Diagnostic study of social compliance initiatives

in the textile and clothing sector in Morocco

Report
June 2008

Arianna Rossi et Frédérique El Kaddioui

 Table of Contents

INTRODUCTION ................................................................................................................................................. 3
1. COMPARISON OF THE FC CODE WITH OTHER RELEVANT BUYERS’ CODES OF LABOUR
PRACTICE ............................................................................................................................................................ 4
I. CONTENT OF THE CODES ............................................................................................................................... 4
1. Child Labour ........................................................................................................................................ 4
2. Forced Labour ...................................................................................................................................... 4
3. Discrimination ...................................................................................................................................... 5
4. Health and Safety ................................................................................................................................. 6
5. Remuneration and social benefits........................................................................................................ 6
6. Working hours ...................................................................................................................................... 7
7. Freedom of Association ....................................................................................................................... 8
8. Disciplinary measures and harassment ............................................................................................... 9
9. Regular employment .......................................................................................................................... 10
10. Subcontracting ................................................................................................................................... 10
11. Environment ....................................................................................................................................... 11
12. Implementation ..................................................................................................................................... 11
II. SUMMARY AND CONCLUSIONS ................................................................................................................... 12
2. FIELD STUDY ................................................................................................................................................ 16
I. METHODOLOGY ..................................................................................................................................... 16
II. OUTCOMES ............................................................................................................................................. 17
1. Management Interviews ..................................................................................................................... 17
a. Motivation .................................................................................................................................................... 17
b. Advantages of the FC................................................................................................................................... 18
c. Disadvantages ............................................................................................................................................... 20
d. Relationship with clients .............................................................................................................................. 21
e. Expectations for the future.......................................................................................................................... 22
f. Recommendations for the promotion and improvement of FC ............................................................... 24
2. Workers’ interviews ............................................................................................................................ 25
a. Changes before and after FC ............................................................................................................................. 25
b. Outstanding issues .............................................................................................................................................. 26
3. RECOMMENDATIONS ................................................................................................................................ 27
FOCUS AREAS ................................................................................................................................................... 27
RECOMMENDATIONS ....................................................................................................................................... 27

2
 Introduction
The present study aims at analysing and understanding in detail social compliance
initiatives in the textile and clothing industry in Morocco. In particular, it focuses on the code
of labour practice elaborated by the Moroccan Association for Textiles and Clothing Industry
(AMITH) and its related label, Fibre Citoyenne (Citizen fibre). The objective of the report is
to compare the Fibre Citoyenne code with other buyers’ codes of labour practice and to
understand its impact since its introduction at the factory level.

The issue of social compliance has gained considerable attention in the past decades,
as a natural counterpart to globalisation and its opportunities and challenges. Many initiatives
have been launched in order to ensure that globalisation and economic development take
place in accordance with human rights and international labour standards. Such initiatives
have occurred both at the international level and the local level, by a variety of actors, such as
international organisations (e.g. International Labour Organisation (ILO)), multi-stakeholder
initiatives (e.g. Ethical Trading Initiative (ETI)) and private companies operating in a
multinational environment. Such companies have invested largely in corporate social
responsibility initiatives to ensure that their outsourced production takes place under
conditions that comply with international standards. In order to do that, most multinational
enterprises issue a code of labour practice to be respected by their suppliers.
At the national level, the AMITH has introduced a sector-wide code of conduct in
2003. The code is based on the principles of civism and compliance with legal requirements,
social ethics, protection of the environment and sustainable development. The AMITH
created a related label, called Fibre Citoyenne (FC), to assess enterprises’ compliance to the
code, as well as to increase the visibility of the initiative and to market it with international
buyers active in Morocco. The FC label is awarded to companies based on independent
monitoring.
After five years from the introduction of the FC, the MFA Forum commissioned the
present study to compare the FC to other relevant buyers’ codes, to evaluate its impact on
Moroccan enterprises and to understand possible avenues for its improvement and evolution.

The first section of the report concerns the detailed comparison of the FC code with
selected buyers’ codes, as well as with the Moroccan Labour Code and the ETI base code.

The second section of the report presents the outcomes of the field study carried out in
Morocco at the factory level. It provides insights in management and workers’ perspectives
on social compliance initiatives, their motivations, the advantages and disadvantages deriving
from the FC, the changes that it brought about, and their expectations and recommendations
for its future.

The third section identifies focus areas that constitute particular challenges and
provides recommendations for the development of the Fibre Citoyenne.

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 1. Comparison of the FC code with other relevant buyers’ codes of
labour practice
The present section aims at analysing the FC code in comparison with the Moroccan
Labour Code, as well as with other relevant buyers’ codes of labour practice. The codes that
will be considered for comparison are those of the international buyers that constitute the
buyers’ group within the MFA Forum. The buyers’ group is composed of Nike, Levi’s Strauss
&Co. (henceforth Levi’s), Next, Marks & Spencer (henceforth M&S) and Inditex. The codes
of labour practice of Next and M&S are aligned with the Ethical Trading Initiative (ETI) base
code. Therefore, the FC code will also be compared to the ETI code.
After analysing in detail every chapter of the FC code and how they compare with
other codes, the monitoring system will also be assessed.

I. Content of the Codes

1. Child Labour

FC Code :
The minimum age for recruitment is of 15 years of age, including the apprenticeship
training centres (CFA).
The age verification system at the moment of hiring must be rigorous.
The personnel, including trainees and apprentices, must be recorded on an updated
register.

The provisions in the FC code are based on the Moroccan labour code. Under the
article 143, it is stated that underage individuals cannot be employed nor being admitted on
the enterprise’s premises before the age of 15.

The ETI code states at its point 4 that “There shall be no new recruitment of child
labour. (…) Children and young persons under 18 shall not be employed at night or in
hazardous conditions.”
The Nike code states: “The contractor does not employ any person below the age of 18
to produce footwear. The contractor does not employ any person below the age of 16 to
produce apparel, accessories or equipment. If at the time Nike production begins, the
contractor employs people of the legal working age who are at least 15, that employment may
continue, but the contractor will not hire any person going forward who is younger than the
Nike or legal age limit, whichever is higher.”
The Levis’ code underlines that the company will not utilize partners who use child
labour in any of their facilities. It is stated that “Use of child labour is not permissible.
Workers can be no less than 15 years of age and not younger than the compulsory age to be in
school.”
The Inditex code states that “The External Manufacturers and Workshops shall not
work with minors. We define as minors those people who are under the age of 16 (…)”

2. Forced Labour

FC Code :
The enterprise guarantees respect of the fundamental principles of human rights and is
committed not to use any form of forced labour.

4
 The formulation of the working contract should not force in any way the employee to
perform work against his or her will.

The FC code is based on the Moroccan labour law, which asserts in art.10 that it is
forbidden to request employees to perform forced labour or labour against their will.

The ETI base code has prohibition of forced labour as its first point, stating that
“employment is freely chosen” and that “there is no forced, bonded or involuntary prison
labour”.
The Nike code affirms that “The contractor does not use forced labour in any form --
prison, indentured, bonded or otherwise.”
Levi’s declares in its code that the company “will not utilize or purchase materials
from a business partner utilizing prison or forced labour.”
The Inditex code also affirms that the company will “not allow any form of forced or
involuntary labour in the production centres and/or facilities of its external manufacturers,
suppliers and their subcontractors.” It also forbids bonded labour by stating that “External
manufacturers, suppliers and their subcontractors may not require their employees to make
any kind of “deposits”, nor are they entitled to retain their identity papers.”

3. Discrimination

FC Code:
Recruitment, compensation, promotion and training will be based on the unique criteria
of competence and capability of the employee.
Contracts, hiring procedures and internal regulation exclude all forms of discrimination.

The Moroccan labour code mentions discrimination in two articles. At art. 9 it is

stated that “(…) it is [equally] forbidden all discrimination based on race, colour, sex,
disabilities, marital situation, religion, political opinion, union affiliation, national or social
origin, that has the effect of violating or altering the principle of equality of opportunities and
treatment, concerning the recruitment process, work conduct and repartition, professional
training, salary, promotion, assignment of social benefits, disciplinary measures and
dismissal.”
Gender discrimination is also regulated by art. 346: “All discrimination between sexes related
to the salary for a job with the same value is forbidden.”

The ETI base code affirms: “There is no discrimination in hiring, compensation,

access to training, promotion, termination or retirement based on race, caste, national origin,
religion, age, disability, gender, marital status, sexual orientation, union membership or
political affiliation.”
The Nike code states that “There shall be no discrimination based on race, creed,
gender, marital or maternity status, religious or political beliefs, age or sexual orientation.”
The Levi’s code states that while the company recognizes and respects cultural
differences, it believes that workers should be employed on the basis of their ability to do the
job, rather than on the basis of personal characteristics or beliefs.
The Inditex code declares that “External manufacturers, suppliers and their
subcontractors shall not apply any type of discriminatory practice as regards the recruitment,
compensation, access to training, promotion, termination of the employment agreement or
retirement, based on race, caste, creed, nationality, religion, age, physical or mental disability,
gender, marital status, sexual orientation and/or union membership or political affiliation.

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 4. Health and Safety

FC code:
Employees work under conditions that guarantee hygiene and safety.
The Health and Safety committee and the Medical Service will focus on the specific
dangers resulting from the activity of the enterprise.

The fourth title of the Labour Code (art. 281-344) is dedicated to the health and safety
provisions for employees, covering in detail a wide range of issues. It is beyond the scope of
this study to analyse individual articles.

The ETI base code has specific provisions concerning health and safety issues:
“A safe and hygienic working environment shall be provided, bearing in mind the
prevailing knowledge of the industry and of any specific hazards. Adequate steps shall be
taken to prevent accidents and injury to health arising out of, associated with, or occurring in
the course of work, by minimising, so far as is reasonably practicable, the causes of hazards
inherent in the working environment.
Workers shall receive regular and recorded health and safety training, and such
training shall be repeated for new or reassigned workers.
Access to clean toilet facilities and to potable water, and, if appropriate, sanitary
facilities for food storage shall be provided.
Accommodation, where provided, shall be clean, safe, and meet the basic needs of the
workers.
The company observing the code shall assign responsibility for health and safety to a
senior management representative.”

The Nike code stresses the importance of providing a safe and healthy work place and
of promoting the health and well-being of all employees. In addition, it specifies that “The
contractor has written environmental, safety and health policies and standards, and
implements a system to minimize negative impacts on the environment, reduce work-related
injury and illness, and promote the general health of employees.”
The Levi’s code states that the company will “only utilize business partners who
provide workers with a safe and healthy work environment. Business partners who provide
residential facilities for their workers must provide safe and healthy facilities.”
The Inditex code asserts that “External manufacturers, suppliers and their
subcontractors shall provide a safe and healthy workplace to their employees, ensuring
minimum conditions of light, ventilation, hygiene, fire prevention, safety measures, and
access to a drinking water supply.”

5. Remuneration and social benefits

FC code:
Employees receive a fair remuneration, and at least equal to the legal minimum wage.
All worked hours are paid according to regulation. The wage calculation should mention
in detail all earnings and deduction, be transparent, understandable and verifiable.
All employees benefit at least from the compulsory social security and from all other
social benefits prescribed by the law or by collective conventions.

6
 The Moroccan labour code states at art.345 that wage is fixed through a direct
agreement among the parties, or by collective bargaining, subject to the legal provisions
concerning legal minimum wage.
Provisions regarding the remuneration of overtime are found at art. 201: “(…)
overtime should be compensated with an increase of salary of 25% if they take place between
6 am and 9 pm for non-agricultural activities, (…) and of 50% if they take place between 9
pm and 6 am (…). The increase is raised respectively to 50% and 100% if overtime is carried
out on the weekly day off, even if the employee receives a compensatory day off.” Overtime
premium rate may also be paid on an annual basis if the company adopts the annualisation
system, which means that premium rate will be paid only for hours exceeding the yearly quota
of 2288 hours.

The ETI base code refers to the concept of living wage, affirming that « Wages and
benefits paid for a standard working week meet, at a minimum, national legal standards or
industry benchmark standards, whichever is higher. In any event wages should always be
enough to meet basic needs and to provide some discretionary income. All workers shall be
provided with written and understandable information about their employment conditions in
respect to wages before they enter employment and about the particulars of their wages for the
pay period concerned each time that they are paid. Deductions from wages as a disciplinary
measure shall not be permitted nor shall any deductions from wages not provided for by
national law be permitted without the expressed permission of the worker concerned. All
disciplinary measures should be recorded.”

The Nike code prescribes contractors to provide each employee at least the minimum
wage, or the prevailing industry wage, whichever is higher; to provide each employee a clear,
written accounting for every pay period; and to not deduct from employee pay for disciplinary
infractions. In addition, contractors should provide each employee all legally mandated
benefits.
The Levi’s code affirms that the company will only do business with partners who
provide wages and benefits that comply with any applicable law and match the prevailing
local manufacturing or finishing industry practices.
The Inditex Code states that “External manufacturers, suppliers and their
subcontractors shall ensure that wages paid for a standard working week shall meet at least
the minimum legal or collective bargain agreement, whichever is higher. In any event, wages
should always be enough to meet at least the basic needs of workers and their families and
any other which might be considered as reasonable additional needs.”

6. Working hours

FC Code:
Working hours respect local regulation. In the event of overtime, the limit of 60 hours per
week determined by international standards will be respected.
All employees benefit from one day off per week.
Recording of all working hours for each employee will be carried out daily through a
reliable, equitable and verifiable scorecard.

Art. 184 of the Labour Code affirms: « In non-agricultural activities, the normal
duration of work is fixed at 2288 hours per year, or 44 hours per week. The global yearly
duration can be divided according to the needs of the enterprise, provided that the normal
duration of work does not exceed 10 hours per day”.

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 The ETI base code states that working hours should not be excessive: “Working hours
comply with national laws and benchmark industry standards, whichever affords greater
protection. In any event, workers shall not on a regular basis be required to work in excess of
48 hours per week and shall be provided with at least one day off for every 7 day period on
average. Overtime shall be voluntary, shall not exceed 12 hours per week, shall not be
demanded on a regular basis and shall always be compensated at a premium rate.”

The Nike code asserts: “The contractor complies with legally mandated work hours;
uses overtime only when each employee is fully compensated according to local law; informs
each employee at the time of hiring if mandatory overtime is a condition of employment; and
on a regularly scheduled basis provides one day off in seven, and requires no more than 60
hours of work per week on a regularly scheduled basis, or complies with local limits if they
are lower.”
The Levi’s code states that the company will “identify local legal limits on work hours
and seek business partners who do not exceed them except for appropriately compensated
overtime.” While the company favours partners who utilize less than sixty-hour work weeks,
they will not use contractors who, on a regular basis, require in excess of a sixty-hour week.
In addition, “Employees should be allowed at least one day off in seven.”
The Inditex code conforms to the provisions of the ETI base code: “External
manufacturers, suppliers and their subcontractors shall adjust the length of the working day to
the provisions of the applicable laws or of the collective bargain agreement for the sector in
question, should this latter afford greater protection for the workers. At no event shall external
manufacturers, suppliers and their subcontractors require their employees to work, as a rule of
thumb, in excess of 48 hours a week and workers shall be granted at least one day off for
every 7 calendar day period on average. Overtime shall be voluntary, shall not exceed 12
hours per week, shall not be demanded on a regular basis and shall always be compensated at
a premium rate, pursuant to the provisions of the prevailing regulations in force.”

7. Freedom of Association

FC Code :
Freedom of association, guaranteed by the law, is respected. In any case, elections for
employees’ representatives are organised according to regulation.

At art. 9 of the Labour code it is asserted that it is forbidden to limit freedoms and
rights related to unionisation within the enterprise.

The ETI base code affirms: “Workers, without distinction, have the right to join or
form trade unions of their own choosing and to bargain collectively.” In addition, “The
employer adopts an open attitude towards the activities of trade unions and their
organisational activities.” Finally, “Workers representatives are not discriminated against and
have access to carry out their representative functions in the workplace.”

The Nike code states that management practices of contractors should respect the
rights of all employees, including the right to free association and collective bargaining.
The code of Levi’s declares that the company expects suppliers to respect the right to
free association and the right to organize and bargain collectively without unlawful
interference. Business partners should ensure that workers who make such decisions or
participate in such organizations are not the object of discrimination or punitive disciplinary

8
actions and that the representatives of such organizations have access to their members under
conditions established either by local laws or mutual agreement between the employer and the
worker organizations.
The Inditex code states: “External manufacturers, suppliers and their subcontractors
shall ensure that their employees, without distinction, have the right of association, union
membership and collective bargaining. No retaliation may arise from the exercise of such
right and no remuneration or payment whatsoever may be offered to the employees in order to
hinder the exercise of such right. External manufacturers, suppliers and their subcontractors
shall adopt an open and collaborative attitude towards the activities of Trade Unions.”

The FC code, unlike the ETI and buyers’ codes, does not explicitly mention collective
bargaining.

8. Disciplinary measures and harassment

FC Code :
Disciplinary measures are gradual, according to regulation, and the level of sanction is
adapted to the misconduct.
Internal regulation defines rights and obligations for employers and employees, and it is
circulated among all employees.
The employer engages in the formalisation of a communication system for employees’
anonymous information, suggestions and complaints.

The first provision of the FC is based on art. 38 of the Labour Code, which prescribes
that disciplinary measures should be applied gradually.
Art. 36 of the Labour Code states that disciplinary sanctions or layoffs should not be
based on invalid motives such as union membership, participation in union activities, being a
workers representative, any form of discrimination.
Art. 40 lists possible misconducts on the side of employers, company heads and
management, including grave insults, any form of violence and aggression towards the
employee, sexual harassment and incitement to immoral behaviour.

The ETI base code states that no harsh or inhumane treatment should be allowed.
“Physical abuse or discipline, the threat of physical abuse, sexual or other harassment and
verbal abuse or other forms of intimidation shall be prohibited.” In addition, it also states that
“Deductions from wages as a disciplinary measure shall not be permitted nor shall any
deductions from wages not provided for by national law be permitted without the expressed
permission of the worker concerned. All disciplinary measures should be recorded.”

The Nike Code asserts that contractors must recognize the dignity of each employee,
and the right to a workplace free of harassment, abuse or corporal punishment.
The Levi’s code affirms that the company will not utilize business partners who use
corporal or other forms of mental or physical coercion.
The Inditex code states that “External manufacturers, suppliers and their
subcontractors shall treat their employees with dignity and respect. Under no circumstances
shall physical punishment, sexual or racial harassment, verbal or power abuse or any other
form of harassment or intimidation be permitted.” In addition, it also states that “External
manufacturers, suppliers and their subcontractors shall not proceed to any withholdings and/or
deductions from wages for disciplinary purposes (…)”.

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 9. Regular employment

FC Code :
The employment will be formalised by a contract or at least by a work card [carte du
travail]. The contract corresponds to the employee’s situation within the enterprise.
The enterprise does not take advantage of the apprenticeship training programmes to
avoid paying the minimum wage to positions that require a low level of qualification.
It is forbidden to use repeatedly temporary contracts or any practice aimed at keeping the
employee in a precarious employment situation.

The ETI base code is explicitly mentions the issue of regular employment: “To every
extent possible work performed must be on the basis of recognised employment relationship
established through national law and practice. Obligations to employees under labour or
social security laws and regulations arising from the regular employment relationship shall
not be avoided through the use of labour-only contracting, sub- contracting, or home-working
arrangements, or through apprenticeship schemes where there is no real intent to impart skills
or provide regular employment, nor shall any such obligations be avoided through the
excessive use of fixed-term contracts of employment.”

The Inditex code is aligned with the ETI code, affirming that “External manufacturers,
suppliers and their subcontractors undertake that all the employment formulas they use are
part of the ordinary labour practice and the applicable local laws. External manufacturers,
suppliers and their subcontractors shall not impair the rights of workers acknowledged under
the labour and social security laws and regulations by using schemes of: subcontracting,
homeworking, training and apprenticeship contracts or any other like formula which prevents
promotion of regular employment in the framework or regular employment relationships.”

10. Subcontracting

FC Code :
The enterprise verifies that the employees of service providers (security, cleaning,
temporary workers…) in their premises benefit from lawful working conditions”

The Labour code specifies in art. 87 that the subcontractor must comply with all
provisions of the code including those related to social security and work injury.

The ETI base code does not have specific provisions concerning subcontracting.

M&S specifies that suppliers must agree with the company in advance the production
site or sites to be used for each order: subcontracting of its orders is not allowed.
Next affirms in its code of practice that “Where a supplier wishes to use
subcontractors or outworkers this must be approved in advance by NEXT. It is the supplier’s
responsibility to ensure and provide evidence that any subcontractor or outworker used,
conforms to the standards outlined in this code.”
The Nike code mentions that the contractor should not use any form of homework for
Nike production.
The Inditex code specifies that “External manufacturers and suppliers shall not
subcontract any work without the prior written authorisation of Inditex. External
manufacturers and suppliers, which subcontract work for Inditex, shall be responsible for the

10
subcontractors’ compliance with the Code. External manufacturers, suppliers and their
subcontractors shall apply the principles of the Code to any homeworker involved in their
supply chain, and they shall give transparency to the locations and working conditions of said
homeworkers.”

11. Environment

FC Code :
In order to protect the environment, waste disposal will be organised, rational and
adapted to the product, and will privilege reutilisation and recycling.
Stocking and handling of hazardous chemicals will follow basic safety rules for
environment protection.

While the Labour code and the ETI base code do not include provisions concerning
the environment, the FC code is aligned with buyers’ codes in its provisions regarding this
issue.

M&S states that “suppliers must meet all local and national regulations. In addition,
[the company] expect them to meet all the relevant Marks and Spencer standards relating to
the environment.
Next affirms in its code that “supplier must comply with national laws and
international standards that aim to protect the environment.”
The Nike code asserts that the contractors should have written environmental policies
and standards, and should implement a system to minimize negative impacts on the
environment.
The Levi’s code affirms that the company will only do business with partners who
share its commitment to the environment and who conduct their business in a way that is
consistent with LS&CO.’s Environmental Philosophy and Guiding Principles.
The code of Inditex affirms that “External manufacturers, suppliers and their
subcontractors shall be duly committed at all times to protect the environment and shall
comply, at least, with the standards and requirements of the applicable Local and International
Laws and Regulations.”

12. Implementation

FC Code :
The enterprise adopts management and organisation systems that are efficient,
transparent and adapted to its size and activity.
The systems allow a rigorous follow-up of human resource management and prove
compliance of the enterprise’s practices to the regulation.

In accordance to buyers’ practices, the monitoring system of the FC code is based on

audits. When the label was established in 2003, a first group of enterprises was accompanied
through a support programme and certified by an external audit company. In the following
years, new applicants were audited after the completion of the FC support programme. The
FC support system consists of a preliminary audit, followed by a plan of corrective actions
aimed at achieving social compliance. The enterprise is accompanied by a support cabinet that
assists it in the implementation of an action plan over a period of six months, covering issues
of health and safety, minimum working age, wages, working hours, discrimination, freedom

11
of association, forced labour and environment. After this period, the enterprise is audited
again. The FC label is issued on the base of the results and conclusions drawn on the final
audit. Verification audits, aimed at confirming or withdrawing the label of already FC-
certified enterprises, have been launched in April 2008 and are currently ongoing.

The ETI Principles of Implementation cover areas related to monitoring and

verification, transparency and disclosure. More in detail, the first principle concerns
commitment by companies to endorse the base code and its implementation process, by
appointing a senior manager for implementation activities, and by integrating the code and its
implementation process into their core business. Secondly, the ETI Principles of
Implementation address the issues of monitoring, independent verification and reporting.
Then, in the section on awareness raising and training it is stated that the relevant personnel
should be provided with appropriate training and guidelines. A continuous improvement
approach is at the base of corrective actions. The ETI also underlines in its last point
management procedures, pricing and incentives, stating that negotiations with suppliers shall
take into account the costs of compliance.

Each of the buyers’ codes has specific provisions concerning the publication of the
code on the factory floor and its translation in a local language understood by the employees.
Inditex specifies that suppliers shall establish a management system that implements
the code, and shall appoint a senior member of management to be responsible for its
implementation and enforcement.
Concerning the monitoring system of the codes of labour practice, buyers carry out
regular audits in their suppliers’ factories to ensure compliance with their codes. The
frequency of such audits varies according to the buyer as well as to the level of compliance of
the supplying factory. Audits may be managed internally by the buyer, or they may be
outsourced and carried out externally by an auditing cabinet. Audits may be announced or
unannounced. Nike explicitly mentions in its code that audits are unannounced.
In the codes of M&S and Levi’s it is explicitly stated that the company will support
necessary improvements in their suppliers’ factories, requiring corrective action plans in the
event of non compliance of certain points. However, should the corrective action prove not
successful, they would cancel contracts and terminate the business relationship.
The Inditex code explicitly mentions the issue of transparency in its chapter on ethical
commitment, which outlines measures for the prevention of corruption, bribe and extortion.

II. Summary and Conclusions

The table below provides a snapshot view of the sections above, summarising the
detailed provisions of each code.

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 Fibre
Nike Levi's Inditex Next M&S ETI Base Code
Citoyenne
Children and
young persons
Legal working
Not younger under 18 shall not
age in Morocco No less than 15 16, exceptional see ETI Base see ETI Base
Child Labour than 16 years of be employed at
- 15 years of years old cases 14 Code Code
age night or in
age
hazardous
conditions.
Prohibition on
Does not allow
forced labor, Forbids prison There is no
Forbids any any form of
whether prison, or forced labor see ETI Base see ETI Base forced, bonded or
Forced Labor form of forced forced or
indentured, in contracting Code Code involuntary prison
labour involuntary
bonded or relationships labor.
labour
otherwise
There is no
Forbids any type
discrimination in
Respects of discriminatory
hiring,
cultural practice based
compensation,
No differences, on race, caste,
access to training,
Excludes all discrimination believes that creed,
promotion,
discrimination based on race, workers should nationality,
termination or
practices creed, gender, be employed religion, age,
retirement based
based on marital or on the basis of physical or see ETI Base see ETI Base
Discrimination on race, caste,
criteria other maternity status, their ability to mental disability, Code Code
national origin,
than religious or do the job, gender, marital
religion, age,
professional political beliefs, rather than on status, sexual
disability, gender,
competence. age or sexual the basis of orientation
marital status,
orientation. personal and/or union
sexual orientation,
characteristics membership or
union
or beliefs. political
membership or
affiliation.
political affiliation.
Provision of a
Written safety safe and healthy
and health workplace to
policies and their employees,
Will only utilize
Employees standards, ensuring
business
work under implementation minimum
partners who Working
conditions that of a system to conditions of see ETI Base see ETI Base
Health & Safety provide workers conditions are
guarantee reduce work- light, ventilation, Code Code
with a safe and safe and hygienic.
hygiene and related injury hygiene, fire
healthy work
safety. and illness, and prevention,
environment.
promote the safety measures,
general health and access to a
of employees drinking water
supply.
At least the legal The higher of
Wages and
minimum wage national legal
benefits that
or collective standards or
comply with
Fair Minimum wage bargain industry
any applicable
remuneration, or prevailing agreement, benchmark
Remuneration law and match
and at least industry whichever is see ETI Base see ETI Base standards and
and social the prevailing
equal to the standard, higher. Wages Code Code should always be
benefits local
legal minimum whichever should be enough to meet
manufacturing
wage. higher enough to meet basic needs and
or finishing
at least the basic to provide some
industry
needs of workers discretionary
practices.
and their families income.
Working hours
comply with
Working hours
national laws and
respect local
No more than No more than No more than 48 see ETI Base see ETI Base benchmark
Working hours regulation, with
60 hrs per/week 60hrs per/week hours per week Code Code industry
a limit of 60
standards,
hours per week
whichever affords
greater protection.
Respect the
rights of all Right to free Right of Freedom of
employees, association and association, association and
Freedom of
Freedom of including the the right to union see ETI Base see ETI Base the right to
association is
Association right to free organize and membership and Code Code collective
respected
association and bargain collective bargaining are
collective collectively bargaining respected.
bargaining

13
 Forbids physical
Prohibits punishment,
Disciplinary deductions from Will not utilize sexual or racial Deductions from
measures are pay as a business harassment, wages as a
gradual, disciplinary partners who verbal or power disciplinary
Disciplinary according to measure; right use corporal or abuse or any measure shall not
see ETI Base see ETI Base
Measures and regulation, and to a workplace other forms of other form of be permitted. No
Code Code
Harassment the level of free of mental or harassment or harsh or
sanction is harassment, physical intimidation; any inhumane
adapted to the abuse or coercion. deductions from treatment is
misconduct corporal wages for allowed.
punishment. disciplinary
purposes
The
Not impair the
employment
rights of workers
will be
by using
formalised by a
subcontracting,
contract or at
homeworking,
least by a work
training and
card ; forbids to Regular
Regular apprenticeship see ETI Base see ETI Base
use repeatedly employment is
Employment contracts or any Code Code
temporary provided.
other like
contracts that
formula which
keeps
prevents
employees in a
promotion of
precarious
regular
employment
employment
situation
Subcontractors
must be
approved in
Employees of No
advance by
service subcontracting
No use of any NEXT. It is the
providers without the prior Subcontracting
Subcontracting form of supplier’s
benefit from written is not allowed.
homework responsibility to
lawful working authorisation of
ensure
conditions Inditex.
subcontractors'
conformity to
the standards
Environment
Written The External
protection
environmental Business to be Manufacturers Suppliers must
through
policies and conducted and Workshops comply with Suppliers must
organised and
standards; consistently are obliged to national laws meet all the
rational waste
implementation with LS&CO.’s comply with the and relevant M&S
Environment disposal,
of a system to Environmental provisions of the international standards
reutilisation
minimize Philosophy and legislation in standards that relating to the
and recycling,
negative Guiding force on aim to protect environment.
respect of
impacts on the Principles environmental the environment
basic safety
environment matters.
rules.
No ETI Principles of
subcontracting; Implementation:
management (1) commitment;
Regular Regular
Management systems to (2) monitoring,
evaluation of evaluation of
and implement and independent
suppliers' suppliers'
organisation maintain verification and
Independent compliance, See ETI compliance,
systems that programmes to reporting; (3)
Implementation verification and corrective Principles of corrective
prove set in train the awareness raising
inspections. action plans, Implementation action plans,
compliance of code; and training; (4)
termination of termination of
practices to independent corrective actions;
contract if no contract if no
regulation verification and (5) management
action is taken. action is taken.
monitoring; no procedures,
corruption, bribe pricing and
or extortion. incentives

14
 As summarised in the table above, the analysis of the provisions of the FC code in
comparison to the buyers’ codes and the ETI base code highlights that there is no significant
difference regarding the issues covered and the language used. The FC code is synthetic and
straightforward, and strongly anchored on the Moroccan Labour Code.
A potential area of improvement concerns transparency of the FC verification
mechanism based on independent audits. The detailed audit sheets used in the monitoring
procedures could be published on the AMITH website, which hosts all the detailed
information concerning the FC. Such publication would allow more in-depth comparisons
between specific provisions of the FC code and of buyers’ codes.

15
 2. Field Study
I. Methodology

The methodology was largely influenced by the time frame and the available budget.
The sample for the field study was selected among the enterprises members of the AMITH in
the textile and clothing sector. Fifteen factories were approached and twelve accepted to be
part of the sample. The sample selection was made according to two criteria:
1) regional distribution, as the sample needed to be representative of the geographical
distribution of the sector,
2) level of engagement in the FC (already certified, ongoing certification process, not
involved with FC)

The Moroccan textile and clothing sector traditionally originated in Fès, before turning
to the export market and expanding to Casablanca, Rabat and Tangier. These four areas are
characterised by a high level of garment production for the export market and of employment
in the textile and clothing sector. The area of Grand Casablanca alone employs more than half
of registered workers in the Moroccan textile and clothing sector. In order to correctly
represent the geographical distribution of the sector, the sample enterprises were selected in
the regions of Casablanca-Berrechid, Rabat-Temara, Fès and Tangier, as exemplified by the
chart below.

Tanger; 3 Casablanca-
Berrechid; 4

Fès; 2

Rabat-Temara;
3

The selection of the sample has also taken into account the different level of
engagement in the FC. Understanding the reasoning of managers and directors to engage in
the FC was a key element for assessing its potential for mainstreaming. The sample is
constituted of five enterprises that are already FC-certified, six that are in the progress of
being audited for certification (or have been already audited) and one that is subjected only to
international buyers’ codes.
The field study was carried out during April-May 2008.

The main objective of the field study was to understand and analyse the opinions and
perspectives of management and workers in factories supplying for international buyers
concerning the FC certification.
The methodology is based on semi-structured interviews with the management and on
group interviews, also called focus group discussions, with workers. The choice of
16
methodology is explained by the envisaged type of study. Priority was given to experiences
and opinions of the participants, underlining the complexity, detail and depth of the data.
Traditional surveys based on standardised questionnaires on a large scale do not allow this
type of analysis and were excluded. For this reason, a qualitative study was preferred.
The choice of this methodology provided a wide variety of opportunities for
discussion and open dialogue among the research participants. The opinions, understanding,
interpretation and beliefs of interviewees were crucial to understand the object of study.
Similarly, focus group discussions were chosen to obtain the viewpoints of workers, because
they encourage open communication on sensitive issues.

II. Outcomes

The aim of the field work was to collect information and perspectives from the
management and the workers in a selected group of enterprises in order to assess the impact
and the potentiality that the FC has in the garment industry in Morocco.
In order to understand what are the main driving forces that bring managers to engage
in social compliance activities, the first area of investigation was their motivation to join the
FC certification process.
Secondly, the interviews with the management have explored the main advantages and
disadvantages deriving from the involvement with the FC. Given that the sample chosen is
composed of enterprises at different stages of the certification, these sections provide
important insights on the benefits and challenges brought about by the FC.
Following up the comparison between the FC and selected buyers’ codes of conduct,
the interviews also focused on the management experience with other codes and with their
related implementation system.
Managers have been asked to express their thoughts concerning their expectations for
the future of the industry and the relationship between competitiveness and social compliance.
They have also been asked to express opinions on the potential of the FC.
Finally, managers had the opportunity to provide recommendations for the
advancement, promotion and possible improvement of the current FC.

Focus group discussions with a small sample of workers in each factory have been
carried out. These discussions aimed at understanding workers’ perspective concerning the
engagement in social compliance, and in particular the related changes brought at factory
level.

The outcomes of the interviews and focus group discussions are presented in the
following sections.

1. Management Interviews

a. Motivation

The first area of investigation concerned the motivation that brings or has already
brought enterprises to social compliance and in particular to the FC certification. Managers
were asked what was the main driving force behind their decision to engage in the FC
certification process. The interviews show two main factors as sources of motivation, one
external and one internal to the enterprise.

17
 External factor
One very strong motivational factor is strictly business-related and rotates around the
clients. Being FC-certified is seen as a competitive advantage by managers, who see through
it the opportunity to acquire a larger number of clients, to diversify their client base by
attracting more prestigious brand names and to expand their exports towards unexplored,
more demanding markets. Managers believe that having the FC label reassures their clients
because it guarantees a minimum standard of compliance with international and local labour
laws. Some managers see it as an obligatory move to continue to work with large orders in a
sustained way.
In some cases, clients (namely Inditex, due to its bilateral agreement with AMITH of
July 2007) have directly demanded suppliers to engage in the FC certification. This is
particularly valid for those enterprises that have recently joined the support programme for
the FC certification.
Furthermore, due to their clients’ frequent audits, four enterprises were ready to be
audited for the FC certification without the need of the support programme. In these cases
managers have voluntarily joined the FC, considering it a bonus feature for the enterprise.
One manager stated that he had the objective of actively sensitising and encouraging other
enterprises to engage in the programme by setting an example.

Internal factor
Alongside the external factors, eight managers have stated that they have engaged in
the FC certification because of reasons that are independent from external pressures they may
receive. These reasons refer to the concept of “citizenship” and civic responsibility, not only
at the enterprise level but in the larger context of the Moroccan society. Managers state that
their engagement in social compliance was a personal, voluntary choice driven by the
awareness of human and labour rights. They underline that being socially compliant is not a
matter of discussion but a necessary factor in order to be good citizens and advance the
Moroccan society as a whole. This group of interviewees agree that, while it might not have
been their first motivation to start the certification process, this awareness has become
increasingly important in their efforts towards the FC certification. All managers recognise
the benefits deriving from good social climate and stability at the factory level. Such situation
is based on good relationships and communication with workers and their representatives, as
well as by the workers’ awareness of their rights and their importance in the factory. Workers
and human resources in general have been stressed to be the crucial capital of the enterprise,
and therefore investment in the improvement of their situation can only lead to benefits for
the factory as a whole.
Furthermore, it has been suggested that the FC support programme could serve as an
additional motivational factor for enterprises that may join the certification process in the
future. Six managers stated that they recommended to other enterprises to become FC-
certified because of the benefits that they have drawn from the support programme. In
particular, they recognise the support cabinets to be very helpful not only in terms of social
compliance issues, but also for human resource management, restructuring and reorganisation
of the factory.

b. Advantages of the FC

All the managers interviewed agree that being involved in the FC has been a very
positive experience. The overall judgement on the FC certification, as well as on the support
programme guided by the cabinet, largely depends on the characteristics of the enterprise. A
number of enterprises selected were part of the original group of firms that was selected for
the FC certification at its launch in 2003. For most of these enterprises, the FC represented an

18
extra certification on top of their already established efforts in the field of social compliance.
Managers state that they had already made most of the investment before they were FC-
certified, because of the initiatives carried out bilaterally with their clients (in particular with
US and UK clients). In these cases, the managers felt they were already in compliance and
they did not take advantage of the support programme with the cabinet.
The experience of the six enterprises that have only recently joined the FC or are in the
process of being certified seems to differ from the one of the first group. Indeed, these
managers recognise a very impressive change on their factory floors thanks to the
involvement in the FC and especially thanks to the consultancy of the cabinets carrying out
the support programme.

The main advantages recognised by the management can be grouped in the following
points:

Business opportunities
Managers underline the advantages deriving from the FC in terms of business
opportunities. The managers of the five firms that are already FC-certified recognise that their
enterprises have become more reliable, and therefore that clients are keener on entrusting
them with larger or more complicated orders. They have been able to expand their client base
towards more demanding, prestigious clients that value social compliance efforts. Four
managers have started or are planning to venture in different export markets such as the US or
the UK. They also suggest that they do not have to struggle to approach clients to have more
orders, but that instead they are actively pursued by clients.
For the six enterprises that are in the process of being certified, advantages are
expected in terms of larger orders, higher number of clients, and the opportunity to work with
specific clients that have fully engaged in the FC by declaring that they will only work with
FC-certified suppliers (i.e. Inditex).

Reorganisation and management system

The managers of firms that have recently joined the FC support programme are very
impressed by the changes in terms of reorganisation of production and, more generally, about
the significant changes taking place on the factory floor.
The FC certification and its support programme have been instrumental for general
upgrading of the firms and a complete restructuring of production. Many managers credit the
support cabinet as a very useful helping actor in order to improve their management system,
to rationalise their production and to sustain their learning process. Managers recognise they
have changed their working methods to be more efficient and more productive, in order to
counterbalance the investment they made for social compliance.
In particular, the most observable improvements have been recorded in security and
hygiene issues. Managers state that, even though they thought they had a good level of
security in the factory, many changes had to be made in order to comply with the FC code,
and now they recognise that they needed improvements. Other managers commend the
progress in terms of keeping track of workers’ dossiers, legal documentation and medical
files.

Social climate within the factory

All the managers interviewed agree on the improvements that the FC brought in terms
of social climate within the factory. The relationship between management and workers has
improved greatly with the introduction of the FC and thanks to the support cabinets, which
initiated communication groups and health and safety committees in companies which had no
workers representatives. Managers describe how the FC has advanced communication with

19
their workers, how it has improved clarity and simplified their relationship with workers’
representatives. They underline that the FC support programme has shed light on the
Moroccan legislation and has raised awareness on workers’ rights and benefits. Managers
recognise that workers are more motivated in their jobs, and therefore more productive,
because they know their rights and feel secure and respected. They also emphasise that the
most important issue in their relationship with their workers is not necessarily a material
matter, like paying a higher wage, but rather showing them respect and listen to their needs
and concerns. This improved attitude assures stability in the workforce and a reduced
turnover.

Standardisation of codes of labour practice

Managers also point out the relevance of the FC as a label that certifies social
compliance in the Moroccan textile and clothing industries. They commend the creation of
one unified standard consolidating all codes of labour practice and setting a single
implementation system. For the time being, managers recognise that the FC facilitates the
buyers’ audits.
Furthermore, managers highlight the importance of the FC initiative in changing the
image of Moroccan firms abroad, as well as its beneficial effect within the country in terms of
improved knowledge of the Moroccan labour code.

c. Disadvantages

The interviews gave managers the opportunity to express their concerns about the
disadvantages deriving from the FC. Those interviewees that have been involved in the FC or
in buyers’ compliance systems for a longer time see hardly any inconvenience connected to
social compliance, because they have observed that disadvantages in the short term turn into
advantages in the medium and long term. The managers of the six enterprises that are going
through the FC certification at present expressed a number of concerns connected to social
compliance.

The most frequently mentioned disadvantages are explained in the following sections:

Costs
The most commonly reported disadvantage is connected to the costs associated to
social compliance, and in particular to the FC certification. The attitude towards this issue
largely depends on how far the firm was from compliance, and therefore, on how high the
required investment was. In the majority of the visited enterprises, the investment has been
very substantial both in physical terms, such as health and safety requirements (canteen,
additional toilets, well equipped first aid room with nurse and doctor’s contract), and in terms
of wage and social security, i.e. paying all employees the minimum wage and registering the
totality of the labour force to the national social security system (CNSS). In average, the cost
of compliance in terms of minimum wage and CNSS for a medium enterprise of around 300
employees can amount between 100,000 and 150,000 dirhams (c. 15,000 to 20,000 US$). The
highest expense is registration to the CNSS and the penalties for delays in payments, which
can reach millions of dirhams. Indeed, the specific issue of CNSS registration has emerged as
one of the most pressing concerns. Several factories, especially in the area of Tangier, have
lamented the very high charges they face with the registration of the totality of their workers
to the CNSS: the status quo before their involvement in the FC was to register around 60% of
the workers. Hence, compliance with the FC requires a very significant investment, especially
for larger firms.

20
 While being aware of the high cost of compliance, several managers point out that the
costs are justified when looking at the long term, when costs become a productive investment
and they are balanced by the enhanced organisation of the factory, the improved stability on
the factory floor and the stronger motivation of the workforce.
As will be deepened further on in the section concerning expectations for the future,
managers complain that the costs they underwent in order to be compliant are not met by a
correspondent increase in the prices they are offered by their clients. This is an issue that
creates anxiety, especially for those enterprises that were farther from compliance and
sustained significant costs in a short span of time.

Time frame
Managers have raised the issue of the time frame of the FC certification and its related
support programme. They underline that they, as well as their workers, need longer time in
order to be able to assimilate the information provided by the support programme. Managers
in particular need more time in order to implement changes and reorganisation on the factory
floor. Since many of the adjustments required involve not only physical investment but a
change in mentality, they underline that implementation is rather slow. That is why they
would have preferred a longer time frame.

Adherence to reality
Some of the managers interviewed point out that some of the requirements of the FC
are not realistic. One of these issues is the respect of the legal working hours and overtime.
Interviews show that in order to fulfil clients’ orders on a very short notice, enterprises are not
able to follow the legal requirements concerning working hours and overtime, because if they
did, they would not be able to deliver the products and they would lose their supplying
contracts. Managers also stressed that even when workers are urged not to do excessive
overtime, they want to work more in order to have a higher income.
Freedom of association has also been mentioned when discussing the adherence to
reality of the FC code. Two managers have manifested uneasiness and apprehension
concerning unions, due to negative experiences of other factories in the garment sector.
Managers have also underlined their difficulty in providing a full-time doctor on the
factory floor, although they have also acknowledged that there is a certain degree of flexibility
during the audits concerning this point.

d. Relationship with clients

The interviews covered also aspects of the relationship between the Moroccan
enterprises and their clients, especially focusing on their codes of labour practice and their
auditing systems.
Managers state that the FC and the clients’ codes are the same. There are only very
few details that differ in the detailed audit sheets. One manager pointed out that his US clients
are increasingly concerned with environmental standards.
Concerning social audits, the experience is diverse. Some enterprises are audited very
regularly (between every 6 months to every year) from Spanish, American and English
clients. Other enterprises were not audited very frequently and lamented the lack of
appropriate follow-up to the audits, which did not allow them to address the possible
problems. Other enterprises have pointed out that they are not appropriately informed
beforehand about the clients’ expectations on certain details, and that they only find out about
their deficiencies when the audit takes place. This hinders them to adjust and address
potentially problematic areas before the audits.

21
 Concerning the general relationship with the clients, there are also different
experiences. Some managers praise their level of communication with the clients,
highlighting that there is no imposition of orders or delivery times, and that they are always
able to negotiate and discuss time frame and capacity of the orders. Other managers state that
they are unable to discuss the capacity and the prices offered for the orders, a situation which
puts them in a more difficult position.
Several managers also mentioned the issue of dealing with intermediaries. In certain
instances, the presence of such intermediaries is problematic, because it hinders direct control
of the client on its supplying base. Some managers observe that this situation leads to
unauthorised subcontracting to non-compliant factories that offer a lower production costs,
therefore causing detrimental effects on the orders directed to their own enterprise. Another
issue connected with the presence of intermediaries is the lack of liability of the client in the
event of unpaid orders.

e. Expectations for the future

concerning competitiveness and its relationship with social compliance

In general, managers do not see any conflict between social compliance and
competitiveness; on the other side, as outlined below, they see a positive gain deriving from
compliance and FC certification. Nevertheless, managers recognise that their margins are
lower and lower, and that although the Moroccan textile and clothing industries produce a
middle-high range of products, they still suffer increasing pressure from international
competition. Such competition comes from Asia, as well as from other countries in the
MENA region, such as Egypt, characterised by lower production costs.
Looking more in detail at the impact of FC certification, the interviews carried out
show that the expectations on this issue differ according to the type of enterprise, i.e. between
the enterprises that are already certified and those that are in the process of certification. The
section below summarises the expectations of the interviewees.

Priority to FC enterprises
The first issue emerging from the interviews is the priority to be given by clients to
FC-certified enterprises. Most of the managers have mentioned this issue, underlining their
hopes of being prioritised. They rely on the agreement signed by Inditex in July 2007, which
states that the company will only work with FC enterprises, and they hope other international
clients will adopt the same strategy. Managers highlight the importance of the role played by
the AMITH in negotiating and securing such commitment from the clients. Some managers
are doubtful that clients will actually work exclusively with FC firms: they think there is not
sufficient capacity to respond to the clients’ orders, and they suggest that clients,
notwithstanding their willingness and involvement in social compliance, will still resort to
non compliant suppliers at the peak of the season.
Managers of enterprises that are not FC-labelled yet are also very aware of the issue of
priority/exclusivity. They state that, should it become compulsory for firms to be FC-certified
in order to be able to work with certain clients (especially Inditex), they would apply and
obtain the certification without further ado, even at the cost of dismissing a considerable
portion of their workforce in order to be able to register every worker to the CNSS.

Larger, regular orders

As a result of the FC certification, managers expect to have regular orders from their
clients, involving larger quantities. Since the competitive advantage of Moroccan enterprises
involves also their ability to deal with very small quantities, managers sometimes find

22
themselves accepting orders for very small replenishment orders, consisting of just a few
pieces of a certain size. This arrangement hinders the management’s possibilities to invest in
technology, materials and even further improvements on the factory floor. Several managers
believe this expectation will be realised, since certain clients are already repeatedly asking
them to increase their productive capacity.

More clients
The vast majority of managers see the FC certification as an opportunity to attract
more clients. They believe that the certification attracts big retailers and brand-name
companies that are especially concerned with the social compliance of their supplying base.
The FC also provides an opportunity to diversify the client base. In particular, some managers
plan to reach out to Spanish buyers such as Inditex, which has been very vocal about their
participation in the FC initiative; as well as to renowned demanding markets such as the UK
and USA.

Higher prices
Several managers expect, or rather hope, that clients will reward their investment in
social compliance by increasing their prices. They underline how social compliance is a
shared responsibility, and their efforts and subsequent costs should be compensated by an
increase in the prices they are offered. However, most managers do not rely on this to happen
recognising that most clients are not willing to make this step.

Competitiveness gain
As already shown in the section of the present report describing the advantages of the
FC, managers are very confident about the positive effect that social compliance, and in
particular FC certification and support programme, has on competitiveness. The impact on the
enterprise’s performance is related to the improved social climate, which in turn is based on
enhanced workers’ representation and involvement in decision-making. This has a dramatic
effect on the sense of belonging to the enterprise, and as a consequence on its performance
and reactivity to market demands.
Managers underline that the FC certification is the first step of a sustained effort in
terms of social compliance and that it should constitute a path of continuous improvements.

Prestige
The FC label is expected to give prestige to the certified enterprises and to promote the
image of Moroccan firms abroad, reassuring clients in their investment. Managers expect the
AMITH to widely publicise the label in order to be able to reap the expected benefits
described above.

Concerns and outstanding issues

The main concern is that clients will not exclusively work with FC enterprises, but that
they will continue to supply from non-certified, and possibly non-compliant, factories. This is
a very widely felt risk among the interviewees, because they realise that competition with
these uncertified firms would be unfair and would compromise their survival on the market.
Another related concern is subcontracting: two of the managers interviewed in Tangier
point out that it would be possible to be FC-certified while at the same time engage in
unauthorised subcontracting to smaller, non-compliant factories.
Concerns surround the issue of CNSS registration. Some managers suggest the need
for negotiation of a special regime for the textile and clothing industries; others suggest to
lower the CNSS rate or to lower the penalty fees for delayed payments, as they believe these
measures would create a win-win situation both for the enterprise, which would be able to

23
register the totality of its workers, and for the CNSS, which would not lose income. Others
encourage the negotiation of fiscal incentives for FC enterprises.

f. Recommendations for the promotion and improvement of FC

In general, managers praise the FC code and do not see any significant change to be
made in the FC terms of reference, because it is based on the Moroccan labour code. One
manager proposed the inclusion of more technical details concerning quality assurance and
management as a possible evolution of the code concerns
In the sections below, there are a number of recommendations for the promotion and
possible improvement of the FC as a label and certification system.

Awareness and promotion

There is widespread consensus on the fact that the FC is still not widely recognised by
clients at the international level. Most clients still continue their own audits and are not fully
aware of the potential of the FC label. Managers suggest that the AMITH should engage in a
series of awareness-raising activities, involving media and communication (newspapers and
television). A suggestion is to have an “open day” to promote and disseminate information
about the FC. This open day could also be instrumental in attracting new clients from UK,
France, Germany and Italy. These efforts to promote and explain the FC are necessary also to
further involve workers and make sure they realise that they are the main target of the
improvements brought about by the FC. Awareness would also stimulate a change in
mentality and habits on their part.

Credibility
Managers are well aware of the fact that the FC label must be credible, in order to reap
the benefits deriving from its reputation.
In order to ensure credibility, there should be stricter controls and audits on the FC-
certified firms: managers recognise that an effort has been made in this direction, with the
recent second round of audits to confirm the label. The re-auditing should take place more
often. Some managers suggest every 6 months, some others every year; others suggest the
frequency depends on possible problems found on the factory floor. Some managers
encourage unannounced audits to make sure there is no possibility to fake the situation; others
recommend a 24-48 hours notice to ensure the presence of the pertaining officer in the
factory.
Managers stress that, in order to be credible, the FC should be enforced even in remote
and difficult areas, such as Guercif, where implementation of the labour code is particularly
challenging.
Opinions concerning the level of tolerance during the certification process differ
among the interviewees. A number of managers, especially in the areas of Casablanca and
Rabat, believe that certain issues are not negotiable, and non compliance with them should
result in failing to be FC-certified. Such issues are CNSS registration, payment of the
minimum wage, issuance of wage slips, use of time cards to track the hours worked, annual,
sick and maternity leave. Instead, other issues, such as working hours, overtime and the
presence of a full-time doctor in the factory, could be regarded with a larger degree of
flexibility. Another suggestion is to create a scorecard for every audit chapter, and decide
about the certification on the base of a certain score, with some disqualifying points (e.g. child
labour). Other managers have a different opinion, arguing for example that flexibility and
tolerance should depend also on the specific characteristics of each factory (e.g. their size).
Others, especially in Tangier, argue that the CNSS payments should be object of a new

24
negotiation with the government. Others believe that efforts should be appreciated, and that
certification should be given also to those factories that can comply at 80 or 90% (e.g.
factories that register 80-90% of their employees to the CNSS).
Increased transparency in the certification process should also be achieved, in order to
reassure potential applicants about the credibility of the label. For example, the selection of
the auditing firm should be done with a higher degree of transparency.

Mainstreaming
Connected to both the issue of promotion and awareness, and the issue of credibility,
is the scope of involvement in the FC. Managers feel that there is a need to have more and
more enterprises involved in the certification, until ultimately reaching a total coverage
among Moroccan enterprises. Such effort should be firstly encouraged by the AMITH, by
promoting the advantages deriving from the certification; however, all relevant stakeholders
should be involved. The FC label should be equally supported by the government and by
unions.
In order to create further incentives to stimulate participation in the FC, the AMITH
should also coordinate the FC label with other aspects of the Moroccan economy, such as the
financial/credit system, the fiscal system and the customs certification.
It has been suggested that the FC should be compulsory in the textile and clothing
sector, and that it should be imposed by clients, to counteract the lack of enforcement of the
labour code.

2. Workers’ interviews

Small focus group discussions, with three to four members each, have been carried out
in the visited factories. Members were chosen randomly on the factory floor, among workers
operating at sewing machines, cutting machines, serigraphy, finishing, controlling and
packaging. Both senior workers (with 15+ years experience in the factory) and recently hired
workers were interviewed.
These interviews had the objective of hearing workers’ reactions to the changes
brought about by the FC and of understanding which priority areas still need to be addressed.

a. Changes before and after FC

The overall outcome of workers’ interviews is that they are generally content with
their working conditions, they are aware of their rights and they feel respected and well-
treated by the management. Often they underline that they are glad to work in factories that
have a good reputation, and that they would easily change job if they had violations in their
rights.
Although very often workers are not aware of the name “FC”, they usually recognise
significant improvements as a result of the certification and its support programme. The most
noticeable area of improvement is related to tangible issues, such as access to the canteen,
clean toilets separated between women and men, clean and safe environment, improved
ventilation system that reduces the heat in the factory.
Workers underline that the FC has brought better clients, and a steady, continuous
workflow: in former times there were frequent lay-offs and more temporary work. Others
notice that overtime is reduced and there are more regular working hours. They also praise
new working methods and the general reorganisation of production.
In terms of social security and wages, most of the workers interviewed were already
paid the minimum wage before the introduction of the FC. However, in certain occasions they

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underline that they used to be paid a fixed wage, no matter the hours worked, whereas
nowadays they are paid on hourly basis. In terms of registration to CNSS, all workers
interviewed were registered. Some of them notice an improvement due to the FC because the
registration to the CNSS takes place when they are hired by the enterprise, whereas before
there used to be a 6-month probation period which was not covered by the CNSS.

b. Outstanding issues

It must be noted that there were no unionised workers among those interviewed, and
although not explicitly asked, it seems unlikely that there were unions present in any of the
visited factories. This finding is consistent with the weak rates of unionisation across the
garment industry in Morocco.
Also, not all of the interviewed workers were satisfied with their situation. Especially
among packaging and finishing units, workers are often working long hours and feel they
have a lower status on the factory floor when compared to machine workers. In one
circumstance, workers were not paid the minimum wage and were instructed by their
supervisor about what to say in order to pass the certification audit. They also complained
about long working hours and heavy loads to carry.
The most significant concerns that workers highlight is their relationship with the
management, and especially with their direct supervisors. Whilst certain groups of workers
have direct access to the head of the enterprise and they feel that they are listened to, many of
them can only talk to their direct supervisor, who is often not interested or not helpful in
listening to their concerns. It appears clear that respect and understanding from the
management is very high in workers’ priorities, and that is potentially where efforts should be
concentrated in the future.

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3. Recommendations

This section aims at identifying focus areas from the analysis and field study and at
providing recommendations for the improvement and long-term sustainability of the FC.

Focus areas

Certain provisions of the FC and buyers’ codes are more controversial and problematic
than others. While there is unanimity on the prohibition of child labour and forced labour and
there is widespread recognition of the importance of health and safety regulations, the
analysis carried out in section 1 and 2 highlighted a number of focus areas, whose
implementation still remain challenging.
Minimum wage: the payment of minimum wage (SMIG) constitutes a significant
investment for enterprises that have an ongoing certification process. Despite the important
efforts being made in order to pay the SMIG to every worker, it has been noted that certain
categories of workers (i.e. in finishing and packaging) are sometimes not considered part of
the actual workforce and are not paid the minimum wage.
Registration to social security (CNSS): together with the payment of the SMIG, the
fees deriving from the registration to the social security system (CNSS) represent the highest
costs for social compliance. Due to the former practice of registering around 60% of the
workforce, the area of Tangier is particularly problematic when it comes to registration to the
CNSS of the totality of workers.
Working hours and overtime: interviews in Section 2 show that the provisions
concerning working hours and overtime are problematic and are often deemed unrealistic by
managers. Being pressured by short delivery schedules, managers affirm that they have to
resort to overtime, during high season on a regular basis, to be able to respond to clients’
orders.
Freedom of association: while not explicitly investigated in the interviews, freedom
of association emerges as a difficult subject. Whilst managers affirm to have a good degree of
communication with workers’ delegates in their enterprises, social dialogue with organised
unions was not observed in the course of the field study. Union presence was not detected in
any of the visited factories, and there were no unionised workers among those who
participated to the group discussions. In two circumstances managers explicitly mentioned
their preoccupation with the eventuality of having unionised workers in their factory.
Subcontracting: the issue of unauthorised subcontracting to non-compliant factories
has also emerged as one of the concerns for the future. Managers that are engaged in the FC
fear that they will face unfair competition from enterprises that subcontract most of their
production in order to be able to themselves officially comply with code provisions. Such a
scenario would be detrimental to the initiative as a whole.

Recommendations

Section 1 has shown that the FC code and the buyers’ codes, including the ETI base
code, are very similar in their content and phrasing. This result has been confirmed by the
interviews with the managers, who have stated that there is hardly any difference between the
FC code and the buyers’ codes. It can be affirmed that, while there could minor changes to be
made to the FC code, significant revisions or redrafts are unnecessary at the moment, as the
code is well aligned with the Moroccan Labour Code as well as with those of international
buyers.

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 Implementation and monitoring system
It was shown that the credibility of the FC label and its certification mechanism does
not only depend on the content of its code. Indeed, it largely depends on its implementation
and monitoring mechanisms. As outlined in the conclusions of Section 1, increased
transparency with regards to the FC auditing practices and improvement of its support
documentation system would be desirable.
Differences between the FC and buyers’ practices concerning implementation and
monitoring emerged from the interviews with the management. The enterprises visited in the
course of the field study are usually audited by their clients every 6 or 12 months, whereas
they had one FC audit in the occasion of their certification, followed by a second round of
verification audits in May 2008. This means that, in the case of the first group of enterprises
certified in 2005, there has been a gap of almost 3 years between audits. In order to ensure
credibility, managers suggested to continue the efforts made in the past few months aimed at
more frequent audits. The goal would be to carry out FC audits with the same frequency as
the buyers (every 6-12 months). Furthermore, it was found that the credibility of the FC is
strongly connected to its rigorous implementation. Due to the highly diversified industrial
texture in Morocco, certain geographical areas are traditionally identified with poor working
conditions and lax enforcement of the labour law. Managers recommended a thorough
implementation of the same standards across all regions, without being more tolerant or
making concessions to any particular area.

Communication
Communication regarding the FC should be improved and information disseminated to
a higher degree, in order to ensure its promotion as well as up-to-date information for the
involved stakeholders. The AMITH website, which has been used as a platform for the
promotion of the FC, could be expanded to include more detailed information, especially
concerning the monitoring and implementation system used in the FC framework.

Stakeholder support and buyers’ engagement

Sustainable improvements in the long term require the support and engagement from
all stakeholders, including the Moroccan government and unions, focusing on effective
implementation of the Fibre Citoyenne.
A condition for sustainability is also closely linked to the international buyers’
commitment to develop socially responsible purchasing practices and to value the efforts
towards social compliance, for instance by prioritising FC-certified enterprises. Buyers’
support and engagement constitute a significant motivational push for Moroccan enterprises
and are crucial to ensure long term sustainability of social compliance efforts in the sector.

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