs laws, and in particular, will establish and maintain programs to comply with customs laws regarding illegal transshipment of finished products.


44

PRINCIPLE 12 SECURITY


12.1 Does the facility have practices to guard against the introduction of contraband (e.g. drugs, explosives, biohazards, and/or other contraband)? Any non-manifested cargo will be referred to as contraband

Facility maintains two levels of security. One at the warehouse department, inspecting all goods shipped out and assuring the area is secure from non essential personnel and the other at the main entrance gate, where other team of security guards screens the cargo documentation and permit to depart the facility. Security Policy No. 12 and Security Instructions

12.2 Does the facility have a responsible person in charge of security?

Name: Mr. Anamul Haque Position: Security In Charge Responsible since: November 01, 2012

Container Inspection

12.3 Does the facility have documented procedures in place to verify the physical integrity of the container structure prior to loading?

Physical integrity procedure of container structure: No.12

12.3.1 Does the procedure include the reliability of the locking mechanisms of the doors? Exit doors and windows are properly locked

during non working hours.

12.3.2 Does the facility conduct a seven-point inspection process for all containers and keep records of all inspections:

If the answer to any of these points is no, please state the alternative method used.

Front wall

Left side

Right side

Floor

Ceiling/Roof

Inside/outside doors

Outside/Undercarriage

7 point inspection carried out by the security before loading and after loading.

Trailer Inspection

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12.4 Does the facility have procedures in place to verify the physical integrity of the trailer structure prior to loading, including the reliability of the locking mechanisms of the doors?

Physical integrity procedure of trailer structure: No.12

12.4.1 Is the facility following five-point inspection process is recommended for all trailers?

Fifth wheel area - check natural compartment/skid plate

Exterior - front/sides

Rear - bumper/doors

Front wall

Left side

5 point inspection carried out by the security for all trailers

Container and Trailer Seals

12.5 Does the factory affix a high security seal to all loaded trailers and containers bound for the U.S.?

Seals that meets PAS ISO 17712 were been used.

12.5.1 Do the seals meet or exceed the current PAS ISO 17712 standards for high security seals?

The consignment is loaded on the vehicle in the presence of the security and packing in charge. The vehicle is locked and is sealed. The consignment is sent to the container terminal and handed over to the freight forwarders. The stuffing of the container is carried out by the customs officials.

12.5.2Does the facility have documented procedures stipulating how seals are to be controlled and affixed to loaded containers and trailers?

Seals are kept by security department, specified persons are assigned for affixing, replacing, recording, tracking and verifying seals on containers.

12.5.3 Does the facility have documented procedures for recognizing and reporting compromised seals and/or containers/trailers to US Customs and Border Protection or the appropriate local authority?

Any abnormal case will be reported to US Customs and Border Protection in time.

12.5.4 Does the facility have designated employees for the distribution of seals for integrity purposes?

A designated person from warehouse department Name: Mr. Tariqul Islam (Warehouse In-charge)

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Container and Trailer Storage

12.6 Is the security of containers and trailers located within the facility maintained? Are they in a secure area to prevent unauthorized access and/or manipulation?

The facility has a procedure for preventing unauthorised access to empty and/or full containers. Only the employees with work permit can enter these areas and warning signs of ‘No Entry’ were posted

12.6.1 Does the facility have documented procedures in place for reporting and neutralizing unauthorized entry into containers/trailers or container/trailer storage areas?

Reporting procedure has been stated clearly in the documented polices.

Physical Access Controls

12.7 Does the facility have a physical access control procedure? Important exits were controlled by security guards

patrolling.

Employees

12.7.1Does the facilities have an employee identification system in place for positive identification and access control purposes?

Every employee has a unique ID card for entering the facility.

12.7.2 Does the facility ensure that employees are only given access to those areas needed for the performance of their duties?

Packing area was only allowed for packing workers.

12.7.3 Does the facility control the issuance and removal of employee, visitor and vendor identification badges?

Does the facility have documented procedures for the issuance, removal and changing of access devices (e.g. keys, key cards, etc.)?

A record of issuing and receiving ID badges for employee, visitor and vendor were kept by security guard at factory gate. Keys, key cards and codes were kept by related departments’ supervisor only.

Visitors

12.7.4 Do visitors present photo identification for documentation purposes upon arrival? All visitors should be escorted and should visibly display temporary identification.

Normally visitors’ identification card would be required for review before entering the facility.

Deliveries (including mail)

12.7.5 Is vendor ID and/or photo identification required to be presented for documentation purposes upon arrival by all vendors? Arriving packages and mail should be periodically screened before being disseminated.

Normally vendors’ identification card would be required for review before entering the facility.

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Challenging and Removing Unauthorized Persons

12.7.6 Does the facility have documented procedures in place to identify, challenge and address unauthorized/unidentified persons?

Security Policy No. 12

Personnel Security

12.8 Does the facility have documented procedures in place to screen prospective employees and to periodically check current employees?

Security Policy No. 12

Pre-Employment Verification

12.8.1 Does the facility verify application information, such as employment history and references, prior to employment?

Reference check would be conducted for each employee before employment.

Background Checks / Investigations

12.8.2 Does the facility conduct background checks and investigations for prospective employees?

It was verified that facility performs background checks on security dock personnel before employment is permanent. Police verification carried out by local Police station demonstrates that no criminal records for all related employees.

12.8.3 Once employed, are periodic checks and reinvestigations performed based on cause, and/or the sensitivity of the employee’s position?

Annually basis

Personnel Termination Procedures

12.8.4 Does the facility have procedures in place to remove identification, facility, and system access for terminated employees?

All mentioned items would be terminated at once when worker left.

Documentation Processing

12.9 Are documented procedures in place to ensure that all information used in the clearing of merchandise/cargo, is legible, complete, accurate, and protected against the exchange, loss or introduction of erroneous information? Documentation control must include safeguarding computer access and information.

Security procedure No.12

Manifesting Procedures

12.9.1Are documented procedures in place to help ensure the integrity of cargo and that information received from business partners is reported accurately and in a timely manner?

Security procedure No. 12

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Shipping and Receiving

12.9.2 Is cargo that is being shipped reconciled against information on the cargo manifest?

Facility maintains two levels of security. One at the warehouse department, inspecting all goods shipped out and assuring the area is secure from non essential personnel and the other at the main entrance gate, where other team of security guards screens the cargo documentation and permit to depart the facility. Security Policy No. 12 and Security Instructions

12.9.3 Is all cargo accurately described, and the weights, labels, marks and piece count indicated and verified?

All cargos would be carefully checked and verified.

12.9.4 Does the facility verify departing cargo against purchase or delivery orders?

Warehouse staff responsible for shipment and security guard both would check the departing cargo.

12.9.5 Are drivers delivering or receiving cargo positively identified before cargo is received or released?

Drivers would receive all information that would be used for checking the cargo before cargo received or released.

12.9.6 Are documented procedures in place to track the timely movement of incoming and outgoing goods?

Security Procedure No. 12

Cargo Discrepancies

12.9.7 Are all shortages, overages, and other significant discrepancies or anomalies resolved and/or investigated appropriately?

Controlled before dispatch and buyer kept informed.

12.9.8 Are customs and/or other appropriate law enforcement agencies notified if anomalies, illegal or suspicious activities are detected, as appropriate?

Customs would be informed at once when any illegal or suspicious activities been detected.

Fencing

12.10.1 Is there perimeter fencing enclosing the areas around cargo handling and storage facilities?

Perimeters fencing higher than 2m were installed.

12.10.2 Is interior fencing within a cargo handling area used to segregate domestic, international, high value, and hazardous cargo?

No domestic cargo

Gates and Gate Houses

12.10.3 Are gates through which vehicles and/or personnel enter or exit manned and/or monitored?

All gates were equipped with security guard.

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Parking

12.10.4 Are private passenger vehicles prohibited from parking in or adjacent to cargo handling and storage areas?

Private passenger vehicles were not allowed to entering facility.

Building Structure

12.10.5 Are buildings constructed of materials that resist unlawful entry? The facility building is constructed of brick wall

and the main gate is manned 24x7.

12.10.6 Is the integrity of structures maintained by periodic inspection and repair? Daily basis

Locking Devices and Key Controls

12.10.7 Are all external and internal windows, gates and fences secured with locking devices? Management or security personnel must control the issuance of all locks and keys.

Exit doors and windows are properly locked during non working hours.

Lighting

12.10.8 Is there adequate lighting provided inside and outside the facility including the following areas: entrances and exits, cargo handling and storage areas, fence lines and parking areas?

The facility has installed halogen lights over the main gate and in the parking area. The perimeter wall is equipped with fog lights. All the exits are equipped with individual battery operated emergency lights.

Alarms Systems and Video Surveillance Cameras

12.10.9 Are alarm systems and video surveillance cameras utilized to monitor premises and prevent unauthorized access to cargo handling and storage areas?

All high risk areas like cargo handling, gates, storage area were equipped with Security guard.

Password Protection

12.11Does the facility has automated systems for individually assigned accounts that require a periodic change of passwords?

Individual’s computer passwords would be changed on monthly basis.

12.11.1Does the facility have documented IT security policies and procedures and standards in place and provide them to employees in the form of training?

IT security procedure No. 12

Accountability

12.11.2 Does the facility have a system in place to identify the abuse of IT including improper

All computers were monitored by central controller; any abnormal would be reported to management at once.

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access, tampering or altering of business data?

Security Training and Threat Awareness

12.12 Does the facility have a threat awareness program in place and established and maintained by security personnel to recognize and foster awareness of the threat posed by terrorists and contraband smugglers at each point in the supply chain?

Threat awareness training would be provided to all employees twice per year.

12.12.1 Does the facility makes employees aware of the procedures the company has in place to address a security situation and how to report it?

Related procedure would be emphasized at each awareness training and also posted onsite.

12.12.2 Does the facility give additional training to employees in the shipping and receiving areas, as well as those receiving and opening mail?

Last training carried out on April 03, 2013

12.12.3 Does the facility undertake additionally, specific training to assist employees in maintaining cargo integrity, recognizing internal conspiracies, and protecting access controls?

Such training would be delivered by department supervisor once needed.

12.12.4 Do these programs offer incentives for active employee participation?

Incentive policy was included in the security procedure, anyone who reported the suspicious activities would have a special incentive.


None

12. SECURITY Facilities will maintain facility security procedures to guard against

the introduction of non-manifested cargo into outbound shipments (i.e. drugs, explosives biohazards and /or other contraband).


WRAP Audit Report ALGI version April 2013

This report provides a summary of the findings and other applicable information found/gathered during the audit conducted on the dates mentioned only. The audit process requires that information be gathered and considered from records review, worker interviews, management interviews and visual observation. More information is gathered during the audit process than is provided here. The audit process is a sampling exercise only and does not guarantee that the audited facility prior, during or post-audit is in full compliance with WRAP Principles. WRAP Principles should not be used to prevent companies from exceeding these requirements. Companies applying WRAP Principles are expected to comply with national and other applicable law, and where the provisions of law and WRAP Principles address the same subject, to apply that provision which affords the greater protection. The ownership of this report remains with the party who has paid for the audit, unless the report is generated as part of an unannounced audit visit. Release permission must be provided by the owner prior to release to any third parties.

14539 ratool apparels ltd. bangladesh wrap fcr ar 13638

Documents

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