SIZA Guide to using the Ethical Trading Handbook March 2014

1. SIZA Guide to using the Ethical Trading Handbook March 2014 1

2. AcknowledgementsThe SIZA Guide to using the Ethical Trading Handbook has been produced for the SIZA programme as a tool for Ethical Trade Facilitators to present awareness sessions for farm and packhouseemplyoees on how to use the Ethical Trading Handbook. This guide also provides some background to ethical trade but its main focus is to inform people how best to access information in the Ethical Trading Handbook. We gratefully acknowledge all the people in the industry who contributed to the development of this Guide and to the South African Table Grape Industry for funding its development. 2

3. This pack is a guide to using the Ethical Trading Handbook for farm and packhouse employees and is support material for Ethical Trade Facilitators who run SIZA awareness and training sessions. While the focus is on how to use the Handbook it also provides useful information on the background to Ethical Trade and the SIZA programme, ethical audits and the role of the Ethical Trade Facilitator. It is divided up into 6 sessions each consisting of a number of different topics which can be used as required. 3

4. Contents Session 1: Introduction to Ethical Trade page 6 • Topic 1: What does ethical trade mean? page 7 • Topic 2: Where does ethical trade come from and who drives this? page 11 • Topic 3: Who drives ethical trade in the supply chain? page 13 • Topic 4: What is the Global Social Compliance Programme? page 14 • Topic 5: What value can ethical trade add to your business? page 19 • Topic 6: Why is it important to have management systems in place? page 21 Session 2: What is the SIZA programme? page 24 • Topic 1: Background to the SIZA programme page 25 • Topic 2: Goals of the SIZA programme page 30 • Topic 3: SIZA Programme framework page 32 Session 3: The Ethical Audit page 33 • Topic 1: What is an ethical audit? page 35 • Topic 2: What happens in an ethical audit? page 39 4

5. Contents • Session 4: How to use the Ethical Trading Handbook page 42 • Topic 1: Introduction to the scope and content of the ET Handbook page 43 • Topic 2: Finding information in the Ethical Trading Handbook page 46 • Session 5: Checklists and Improvement Plans page 51 • Topic 1: How to use the Checklist as a self-audit page 52 • Topic 2: Developing an Improvement Plan page 60 • Session 6: The role of the Ethical Trade Facilitator page 63 • Topic 1: What is the role and purpose of the Ethical Trade Facilitator? page 64 • Topic 2: Tasks and responsibilities of the Ethical Trade Facilitator page 66 5

6. SESSION 1: INTRODUCTION TO ETHICAL TRADE 6

7. Topic 1: What does ethical trade mean? 7

8. 8 • Ethical trade can have a number of different meanings, but our focus is on • Social and labour ethical practices in a business’s supply chain

9. 9 Ethical trade provides assurance to consumers that all the members of the supply chain comply with international standards Supplier commitment is shown by adopting a code of labour practice for example, the SIZA Code of Practice that measures their compliance with minimum labour standards The supplier must demonstrate that he or she is compliant by supplying evidence (for example, a payslip to prove minimum wages are paid and only legal deductions are made)

10. 10 • The SIZA Code addresses the following types of issues: • Wages • Hours of work • Health and safety • Right to join trade union • The SIZA Code of Practice is based on international conventions and South African labour laws

11. Topic 2: Where does ethical trade come from and who drives it? 11

12. 12 • The SIZA Code is based on: • ILO conventions that prescribe minimum standards • South African legislation

13. Topic 3: Who drives ethical trade in the supply chain? 13

14. 14 • Ultimately it is the consumer that wants to know that the food they buy is being produced in an ethically sound environment • Pressure to prove ethical compliance comes from consumers and civil society (NGO’s and labour unions) due to concerns over social and environmental conditions in supply chains • The media and research reports tell the stories

15. 15

16. Topic 4: What is the Global Social Compliance Programme? 16

17. 17 • Global Social Compliance Programme (GSCP) • An initiative of retailers (eg. Tesco, M&S, Ahold, Migros) to support principles of non-duplication of ethical audits • GSCP reference code combines all the principles of the international ethical codes (ETI, BSCI, SA 8OOO) into a single reference code • The reference code can be adopted by industries such as the fruit industry as a platform for their own ethical standard • Fruit SA used the GSCP reference code as a platform to benchmark the SIZA Standard against international requirements and was found to be 92% equivalent • Aim? To reduce duplication of audits and to develop a clear, consistent message on best practice for suppliers globally • Why? To continuously improve conditions in the workplace

18. 18 The South African fruit industry was proactive in its response by initiating its own ethical trade programme, using the GSCP reference tools as a globally accepted platform to benchmark its own Standard

19. Topic 5: What value can ethical trade add to your business? 19

20. An ethical trade programme focuses on continuous improvement in the workplace and adds value in many ways: Efficiency + productivity Motivation of workforce Retain current markets and access to new markets Supply chain sustainability Use of resources to support capacity building Audit costs Absenteeism Managing Risk for individuals and the industry 20

21. Topic 6: Why is it important to have management systems in place? 21

22. 22 • Good management systems allow a business to run effectively • They help to demonstrate to an auditor that the business complies with ethical standards • You must be able to show proof of everything you say that you do

23. 23 • Examples that can be used as proof: • Payslips – can prove how much employees have been paid • Employee contracts – can prove that somebody is employed, for how long and under what conditions • Workplace policies – should be visible in the workplace, explained to all employees and used to demonstrate the business’ position on critical issues such as: • Discrimination • Ethical trade • Child labour • Sexual harassment

24. SESSION 2: WHAT IS THE SIZA PROGRAMME? 24

25. Topic 1: Background to the SIZA Programme 25

26. 26

27. These organizations come together to represent the industry’s interests around common issues • Example: Ethical Trade • FSA represents • 5,000 producers • 400,000 employees • FPEF represents • 110 export houses 27

28. FSA developed + implemented an Ethical Trade programme, later formalised as the Sustainbility Initiative of South Africa (SIZA), in response to increasing demands on growers by international retailers. • SIZA Programme is: • Locally managed, locally relevant • Aligned to South African legislation • Complies with international standards and requirements • Allows growers to avoid duplication of ethical audits • Allows for collection of data to inform needs • Provides support for growers (capacity-building programme) • Focus on continuous improvement (development-led not audit-led) 28

29. SIZA Programme includes: • SA standard (based on GSCP reference code; aligned to SA law) • Audit methodology (based on GSCP reference tool) • How the audit will take place • How often audits will take place • How non-compliances will be verified, etc • Auditor recognition (based on GSCP reference tool) • Ethical Programme Guidelines • Management structure • Dealing with complaints (eg from audits) • Capturing data • Support for continuous improvement, etc 29

30. Topic 2: Goals of the SIZA programme 30

31. Goals of the SIZA Programme are: • To ensure the industry drives its own ethical trade programme in a professional manner • To support ongoing improvement of labour conditions on fruit farms and pack houses • To help manage commercial risks allied to ethical trade matters • To give retailers + other stakeholders confidence in South African supply base • Reduce the number, duplication + costs of audits by converging with other ethical programmes • To support ethical practices along the supply chain 31

32. Topic 3: The SIZA Programme Framework 32

33. 33

34. SESSION 3: THE ETHICAL AUDIT 34

35. Topic 1: What is an Ethical Audit? 35

36. Ethical audit: • Aims to measure current performance • Identifies areas where improvements can be made • Involves interviews with employees • Conducted by professionally trained auditors • More time-consuming and costly then other audits, therefore takes place less frequently based on SIZA Audit Frequency Matrix (frequency depends on nuber of non-compliances) 36

37. An ethical audit is: • A way of jointly agreeing on how to fix a problem • A constructive way to advise people of problems • Focussed on continuous improvement • Aimed at supporting producers + pack house owners • Aimed at an ongoing process An ethical audit is not: • A pass/fail exercise • Aimed at catching people out • A tick box exercise (like GLOBALG.A.P) • Able to be overlapped with other audits 37

38. How is an ethical audit different to a GLOBALG.A.P audit? • Aims to ensure food safety for export products • Assures consumers that a product was produced with minimal negative impact to the environment + decreased use of chemicals • Focuses on good agricultural practices (G.A.P) • Does not focus on fair labour practices (like an ethical audit) 38

39. Topic 2: What happens in an ethical audit? 39

40. 40

41. What is the purpose of the feedback session? • Conducted after the site assessment • Between the auditors and management • To discuss any non-compliances found • How these can be addressed • What actions will be taken + by whom • Agreed by both parties • Uploaded onto the system once corrective measures have been completed 41

42. SESSION 4: HOW TO USE THE ETHICAL TRADING HANDBOOK 42

43. Topic 1: Introduction to the scope and content of the Ethical Trading Handbook 43

44. 44

45. Each chapter in the handbook which deals with the Code has the following sub-sections: • What does the Code say? • What does South African law say? • Guidelines to the law and best practice • Common questions and answers • This will add to the ease of use and you should quickly become familiar with how to use the handbook 45

46. Topic 2: Finding information in the Handbook 46

47. Identify the issue that you have and need assistance with • Go to the index at the back of the Handbook and search for that topic (in alphabetical order) • Now go to the relevant page number in the Handbook • Don’t forget there is also more information available on the website: www.siza.co.za 47

48. Case Study 1: Sexual Harassment / Discrimination Questions: • What is/are the issue(s)? • What does the law say? • What is recommended (Best Practice)? • Where did you find the information? 48 Sara lodged a complaint of sexual harassment with the manager of the farm. She said the supervisor in her section often came physically close to her, sometimes touching her and then making comments of a sexual nature. She stated she had complained to management before but her complaints were ignored. She also said that she believed she had been overlooked for promotion because she was a woman and that jobs which she was qualified to do had been given to men with less skills than her.

49. Case Study 2: Child Labour Questions: • What is/are the issue(s)? • What does the law say? • What is recommended (Best Practice)? • Where did you find the information? 49 John is a producer and he employs young people over the age of 15 years to work during holidays. Fanie is one of the young boys he employs. Fanie is 16 years old and asks John for fulltime employment on the farm. He says he has left school because his parents can’t afford to send him and they need him to earn some money for the family. John wants to know whether it is legal to employ the young people during the school holidays and also whether he can employ Fanie seeing as he has left school and he urgently needs to earn an income.

50. Case Study 3: Loans / Deductions Questions: • What is/are the issue(s)? • What does the law say? • What is recommended (Best Practice)? • Where did you find the information? 50 Basie is a small-scale grower with 15 permanent workers. Basie regularly loans money to his employees for them to buy food at the farm shop. He deducts this amount off their wages every week. He writes down the purchases in a small book at the shop but doesn’t get the workers to sign for this. However his workers are now complaining that he is deducting too much from their wages. Basie wants to stop making the loans. He comes to you for advice because he wants to do what is right in terms of the law.