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Chronology of Gildan Activewear El Progreso Case

September 27, 2006

2001-02
The Maquila Solidarity Network (MSN) and the Honduran Independent Monitoring Team (EMIH) carry out joint research on the investment strategy and labour practices of Montreal-based T-shirt manufacturer Gildan Activewear. Research is also carried out by local groups in Mexico, El Salvador and Haiti.

January 22, 2002
The CBC television program Disclosure airs "Sewing Discontent". The program alleges that Gildan workers in Honduras receive less than a living wage, work 11-hour shifts, have excessively high production quotas, are subjected to forced pregnancy testing, breathe air filled with fabric dust, and are fired if they attempt to organize unions. Gildan denies all the allegations and presents CBC with affidavits signed by Honduran Gildan workers saying they had been pressured to lie to the CBC reporter.

February 2002
At its annual shareholder meeting, Gildan promises to adopt the SA8000 Standard as its code of conduct and to have its factories certified under that program.

November 2002
MSN attempts to engage with Gildan concerning the findings of the MSN/EMIH research, giving the company the opportunity to review and comment on the first draft of the research report. Findings include: wages that don't meet basic needs, excessively high production targets, the impact of the 4X4 work schedule (4 consecutive 11 hour workdays) and the intensive pace of production on women workers' health and family life, failure to provide day care and nursing facilities as required by law, lack of freedom of association, and workers' belief that new employees are tested for pregnancy and those found to be pregnant would be fired. Gildan denies that the findings are based in fact.

MSN receives reports from Honduras that 38 workers at the company's El Progreso factory have been fired shortly after they applied to the Ministry of Labour for registration of a union. At MSN's request, EMIH interviews the workers and drafts a report on the circumstances surrounding the firings, which MSN communicates to Gildan. Gildan denies that the workers were fired for forming a union.

December 2003
MSN meets with Gildan to discuss the two reports. Gildan once again denies that the research findings are based in fact or that any El Progreso workers were fired for union activity. It refuses to offer to reinstate the fired workers or to contact the Ministry of Labour to confirm that the workers had applied for the registration of their union prior to the firings. MSN calls on the company to cooperate with an independent investigation into the firings and other workplace issues documented in the MSN/EMIH report.

February 5, 2003
Federal Minister of International Development, Susan Whelan, announces that Gildan Activewear is the recipient of an award sponsored by CIDA and the Canadian Manufacturers and Exporters (CME) for "Excellence in Corporate Social and Ethical Responsibility." The Minister states, "Gildan Activewear's management of three of its plants in Honduras has demonstrated an exemplary combination of corporate social responsibility and business success."

February 6, 2003
At its annual meeting, Gildan is challenged about the firings of union supporters and questioned as to the status of its efforts to have its factories SA8000 certified. Gildan denies that the workers were fired for union activity and cites the CIDA/CME award as evidence that it is a socially responsible company. It claims it has not yet made a decision as to whether it will seek SA8000 certification or become involved in another initiative.

The Solidarity Fund of the Quebec Federation of Labour (Fonds de solidarite FTQ), a major investor in Gildan, joins MSN in calling on Gildan to cooperate with an independent investigation. Two bulk purchasers of Gildan T-shirts - Amnesty International and Oxfam Canada - also supported the call for an independent investigation. Gildan breaks off all communication with MSN.

March 2003
With Gildan's cooperation, the FTQ Solidarity Fund carries out its own investigation of alleged violations of freedom of association at the El Progreso factory. The Fund's investigators return from Honduras convinced that the workers' associational rights had been violated. The FTQ attempts to convince Gildan to take corrective action.

July 2003
MSN and EMIH release their joint research report entitled A Canadian Success Story? Gildan Activewear: T-shirts, Free Trade and Worker Rights.

July 9, 2003
Gildan threatens to take legal action against MSN if it continues to circulate the report or information from it. It releases an official statement, saying the company "unequivocally and categorically denies the allegations" in the report. MSN informs Gildan that it stands by the findings in the report and will continue to distribute it. Gildan contacts all MSN funders and informs them of the threat of legal action against MSN. Numerous funders, bulk purchasers, including the State of Maine, and respected academics write to Gildan, urging the company to cooperate with an independent investigation.

With MSN's support, EMIH carries out follow-up research, which finds that additional union supporters have been fired at El Progreso. Workers interviewed by EMIH claim the company has a policy of firing whole work teams if any team members are involved in union organizing and other team members fail to report them to management.

October 20, 2003
Two leaders of another union organizing attempt at Gildan El Progreso are fired.

October 22, 2003
Gildan is accepted as a Participating Company in the Fair Labor Association (FLA).

November 4, 2003
Thirty-seven additional El Progreso workers are dismissed. According to the Independent Federation of Honduran Workers (FITH) and workers interviewed by EMIH, the workers were fired because of suspicions they supported the latest union organizing drive.

November 12, 2003
The FTQ Solidarity Fund announces it is selling off its shares in Gildan because of the company's refusal to reinstate 38 union members fired in November 2002. The Fund also announces that its representative on the Gildan Board of Directors would be resigning.

December 2003
MSN, together with the FITH and the Canadian Labour Congress, file a formal complaint with the Fair Labor Association (FLA) and the Worker Rights Consortium (WRC) concerning the 2002 and 2003 firings, alleging there was a pattern of violations of freedom of association at Gildan El Progreso.

January 30, 2004
Gildan agrees to cooperate with an FLA investigation of the alleged violations of freedom of association at the factory.

February 4, 2004
At its annual shareholder meeting, Gildan's CEO promises to fully cooperate with the FLA audit and to take corrective action if his company has failed to meet its commitments to the FLA. However, Gildan does not agree to provide the WRC audit team access to the factory or to factory records.

May 2004
Gildan receives information on the results of the two investigations, confirming that El Progreso workers' right to freedom of association has been violated. Other findings include failure to pay legal overtime pay and holiday pay, discrimination against pregnant workers, and sexual harassment. Gildan enters into joint discussions with the FLA and WRC on a corrective action plan.

June 25, 2004
MSN receives word from Gildan that the company will be taking corrective action that MSN will find acceptable. MSN had been demanding that Gildan offer to reinstate all union supporters fired since November 2002.

July 12, 2004
Gildan CEO Glenn Chamandy attends a face-to-face meeting with representatives of the FLA and WRC to attempt to gain agreement on the details of the corrective action plan. Gildan makes the surprise announcement that it is going to close the factory on September 30 and claims the decision has nothing to do with the audit findings or proposals for corrective action. It informs the FLA and WRC that El Progreso workers will be given formal notice of the decision on July 13.

July/August 2004
With the support of local NGOs, Gildan El Progreso workers form a committee to negotiate with the company. They put forward a series of demands concerning severance pay, health benefits for pregnant workers, compensation for workers injured on the job, job opportunities at other Gildan factories, and protection against blacklisting. While Gildan initially enters into negotiations with the committee and NGOs supporting them, the company later withdraws from the negotiations.

July 26, 2004
The FLA places Gildan on a 90-day Special Membership Review because the company had "failed to achieve or maintain compliance with the FLA's standards."

July 29, 2004
The WRC releases its report, including detailed findings and recommendations. According to the report, the WRC found "overwhelming evidence supporting the conclusion that Gildan Activewear El Progreso management deliberately targeted union supporters for dismissal in violation of Honduran laws...." The report concludes, "On balance... the weight of the evidence argues in favor of the view that anti-union animus played at least some significant role in the decision to close the factory at this time...."

September 24, 2004
Gildan closes the El Progreso factory. Workers receive legal severance pay, but no job opportunities at other Gildan factories in Honduras.

September 30, 2004
Real Assets Investment Management Inc. announces it has divested of the shares of Gildan Activewear in its portfolios because of Gildan's decision to close the El Progreso factory during a third-party complaint process.

October 26, 2004
The Fair Labor Association unanimously passes a motion to terminate Gildan's status as a FLA Participating Company, effective December 10, 2004, unless, by November 30, 2004, Gildan implements an acceptable corrective action plan and meets other conditions.

November 2004
Gildan begins to engage in constructive dialogue with MSN and EMIH in an attempt to resolve outstanding issues.

December 10, 2004
The FLA Board accepts Gildan back as a member in good standing, but also expresses its expectation that Gildan would provide former El Progreso workers first hire preference at current and new factories in Honduras. The WRC informs its member universities that Gildan had not adequately addressed the damage caused by the company's decision to close the factory during a third party complaint process and is therefore not in compliance with university codes of conduct.

January 19, 2005
Gildan submits an acceptable corrective action plan to the WRC and MSN.

January 24, 2005
MSN suspends its Gildan campaign.

May 10, 2006
MSN, EMIH and WRC release a first update on Gildan's compliance with the corrective action plan. The results are mixed. Gildan made some good faith efforts to comply with the agreement but did not provide EMIH with sufficient access to related documentation and personnel to fully determine whether or to what degree Gildan complied with its key commitment to provide first-hire preference to former Gildan El Progreso workers. Gildan agrees to provide the WRC, MSN, and EMIH with increased access to documents and personnel in order to complete the verification process. Gildan also agrees to re-launch efforts to recruit more former El Progreso workers to apply for work at Gildan facilities.

September 27, 2006
MSN, EMIH and WRC release a final update on Gildan's compliance with the corrective action plan. The update on Gildan's compliance with the January 2005 priority hiring agreement includes a series of recommendations to Gildan based on the El Progreso experience.

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