Dive Temporary:

  • Violations amongst Levi Strauss’ Tier 1 and Tier 2 suppliers jumped in 2021 throughout all classes, in response to the retailer’s annual sustainability report.
  • The rise occurred partially as a result of attire and footwear suppliers struggled to make well timed wage funds because the COVID-19 pandemic dried up their money flows, Levi’s stated within the September report. In some instances, suppliers hadn’t met new necessities established by the corporate in 2020.
  • “Delays in remittance of social safety advantages, severance funds to employees, delays in permits renewal and different points related to the pandemic have been reported throughout the assessments,” Levi’s stated, including that it labored with suppliers to fulfill their authorized obligations to pay their employees.

Mixed Tier 1 and a couple of provider violations surge for Levi Strauss in 2021

Provider violations by class: Zero tolerance (should remediate instantly), instant motion (should remediate absolutely inside two months) and steady enchancment (ought to be addressed).

Dive Perception:

After violations skyrocketed in 2021, Levi’s stated within the report that it’s leaning on corrective motion plans to assist suppliers adjust to the corporate’s code of conduct going ahead.

The retailer stated it’s offering suppliers with the coaching, assets and capability constructing essential to sort out systemic points. A particular focus was positioned on licensees, who have been hit more durable by the pandemic than direct suppliers, in response to Levi’s.

“We’re additionally adjusting our scoring methodology and score system to extra carefully align them with trade practices and to fast-track remediation and closure of [corrective action plans],” Levi’s stated.

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The corporate stated it terminated two provider relationships for noncompliance after zero-tolerance violations, with one other present process verification as of September. The rest have been remediated.

Zero-tolerance violations are thought of severe breaches of the provider code of conduct which require instant remediation. They’ll embrace sexual harassment, compelled labor and little one labor. Levi’s stated it recognized one incident of sexual harassment in 2021, which the corporate stated has been remediated, and discovered no cases of compelled labor or little one labor in its assessments final yr.

Well being and security issues remained the most typical problem for Levi’s at each Tier 1 and Tier 2 services in 2021 even with the general surge in violations, making up 53% of points discovered. In 2020, 54% of points have been tied to well being and security.

The retailer stated within the report that well being and security evaluation findings are sometimes tied to “paperwork administration non-conformances,” quite than points threatening employee security. It added that it repeatedly reminds suppliers concerning the significance of ongoing security coaching.

“As a result of our well being and security necessities are so intensive, it isn’t unusual for assessments to uncover a violation, generally attributable to office circumstances or procedures, and generally attributable to employee noncompliance, corresponding to removing of gloves or a masks,” Levi’s stated.

Working hours and wages and advantages tied for a distant second in points discovered at 12% every. That is not an issue distinctive to Levi’s provide chain — Amazon just lately reported that amongst its suppliers and potential companions, greater than 40% of these audited final yr had wage and advantages points. At Victoria’s Secret and Co.’s suppliers, the vast majority of what it thought of to be “elevated violations” in 2021 involved wages and advantages, per its most up-to-date ESG report.

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