98-12-22, Levi Strauss update from the CCC

Dear Friends,

Below is a report sent to Alan Christie, Community Affairs Director at Levi Strauss Europe. This report responds to questions raised by Levi Strauss regarding the case file on that company which was presented to the Permanent Peoples Tribunal on May 2, 1998. If you have not yet had a chance to read the case file. Among the information included in this document below is follow-up information on the situation at two Indonesian factories producing for Levi Strauss about which testimony was presented to the PPT.

Originally, representatives of the Clean Clothes Campaign planned to meet
with representatives of Levi Strauss to discuss these points, the Levi
Strauss guidelines, their implementation and subsequent monitoring of
working conditions. But given the current ongoing nature of negotiations
between Levi Strauss and Belgian and French trade unions regarding the
proposed closure of Levi facilities in those countries, this meeting has
been postponed. As you know from our request for protest letters regarding
this situation, the CCC stands in solidarity with the members of these
unions (the ABVV and ACV in Belgium, and the CGT, CFDT and CFTC in France)
in their call for a committed dialogue between Levi Strauss management and
the unions to meet the demands of workers at the four European factories
slated for closure.

---------------------------

Comment to the points raised in the June 22, 1998 letter from Patrick
Neyts/Mark Elliot regarding the case file on Levi Strauss presented to the
Permanent Peoples Tribunal, Brussels, May 2, 1998

1. Concern regarding the dates when the Levi Strauss Global Sourcing and
Operating Guidelines were announced and when problems regarding working
conditions in Saipan were revealed:

As stated in the report: The U.S. Department of Labor lawsuit was initiated
after an investigation following grievances filed by workers in 1989.

The claim that Levi Strauss was a pioneer in the corporate codes of conduct
movement is not disputed, instead our concern is more with the fact that
years after the drafting of such a code the situation for Chinese migrant
workers producing for Levi Strauss in Mauritius in 1997 is in many ways
similar to the situation of Chinese migrant workers in Saipan before the
implementation of the Levi GSOG.

2. a) The CCC report states that there is "evidence that repeatedly shows
that the company's codes has not been implemented." The response states
that the guidelines have been "implemented worldwide."

Given the content of the guidelines and the reports that continue to come
in regarding the reality of working conditions found in various factories
producing for Levi Strauss, the Clean Clothes Campaign continues to support
our statement that the company's own guidelines are not implemented. If
they were, there would not be a difference between the standards stated in
the guideline document and in the actual standards of conditions found in
the workplace.

b) We stated that "the role of a quality controller and that of one charged
with verification of labor standards are significantly different and
require distinctive courses of training."

This is still true. The Clean Clothes Campaign is pleased to receive and
react to any information/documentation that Levi Strauss can supply us with
regarding the training provided to those who are charged with verifying the
labor standards in facilities producing garments for Levi Strauss. Names
and contact information for your 100 Trained Assessors and the factories
which they cover would be useful, therefore if questions come up regarding
conditions in specific facilities the assessor charged with verifying
implementation and enforcement of the guidelines within that territory
could be contacted directly for a copy of their most recent written
evaluation.

For more on this point and with regard to the need for quality training for
those who assess the LS&CO Guidelines, we refer to your own pilot program
and the evaluation of the training program carried out by Oxfam UK,
Facultad Latinoamericana de Ciencias Sociales, Programa Investigacion y
Formacion para la Intervencion Communitaria, Centro de Investigacion para
la Accion Femenina:

The NGOs reported a failure on the company's behalf to explain and analyze
their rationale for having such guidelines. The reasons for developing the
guidelines should be explained. Participants in the training should visit
the plants more than once (twice) so that they become better acquainted
with the audit process that determines TOE compliance. They found that the
training lacked examples of the documents analyzed by the auditors in the
sourcing plants (ex. payrolls, personnel records, human resources policies,
social plans, blueprints of the facilities, organizational charts, work
flows and information regarding the different types of production processes
which exist in the plants, such as modular working arrangements).

As for developing the skills to manage the audit instruments and forms, the
course lacked practical examples to show how they are used. The instruments
used (forms, audit instruments) lack a conceptual explanation about the
subject areas and practices they measure. An analytical and/or theoretical
background should underline each audit form or instrument to define the
concept as well as the problems or issues to be measured.

The instruments presented during the training and later used by the
researchers were found to lack a handbook or set of instructions for
interviewing which would have contributed to harmonizing the data
collection process. This pilot project revealed that indicators relevant to
each of the processes and activities that are measured have yet to be
developed! This inadequacy forced the quality of collected data to depend
upon the particular skills of the person collecting information, a
limitation which makes it difficult for a person not widely experienced in
TOE management to use it.

They recommended that local experts and professional associations provide
ideas and examples about the economic, political and social environment
during the training to contribute to a better understanding of how
communication/relations between contractors and the community are managed.

They reported that information on the Levi Strauss guidelines needs to be
disseminated to middle managment, employees and workers. They recommended
that these efforts be ongoing and should tailored to the educational level
of the targeted employees.

In a September 1998 letter to the Clean Clothes Campaign, Patrick Neyts
stated that Levi Strauss would implement the changes suggested by the NGOs.
"We are in agreement with their recommendations and are developing plans to
implement them worldwide..." he wrote. What progress has been made on these
issues? An update on how Levi Strauss plans to pursue these recommendations
is in order. Any such action plan should include a schedule with specific
deadlines. A follow-up evaluation on how these recommendations are dealt
with should be commissioned.

4. Regarding China
The June 22 response letter stated that "LS&CO is confident it can conduct
responsible business activities in China because, in a wide variety of
industries, other major global companies are showing that it is possible to
successfully operate in China in a responsible manner. The company believes
it can identify successful business partners who will honour its Global
Sourcing and Operating Guidelines."

The Clean Clothes Campaign stands behind the concerns raised in the May
1998 case file (and voiced by a representative of the China Labour Bulletin
who testified during the session on Levi Strauss during the International
Forum) regarding Levi Strauss plans to expand production in China. Given
the wide body of information available regarding workers rights and working
conditions in that country, the question as to how a commitment to a high
standard of working conditions will be upheld within the Chinese context
remains a serious concern. Please supply us with copies of the evidence
that supports claims that the human rights situation in China has improved.
We would also like more details on how Levi Strauss plans to insure
implementation of the Levi GSOG in China. For example, how will you ensure
that the right to free association is ensured? How will you monitor
conditions in dormitories? What will the complaints procedure be in the
Chinese context (i.e. if a worker would like to file a grievance regarding
a violation of the code?). Statements that the human rights situation has
improved in China and that the Levi Strauss code can be enforced in the
Chinese context fly in the face of the majority of all recent research
carried out in China, therefore your evidence to support these claims and
information on the methodology used to collect this information should be
shared if Levi Strauss would like the Clean Clothes Campaign (and
consumers) to consider their claims.

5. The Clean Clothes Campaign stated that "Restructuring of European
operations is rumoured, but no concrete plans have been announced, and
workers have been pressuring the company for a European-level consultation
to clarify plans for the future."

The Levi Strauss response letter reacted to this point by stating: "Wrong
again" and cited a four year "fruitful and constructive discussion with
members of its European workforce." They mention a "highly constructive
meeting" that took place after the International Forum in May.

Well, we know that European restructuring is happening at this very moment
(ex. Belgium and France closures). The description of the dialogue between
Levi Strauss and its employees as one characterized by "constructive"
meetings can be taken up with the Belgian and French trade union
representatives currently in negotiations with management. Both Belgian
unions have already commented that Levi Strauss has not taken proposals
made by the works councils seriously and has not demonstrated a concerted
effort to investigate alternatives to plant closures in Europe, and has not
offered suitable documentation to back up their claims regarding over
capacity, financial distress, etc. This does not imply a dialogue entirely
satisfactory to Levi's European workforce.

6. References to contractors

a) regarding PT Great River in Indonesia: Levi Strauss states that they
have never done business with them.

Our statements on working conditions at PT Great River are based on
eyewitness reports (1996) provided by a former worker and interviews with
employees (1995).

b) regarding PT Ulinda, Indonesia: Levi Strauss states that no such
factory exists in Indonesia.

This is probably a reference to PT Yulinda, the same factory on which
information was presented at the forum. Please refer to item #8 below for
more information on the current situation at PT Yulinda.

c) regarding Korea Lanka in Sri Lanka: Levi Strauss states that they have
never done business with them.

Our sources state that Korea Lanka produced products with the Dockers label
which were delivered to the Jeff Gold Association in the UK.

7. The Clean Clothes Campaign stated that "At P.T. Bali Nirwana Garments in
Tangerang, also in Indonesia, 5% of production is devoted to making jeans
for Levi Strauss. Though they subcontract to companies, the purchasing
manager interviewed in late 1995 said that in terms of guaranteeing that
the subcontractors match even local health & safety requirements the best
he can do is to advise them to do so (SOMO/CCC, 1995). As for guidelines
pertaining to labor conditions/issues in 1995, he reported that no clients
have asked them to sign a code of conduct (SOMO/CCC, 1995)."

Levi Strauss responded by saying that "Our Indonesian branch has never done
business with this contractor. It may be possible that our former licensee
in Indonesia placed some order with this company in the period before 1991,
but we have been unable to substantiate this."

It seems that before Levi Strauss makes claims about having "worldwide
implementation" of their guidelines, they should be sure of where and
under what conditions their garments are actually produced. If the company
does not know, how can they make such a claim? Whether a subcontractor, or
a subcontractor's subcontractor, the responsibility of Levi Strauss is
still clear, their code still applies.

Meanwhile, the Clean Clothes Campaign stands by its 1995 findings. Below
are photos taken by a CCC researcher in September 1995 at PT Bali Nirwana.
At the time that these photos were taken (1995), 5% of production at PT
Bali Nirwana was for Levi Strauss' licensee in Indonesia, accoridng to Mr.
Lalit Matai, purchasing manager. The PT Bali Nirwana brochure circulated at
the time prominently features Levi Strauss jeans.

8. Regarding the situation at Yulinda Duta Fashion

Information presented at the forum included statements that workers put in
a 75 hour week, working seven days a week and that refusing overtime is
difficult. Testimony was made that there were 2000 workers, 98% women. The
response from Levi Strauss stated that working hours including overtime is
52-58 hours a week and that overtime is voluntary. They said that there
were 1700 workers, 85% women.

The exact number of workers at Yulinda Duta changes regularly. Regarding
hours: a report filed in late October 1998 by SISBIKUM, our Indonesian
colleagues who supplied information utilized in the May 1998 case file on
Levi Struass, found that working hours are 8 a.m. until 4 p.m., plus
overtime from 4- 6 p.m., with compulsory overtime until 10 p.m. three or
four times per week to reach targets.

The outstanding question here seems to be whether or not overtime is
voluntary. What evidence can Levi Strauss provide to support their
statement on this point? The Clean Clothes Campaign requests copies of the
last evaluation of this facility, including interviews with workers.
Meanwhile, a recent report (October 1998) by NCOS, a Belgian NGO, found
that at Yulinda Duta workers had to sign a paper prior to working overtime,
stating the the overtime is voluntary. They reported that in practice if
the worker refuses or is reluctant to accept overtime she/he is
intimidated/pressured by the management (most of the time by the supervisor).

9. Regarding the situation at Sandrafine

Testimony presented said that those suspected of participating in a 1996
action were fired, while the response letter from Levi Strauss claims that
only one person was fired.

Regarding current working conditions and a new agreement made after the
tribunal: the most recent information from SISBIKUM (October 30, 1998), the
same organization which provided the information on Sandrafine and Yulinda
in May 1998, is that conditions there are worse. SISBIKUM reports layoffs
at Sandrafine, which managament justifies with plans to move to Vietnam in
December 1998 or January 1999, and the economic crisis. At the end of
October 1998 approx. 100 workers had been laid off, generally those
employed less than three months or those who have worked five years or
more, according to this report.

Regarding the question of the 40 vs. 10 toilets at Sandrafine: SISBIKUM
reports that thought there are 40 toilets at Sandrafine only 10 can be used
by the 2000 workers, using a toilet card.
SISBIKUM reports that out of nine items included in the agreement following
the 1996 strike six have not been implemented. They also report that salary
levels do not meet the Indonesia Man Power Regulation No. 72/1984. They
report that workers do not receive the minimum wage. Management gives
workers who refuse to work over time sanctions, intimidates them and
threatens them with dismissal.

Note:
At both these factories in late October 1998 the Levi Strauss guidelines
had still not been made public to the workers. According to the SISBIKUM
report no posters, documents, stickers, etc. had been circulated to workers
by the company to familiarize them with Levi's own code of conduct.

10. Regarding the situation at Noveca in 1996

Levi Strauss responded that during the past two years their visits to the
contractor show that they are complying with requests to improve the
problems at Noveca cited in the Development and Peace case study.

Please substantiate this position by providing us with copies of the
Assessments made during the past two years, including copies of interviews
with workers at this facility and a copy of the Levi Strauss guidelines
written in the local language.

11. Regarding the Clean Clothes Campaign's decision to withhold the name of
a factory producing for Levi Strauss in Mauritius. Responding to testimony
on the situation at this facility, Levi's stated that: "...Unsupported
allegations about LS&CO's supposed involvement with æunnamed' companies
does nothing to move things forward towards better sourcing outcomes...how
can we work towards better solutions if you will not share the information
you have about Mauritius with us?"

Levi Strauss states that their code is implemented worldwide. The company
claims that their 100 trained assessors have been successfully deployed
around the world to regularly monitor adherance to this code, via announced
and unannounced visits to contractors' premises. Your monitoring process
(again, please provide documentation of just what exactly your monitoring
policy and procedures entail) should easily reveal the site of these
infractions. Please provide us with copies of the written evaluations of
all your suppliers in Mauritius.

12. Regarding the Clean Clothes Campaign statement that it was a two-year
struggle for a union to be established at Levi's Hungary. Levi Strauss
responds that unions were not prevented from taking root in this factory
and workers were not prevented from talking to unions.

The European Trade Union Committee for Textile, Clothing, and Leather is of
the opinion that this was a two-year struggle. This points to contradictory
interpretations of the level of ease with which workers at facilities
producing for Levi Strauss are able to exercise their right of free
association. Item #5 mentioned that Levi Strauss responded to reports that
the company's European workforce was looking for clarification of the
company's restructuring plans with the claim that this was incorrect.
However, as stated above, the fact is that Levi's European workers continue
to demand clarification on the company's restructuring plans (see for
example the demands of Belgian and French trade unions in response to
Levi's planned closure of four factories). Both examples highlight the need
to improve the quality of dialogue between Levi Strauss and their workers.

13. In 1997 when CCC/SOMO researchers visited Levi Strauss' Polish factory
the code was not displayed and had not been translated into Polish. Levi's
responded that the factory more than meets all the criteria in the code.

Shouldn't workers be aware of the code anyway? If the code cannot withstand
scrutiny by those who actually produce garments for Levi Strauss, its value
and function become questionable. The Clean Clothes Campaign is still
waiting for the Polish translation of the Levi Strauss Guildelines,
promised by the company in 1997. As participants in an ongoing project with
trade unions and NGOs in Poland this document remains of interest to our
Polish colleagues.