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FLA Year Two Annual Public Report
Glossary
Accreditation: see FLA Accredited Compliance Program
Agent: individual or business that acts on behalf of a company to locate and negotiate with production facilities. Agents often represent companies that do not have buying offices in particular countries, or are used to supplement a company's buying staff. Because they are often based locally and have established relationships with factories, agents are sometimes called upon to play a role in a company's internal monitoring.
Audit: see Monitoring
Brand: a trademark or logo affixed to a product that is either owned or controlled by a company, or which the company has the right to use under license.
Applicable brands are those brands of a participating company for which the company is seeking accreditation that such brands are produced in compliance with FLA standards, in accordance with the FLA Charter.
Compliance: adherence to the international labor standards expressed in the FLA Workplace Code of Conduct and Obligations of Companies (see FLA Charter), including adherence to applicable national and local laws. As a dynamic rather than static condition, compliance requires a process to ensure continuing adherence. Non-compliance refers to activities or situations that contravene or fall short of FLA standards. An FLA company's compliance program encompasses a range of activities and initiatives to: uncover non-compliance (e.g., announced and unannounced monitoring visits); remediate non-compliance; and promote improvements in compliance (e.g., rights awareness trainings, health and safety workshops, etc.).
Category B Licensee: a College or University Licensee that commits to execute the FLA program requirements in all factories producing licensed goods for FLA College or University Affiliates, and whose participation in the Association has been approved by the Board.
Contractor: See Supplier.
Facility: the site where production or manufacturing of applicable brands or licensed goods for College or University Affiliates takes place. The term factory is used interchangeably with "facility" in this report.
Applicable facilities are those facilities used by a company to produce its applicable brands or college/university licensed goods.
FLA Accredited Compliance Program: a designation given by the FLA Board of Directors signifying that a company's labor compliance program is found to be in substantial compliance with FLA requirements. Labor compliance programs become eligible for accreditation at the end of their 'initial implementation period,' and are considered for re-accreditation every two years. The FLA retains the right to retract FLA accreditation if it finds that a company is not acting in good faith to uphold its FLA obligations and to continuously improve.
Follow-up Visit: a visit to a factory undertaken after an initial monitoring visit to track progress with respect to a remediation plan.
Initial Implementation Period: the period during which a participating company develops its labor compliance program in accordance with FLA requirements. When applying to participate in the FLA, companies commit to an initial implementation period of two or three years. Upon completion of the initial implementation period, the FLA Board of Directors considers accreditation of the company's compliance program if the company has fulfilled its compliance commitments.
Licensee: a company or supplier that is licensed to produce goods bearing another entity's brand name or logo through a private agreement with the other entity, such as a company or a university.
Manufacturer: See Supplier.
Monitor: the individual or team of individuals who carry out internal or independent external monitoring. The terms auditor and audit team are also used to refer to the individual(s) conducting monitoring. An "FLA-accredited" monitor refers to a monitoring organization or firm that has been accredited by the FLA on the basis of its independence and professional qualifications to conduct monitoring of applicable facilities on behalf of the FLA.
Monitoring: In this report, this term refers to activities undertaken by FLA-accredited monitors, representatives of participating companies, or other third-party professionals, to assess and report on the workplace conditions of facilities used by FLA companies. Monitoring visits (also referred to as social audits, compliance audits, or labor audits) include activities such as: a visual inspection of the facility, on-site or off-site worker interviews, management interviews, a payroll and timecards audit, a review of other records, etc.
The FLA system has two categories of monitoring:
Internal Monitoring: activities undertaken by a company and executed by its staff, agents, or contracted third-party professionals to monitor Code compliance in its facilities. Such activities can range from informal assessments of compliance (e.g., a factory walkthrough to check heath and safety conditions, such as fire safety, chemical storage, etc.) to "full" audits, which are more comprehensive assessments and include most or all of the components of a "monitoring visit" listed above.
Independent External Monitoring (IEM): a monitoring visit that is undertaken by an FLA-accredited monitor to assess and report on the status of factory compliance with the FLA Code and Obligations of Companies. The visit is not announced in advance to either the company or the factory, and is conducted by a monitor that is selected and paid for by the FLA. Required components of independent external monitoring include: gathering information from local sources, confidential worker interviews, management interviews, records review, visual inspection, and analysis and reporting. (Please refer to the FLA's Monitoring Guidance document for descriptions of each of these activities.)
Monitoring Plan: the plan submitted to the FLA by each prospective Participating Company or Category B Licensee, which describes the company's proposed compliance program. It details the manner in which the company aims to systematize compliance in its business operations and fulfill the FLA Obligations of Companies.
Participating Company: a company that has agreed to submit all its applicable brands to the FLA program and whose participation in the FLA has been approved by the FLA Board of Directors.
Person Days: a measurement that is used by the FLA to reflect the total amount of time a team spends monitoring a given facility, reflecting both the size of the team and the number of days spent on the visit. Therefore, if a monitoring team consisting of three auditors spends three days in a facility, the visit would have been nine person days.
Remediation: (also referred to as corrective action in this report) a process that is undertaken to correct non-compliance with FLA standards. The FLA requires companies to develop and implement a remediation plan (corrective action plan) with factory management to resolve non-compliance issues whenever they are detected. Companies are encouraged to design remediation plans that address the root causes of the particular non-compliance issue in order to achieve longer-term compliance.
Sub-contractor: a facility contracted by a company or a supplier to carry out part of the production process, such as cutting, sewing, assembling or packaging.
Supplier: a company engaged in a manufacturing process, including cutting, sewing, assembling and packaging, which results in a finished product for the consumer. This term is used to denote any actor that supplies intermediate or finished products to companies. These might otherwise be referred to as vendors, manufacturers, contractors, sub-contractors, or simply factories.
Supply Chain: The network of facilities that are involved in the production process, from the procurement of raw materials, to the production of intermediate and final products, to the delivery of products to consumers through a distribution system. The FLA focuses on compliance in the production of goods. This means that the processing of raw materials and the delivery and distribution of finished goods do not currently fall within the FLA's mandate.
Third Party Monitor: In this report, this term refers to a monitoring organization or firm that is contracted by an FLA company to conduct internal monitoring or other compliance-related activities. They should not be confused with FLA accredited independent external monitors, which are completely independent of the company (see definition above for further clarification).
Vendor: See Supplier.
Verification: the process of reexamining a particular workplace to determine whether remediation activities have been undertaken in an effort to effectively address non-compliance issues.
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