C

Certification Body

An organization accredited to certify or verify another entity’s compliance with a specified standard or set of standards.

Child

A child is a person under the age of 18 years.

Child Labor

  • A child is a person under the age of 18 years.
  • Child labor is work below the minimum age as established in national legislation (excluding permissible light work). Child labor also includes the worst forms of child labor (WFCL).
  • ILO Convention 138 requires countries to establish a minimum age for work no less than the age of compulsory schooling, and no less than 15 years. It allows less-developed countries to establish a minimum age of 14.

Code of Conduct

The foundation of a social compliance program, a code of conduct is a document that sets out the social (and often, environmental) standards and policies with which a company and its suppliers are expected to comply. Many companies refer to their codes by a name other than “code of conduct,” such as “terms of engagement,” “supplier expectations,” and many others. A code is a set of voluntary standards; in this respect, it differs from law—although relevant laws (both U.S. and source country) must be taken into account, as should collective bargaining agreements and international framework agreements (IFAs) with union federations, which are enforceable contracts. A code is not a substitute for any of these instruments.

Corporate Accountability

A term often used to reference companies’ actions that are more closely linked to legal requirements.

Corporate Social Responsibility (CSR)

A broad concept intended to cover how companies integrate social and environmental concerns into their operations and interactions with stakeholders aside from legal requirements. Many other terms are also used to address such actions, including the “triple bottom line,” “sustainability,” “corporate citizenship,” “environmental, social, and governance (ESG),” and many others.

Corrective Action Plan (CAP)

A plan of action for remediation of all violations found in a particular audit.

D

Downstream

The part of the supply chain process on the demand side, referring to the flow of goods or products from a supplier to the company and to the end user or customer.

Due Diligence

As defined by the UN Guiding Principles on Business and Human Rights, due diligence is a process that includes assessing actual and potential human rights impacts (including fundamental labor rights such as child labor and forced labor), integrating and acting upon the findings, tracking responses, and communicating how impacts are addressed. According to the OECD Due Diligence Guidance for Responsible Business Conduct, there are six steps in a due diligence process:

  1. Embed responsible business conduct into policies and management systems
  2. Identify and assess actual and potential adverse impacts associated with the enterprise’s operations, products or services
  3. Cease, prevent and mitigate adverse impacts
  4. Track implementation and results
  5. Communicate how impacts are addressed
  6. Provide for or cooperate in remediation when appropriate

Due diligence should cover assessment of the adverse impacts that a business may cause or contribute to through its own activities as well as those that may be directly linked to its operations, products, or services through business relationships. Due diligence varies in complexity with the size of a business enterprise, the risk of severe human rights impacts, and the nature and context of a business’ operations.

F

Forced Child Labor

Forced child labor is a worst form of child labor under ILO C. 182. Children are in forced child labor if subjected to work under the threat or menace of penalty. Children older than the minimum age for work are in forced child labor if work is involuntary and they are under the menace of penalty. For children younger than the minimum age, involuntariness does not need to be established because children under the minimum age cannot legally consent to work. Forced child labor also includes work performed with or for the child’s parents for a third party under the threat or menace of any penalty directly applied to the child or parents. All children who are made to work as a result of parental forced labor are engaged in forced child labor.

Forced or Compulsory Labor

Forced labor is defined as all work or service that is exacted from any person under the menace of any penalty and for which the worker does not offer themselves voluntarily. Circumstances that may give rise to involuntary work, when undertaken under deception or uninformed, include, inter alia, unfree recruitment at birth or through transaction such as slavery or bonded labor; situations in which the worker must perform a job of a different nature from that specified during recruitment without their consent; abusive requirements for overtime or on-call work that were not previously agreed to with the employer; work in hazardous conditions to which the worker has not consented, with or without compensation or protective equipment; work with very low or no wages; degrading living conditions imposed by the employer; work for other employers than agreed to; work for a longer period of time than agreed to; and work with no or limited freedom to terminate the work contract.

G

Grievance

A concern or complaint raised by an individual or a group within a community affected by company operations.

Grievance Mechanisms

Grievance mechanisms are a cornerstone of worker representation. They allow unions to raise workers’ issues through established, transparent systems that alleviate workers’ fear of reprisal from employers. However, workers without the protection of an effective union and collective bargaining agreement should also have ways to express concerns and bring their perspectives to management. Workers should have whistleblower protections that empower them to safely report serious concerns.

H

Hazardous Work

The term “hazardous work” refers to the worst form of child labor identified in ILO Convention. 182, Article 3(d), “work which, by its nature or the circumstances in which it is carried out, is likely to harm the health, safety, or morals of children.” ILO C. 182, Article 4, directs countries to consult with employers and workers to identify the types of hazardous work that should be prohibited by law or regulation. Hazardous work lists vary from country to country and may describe specific activities, occupations, industries, or conditions.

Hazardous Work for Children

According to ILO Convention 182, hazardous work “shall be determined by national laws or regulations or by the competent authority, after consultation with the organizations of employers and workers concerned, taking into consideration relevant international standards...” (Article 4). As this suggests, forms of work identified as “hazardous” for children may vary from country to country. ILO Recommendation No. 190, which accompanies ILO Convention 182, gives additional guidance on identifying “hazardous work.” ILO Recommendation No. 190 states in Section II, Paragraph 3 that “[i]n determining the types of work referred to under Article 3(d) of the Convention [ILO Convention 182], and in identifying where they exist, consideration should be given, inter alia to:

  • work which exposes children to physical, psychological, or sexual abuse;
  • work underground, under water, at dangerous heights, or in confined spaces;
  • work with dangerous machinery, equipment and tools, or which involves the manual handling or transport of heavy loads;
  • work in an unhealthy environment which may, for example, expose children to hazardous substances, agents or processes, or to temperatures, noise levels, or vibrations damaging to their health;
  • work under particularly difficult conditions such as work for long hours or during the night or work where the child is unreasonably confined to the premises of the employer.”

Human Trafficking

Human trafficking, or trafficking in persons, is defined in the Protocol to Prevent, Suppress and Punish Trafficking in Persons, especially Women and Children of 2000 (a protocol to the UN Convention Against Transnational Organized Crime) as “the recruitment, transportation, transfer, harboring or receipt of persons, by means of the threat or use of force or other forms of coercion, abduction, fraud, deception, the abuse of power or a position of vulnerability, or of the giving or receiving of payments or benefits to achieve the consent of a person having control over another person, for the purpose of exploitation.” As set out in this protocol, exploitation includes, at a minimum, “the exploitation of the prostitution of others or other forms of sexual exploitation, forced labor or services, slavery or practices similar to slavery, servitude or the removal of organs.”

I

ILO Convention 29 (ILO C. 29)

Prohibits all forms of forced or compulsory labor, which is defined as “all work or service which is exacted from any person under the menace of any penalty and for which the person has not offered himself voluntarily.”

ILO Convention 105 (ILO C. 105)

Prohibits forced or compulsory labor as a means of political coercion or education, or as a punishment for holding or expressing political views or views ideologically opposed to the established political, social, or economic system; as a method of mobilizing and using labor for economic development; as a means of labor discipline; as a punishment for having participated in strikes; and as a means of racial, social, national, or religious discrimination.

ILO Convention 138 (ILO C. 138)

Requires countries to establish a minimum age for work no less than the age of compulsory schooling, and no less than 15 years. Countries whose economy and educational facilities are insufficiently developed may initially specify a minimum legal working age of 14 when ratifying the Convention. In addition, Article 7(1) says that national laws or regulations may permit the employment or work of children ages 13 to 15 years for light work. Countries that specify a minimum legal working age of 14 may permit light work for children ages 12 to 14.

ILO Recommendation No. 190

Supplements ILO C. 182 and provides non-binding practical guidance in applying the Convention. Among other provisions, it includes a list of working conditions and types of work that should be considered when determining what comprises hazardous work. These include:

  1. Work which exposes children to physical, psychological, or sexual abuse;
  2. Work underground, under water, at dangerous heights, or in confined spaces;
  3. Work with dangerous machinery, equipment and tools, or which involves the manual handling or transport of heavy loads;
  4. Work in an unhealthy environment which may, for example, expose children to hazardous substances, agents or processes, or to temperatures, noise levels, or vibrations damaging to their health;
  5. Work under particularly difficult conditions such as work for long hours or during the night or work where the child is unreasonably confined to the premises of the employer.”

Impact

A situation in which damage has been done to a company, such as reputational damage or legal liability, or to individuals or entities affected by a company’s activities or linked to a company’s operations, products, or services, through business relationships.

Impact Evaluation

A method that establishes, with statistical rigor, a causal linkage and quantifiable impact of a specific intervention.

Independent Review

Independent review consists of independent monitoring (auditing) and independent verification. Independence in the social compliance context is defined by a lack of a direct financial transaction between the company and external entity.

Independent Verification

Independent third-party review of the implementation and effectiveness of the social compliance system to reduce occupational health and safety and/or forced labor risks, usually carried out by a certification body.

International Framework Agreements (IFAs)

IFAs, also known as Global Framework Agreements (GFAs), differ from company codes of conduct in that they are negotiated instruments between multinational enterprises and global union federations intended to ensure that companies commit to respecting core principles covering labor relations and working conditions. IFAs vary but are based on ILO core labor standards, focusing in particular on two broad categories: (1) fundamental principles and rights at work (freedom of association, collective bargaining, non-discrimination, abolition of forced labor, and elimination of child labor) and minimum terms and conditions of employment (working time, wages, occupational safety, and health); and (2) other conditions of work: mobility and related issues such as training, job security, subcontracting, and restructuring.

Examples of IFAs include:

  1. Danone and the International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations
  2. Global Framework Agreement between IndustriALL (global union) and Hennes & Mauritz (H&M)
  3. International Accord for Health and Safety in the Textile and Garment Industry (The Accord) in Bangladesh and Pakistan

International Labor Organization (ILO)

The International Labor Organization (ILO) is a UN specialized agency that brings together representatives of governments, trade unions, and employers’ associations to promote social justice and internationally recognized human and labor rights by setting and supervising the application of conventions and recommendations, as well as promoting decent work and providing technical support to governments, trade unions, and employers.

M

Migrant Workers

Migrants are a category of workers particularly vulnerable to forced labor. In the global economy, millions of workers leave their homes for jobs elsewhere in their own country or in another part of the world. Many migrants in search of jobs place their trust in labor recruiters or brokers to make transportation arrangements and place them in jobs, but many workers find—too late—that their wages and employment terms do not match brokers’ promises. Some migrants incur large debts in the recruitment process and become trapped in debt bondage when they cannot repay these debts. Cycles of debt bondage can also begin when employers deduct from workers’ wages for housing, food, and other costs, leaving them with little or no take-home pay. Many migrant workers are required to sign contracts in languages they cannot read; others have informal employment relationships with no contracts at all. Some workers unknowingly travel abroad without an employment visa or visa of any kind. Once abroad, migrant workers may be required to turn over their identity documents to employers, leaving them without the option to escape abusive or exploitative conditions. 

Monitoring

For the purposes of this tool, compliance monitoring is synonymous with social compliance auditing.

O

OECD Guidelines

The OECD Guidelines for Multinational Enterprises (OECD Guidelines) are recommendations from governments to multinational enterprises on responsible business conduct. The OECD Guidelines set standards for responsible business conduct across a range of issues such as human rights, labor rights, and the environment. It also includes international institution guidance on supply chain responsibility. It also recommends that enterprises leverage their business relationships to prevent or mitigate adverse human rights impacts.

P

Public Reporting

Communication that is made available to the public through a variety of channels about all elements of a company’s social compliance systems.

R

Recruitment Fees

Recruitment fees or related costs are defined by the ILO as any fees or costs workers incur during the recruitment process to secure employment or placement, regardless of the manner, timing, or location of their imposition or collection. This includes payments for recruitment services offered by labor recruiters as well as related costs that are integral to recruitment and placement. Related costs include but are not limited to travel and lodging expenses, medical costs, and equipment costs. The U.S. government’s Federal Acquisition Regulations also define recruitment fees as “fees of any type, including charges, costs, assessments, or other financial obligations, that are associated with the recruiting process, regardless of the time, manner, or location of imposition or collection of the fee.”

Remediation

The actions taken in response to an identified violation. Remediation actions should strive to both fix the problem and prevent it from recurring. 

Risk

A situation that increases the potential for damage to a company, such as reputational damage or legal liability, or damage to individuals or entities affected by a company’s activities or linked to a company’s operations, products, or services through business relationships.

S

Slavery and Slavery Like Practices

Slavery is the status or condition of a person over whom any or all of the powers attaching to the right of ownership are exercised. Practices similar to slavery includes:

  • Debt bondage—the status or condition arising from a pledge by a debtor of his personal services or of those of a person under his control as security for a debt, if the value of those services as reasonably assessed is not applied towards the liquidation of the debt or the length and nature of those services are not respectively limited and defined;
  • Serfdom is defined as the condition or status of a tenant who is by law, custom or agreement bound to live and labor on land belonging to another person and to render some determinate service to such other person, whether for reward or not, and is not free to change his status; and
  • Forced or compulsory labor.

Social Compliance Audit

Otherwise known as a “social audit” refers to the process of examining a specific worksite’s compliance with the standards set in the company’s code of conduct. The term “audit” is used throughout the tool to refer to social auditing but should not be confused with financial and other types of auditing undertaken by companies. Typically, a company pays a separate, independent institution for auditing services or for membership in an auditing services body. Social auditing is one of the primary ways—in addition to engagement with unions, workers, and grievance mechanisms—to obtain information about violations of a company’s code of conduct. Auditing uncovers problems; it does not solve problems. It is one piece of the larger social compliance system along with stakeholder engagement, communication, remediation, and the other steps in the process.

Stakeholder

A person or group directly or indirectly affected by, or otherwise having an interest in a company’s policies, actions, and/or supply chain. The term “stakeholder” is widely used in government, business, and civil society organizations, not solely in relation to social compliance. A company’s stakeholders often include its employees, suppliers, investors, customers, and regulators. However, a company’s social compliance program may have a subset of stakeholders that is distinct from those of the company as a whole. This applies to individuals and communities that are affected by a business’s operations and practices, regardless of whether they are directly part of a business’s formal supply chain. For example, sugarcane producers and farmers who sell sugar to an intermediary from which the company purchases might still be directly affected by a company, even though they may not be a part of its formal supply chain. The UN recognizes these individuals as having human rights and protections that businesses should consider related to their social compliance actions.

Social Compliance System

A social compliance system is one component of a company’s broader corporate social responsibility (CSR), sustainability, or accountability program. A social compliance system is an integrated set of policies and practices through which a company seeks to ensure maximum adherence to the elements of its code of conduct that cover social and labor issues.

Supply Chain

The chain or network comprised of all organizations and individuals involved in producing, processing, trading, transporting and/or distributing a product or commodity from its point of origin to the company and/or to the final retailer. For examples of various supply chains, please refer to Supply Chain Mapping in Step 2: Assess Risks and Impacts.

U

UN Guiding Principles on Business and Human Rights

Under the UN Guiding Principles on Business and Human Rights, states have the duty to protect against human rights abuse within their territory or jurisdiction by third parties, including business enterprises. States also have the duty to take appropriate steps to ensure that when such abuses occur, those affected have access to effective remedy. For their part, business enterprises have the responsibility to respect human rights, including by avoiding, causing, or contributing to adverse human rights impacts through their own activities. Corporate actors also have the responsibility to provide victims access to effective remedy and should prevent or mitigate such impacts that are directly linked to their operations, products, or services by their business relationships. The UN Guiding Principles on Business and Human Rights apply to all states and all business enterprises, both transnational and others, regardless of their size, sector, location, ownership, or structure.

Upstream

The part of the supply chain process on the supply side, referring to the flow of goods or products from the company to the suppliers and to the procurers of raw materials at the farm or forest level, in the direction of raw materials. This includes companies’ network of supplies.

V

Violation

A situation identified through an audit or any other avenue that is in breach of the code of conduct or other local or international standards.

W

Worst Forms of Child Labor

ILO Convention 182 defines the WFCL as:

  • All forms of slavery or practices similar to slavery, such as the sale and trafficking of children, debt bondage and serfdom, and forced or compulsory labor, including forced or compulsory recruitment of children for use in armed conflict.
  • The use, procuring, or offering of a child for prostitution, the production of pornography, or for pornographic performances.
  • The use, procuring, or offering of a child for illicit activities, in particular for the production and trafficking of drugs as defined in the relevant international treaties.
  • Work which, by its nature or the circumstances in which it is carried out, is likely to harm the health, safety, or morals of children (referred to as “hazardous work”).