Living Wages

 

Hanesbrands (“Hanes”) owns and operates most of the manufacturing facilities it uses, unlike most apparel companies.  These owned facilities employ nearly 50,000 employees and produce almost 80% of Hanes’ total unit volume.   We provide our production employees a living wage comprised of pay, bonuses and in-kind benefits that are sufficient to enable workers to meet basic needs and have some discretionary income.

Hanes has been a fully-accredited member of the Fair Labor Association (“FLA”) for over 10 years.  Our social compliance program is accredited by the FLA, meaning that they have reviewed our program and are satisfied that it has the systems and procedures in place to successfully uphold fair labor standards throughout our supply chain and mitigate and remediate any violations if they occur.   Hanes was re-accredited by the FLA in October of 2019.

The FLA is a true multi-stakeholder initiative comprised of civil society organizations, businesses and universities whose aim is to “promote and protect workers’ rights and to improve working conditions globally through adherence to international standards.”  The FLA and its members (including Hanes) have long recognized the importance of wages and other forms of compensation to the livelihood of workers and have been actively and constructively working on the living wage issue for years. 

In 2015, the FLA established a Fair Compensation Work Plan to support its members as they make progress toward ensuring workers receive  fair compensation.  Since then, the FLA has developed tools to support implementation of the work plan, including a Wage Data Collection Toolkit. More recently in 2019, the FLA developed a Fair Compensation Dashboard along with wage ladders, allowing members to perform interactive wage benchmarking of facilities.

The FLA uses a compensation data collection methodology derived from the Ankers’ methodology  used by the Global Living Wage Coalition (“GLWC”) and chooses living wage benchmarks for its wage ladders that are internationally recognized and have transparent calculation methodologies.  Where available, the FLA wage ladders include benchmarks from the GLWC.

Our Global Standards for Suppliers, which includes a compensation / living wage provision, aligns to the FLA Code of Conduct.  Hanes defines living wage as compensation (wages, bonuses and in-kind benefits, excluding overtime) sufficient to enable employees/workers to meet basic needs and have some discretionary income.  “Basic needs” is defined as the minimum necessary to have access to appropriate resources, including food, safe drinking water, clothing, shelter, energy, transportation, education, sanitation facilities and healthcare services. We recognize that employee/workers’ compensation should be sufficient to afford a decent standard of living for the worker and her or his family. Living wage is a family concept and as part of the overall analysis encompasses the concept of multiple wage earners in a household. Hanes is committed to all elements of its Global Standards for Suppliers – including its compensation/living wage provision.

Along with Hanes’ Global Standards for Suppliers is  Hanes’ Responsible Sourcing Policy which outlines the following commitments: 

  • Working with suppliers on sourcing, planning, and manufacturing capacity practices that support fair treatment of workers;
  • Providing  suppliers with plans and forecasts on a regular basis so that facilities can plan their capacity accordingly;
  • Adjusting timelines and delivery dates if excessive hours of work will be necessary to complete the purchase order (PO);
  • Defining lead times through the time & action calendar to ensure adequate lead time is provided.

Work performed to date:

Since 2016, Hanes has undertaken extensive employee survey work in its owned facilities across the globe (including the Dominican Republic, Honduras, El Salvador and Vietnam) to understand whether our employees are earning a living wage.  The research was conducted by two experienced, independent labor economists (Dr. Craig Richardson and Dr. Zagros Madjd-Sadjadi) who found that Hanes employees are accumulating significant assets, savings and are spending money on purely discretionary items.  Based on this work, they concluded that Hanes employees at the facilities studied receive wages and benefits that exceed a living wage.  

In addition to the economists’ work described above, Hanes has also benchmarked the compensation provided to our employees in these facilities against available living wage benchmarks (eg. FLA Fair Wage Ladders and GLWC benchmarks). This benchmarking confirmed that the compensation Hanes pays all employees in these facilities exceeds these living wage benchmarks.

Next Steps:

Hanes will continue to work with the FLA to develop a roadmap aligned with the FLA’s Fair Wage Strategy (due to be released to members in 2020).  Hanes  will also conduct further wage analysis using available FLA fair wage ladders in benchmarking exercises moving forward in addition to our economists’ research.

Owned facilities (representing 80% of Hanes total unit volume):

Benchmarking has already been undertaken in key facilities that produce the vast majority of our internal production. As noted above, this benchmarking confirmed that Hanes employees in these facilities are being paid in excess of recognized living wage standards.

  • To confirm employees in remaining owned facilities are also being paid a living wage, we will conduct wage analysis in one additional facility in each major sourcing region by the end of 2020.  We plan to conduct this same wage analysis in remaining regions as FLA wage ladders become available.
  • While we do not expect any gaps to be identified, where the fair compensation goal may not be met, Hanes will take appropriate actions that seek to progressively realize a level of compensation that does (in accordance with our Global Standards for Suppliers and FLA requirements).

Third-party suppliers (representing 20% of Hanes total unit volume):

Hanes is also committed to working with our third-party suppliers to meet the compensation/living wage guidelines found in its Global Standards for Suppliers. To do this, Hanes will engage additional economist research and benchmark compensation using FLA wage ladders in several strategic contractors by the end of 2020. We will continue to report annually as part of this journey.

More information on our Ethical Standards and Social Compliance Program can be found here.

Find out what our employees have to say about working for HanesBrands:

^ About the researchers:

Dr. Zagros Madjd-Sadjadi is Professor of Economics at Winston-Salem State University and a Research Fellow with the Center for the Study of Economic Mobility. He has previously worked as the Chief Economist of the City and County of San Francisco, as a Research Manager in the California Department of Labor Statistics and Research, and as a Lecturer in the Department of Economics at The University of the West Indies, Mona in Kingston, Jamaica.

Dr. Craig Richardson is the BB&T Distinguished Professor of Economics at Winston-Salem State University and the Director for the Center for the Study of Economic Mobility, which is funded through the Center for Advancing Opportunity and the Thurgood Marshall College Fund. He has previously worked for the Urban Institute, The World Bank, and the Peru-based Institute of Liberty and Democracy.