1 Social Development

1.1 Fairtrade adds Development Potential

Fairtrade should make a difference in development for certified producers.

1.1.1 Minimum Requirement

1.1.1.1 The producer organisation can demonstrate that Fairtrade revenues will promote social and economical development of small farmers.

1.1.2 Progress Requirement

1.1.2.1 A monitored plan should be developed under which the benefits of Fairtrade (including the Premium) are shared based on a democratic decision taken by the beneficiaries.

1.2 Members are Small Producers

By small producers are understood those that are not structurally dependent on permanent hired labour, managing their farm mainly with their own and their family's labour-force.

1.2.1 Minimum Requirement

1.2.1.1 The majority of the members of the organisation are small producers.

1.2.1.2 Of every Fairtrade-certified product sold by the organisation, more than 50% of the volume must be produced by small producers.

1.2.2 Progress Requirement

1.2.2.1 Where a minority of small producers from within a small producer organisation is producing a particular Fairtrade-product, special attention needs to be given to ensure that they will always receive a cost-covering price for their product from the small producers' organisation. The small producer organisation will establish an adequate system for this respectively.

1.3 Democracy, Participation and Transparency

The organisation must be an instrument for the social and economical development of the members, and in particular the benefits of Fairtrade must come to the members. The organisation must therefore have a democratic structure and transparent administration, which enables an effective control by the members and its Board over the management, including the decisions about how the benefits are shared. Furthermore, there must be no discrimination regarding membership and participation.

1.3.1 Minimum requirements

1.3.1.1 An organisational structure is in place which enables control by the members. There is a General Assembly with voting rights for all members as the supreme decision taking body and an elected Board. The staff answers through the Board to the General Assembly.

1.3.1.2 The organisation holds a General Assembly at least once a year.

1.3.1.3 The annual report and accounts are presented to and approved by the General Assembly.

1.3.1.4 Administration is in place.

1.3.2 Progress requirements

1.3.2.1 The organisation works towards transparent planning of the business. Organisations are encouraged to make annual business plans, cash flow predictions and longer term strategic plans. Such plans will be approved by the General Assembly.

1.3.2.2 The participation of members in the organisation's administration and internal control is promoted through training and education - and improves as a result.

1.3.2.3 The organisation establishes or improves internal mechanisms of members’ control over the administration, such as a control committee with rights to review the administration, external audit, etc.

1.3.2.4 Increasingly, the organisation’s policies are discussed in member meetings. Management actively encourages members’ participation in meetings.

1.3.2.5 There is improvement of the flow of information from board to members about the business and the organisation’s policies.

1.3.2.6 Measures will be taken to improve the members’ commitment to the organisation.

1.4 Non-Discrimination

FLO follows ILO Convention 111 on ending discrimination of workers. The Convention rejects “any distinction, exclusion or preference made on the basis of race, colour, sex, religion, political opinion, national extraction or social origin, which has the effect of nullifying or impairing equality of opportunity or treatment in employment or occupation” (art. 1). As far as applicable, FLO extends these principles to members of organisations.

1.4.1 Minimum requirements

1.4.1.1 If the organisation restricts new membership, the restriction may not contribute to the discrimination of particular social groups.

1.4.2 Progress requirements

1.4.2.1 Programs related to disadvantaged/minority groups within the organisation are in place to improve the position of those groups in the organisation, particularly with respect to recruitment, staff and committee membership.

2 Economic Development

2.1 Fairtrade Premium

The organisation has the commitment and capacity to administer the Fairtrade Premium in a way which is transparent for beneficiaries and FLO. Decisions on the use of the Premium are taken democratically by the members.

2.1.1 Minimum requirements

2.1.1.1 The organisation administrates and manages the Premium transparently and uses it in line with the requirements outlined in these Standards.

2.1.1.2 The use of the Fairtrade Premium is decided by the General Assembly and properly documented

2.1.2 Progress requirements

2.1.2.1 As soon as Premium is available, there is a yearly Premium plan and budget, preferably these are part of a general work plan and budget of the organisation.

2.2 Export Ability

The producers must have access to the logistical, administrative and technical means to bring a quality product to the market.

2.2.1 Minimum requirements

2.2.1.1 Logistics and communication equipment are in place.

2.2.1.2 The producer organisation proves that it meets current export quality standards, preferably through previously exported products which were accepted by importers.

2.2.1.3 Demand for the producers’ Fairtrade product exists.

2.2.1.4 The organisation has experience in the commercialisation of a product as an organisation.

2.2.2 Progress requirements

2.2.2.1 The producer organisation increases efficiency in their exporting operations as well as in other operations and this way maximises the return to the members.

2.3 Economic Strengthening of the Organisation

2.3.1 Progress requirements

2.3.1.1 Members will gradually take on more responsibility over the whole export process.

2.3.1.2 The organisation will work towards the strengthening of its business related operations. This could for example be through the building up of working capital, implementation of quality control, training/education and risk management systems, etc.

3 Environmental Development

3.1 Environment protection

Producers are expected to protect the natural environment and to make environment protection a part of farm management.

Producers will implement a system of Integrated Crop Management (ICM), with the aim of establishing a balance between environment protection and business results, through the permanent monitoring of economic and environmental parameters, on the basis of which an integrated cultivation and protection plan is devised and permanently adapted. FLO encourages producers to work towards organic certification.

ICM minimises the use of fertilisers and pesticides, and partially and gradually replaces them with organic fertilisers and biological disease control.

3.1.1 Minimum requirements

3.1.1.1 The producers live up to national and international legislation regarding the use of pesticides, handling pesticides (storing, filling, cleaning, administration, etc.), the protection of natural waters, virgin forest and other ecosystems of high ecological value, erosion and waste management.

3.1.1.2 Pesticides in WHO class 1 a+b, pesticides in the Pesticide Action Network’s “dirty dozen” list and pesticides in FAO/UNEP's Prior Informed Consent Procedure list (respecting updates, see appendix) cannot be used.

3.1.2 Progress requirements

3.1.2.1 The producer organisation will encourage its members to implement a system of Integrated Crop Management.

4 Standards on Labour Conditions

FLO regards the ILO Conventions as the authority on working conditions, and expects all registered producers to meet the requirements as far as possible. Where a significant number of workers are employed by a small farmer organisation, there are specific standards to meet. Where a smaller number are employed and where workers are casually hired by farmers themselves, the organisations should take steps to improve working conditions and to ensure that such workers share the benefits of Fairtrade. This should be part of the development plan and be reported to FLO.

The term “workers” refers to all those employed, including casual, seasonal and permanent workers.

In cases where a plantation or factory is a member of the producer organisation certified by FLO, the generic standards for hired labour apply fully and the plantation or factory will need to go through a separate certification process.

Applicable to all producer organisations:

4.1 Forced Labour and Child Labour

FLO follows ILO Conventions 29, 105, 138 and 182 on child labour and forced labour. Forced or bonded labour must not occur. Bonded labour can be the result of forms of indebtedness of workers to the company or middlemen. Children may only work if their education is not jeopardised. If children work, they must not execute tasks, which are especially hazardous for them due to their age.

4.1.1 Minimum requirements

4.1.1.1 Forced labour, including bonded or involuntary prison labour, does not occur.

4.1.1.2 Children are not employed (contracted) below the age of 15.

4.1.1.3 Working does not jeopardise schooling or the social, moral or physical development of the young person.

4.1.1.4 The minimum age of admission to any type of work which by its nature or the circumstances under which it is carried out, is likely to jeopardise the health, safety or morals of young people, shall not be less than 18 years.

4.1.1.5 Employment is not conditioned by employment of the spouse. Spouses have the right to off-farm employment.

Applicable to Producer organisations in which a significant number of workers are employed:

4.2 Freedom of Association & Collective Bargaining

FLO follows ILO Conventions 87 and 98 on freedom of association and collective bargaining. Workers and employers shall have the right to establish and to join organisations of their own choosing, and to draw up their constitutions and rules, to elect their representatives and to formulate their programmes. Workers shall enjoy adequate protection against acts of anti-union discrimination in respect of their employment.

4.2.1 Minimum requirements

4.2.1.1 The organisation recognises in writing the right of all employees to join an independent trade union, free of interference of the employer, the right to establish and join federations, and the right to collective bargaining.

4.2.1.2 The organisation allows trade union organisers to meet all the workers, and allows workers to hold meetings and organise themselves without the interference of the management.

4.2.1.3 The organisation does not discriminate against workers on the basis of union membership or union activities.

4.2.2 Progress requirements

4.2.2.1 If one or more independent and active trade unions exist in the sector and the region, FLO expects that the workers will be represented by (a) trade union(s) and that the workers will be covered by a Collective Bargaining Agreement (CBA).

4.2.2.2 If no independent and active union exists in the region and the sector, all the worker’s will democratically elect a worker’s committee, which represents them, discusses with the organisation and defends their interests. This committee negotiates with the organisation an agreement on the conditions of employment, covering all aspects normally covered by a Collective Bargaining Agreement (CBA).

4.2.2.3 The representation and participation of the workers is improved through training activities. These are also aimed at improving the workers’ awareness of the principles of Fairtrade.

4.2.2.4 If no union is present, the organisation and the workers’ committee gets into a process of consultation with the national union federation(s) and the International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations (IUF) or the respective International Trade Secretariat about improvement of the workers’ representation and implementing a Collective Bargaining Agreement (CBA).

4.3 Conditions of employment

FLO follows ILO Plantation Convention 110, ILO Conventions 100 on equal remuneration and 111 on discrimination. All employees must work under fair conditions of employment. The producer organisation must pay wages in line with or exceeding national laws and agreements on minimum wages or the regional average.

4.3.1 Minimum requirements

4.3.1.1 Salaries are in line with or exceeding regional average and official minimum wages for similar occupations. The employer will specify wages for all functions.

4.3.1.2 Payment must be made regularly and in legal tender and properly documented.

4.3.2 Progress requirements

4.3.2.1 Regarding other conditions of employment like maternity leave, social security provisions, non-monetary benefits, etc. at least the provisions as laid out in the Collective Bargaining Agreement or the Agreement signed between the workers' committee must be fulfilled.

4.3.2.2 All workers are employed under legally binding labour contracts.

4.3.2.3 The organisation works towards all permanent workers having the benefits of a provident fund or pension scheme.

4.3.2.4 An adequate sick leave regulation is put in place.

4.3.2.5 A working hours and overtime regulation is put in place.

4.3.2.6 Salaries are gradually increased to levels above the regional average and official minimum.

4.3.2.7 Differences in the conditions of employment for casual, seasonal and permanent workers are progressively diminished.

4.4 Occupational Health & Safety

FLO follows ILO Convention 155 which aims “to prevent accidents and injury to health arising out of, linked with or occurring in the course of work, by minimising, so far as is reasonably practicable, the causes of hazards inherent in the working environment.”

4.4.1 Minimum requirements

4.4.1.1 Workplaces, machinery and equipment are safe and without risk to health. FLO may require that an inspection is carried out by a competent authority or independent inspection agency.

4.4.1.2 The following persons are not allowed to work with the application of pesticides: persons younger than 18 years, pregnant or nursing women, persons with incapacitated mental conditions; persons with chronic, hepatic or renal diseases, and persons with diseases in the respiratory ways.

4.4.2 Progress requirements

4.4.2.1 Among the workers’ representatives, a person must be nominated who can be consulted and who can address health and safety issues with the organisation.

4.4.2.2 Those who are handling agrochemicals are adequately trained in storage, application and disposal of these. They are actively informed of all relevant information on the product they are handling by the producer organisation. This information is provided in the local language.

4.4.2.3 Adequate personal protective equipment of good quality is available and appropriate, especially for the use of agrochemicals. Workers handling agrochemicals must use it.

4.4.2.4 Workers’ capability and awareness of the chemicals they are using, relevant health protection and first aid are improved through training.

4.4.2.5 Establishment of a occupational health and safety committee with the participation of workers.

4.4.2.6 Collective risk assessments are carried out regularly.