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Company ProfileCompliance ProgramFactory Data
Phillips-Van Heusen Corp. - Labor Compliance Program in Year Two1

Overview of the Program
Program Features

  1. Compliance Systems Developed in Year Two
  2. Improvements in Implementing the FLA Requirements

Overview of the Program

Phillips-Van Heusen's Global Human Rights Program is responsible for implementing the Company's "A Shared Commitment" Code of Conduct, which corresponds with the FLA Workplace Code. In Year Two, the Global Human Rights Program included 12 full-time and 46 part-time staff members, which were organized into regional teams, which were in turn headed by regional leaders. The five regional teams cover: United States and Canada; Central and South America; Europe, Africa and the Middle East; India and Southeast Asia; and China and Far East. All Human Rights Program activities are overseen by PVH's Vice President of Global Human Rights Programs and Social Responsibility, who reports to the Company's Executive Vice President of Foreign Operations and, for any critical issues, has direct communication with the Chairman/President of the Board. The VP of Global Human Rights Programs and Social Responsibility is based at headquarters in the US.

With a view to mainstreaming compliance into the company's broader business model, the Human Rights staff offered training to selected staff from other departments, particularly sourcing and merchandising. Staff from different departments also participated in awareness training sessions given by the Human Rights team for vendors around the world; they also received the company's quarterly human rights newsletter. Moreover, through periodic meetings with sourcing divisions and informal teamwork in the field, the Human Rights team exchanged key information about factories on a regular basis. The Human Rights and sourcing staff leadership also used their combined influence in discussions with factory owners/management about the need to remediate various noncompliance issues in factories.

PVH contracted third party monitors to conduct pre-sourcing audits and to follow-up in regions where the Global Human Rights Program did not have local staff, language expertise, and/or resources; for situations where an independent assessment was necessary; or during periods when the Human Rights staff's workload surpassed internal resources (click here to see a list of monitors).


Features of PVH's Labor Compliance Program in Year Two1

A. Compliance Systems Developed in Year Two

In Year Two, PVH's Global Human Rights Program developed the Critical Engagement and Impact Program (CEIP). CEIP seeks to move away from "traditional" monitoring. Through more in-depth analysis of key problems in factories and coaching of factory management, the program seeks to improve capacity at the factory level to address noncompliance in a sustainable manner. In Year Two, PVH Human Rights staff started to implement the program in 120 apparel factories. To that end, the staff conducted more intensive monitoring and consultation in factories over longer periods. Staff received training in management, conflict resolution, and other techniques, which enabled them to identify practices that lead to noncompliance issues, and to work with management to develop long-term and sustainable solutions to those issues. Factories that had a recurring cycle of alternating compliance and noncompliance were selected to participate in CEIP. The main requirement of factories was a commitment to good faith participation and transparent exchanges with the Human Rights team.

To bring factory management through the CEIP process, Human Rights staff was expected to:
  • Develop factory transparency so as to reduce the use of tactics to cover-up noncompliance issues, such as keeping double books or coaching workers for interviews.
  • Develop, in conjunction with management, longer-term remediation plans that address management practices that are seen to contribute to noncompliance.
  • Train management on the Workplace Code, since it has been PVH's experience that noncompliance may often stem from a lack of understanding of Code provisions.
  • Play an advisory role, rather than the leading role, in the remediation process, so as to encourage managers to take ownership of the process and gain the skills to "self-manage" compliance programs.
PVH reported that the CEIP process was used to address various noncompliance issues, most notably excessive overtime, which is a recurring issue in many factories despite ongoing efforts to remediate the problem. In such factories, the PVH team worked with managers to analyze the underlying reasons that workers were required to work long hours or did not have one in seven days off from work, as required by the Code. They found that bottlenecks in particular departments and inefficiencies in the production process were among the contributing factors. As a result, different managers took different approaches to addressing these issues, including: developing special monitoring practices to observe production inefficiencies and noncompliance; instituting a system of incentive rates for workers that allowed them to earn more and produce more, therefore cutting overtime; and establishing a two-shift system.

While FLA independent external monitoring visits reveal that overtime is a persistent and far-reaching issue, they can provide some preliminary evidence of PVH's work to engage factories on this topic. At the time of drafting this report, the FLA tracking chart about a factory in the Philippines where PVH sources includes evidence of the company's efforts to train the factory to address noncompliance issues more systematically. Please see PVH's tracking charts to review this factory report in detail.

It is worth noting here that PVH also introduced the Engagement and Impact Program for Footwear (EIPF) to management representatives of 60 footwear factories at a PVH conference in China in October 2003. The FLA expects to receive additional information on the impact of CEIP and this footwear project as they are rolled out.

Click here to see the Year One report on PVH.

B. Improvements in Implementing the FLA Requirements

  • PVH added four new full-time positions to its Human Rights team. It also reorganized its regional leadership team with a view to concentrating on strategic issues in each region; the region that once was overseen by the Asia regional leader was split into two: India and Southeast Asia, and China and the Far East.
  • Human Rights staff members received training in management skills, conflict prevention and resolution, and English language skills (complementing the local languages all human rights staff members have for their respective regions) depending on the needs of the individual staff member. Staff members also participated in a series of 6 (re)training sessions on PVH's Critical Engagement and Impact Program, as well as periodic exchanges (in-person and by phone) that focused on endemic compliance issues and challenges, including hours of work, worker compensation, and freedom of association and collective bargaining. The program's trainings often focused at the regional level, but also allowed for exchanges across regions to share good practice and other learning. The team's annual training took place in Hong Kong in January 2003 and lasted two days.
  • PVH developed a training program for its agent's staff in Latin America relating to monitoring and remediation. This involved 2 one-week training courses for the staff, one in Honduras and the other in Brazil. Similarly, the Human Rights staff conducted training sessions for sourcing staff, so as to integrate compliance into PVH sourcing and other business practices.
  • Focusing on training sourcing partners, PVH hosted mandatory Awareness and Training sessions for vendors and factory owners/managers in New York, Maine, Hong Kong, China, India, Bangladesh, Brazil, England, Thailand, Brazil and Honduras. The sessions focused on implementation of PVH's Code. PVH's "Most Commonly Asked Questions: Vendors Manual" was also updated during the year.
Click here to review PVH's activities in Year One.


1 Please note that this section in no way seeks to capture all of the compliance activities reported to the FLA by companies. Instead, the FLA considers it an overview of company activities that will provide the reader with a better understanding of each company's approach and focus in Year Two.
Copyright 2004 by the Fair Labor Association