Supply Chain Innovation

Fair Working Hours and Compensation for Workers in China

Publication date: 
Tuesday, November 25, 2008

Issues: During a 2008 FLA external assessment of a garment factory supplying the SanMar Corporation, FLA assessors found that the factory’s attendance and payroll records were “undependable and unreliable.” There was no way to verify the wages of the factory's 139 workers, resulting in uncertainties such as whether payment was made for all hours worked (production records showed hours worked in factory that were not on payroll records) and whether employees were paid correct wages (for both regular hours and overtime).

Solutions: Following the assessment, the factory hired an employee to monitor the documentation system. The new system holds employees personally responsible for logging work. A July 2009 follow-up visit to the factory by SanMar showed no inconsistent documentation. These visits included cross-checking payroll and attendance records with production records and employee interviews.