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Code Application — Performance and Remediation

Violations of our Terms of Engagement (TOE) are classified in three categories: zero tolerance, immediate action, and continuous improvement.

Zero-tolerance violations typically involve a serious infringement on individual rights or a threat to life safety and include child labor, prison/forced labor, infringement on workers’ freedom to associate or organize, unethical or illegal practices, use of corporal punishment, and failure to comply with agreed upon action items.

Immediate-action violations involve negative impact to individual rights or life safety and include, among other subjects, excessive working hours, non-payment of overtime premiums, and discrimination.

Continuous-improvement items are less serious in nature and involve labor, health and safety, and environmental issues that can be improved in the factory for the well being of workers and/or betterment of its reputation or management practice.

If an inspection reveals that corrective actions are required, then a corrective action plan is developed in cooperation with the contractor. Follow-up visits between annual assessments occur to verify implementation of any agreed-upon action items that are part of the corrective action plan.

If not addressed in the appropriate timeframe, an immediate-action violation can become a zero-tolerance violation, and a continuous-improvement violation can become an immediate-action violation for purposes of placing future orders and future corrective action plans.

Once assessed, suppliers receive an overall annual rating based on all available information, including: current assessment results, change in results from the previous year, repeat violations, and level of follow up on corrective action plans. The rating and information derived during the assessment process is entered into a sourcing database. TOE ratings are a key consideration in determining the factories in which we will place production.

For more information on TOE performance and remediation, contact Leslie Croshaw at lcroshaw@levi.com