How Can We Transition from Piece-Rate to Wages for BSCI Certification in SEZ?

We are a garment manufacturing company starting a new unit for exports in SEZ. We are in the process of obtaining Business Social Compliance Initiative Certification by the end of this year. The major issue we are facing is the piece-rate payment method for workers. How can it be converted into wages? Please add extra details if I am missing something.

Thanks,
Abhilasha

Dear Priya, my company just passed BSCI last month. I think I can help you. Regarding salary, if you pay by piece rate, you can calculate the value of a product in time and then calculate the value of products made in overtime in accordance with the current laws of your country.

For example, in Vietnam, my country:
- 1 product on time = $0.28
- 1 product overtime = $0.28 * 1.5 = $0.42

Documents Required for BSCI Audit

The documents you need to prepare for the audit include:
1. Business and Tax registration
2. Internal facility regulations
3. Collective Bargaining Agreement (CBA)
4. Trade Union registration
5. Wage levels table and Compensation policy
6. Payroll records and other payment calculation related records of the recent 12 months
7. Pay slips
8. Time records/Time cards/Manual time attendance records of the recent 12 months
9. Overtime registration/application forms
10. List of employees who are pregnant over 7th month
11. List of employees who are nursing children under 12 months old
12. List of young employees who are less than 18 years old
13. List of newly recruited employees
14. List of resigned employees
15. Employee personnel files
16. Social and Health insurance payment related records
17. Unused annual leave payment related records
18. Environment Health and Safety committee (EHS) records
19. Health and Safety policies and procedures
20. Health and Safety training records
21. First-aid training records
22. Health and Safety risk assessment
23. Certificates and records of medical/clinic staff
24. Medical Emergency Procedures
25. In-house medical log book
26. Accident reports and investigation records
27. Annual health check records
28. Drinking water test
29. Fire prevention and fighting plan
30. Fire prevention and fighting certificate
31. Fire prevention and fighting inspection reports
32. Fire fighting drill records with photos
33. Evacuation drill records
34. Fire fighting team's training certificates
35. Evacuation maps
36. Factory's plan layout
37. Production process diagram
38. List of machines and equipment
39. Maintenance plan and records
40. Maintenance plan and records of the electrical system
41. Broken needle records
42. List of chemicals used in the factory and Material Safety Data Sheet (MSDS)
43. Inspection certificates of special machinery (including boiler, air-compressor, forklift, elevator)
44. Operation certificates of special machinery
45. Environmental impact evaluation report
46. Commitment of protecting the environment certificate
47. Annual working environmental inspection
48. Annual surrounding environmental inspection
49. Service contract signed with the qualified industrial waste remover
50. Waste water discharge permit
51. Waste water inspection results
52. Food hygiene and safety certificate for the canteen
53. Food hygiene and safety training records of canteen staff
54. Special health check reports of canteen staff
55. Food sample records
56. Electrician's certificate/qualification
57. Procedures and records to recruit subcontractors/suppliers/sub-suppliers
58. Social responsibility policies
59. Commitment complying with the BSCI Social Requirements
60. Anti-corruption/anti-bribery system
61. Basic needs wage at the company area
62. Control procedure of homeworkers
63. Policies and procedures for remediation of children
64. Outside communication procedure

With success

Regards

It's a good idea to have a BSCI certification. Although you have a few months left to face the audit, you have to plan carefully to achieve a successful outcome.

BSCI Code of Conduct

BSCI requires its members to accept the BSCI Code of Conduct and implement it in their supply chain. As of 1st January 2010, the BSCI has strengthened its members' commitment. According to the commitment, laborers who fall under the piece-rate category should not be considered beneficiaries of the Social Compliance promises. The laborers' aim is to achieve more mass production within a short span of time, and the company also benefits a lot from these piece-rate workers in many ways. However, these kinds of piece-rate strategies are not recognized by the body of BSCI.

Converting Piece Rates into Wages

Practically, converting piece rates into wages, as I believe, will not be helpful to you. The workers you inform your BSCI auditors as your employees must be involved/registered with the Employees State Insurance Corporation and Public Provident Fund, etc. You have to maintain proper attendance with proper shift timings, etc.

The information you prepare in records will only help you achieve the milestones.

Hope you understand the tricky and necessary preparations and wish you success in the BSCI certifications during this year-end.

Regards,
Salamkool
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"He is no fool who gives up what he cannot keep to keep what he cannot lose."
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