Michaels Vendor Compliance

Contents

**It is Advantus’ responsibility to pay for all Michaels audits. If a factory fails or does poorly on an audit and the customer requires a re-audit, it is the factory’s responsibility to pay for the re-audit fee.**

***All new factories must have a social audit completed in order to sell their products to Michaels.***

All Michaels vendors are expected to complete an annual inspection of each manufacturing location based on the Michaels Vendor Code of Conduct (CoC) and maintain a record of the inspections at their headquarters. Michaels reserves the right to review these inspection reports upon request. Vendors must allow Michaels and its representatives unrestricted access to inspect its manufacturing locations to ensure compliance with this CoC.

BV will normally notify the vendor when an audit is due. They will send the booking form which must be completed and returned to BV. BV requires payment of the audit prior to the audit being performed.

BV booking form must be sent to BV approximately 6 weeks prior to the expiration of the current factory audit
The audit window must be a 2-week window prior to the current audit expiration date (there are few valid exceptions to this and any exception must be approved by Michaels)
A Vendor Factory Assessment (VFA) is also needed with each new audit. BV should request this as part of the booking process.

When setting up a new factory, Advantus must proactively get the audit scheduled.

See here for recent Social Accountability training from Michaels.

See here for the recent Vendor Code of Conduct from Michaels. Factories should have this posted on the factory floor prior to an audit.

See here for recent Social Accountability Best Practices from Michaels.

Compliance with Applicable Law

Vendors must comply with the legal requirements and industry standards of the countries in which the vendors are doing business. Should the legal requirements and industry standards conflict, vendors must comply with the legal requirements of the country in which the products are manufactured. If, however, the industry standards exceed the country’s legal requirements, Michaels will favor vendors who meet the more rigorous industry standards.

Employment

Michaels regards its vendors as business partners and has developed a strong level of teamwork with its vendor community. Michaels expects the spirit of its commitment to be reflected by its vendors with respect to its employees. At a minimum, Michaels expects its vendors to meet the following:

Child Labor: The use of child labor is prohibited. Vendors agree to employ only workers who meet the applicable minimum legal age requirement for the country or region where the manufacturing is located or are at least 15 years of age (whichever is greater). Vendors must maintain records verifying every worker’s date of birth.
Forced Labor: The use of forced labor is prohibited. Vendors must not use any form of prison labor, indentured labor, bonded labor, or other similar types of forced labor.
Human Rights: Vendors must ensure that every employee is treated with respect and dignity. No employee shall be subjected to any physical, sexual, psychological, or verbal harassment or abuse.
Discrimination: Vendors must not discriminate in hiring practices or any other terms or conditions of work based on race, color, national origin, gender, religion, disability, sexual orientation, or political opinion. Michaels recognizes that cultural differences exist and different standards apply in various countries, however, Michaels believes that all terms and conditions of employment should be based on an individual’s ability to do the job, not based on personal characteristics or beliefs.
Freedom of Association: Vendors must recognize and respect the right of employees to freedom of association and collective bargaining without penalty, discrimination, or harassment.
Compensation: Vendors must fairly compensate their employees by providing wages and benefits that comply with the laws of the countries in which they are doing business or which are consistent with the prevailing local standard in the countries in which they are doing business (whichever is greater). The vendor must pay overtime wages in compliance with local laws or industry standards. Wage rates for overtime must be higher than the rates for the worker’s regular work shift.
Working Hours: Vendors must maintain reasonable employee work hours in compliance with local or national laws. Overtime work hours must be in compliance with local or national laws, but must not exceed more than 60 hours per week. Employees must be guaranteed at least one day off during a seven-day period.

Health and Safety

Vendors must maintain a clean, safe and healthy workplace in compliance with all national and local laws. Employees must have access to clean drinking water, sanitary washing facilities, and an adequate number of toilets, fire extinguishers, and fire exits. Doors and other exits must be kept unlocked during working hours. The manufacturing location must have adequate lighting and ventilation. Vendors must ensure these standards are also met in any canteen and/or dormitory locations.

Environment

Vendors must comply with all applicable environmental laws for the region in which they do business. Vendors are encouraged to have an environmental management system in place. Vendors must store hazardous materials in a secure and ventilated area and dispose of them in a safe and legal manner.

Sub-Contractors

Vendors must ensure that their sub-contractors adhere to this CoC.

Display of CoC

Vendors must familiarize workers with this CoC and display this CoC at their facilities in a place accessible to employees. Vendors must translate this CoC if English is not understood by their employees. See here for a copy in English; see here for a copy in Chinese.

How to Dissociate a Factory in MiPCS

Per Michaels QA, the only way a vendor can dissociate a factory in MiPCS is only if no future PO’s have been written. See below instructions on how to dissociate a factory:

1. Log into MiPCS: https://mipcs.michaels.com/mipcs/logonForm.htm

2. Click on “Vendor Factory Association” at the top of the page: