Prior to accepting any order for Gap Inc. branded product, our suppliers are required to sign our Vendor Compliance Agreement (VCA). Gap Inc. also has a vendor approval process that requires new suppliers for branded apparel product to undergo an assessment against our COVC prior to beginning production for Gap Inc. After the initial assessment of working conditions, the facility either earns approval or is placed in pending status while it addresses outstanding issues. The COVC that is used for the assessments contains provisions related to forced labor, child labor, foreign contract workers and identity document retention.
In signing Gap Inc.’s VCA, which incorporates our COVC, Gap Inc. suppliers agree to comply with the following:
“All applicable laws, rules and regulations … these laws include, but are not limited to, laws relating to the employment conditions of their respective employees such as: (1) wage and hour, labor, child labor, and forced labor requirements; (2) health and safety; (3) immigration; (4) discrimination; (5) labor or workers’ rights in general; and (6) environmental laws and regulations.”
We recognize that policies and expectations alone are not a sufficient safeguard against forced labor within our supply chain. Our statements lay the foundation for a comprehensive approach to engaging and collaborating with our suppliers towards monitoring, remediating and continuous improvement. Gap Inc.’s Supplier Sustainability team within our Global Sustainability department is responsible for the implementation of our supply chain policies and standards relevant to human trafficking and forced labor, which are reflected within our COVC. Our Supplier Sustainability team members – who are locally hired in the countries from which we source and speak local languages – assess and validate that suppliers are meeting the expectations outlined in our COVC. We assess risks to especially vulnerable groups, including migrant labor and women in the workplace; our COVC specifies our management approach towards ensuring free and voluntary labor for these groups.
Our COVC also has stringent requirements around foreign contract workers, who are at risk of exploitation by indentured servitude. We monitor how foreign contract labor is used at facilities producing Gap Inc. branded apparel to help ensure that people are free to work as they choose. For over a decade, we have had a “no fees” policy that applies to foreign contract workers, which requires that any fees and costs payable to host governments for the documentation of foreign contract workers be covered by the facility, and have requirements that cover the entire employment cycle of foreign contract workers. These requirements span recruitment, employment, up to termination of employment, and provide the lens through which our assessors look at policies, practices and conditions in the facility to find indications of forced labor. More information on our policies and procedures on foreign contract workers is available online.
Our COVC further states that facilities must allow “Gap Inc. and/or any of its representatives or agents unrestricted access to its facilities and to all relevant records at all times, whether or not notice is provided in advance.” Gap Inc. conducts both announced and unannounced audits in the facilities we monitor, that are primarily conducted by Gap Inc. staff. Initial assessments for new facilities are generally coordinated with the requested vendor or facility, and with subsequent full assessments we aim for more than 50% to be unannounced or semi-announced.
Gap Inc. monitors all Tier 1 branded apparel suppliers from which we directly source for forced labor and human trafficking. Facilities from Tier 1 suppliers include cut-and-sew production, sub-contractors, and supporting units such as dyeing, embroidery, and wash units. In 2017, we defined and communicated social criteria to Tier 2 fabric vendors, including textile production facilities and subcontractors. These social criteria include provisions involving forced and child labor. We have expanded an augmented version of our Assessment and Remediation program into our Tier 2 strategic textile mills, enabling us to directly evaluate working conditions at the mill level. Over the longer term, we anticipate enrolling our strategic Tier 2 mill vendors into industry initiatives such as the Social Labor Convergence Program, which includes assessments on the risk of forced labor.
An increasing number of facilities producing our branded apparel participate in the Better Work program, a collaborative facility monitoring and capability building initiative led by the International Labour Organization (ILO). Facilities participating in Better Work are assessed by specialists employed by the ILO. These assessments are 100% unannounced and assessed against national labor laws and ILO Conventions, which includes instruments that directly cover forced labor.
Gap Inc.’s Supplier Sustainability team is trained to recognize situations where a facility may be using forced or involuntary labor, and is also trained to assess compliance with our company’s Foreign Contract Worker requirements. Our expectations for Foreign Contract workers and recruitment are available online. We publicly report aggregate findings of assessment results at the facilities that make our branded apparel on our company website.
We consider the following within our Forced Labor standards: forced labor, free egress, restrictions to voluntarily ending employment and restrictions on worker movement. In 2019, our assessments revealed in one facility that we work with, a handful of workers that had contracts that required repayment of training fees which made it financially difficult for the workers to end their employment. In 2018, findings for forced labor included three facilities where we found restrictions on worker movement. These instances involved restrictions within the facility where workers were unable to freely access washrooms and utilize their complete meal breaks. Activity like this violates our COVC and our response to these findings involved corrective action plans and follow-up visits to validate that the remediation occurred. These issues have been remediated by the factories or in some cases the factory no longer manufacture our product. Our policies and action plans in the event we find forced labor are described further online.
We also monitor Unauthorised Subcontracting (UAS), which has high risk for forced labor. We take extra precautions in countries with a high risk of UAS by offering specialized awareness training for suppliers and facility management, and by conducting site visits to ensure our product is being manufactured in the appropriate designated facility. We found three cases of UAS in 2019. In 2018 we also found three cases of UAS, down from 10 cases in 2017. We believe this shows that the enforcement of our policies, which can involve financial chargebacks or business termination, are continuing to have a positive effect. More information on our policies and procedures are available online.