Confirming Wage/Hour Compliance at Collegiate Factories in El Salvador

To:WRC Affiliate Universities and Colleges
From:Tara Mathur and Ben Hensler
Date:November 9, 2021
Re:Confirming Wage/Hour Compliance at Collegiate Factories in El Salvador

Last month, the WRC shared with affiliate schools and university licensees guidance with regard to new wage and hour risks at garment factories in El Salvador, including those producing collegiate apparel. We are glad to report that we have since been able to confirm, via discussions with both licensees and worker representatives, that the 23 factories in the country producing collegiate goods have addressed these risks and maintained compliance with applicable labor standards concerning minimum pay, currency used for wage payments, and work and leave schedules. We appreciate licensees’ efforts, pursuant to the WRC’s guidance, to work with their Salvadoran suppliers to ensure compliance. Obviously, present compliance does not guarantee future compliance and continued vigilance will be important, especially in light of the current Salvadoran government’s erratic approach to labor law and regulation.
This guidance identified the need for licensees, in order to ensure that factories in El Salvador producing collegiate apparel comply with both Salvadoran law and university codes of conduct, to require such suppliers to:

  1. Implement a recent 20 percent increase to El Salvador’s legal minimum wage;
  2. Provide legally mandated, paid time off to workers to receive Covid-19 vaccinations;
  3. Refrain from payment of wages to employees in bitcoin, despite recent legislation in El Salvador authorizing its use as legal tender; and
  4. Refrain from use of a so-called “4 x 4” work schedule (a schedule where employees work four consecutive 12-hour days), which is prohibited under El Salvador’s labor law and Constitution.

The WRC shared this guidance with all licensees sourcing collegiate apparel from El Salvador and asked that they verify with each of their supplier facilities in this country that these factories are complying with Salvadoran law and university codes of conduct on these points.

Currently, a total of 23 factories in El Salvador are disclosed by university licensees for production of collegiate apparel. The WRC contacted 15 licensees sourcing collegiate apparel from these facilities. All licensees with a current sourcing relationship with a Salvadoran supplier affirmed that they have verified that their suppliers of collegiate apparel in El Salvador are complying with university codes of conduct and national law with respect to these wage and hour issues. These licensees include: Boxercraft (Russell Athletic); Columbia Sportswear; Fanatics; Hanesbrands (Gear for Sports, It’s Greek to Me, and Knights Apparel), L2 Brands, New Agenda, Nike, Outerstuff, Spirit Clothing Co. (dba Spirit Activewear and Spirit Jersey), American Eagle Outfitters (Tailgate), adidas (Triform Custom Apparel), Varsity Brands, and Under Armour.

The WRC also conducted interviews with Salvadoran garment workers and union representatives to confirm that the information that the WRC received from licensees and their suppliers is consistent with the experience of workers at these factories. At the time of the publication of this memo, these sources affirm that the supplier factories are, in fact, complying with Salvadoran law and university labor standards with respect to these wage-and-hour issues.

Finally, the one factory in El Salvador producing collegiate apparel that the WRC had identified as having adopted the “4 x 4” work schedule (four 12-hour workdays followed by four days of rest)—which the factory did under the auspices of a temporary decree issued by the Salvadoran government to address health and safety concerns during the Covid-19 pandemic—has since discontinued its use. The workers at this factory have reported to the WRC that all factory employees have been returned to their previous regular work schedule, which complies with the Salvadoran Constitution and labor laws.

The WRC will continue to monitor the compliance of factories supplying licensed apparel with the terms of Salvadoran law and university codes of conduct regarding wage and hour compliance, including with respect to these emerging issues. As always, please let us know if you have any questions.