"How does a company ensure it respects relevant international standards and national laws relating to working hours within its supply chain when workers are either compelled, have no choice, or operate in a context which makes them accept excessive working hours? Workers, including migrant workers, for example, may be compelled to work longer hours in order to earn a living wage or maximise their income. This could also occur in a country where the culture expects long working hours or where the government does not restrict working hour limits or does not effectively enforce the law?"

Defining working hours

According to the International Labour Organization (ILO), standard weekly working hours (excluding overtime) cannot exceed 48 hours per week and eight hours a day. According to the ILO, "the imposition of hours limits was intended to ensure a safe and healthy working environment and adequate rest or leisure time between shifts". However, the international guidelines, especially on overtime limits can be confusing and unclear.

ILO Convention No. 1, on the Hours of Work (Industry) (1919), covering industrial undertakings, i.e. construction, mining, extraction and transport, establishes an eight-hour-day and a 48-hour-week (Article 2).

Article 3 of ILO Convention No. 30 on the Hours of Work (Commerce and Offices) also stipulates working time of 48 hours a week and eight hours a day. Under this Convention, the maximum amount of working hours can be so "arranged so that hours of work in any day do not exceed ten hours" (Article 3). The Convention covers commercial or trading establishments, those working in administrative services and mixed commercial and industrial establishments.

Both Conventions deem working hours exceeding the 48-hour-limit as overtime. Any overtime must be paid at a premium. Convention No. 1 stipulates that the rate of pay for overtime that is determined by ‘government authorities' must be at least 25% more than normal pay (Article 6(2)).

Overtime as the exception rather than the rule

According to the ILO, overtime is only permitted under exceptional circumstances. There are permanent and temporary exceptions and both are referred to in the above-mentioned conventions as well as the ILO Recommendation 116, on the Reduction of Hours of Work (1962) (see discussion on Recommendation 116 below). However, the two Conventions do not explicitly specify any limitations to hours of work on a general level.

Examples of exceptions where working hours may be extended under ILO Convention No. 1 include:

• When "the nature of the process to be carried on continuously by a succession of shifts" requires it. In this case, average working hours shall not exceed 56 hours a week and shall not affect rest days (Article 4);
• In cases of ‘force majeure', "but only so far as may be necessary to avoid serious interference" with ordinary operations (Article 3);
• In other exceptional cases where these time stipulations cannot be applied. In these cases extended working hours must be agreed by workers' and employers' organisations, or regulations set down by the government (Article 6).

Examples of exceptions where working hours may be extended under ILO Convention No. 30 include:

• General interruptions at work due to local holidays, accidents or force majeure. In these cases hours can be increased to make up for the hours that are lost. This is as long as the following conditions are met: hours lost can only be redeemed within 30 days in the year; the increased hours shall not exceed one hour in a day; and the daily working hours shall not exceed 10 (Article 5);
• In exceptional cases where the nature of the work does not make the standard workweek applicable the permitted hours of work will be determined by a ‘public authority'. That is as long as the average number of hours "over the number of weeks" does not exceed 48 hours in a week and 10 hours in a day (Article 6);
• In certain permanent or temporary exceptions laid out in Article 7, such as the type of work (e.g. work that is inherently intermittent or in the case of force majeure. In these cases it is the ‘public authority' that will determine the working hour limitations. Any rate of pay for additional hours in these cases however, shall not be less than 1.25 the normal rate (Article 7(4)).

Recommendation No. 116 provides further guidance on overtime exceptions. These exceptions can be permanent, temporary or periodic. Permanent exceptions include, but are not limited to: where the work is intermittent (such as agriculture); those cases where extended working hours are required in the public interest; as well as for operations where there are technical reasons for work being carried out beyond ‘normal hours'. This could include the seasonal work, such as the production of cards for Christmas, for example, or the harvesting of a fruit crop. In all these exceptions, it is up to the public authorities to place a limit on weekly and hourly working hours (General Principle 1). Part D states that overtime should be remunerated at higher rates than normal rates.

As is clear from the ILO Conventions and other related ILO guidance, there is no standardised limit on working hours over 48 hours per week. However, some guidance of the limit can be gleaned from the preparatory work when the two conventions were drawn up. The 2005 ILO report entitled, Hours of Work, from fixed to flexible?, discusses the preparatory work and the guidance thereof.

According to the ILO report, additional hour limits must be ‘reasonable' and must be "prescribed in line with the general goal of the instruments, namely to establish the eight hour day and 48-hour week as a legal standard". "Specifically, Convention No. 1, the limits considered to be permissible amounted to a total of 60 hours a week in the case of permanent exceptions and 150 hours a year in the case of temporary exceptions, or 100 hours a year for non-seasonal activities. As far as hours of work in commerce and offices are concerned, at the time of adoption of Convention No. 30, such limits amounted to 10 hours a day and 60 hours a week for intermittent work and 10 hours a day and 54 hours a week for preparatory or complementary work."

ILO recommendations and guidance to moving to a 40 hour week

Although the ILO sets a 48-hour week standard, it is now advocating a 40-hour week mainly due to the fact that "over the last century ... hours limits increasingly came to be seen as a way of advancing the additional policy goals of allowing workers to balance their paid work with their family responsibilities and other aspects of their lives, promoting productivity and reducing employment". The ILO's movement to a 40 hour week is found both in ILO Convention No. 47 on the Forty-Hour Week (1935) and Recommendation No. 116, on the Reduction of Hours of Work (1962). So far, only 14 member states have ratified ILO Convention No. 47 including Australian, the Russian Federation and Sweden.

Other rights that can be affected by working hours (and are explained in the Context of the Dilemma section below) include the right to enjoy just and favourable conditions at work, the right to health, the right to a safe working environment and the right to family life.

Other guidance and standards

Social Accountability International: SA8000

This is an auditable standard and voluntary code established by Social Accountability International. These standards are based on international law and workplace norms. According to SA8000, working limitations must comply with the applicable law in the country. In any event, working hours should be no more than 48 hours per week within a seven day period. All overtime must be voluntary, through a collective agreement, and should not exceed 12 hours a week. Nor should it be a regular event. It is important to note, that instead of SA8000 stating that overtime is the exception rather than the rule, it uses the less strong phrase of "not a regular event" seemingly inconsistent with ILO conventions. There is also no mention of this overtime being paid.

Challenges for multinational companies (MNCs) with regard to implementing the 48 hour week

The challenge for a multinational company (MNC) is that it must remain competitive. To do this it must keep costs down while meeting tight production targets. Tough competition in many western and consumer driven markets may put businesses under pressure to further reduce already low prices. In order to maintain competitiveness, supply contracts from retailers will often stipulate tight production timelines that the supplier must adhere to. Tight timelines often mean that suppliers are left in a position where their employees must work beyond the acceptable working hours stipulated by the ILO or national legislation to meet production targets.

Regardless of timelines, there is an inextricable link between low wages and long working hours, especially in emerging economies. This analysis will address both, but emphasis will remain on working hours (see discussion below). Many employees, especially in developing countries, work for very low wages and consequently elect to work more than the ‘normal hours' in order to be able to afford the ‘family bread basket'. This is especially true for migrant workers, who often move to work to save money and to support families back home. This category of workers may have a strong desire to work more to save more money. This, in turn, presents a challenge for MNCs that must then ensure that national regulations and international norms are not breached.

Also, workers may be working on a piece-rate system, where they are paid for what they produce or harvest. Therefore, to earn sufficient income they need to work long hours. This often occurs if they have no other means to support their families.

Another implication is that workers may be ‘impelled' to work overtime by their employers who may threaten replacement, or this pressure may tacitly exist within the corporate culture. Therefore, even if an employee is working overtime that is within legal guidelines, the simple fact that the worker has agreed to this overtime under duress or compulsion means that these extra hours are, in effect, illegal. These types of situations occur in countries where workers are not fully protected by labour laws, or the enforcement of labour laws is weak, or where trade union activity is restricted or banned.

The ILO's Working Time Around the World report states that globally one-in-five workers are putting in ‘excessive hours'. Therefore, this phenomenon of excessive working hours is not confined to only emerging economies, but is one that also exists in well developed economies such as Japan and South Korea, and that is emerging in the United States and the United Kingdom.

There is an important distinction which is explored here, which is that in many developed economies workers and managers are free to leave and find alternative employment. However, their counterparts in emerging economies and less developed countries are frequently locked into working arrangements with few alternatives. Moreover, of most concern is where workers are vulnerable to exploitation over working hours when they are in forced labour situations either because they owe recruitment fees, have been charged excessively for housing and food or where they have been trafficked.

Working hours in the global workforce

Long working hours and low wages are issues of increasing focus at the international level. A 2007 ILO study entitled, Working Time Around the World: Trends in working hours, laws and policies in a global comparative perspective, found that an "estimated 22 per cent of the global workforce, or 614.2 million workers, are working ‘excessively' long hours" (the study used 2004-2005 figures). Jon C. Messenger, Senior Research Officer and a co-author of the study, said in the press release, "the good news is that progress has been made in regulating normal working hours in developing and transition countries, but overall the findings of this study are definitely worrying, especially the prevalence of excessively long hours".

The countries found by the ILO report to have the highest incidence of long working hours (i.e. more than 48 hours per week) included Peru (50.9% of workers), the Republic of Korea (49.5%), Thailand (46.7%) and Pakistan (44.4%).This compares, for example, with 18.1% of workers working more than 48 hours per week in the US and 25.7% in the UK.

At this juncture, it is important to note that although a company may face legal consequences by being complicit in breaching national or international laws and guidelines and may be subjected to legal costs and fines, there is another important and substantial risk. This other important factor is that excessive working hours can pose significant health and safety risks about which a socially responsible company should be aware. These risks can lead to workplace deaths, an increase in accidents, losses in productivity, high staff turnover and a degradation of employee morale. These can have serious costs for business, affect business continuity and result in reputational damage.

The opportunity cost point is supported by the ILO Working Hours report, which says that shorter working hours have positive benefits, including a reduction in accidents, greater productivity and equality between the sexes, as well as better workers' health. Additionally, a 2012 ILO report entitled The Effects of Working Time on Productivity and Firm Performance: a research synthesis paper documents "findings that employer provision of better work/life balance practices such as job flexibility is association with significantly higher productivity and self-assessed performance".

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Long working hours in supply chains

Within their own operations, MNCs often have strong policies and practices that limit the amount of overtime and working hours their employees work. It is therefore less likely that their employees will end up working excessive hours and, accordingly, the risk of these companies breaching national laws and international norms is also lower.

However, there are examples where MNCs are directly implicated, such as where the ‘corporate culture' advocates long working hours and ‘voluntary' overtime by workers.

MNCs are more likely to find working hours that exceed ILO guidelines in countries characterised by the following:

• Where the country has no laws regulating maximum working hours: In some countries, labour laws do not limit the amount of working hours, though they may advocate ‘standard' working hours. Therefore workers are not protected from working more than 48 hours per week as defined as the maximum by the ILO. Although a country may stipulate a standard working week, overtime can be unlimited, leaving workers vulnerable to working excessively long hours without legal protection. Responsible business should be aware of the lack of protections and implement policies and practices accordingly.
• Laws on working hours are not properly enforced: This is typically due to a lack of human or financial resources on the part of enforcement bodies. In a large country such as India for example, it is difficult for national and local governments to recruit an adequate number of labour inspectors to cover all industries and sectors as the country is vast. Lack of enforcement and protection by the government can also result in workers signing agreements – that comply with statutory legislation – which stipulate that they opt out of working limits. However, in practice these ‘agreements' are signed under duress and would therefore be invalid.
• Corruption could exist in countries where labour inspectors/enforcement officers are poorly compensated. These inspectors/officers are more likely to accept bribes from employers breaching labour standards, including working hours.
• There is a general culture that encourages long working hours: In some locations, the culture (either of the country or even a company) will require employees to ‘donate time'. Japan, for example is a country whose culture appears to encourage longer working hours, though the government is seeking to reduce this. According to a 2015 report by the Guardian, high stress levels and death through overwork (karoshi) have increased in Japan in recent years and approximately 22% of Japanese workers work more than 49 hours per week. South Korea is another country where the culture is to work excessive hours. Forbes reveals that the average Korean employee works 2,357 hours per year, which is equivalent to six-and-a-half hours a day for every single day of their life.
• Certain vulnerable worker groups that are not protected by laws. These include ‘atypical' workers such as those in the informal sector, part-time workers, fixed-term employees, domestic workers and those temporary workers outsourced from recruitment companies.

Often these workers are hired by MNC suppliers who compete to win the MNCs' business and offer low costs. These low costs are often achievable for a supplier because they use these irregular workers and do not have to pay for extra costs such as paid holidays, sick pay, etc. In turn, these workers are often desperate for work so will take these jobs, even though they may not be as well protected and may be vulnerable to exploitation.

Sometimes, contracts given to workers are always short term so that standards and rights can be circumvented. Workers are re-hired each season for example, as in most countries, more than 12 months employment secures further rights and benefits; for example, the right to take an employer to a tribunal, the right to paid sick leave or the right to health care.

• Temporary workers: Of particular concern are those temporary workers that are outsourced by companies on fixed-term contracts. These have been the hardest hit by the economic downturn, according to the ILO, as they are the first to lose their jobs. These workers are often subjected to longer working hours (as well as lower pay) and often have only fixed-term contracts (although they can also be casual or seasonal workers).

The practice by MNCs and suppliers of outsourcing employees from third parties appears to be on the increase in many countries including Malaysia, the Philippines and Mexico. Companies are increasingly using this type of labour to cut costs, especially since the economic downturn.

• Migrant workers: According to the ILO, there were an estimated 150 million migrant workers in 2015, many of whom were in vulnerable situations. However, while this represents only 3.9% of the global population, 55.7% of these workers are women, a group that is especially vulnerable to human and labour rights abuses. This includes workers either being compelled to working long hours by their employers or wishing to work more hours to earn more money to send home. However working overtime should be in accordance with the law, international standards or voluntary guidelines, depending on which one protects the worker most. According to SA8000, for example, overtime should not be taken on a regular basis and may not exceed 12 hours a week. Further, overtime can only be undertaken in conformance with a freely negotiated collective bargaining agreement.

Migrant workers move in order to save money and support their family. They will often move to a place where there are little social networks and will want to work extra hours so that they can save enough money to return home. Further, employers often will accommodate this type of arrangement, even if it could breach national regulations or international norms, should an appropriate balance of working hours and rest periods not be achieved.

Despite the high numbers of migrant workers, business should be aware that this diverse group in society is often not well protected in law or in practice, leaving them vulnerable to longer working hours.

• Piece-rate workers: These are workers that do not receive a minimum wage per se, but receive a rate for every piece they produce or harvest. This usually exists in agriculture, workers get paid according to the amount they harvest and in the garment and textile industry, getting paid for each garment produced. In some countries, such as India, this piece-rate is not linked to minimum wage, therefore workers could earn less than minimum wage.

Business sectors where employees experience long working hours

Multi-national companies often come across excessive working hours further down the supply chain, where they do not have direct control over production and timelines. This can occur, for example, when suppliers contract out some of their work to home workers or other, smaller factories. Excessive working hours can also occur where there are few or no laws regulating and limiting working hours. Furthermore, in many countries where domestic laws regulating working hours do exist, these laws are often not properly enforced.

Sectors where there is evidence of excessive working hours include:

• The agricultural sector, which is labour-intensive and where some produce is seasonal, such as fruit and crops. These foodstuffs need to be harvested within a certain time frame to ensure freshness and saleability. Globally, seasonal work in the agricultural sector is not protected by full-time contracts. Often workers are under fixed-term contracts that are not governed or protected by labour laws limiting maximum working hours. Further, a short time frame to harvest those goods places more pressure on workers to work longer working hours in order to ensure that all crops are harvested before they are spoiled. Categories include biofuel production and food harvesting that is often labour-intensive (grapes, corn, etc.).
• The manufacturing industry, where production processes may take more than a normal working day of around eight hours. Often these processes cannot be stopped mid-production. This includes, for example, the electronics industry, where producers have strict timelines to produce vast numbers of products. It includes seasonal work around holidays.
• The clothing and textile industry, for example, will usually experience fluctuations in demand, due to the varied output of clothing (winter, spring, autumn and summer), mostly at the beginning of each season. Companies sourcing from suppliers may often demand that the products be produced within a short time frame. In turn, suppliers are bound by contractual agreements to honour any commitments made in this respect. Seasonal work requires that employees work intensively and for long hours in a short space of time to meet demand.

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Real-world Examples

Death of an intern working for Bank of America highlights excessive working hours in the finance sector

On 15 August 2013, the death of a 21-year-old nearing the completion of a seven-week placement with the investment bank division of the Bank of America Merrill Lynch in London sparked widespread allegations of excessive working hours within the financial services sector. Colleagues of Moritz Erhardt, who died from an epileptic fit, reported that he had repeatedly worked throughout the night – up to eight times in two weeks. The intern's parents confirmed that they received emails from their son at 5am, indicating to them that he was working throughout the night. The bank has responded with commitments to investigate staff working hours, but has admitted that the company has no system in place for monitoring the issue.

Taiwan labour inspectorate punishes nine high-tech companies including Siemens for violating regulations on working limits

The Associated Federated Press reported on 20 January 2011 that labour authorities fined nine high-tech companies up to TWD60,000 (US$2,000) for overworking their employees. The article, entitled ‘Taiwan punishes Siemens, others for staff overwork', states that this came after a much publicised case where an engineer allegedly worked himself to death. Authorities initially rejected the claim for compensation brought by the deceased family. This is being appealed, however. The report further states that overwork appears to be prevalent in the industry and it is "the main driving force for the island's economy".

Japanese government publishes list of companies that can be linked to excessive and illegal hours

In May 2017, the Japanese Health, Labor and Welfare Ministry published a list of companies that had been issued warnings over the use of excessive overtime or other labour law violations. The list – published on a central government website – includes 334 companies including Dentsu, Panasonic Corp, Japan Post Co., many of which have been named for making employee work excessive overtime. The government hopes that by naming and shaming companies it will encourage compliance with labour laws and prevent "karoshi," or death by overwork. The nationwide list will be updated every month.

Undercover journalist exposes excessive working conditions at Foxconn factory in Shenzhen, China

An undercover journalist claimed on 19 May 2010 that Foxconn was subjecting its factory workers to sub-standard working conditions at its large Shenzhen factory, including working excessive hours and being required to work overtime. Foxconn is a Taiwanese based electronics manufacturer that produces many of the iPhones, iPads and iPod mobile devices for Apple.

A journalist from the Southern Weekend went undercover as an intern to work at the Foxconn factory for a month, in order to investigate the reason for nine suicides at the factory in the previous 12 months. He found that most employees were paid the minimum wage, which means they "do not make a living, so are forced to work overtime".

In addition, each employee would sign a ‘voluntary overtime affidavit' on a monthly basis, waiving the 36-hour a month legal working limit so that they could earn enough money for a decent living.

Other organisations have also criticised Foxconn's business practices in the past. China Labor Watch, for example, has ‘long reported' on allegedly sub-standard working conditions at the factory. It claimed that an average shift would last from 10 hours to 12 hours, not the legal eight hours (not necessarily including the two-hour rest period that is required). Any overtime should be "remunerated at higher rates than normal working hours".

Following significant media attention, Foxconn announced on 7 June 2010 that it would be increasing wage levels at the factory by 70% in October 2010. This was implemented on 9 June 2010. The chairman of Foxconn, Terry Gou, also announced that, following an investigation, the company would be ending condolence payments for suicides.This was on the basis of evidence that such payments might actually be encouraging workers to take their lives. Gou also claimed that the company's investigations had found that none of the suicides at the plant were related to working conditions, including long working hours.

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Legal risks

Most countries have legislation limiting working hours. If a company is found to have breached any legislation surrounding limitations on working hours then it could face penalties. Penalties could include fines, remediation, and restitution for employees or compensation. These cases are often not reported as they are minor offences with minor penalties.

In Japan, there appears to be an increasing number of court decisions where families have been compensated for the death of an employee due to "overwork" (karoshi). Often, the court finds that a worker has died or committed suicide due to overwork, i.e. working long hours. This occurs across the board – from workers on the factory floor to managers and senior employees – and was initially found to be particularly pronounced in the construction industry, with shift workers, sales people, those working on television or in media and drivers.

Death due to overwork (karoshi) has been recognised by the Japanese government since its first case in 1969. Compensation has been available for deceased workers' family members through both civil claims and under the labour law. Criminal charges were first brought against a Tokyo interior fitting company in 2001, but as yet companies have managed to evade criminal charges.

Toyota is one company that has been faced with legal suits due to employees dying from overwork. These legal risks have resulted in higher costs in relation to lawsuits and pension pay-outs.

In July 2010, a 31-year-old Chinese worker in Japan was found by a Japanese court to have died from overwork. This was the first time that a court found that a foreigner had died from karoshi. The trainee worked for Fuji Electronic Industries on the metal plating production line. After investigation, it was found that the trainee was working up to 150 hours overtime per month. The company's official records, however, indicated much less. The case has been forwarded to the public prosecutor, but at the time of writing there are no reports of criminal charges.

In 2016, Japanese authorities ruled that the death in Japan of a 27-year old Filipino worker, Joey Tocnang, was due to excessive overtime. According to the Gifu labour standards inspection office, Tocnang worked between 78.5 hours to 122.5 hours of overtime per month before his death in April 2014. The employee was involved in cutting steel and preparing casts for molten metal and was paid minimum wages; he died of a heart attack in his dorm room. Tocnang's family received JPY3 million.

In 2015, the French Red Cross was subject to a fine on grounds of excessive overtime. Health and safety officers reported that the organisation had exceeded the limit of no more than 48 hours work per week and no more than 10 hours a day 3,800 times in 2014, at its Paris headquarters. Media reports indicated the charity could have to pay up to Euros 11 million in compensation and fines.

Operational risks

Studies have found that long working hours can contribute to an increase in the risk of work accidents as well as damage workers' health. Although not a direct risk, if a worker's health is damaged it can translate into an increase in operational costs, particularly in relation to compensation for accidents and loss in productivity due to employees working while they are fatigued and/or taking time off for illness. The health and safety consequences are fully articulated in the context of dilemma section below.

These operational risks of working when fatigued can also result in faulty goods and inferior products. If this happens consistently and over a long period of time, flaws could occur throughout a production line and may result in the recall of products.

An example is the connection between safety issues with Toyota cars and overwork claimed by retired employees and former union members in Toyota. This resulted in employees overworking to ensure production goals were met and may have contributed to the recent car recall that occurred globally in early 2010. Millions of Toyota models were recalled world-wide after allegations of a sticking accelerator pedal. The sticking pedal could have resulted in more than 89 deaths since 2000 in the US alone. The recall cost Toyota US$2 billion. Further, Toyota President Akio Toyoda said that in the company's race to become the world top producer, it compromised quality and safety. This is similar to the allegations made by the ex-employees who claimed that Toyota management implemented "dangerous safety and manpower shortcuts" from 2000 to 2005.

Concerns over product safety were originally flagged by six senior workers at the Toyota plant in 2006 who formed a trade union for contract and part-time workers who could not join Toyota's Union due to their temporary status. These workers sent a memo to senior management "warning Toyota about an impending disaster."

Other allegations made in the memo include:

• Toyota having to recall a higher proportion of total vehicles when compared to other car makers between 2000 and 2005
• Toyota not being thorough enough in identifying the source of problems
• The company compromising manufacturing processes on quality and safety such as: combining vehicle platforms, the sharing of parts between models, the outsourcing of planning, shortened development time (resulting in a shortage of experimental data on prototypes)
• The lack of quality control processes to ensure the manufacture of safe cars, as well as fears that they "ultimately may be ignored ... in the name of competition"

The memo requested that the company:

• prioritise safety
• review cost-reduction measures made in the past
• provide better training for contract workers
• to return the company to a culture of craftsmanship

One of the six, Wakatsuki, told the LA Times that "our responsibility as a labour union was to point out these problems that Toyota should have known about. People were overworked; some were committing suicide". This memo was ignored at the time by management.

Reputational risks

Reputational damage and brand contamination may arise as a result of sustained or high-impact negative publicity and activism, particularly by NGOs, trade unions and journalists. In the past, such actions have typically been concentrated on the apparel and footwear sector, although companies in the food and beverage and electronics sectors have also come under scrutiny, such as Apple and Foxconn in China.In today's market, when negative reports against companies have been published there is often a swift, almost immediate response.

For example, the UK's Channel 4 Dispatches programme report entitled, Fashion's Dirty Secret aired on 3 November 2010, highlighted substandard working conditions in a factory in the UK. The report claimed that fashion companies, including New Look, Peacocks and Jane Norman were sourcing from suppliers where workers were enduring long working hours, unsafe conditions, bullying and low wages. These were in factories where the suppliers' work had been sub-contracted out to other factories.

In response, the Ethical Trade Initiative, of which New Look is a member, released a statement that immediate action was being taken by New Look. According to the ETI it is a violation of the base code "which seems in this case to be flouted". ETI announced in the statement that, due to New Look's track record, it had "every confidence that New Look will carry out a full and frank investigation, and will act swiftly to put things right."

In 2012, NGO scrutiny of conditions in electronics factories in China identified a culture of excessive overtime affecting the supply chains of companies such as Samsung and Apple. In 2012, China Labour Watch, a New York based NGO reported that workers often had to do 16 hours a day and were given just one day off a month. In response to the allegations, Samsung published details of its audits of 105 Chinese suppliers with over 65,000 employees and pledged to address excessive hours by 2014. The company committed to using third-party auditors and set up a hotline to allow workers to anonymously report violations.

In 2012, the Fair Labour Association conducted an investigation of Foxconn factories, an Apple supplier, and reported that over half the employees had worked 11 days without rest. The investigation linked excessive hours to a higher incidence of safety failures and accidents. In response to the report, Apple and Foxconn agreed to compensate workers and to develop a compensation package for workers whose hours were cut in order to abide by working time limits. The report noted that low wages were driving workers to seek additional hours.

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For a company to ensure the responsible elimination of excessive working hours within supply chains it should first look to comply with national laws on working hours. Where national laws are set lower than international standards on working hours, companies should strive to meet these higher standards. The UN ‘Protect, Respect and Remedy' Framework for Business and Human Rights provides guidance on how to protect individuals and communities from corporate related human rights harm.

The framework is comprised of three key principles:

• Protect: The state duty to protect against human rights abuses by third parties, including business;
• Respect: The corporate responsibility to respect human rights; and
• Remedy: Greater access by victims to effective remedy, both judicial and non-judicial.

The framework states that in addition to complying with national laws businesses have a responsibility, in the context of the countries where they operate, to respect human rights through their own business activities and through their relationships with third parties – such as business partners and entities in their supply chains. To meet this responsibility, the framework notes that businesses should engage in human rights due diligence and specifies the main components of the process:

• Policies: Including a human rights policy containing broad commitments, supported by more detailed guidance in specific functional areas
• Impact assessment: Including assessments that explicitly reference internationally recognised human rights and are used by companies to avoid potential negative human rights impacts on an ongoing basis
• Integration: Including the embedding of respect for human rights throughout a company
• Tracking performance: Including regular updates of human rights impact and performance

The Guiding Principles for the Implementation of the UN "Protect, Respect and Remedy" Framework aim to provide "concrete and practical recommendations" about how businesses can operationalise their responsibility to respect human rights. According to the Guiding Principles, the responsibility to respect human rights requires responsible companies to:

• Implement a human rights policy
• Apply human rights due diligence
• Provide for remediation

The UNGPs apply to all States and to all business enterprises, both transnational and others, regardless of their size, sector, location, ownership and structure.

The UNGPs have experienced widespread uptake and support from both the public and private sectors, and numerous companies have publicly stated their commitment to the Guiding Principles. The UN Guiding Principles Reporting Framework is also used by companies to report on how they respect human rights.

Companies can seek specific guidance on this and other issues relating to international labour standards from the ILO Helpdesk. This aims to help company managers and workers understand the ILO approach to socially responsible labour practices and to assist in the development of good industrial relations.

Although the ILO has established a weekly working limit of 48 hours, as stated at the outset, the organisation advocates that multinational companies should be "encourage[d] to progressively reduce the normal hours of work from 48 hours to 40 hours."

1. Adopting a forward looking human rights compliance policy with procedures to match

It is a basic requirement of the ILO that a company operating in emerging economies should develop and implement human rights policies and procedures (including throughout its subsidiaries), which support managers and suppliers to take a socially responsible approach to working hours.

Specific actions may include:

Policy

• Compliance with national laws in relation to working hours, daily rest periods, etc. Where local laws differ from company policy, the higher standard should prevail. Company policy on working hours should be guided by ILO Conventions on working hours of the standard 48-hour week and eight-hour day
• If there are no national laws in relation to working hours, or laws are weakly implemented, the policy should commit to international standards, ILO Convention No. 1, on the Hours of Work (Industry), ILO Convention No. 30, on the Hours of Work (Commerce and Offices), ILO Convention No. 153 on the Hours of Work and Rest Periods (Road Transport), ILO Convention No. 47, on the Forty-Hour Week , Recommendation No. 116, on the Reduction of Hours of Work
• A grievance mechanism which allows employees to address issues in relation to working hours
• Supplier contracts with the MNC must comply with company policy, as well as maintain a grievance process to address claims in relation to working hours

Procedure

• If and where relevant, a company should undertake due diligence. This may be particularly beneficial to companies in high-risk industries, such as mining and manufacturing, where employees tend to work longer hours due to manufacturing processes and procedures that cannot be stopped mid-production.
• Monitor the prevalence of excessive working hours within an industry and the social and economic context, to understand underlying risks of excessive working hours and how it manifests in a particular industry and location of operations
• Effectively communicate any working hours policy, associated guidance and procedures to personnel and, if relevant, to suppliers, subcontractors and business partners
• Provide employees with regular training and awareness building in order to sensitise them to issues surrounding working hours and the dangers of working long hours without breaks. This should also foster awareness and shared responsibility and accountability.
• Continually review and improve working hours policies and procedures to ensure that they are in line with best practice advancements and training managers accordingly
• Implement grievance procedures for both employees and for suppliers. They can be undertaken internally or they could be at the industry-level (e.g. ombudsperson).

The Ethical Trade Initiative's (ETI's) Base Code, which over 50 companies (including Gap, Pentland, Marks & Spencer and Primark) have signed up to, provides a good example. The Base Code addresses working hours, stating the following (revised with effect from 1 April 2014):

• "Working hours must comply with national laws, collective agreements, and the provisions [outlined] below, whichever affords greater protection.
• Working hours, excluding overtime, shall be defined by contract, and shall not exceed 48 hours per week
• All overtime shall be voluntary. Overtime should be used responsibly, taking into account all the following: the extent, frequency and hours worked by individual workers and the workforce as a whole. It shall not be used to replace regular employment. Overtime shall always be compensated at a premium rate, which is recommended to be not less than 125% of the regular rate of pay."

2. Occupational health and safety training for suppliers and company personnel on working hours limitations

Training is a key component of responsible approaches to preventing excessive working hours in the workplace. Company managers and suppliers can benefit from ongoing training in the following areas:

• Understanding the relevant working hours laws within the country
• Understanding and implementing company policy in relation to working hours
• Health and safety procedures for young workers (which often differ from those required for adults; most workers under 18 have shorter working hours)
• Understanding the issues and risks for a company with respect to excessive working hours

3. Social auditing and monitoring

A company should consider including in its CSR audits monitoring its own operations as well as the factories of its major suppliers in countries where a high incidence of working hours has been reported. Such monitoring or audits can be undertaken by the company or a third-party contracted by the company.

Audits could include:

• Interviewing management on policy and practices, ensuring that working hours limits are being honoured. The auditor should ascertain, for example, whether the supplying company requires that workers must clock-in or clock-out hours.
• Interviewing employees on their working hours and breaks, preferably out of the working setting and anonymously – so as to assuage any fears they may have over losing their jobs
• Inspecting the factory/workplace for any signs of workers appearing overly tired, fatigued or stressed
• Inspecting workers' contracts to ensure that overtime hours are not excessive

4. Improving the productivity of business partners and suppliers to reduce the need for long working hours

A company can introduce methods to increase productivity. While commercial pressures will often mean buyers and employers will have to find a way to reduce non-labour costs to compensate for a reduction in working hours, MNCs might be in a strong position to help their suppliers achieve such non-labour cost reductions, including:

• The promotion and/or financing of new technologies to improve production efficiency
• The promotion of new production techniques that are more efficient
• The training of employees in relation to new production techniques, or new production technologies
• Improved logistical coordination and planning to reduce the impact of production problems and disruptions

Nonetheless, MNCs will need to put mechanisms in place to ensure such measures do actually translate into a reduction in working hours for employees and not just an increase in output – and higher profits for suppliers. This might include, for example, a formula by which the increase in production is tied to a pre-agreed percentage of efficiency savings, which is then allocated to increased wages.

Increasing productivity could also include introducing flexible working programmes. A company is likely to see initial non-financial benefits almost immediately, and in the long term this should translate into non-financial benefits. Financial benefits include cost savings in relation to reduced staff turnover (therefore the reduction of recruitment costs), improved worker/management relationships, as well as an increase in productivity.

5. Improving ordering practices

Companies can also create a procedure so that orders they demand from suppliers are achievable within the specified amount of time. This could mean, for example, calculating how many garments a worker could sew within a working day and multiplying this with the number of employees within a factory.

For example, the Ethical Trade Initiative, an alliance of companies, trade unions and voluntary organisations, held a roundtable discussion attended by senior buyers, merchandisers and ethical trade teams from more than 20 global retailers, including New Look, Asda, George, Gap and Next, as well as NGOs and trade union members. Among the experiences shared was that improving buying practices can not only help in tackling workers' issues like excessive overtime and wages, but it can also increase efficiencies that benefit the bottom line.

These include:

• Having a clearer critical path for each product line and integrating purchasing practices initiatives across the business
• Building two-way communication with suppliers (e.g. rather than just handing down demands for compliance, retailers should ask their suppliers what they can change so as to help a supplier or factory to improve practices)
• Establishing tools and guidance for designers, buyers and merchandisers to improve purchasing practices and ensuring they are implemented consistently across the business
• Smoothing out peaks and troughs in the product ordering process
• Helping suppliers improve their forecasting, for example by giving suppliers earlier sight of the order book

Such measures provide more predictability and consistency for suppliers in their forecasting of orders. This helps to reduce potentially unforeseen time and cost pressures, which may impact on their ability to pay living wages (due to the need for excessive overtime, an increased use of casual labour and even unauthorised sub-contracting).

6. Implementing flexitime schedules

Many larger MNCs have been introducing flexible work programmes to allow for a better work-life balance for the worker.

According to the UK Trade Union Confederation, the implementation of the schedules has resulted in better productivity in many companies, as well as:

• A more flexible and committed workforce
• Improved management control
• Reduced absenteeism due to better health
• Improved efficiency

Flexible work could either be time flexibility or flexibility in an employee's contract.

One example of where flexible working time was implemented in a successful manner is by Unilever Foods UK at its Purfleet spreads factory in Essex (the world's largest spread factory) where there was no flexibility to match the peaks and troughs of labour demand in the production of the foodstuff, mustard.

This is only one solution that is better implemented and suggested by a company after suppliers address the use of excessive working hours and address efficiency and productivity. For further guidance on flexible programmes there are a number of organisations that address working time, including flexibility, The Work Foundation, Trade Union Congress and the Labour Relations Agency.

7. Multi-stakeholder engagement and programmes

Multi-stakeholder programmes can assist companies to minimise the risk of excessive working hours throughout the supply chain. For instance, a coordinated effort amongst suppliers, business partners and other companies aimed at managing working hours in the supply chain, through creating a ‘level playing field', may enhance the chances of making a positive impact on supplier wages.

Such an effort could initially focus on contexts where there is a critical mass of buyers who have a long-term relationship with the supplier and are willing to ensure that workers actually receive living wages. This may be arranged through industry groups, multi-stakeholder initiatives such as the Ethical Trading Initiative, or through supply chain data-sharing organisations such as Sedex.

Sedex, for example, provides a secure database for companies to store and share ethical data including self-assessment, audit reports and corrective action reports and status. Such information could be used by member companies to coordinate their efforts in the implementation of living wages in supply chains.

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International legal instruments

The ILO has a number of conventions that cover the hours of work for particular industries and sectors, as well as detailing rest periods, paid leave and night work.

These include:

ILO Convention No. 1, on the Hours of Work (1919) (interim status)

ILO Convention No.1 limits the hours of work of those employed in any industrial undertaking to an eight-hour day and a 48-hour week. This includes those working in mines, quarries and other extractions of minerals, construction, maintenance and repair of buildings, railways, telephone installations, gas works, etc. It also includes those employed to transport goods or passengers by sea, road or inland waterways (and now presumably by air).

The Convention also provides for at least one day of rest each week and provides for a minimum of three weeks' annual leave. It also covers workers undertaking night work, part-time work and workers with family responsibilities. Only 52 ILO members have signed this convention. Some of the member countries that have signed this Convention include many European states as well as Egypt, India, Colombia, Israel and Bangladesh. Countries that have not signed the convention include Indonesia, Philippines, Mexico, Vietnam and Brazil.

ILO Convention No. 30, on the Hours of Work (Commerce and Offices) (1930) (interim status)

ILO Convention No. 30 limits working hours to an eight-hour day and a 48-hour week. A working day cannot exceed 10 hours. This Convention covers those employed in commercial or trading establishments and administrative services in which workers mainly engage in office work and mixed commercial and industrial establishments.

It has been signed by only 30 ILO member countries. Therefore, the majority of ILO member states have not adopted this Convention.

ILO Convention No. 47, on the Forty-Hour Week (1935) (up-to-date)

This Convention calls for the reduction of the working week in a manner where "the standard of living is not reduced as a consequence."

This Convention was created in the Great Depression in the 1930's in consideration of the following:

a) that unemployment has become so widespread and long continued that there are at the present time many millions of workers throughout the world suffering hardship and privation for which they are not themselves responsible and from which they are justly entitled to be relieved

b) it is desirable that workers should as far as practicable be enabled to share in the benefits of the rapid technical progress which is a characteristic of modern industry; and

c) it is necessary that a continuous effort should be made to reduce hours of work in all forms of employment to such extent as is possible

This Convention has only been signed by 15 member states, including Australia, Azerbaijan and Norway.

ILO Convention No. 14, concerning Weekly Rest (Industry) (1921) (up-to-date)

This Convention covers all employees in industrial employment which includes, mining and extraction, manufacturing industries (where products are cleaned, repaired, ornamented or in which materials are transformed), construction, transport of goods and the transport of passengers by road, rail, etc.

The Convention supports a 24-hour rest period for every seven days, advocating the requirement that working hour limitations must also be complied with. It also states that all staff in an enterprise should take days off at the same time and days off should coincide with traditional and customary days off (Article 2(3)).

One-hundred-and-twenty countries out of 183 member states have ratified this Convention. Notable exceptions include Indonesia, Singapore and the Philippines.

ILO Convention No. 30, on the Hours of Work (Commerce and Offices) (1930) (interim status)

ILO Convention No. 30 limits working hours to an eight-hour day and a 48-hour week. A working day cannot exceed 10 hours. This Convention covers those employed in commercial or trading establishments and administrative services in which workers mainly engage in office work and mixed commercial and industrial establishments.

It has been signed by only 30 ILO member countries. Therefore, the majority of ILO member states have not adopted this Convention.

ILO Convention No. 106, concerning Weekly Rest (Commerce and Offices) (1957) (up-to-date)

The Weekly Rest Convention covers people working in "establishments, institutions, and administrative services" that are not subject to national and other arrangements concerning weekly rest in industry, mines, transport and agriculture.

This Convention advocates a daily minimum rest period of 24 hours every seven days. There are temporary exceptions such as in the case of an accident, force majeure or urgent work that needs to be done, or in order to prevent the loss or perishable goods.

ILO Recommendation No. 98, Holidays with Pay Recommendation (1954)

This Recommendation applies to all employed persons and allows workers time off from work, with the exception of seafarers, agricultural workers and persons employed by a member of their family.

ILO Recommendation No. 98 states that all workers shall be entitled to paid annual leave. The duration of the holiday with pay should be "proportionate to the length of service performed and should not be less than two working weeks per year". It further recommends that the government should ensure that public or customary holiday, days of rest, absence on account of sickness, as well as post- and pre-natal leave are not counted as part of holiday pay.

Certification schemes

Social Accountability's SA8000 is one example of a certification scheme followed by many socially responsible companies. It states that: "The company shall respect the right of personnel to a living wage and ensure that wages paid for a normal work week shall always meet at least legal or industry minimum standards and shall be sufficient to meet the basic needs of personnel and to provide some discretionary income."

The standard also provides guidance on wage deductions, benefit composition, overtime and labour contracts – particularly with regard to their impact on the living wage. This standard is not in compliance with ILO conventions on a 40-hour week. Instead it provides for a 48-hour a week maximum, excluding overtime.

Voluntary guidance

The International Organization for Standardization (ISO) new standard, ISO 26000, provides a guide to assist companies to implement practices and procedures in a socially responsible manner.

ISO argues that "an organization's performance in relation to the society in which it operates and its impacts on the environment has become a critical part of measuring performance and its ability to continue operating effectively."

Working Time around the World

According to a 2007 ILO report, "Working Time Around the World", an estimated 22% of the global workforce, or 614.2 million workers, are working more than 48 hours per week. Gender and age are important factors determining the number of hours worked. There is a clear "gender gap", with men working longer hours. Women's time for paid work is constrained by time spent on household/domestic responsibilities.

According to the ILO report, informal employment provides at least half of total employment in all regions of the developing world. Around three in five of those in informal employment consist of the self-employed. While the self-employed in industrialised companies tend to work long hours it is far more variable from country to country. This is especially the case for self-employed men. Self-employed women tend to work short hours. It appears these women are using self-employment instead of working part-time in order to earn some money while handling family responsibilities.

Attempts to reduce working hours in these countries have been undermined as people work longer hours to ensure that they can adequately support themselves and their family. Proposed alternatives to long working hours such as flexibility measures as well as part-time work are not used in practice due to the fact that it reduces household income.

Working hours and the impingement of rights

Long working hours can affect the following rights:

The right to enjoy just and favourable conditions of work (ICESCR, Article 7): Employees have a right to just and favourable working conditions, including fair wages, equal remuneration for equivalent work, healthy and safe working conditions, the right to rest, leisure, holidays and reasonable limitation of working hours as part of the conditions of work.

The right to health (ICESCR, Article 12): Employees working long hours, especially over long periods of time, often face long-term risks to their health and safety. One American study, The impact of overtime and long work hours on occupational injuries and illnesses: new evidence from the United States, found that overtime and extended work schedules resulted in an increase in the risk of hypertension, cardiovascular disease, fatigue, stress, depression, musculoskeletal disorders, chronic infections, diabetes, general health complaints and all cause mortality.

Similarly, according to a Health and Safety UK government report, "Working Long Hours", long working hours affects the general health of the worker. This study compares a number of past studies from all over the world and associates a number of health problems with long working hours including an increase in accidents, stress, psychological and physical health.

The right to a safe working environment (ICESCR, Article 7, ILO Conventions, including but not limited to, ILO Convention No. 152, on Occupational Safety and Health (1979), ILO Convention No. 155, on Occupational Safety and Health (1981), ILO Convention No. 161, on Occupational Health Services (1985), ILO Convention No 170, On Chemicals (1990) and ILO Convention No. 174, on the Prevention of Major Industrial Accidents Convention(1993)): The same American study found that working in jobs with overtime schedules was associated with a "61% higher injury hazard rate compared to jobs without overtime. Working at least 12 hours per day was associated with a 61% higher injury hazard rate compared to jobs without overtime and working at least 60 hours per week was associated with a 23% increased hazard rate".

The right to a family life (Article 10, ICESCR): According to the above cited Health and Safety UK government report, "literature suggests that working long hours impacts negatively on home and family life." Furthermore, long working hours was found to disrupt family activities and ‘atypical work' (that which is worked outside the normal working week), was associated with dissatisfaction with the amount of time that mothers spent with children, dissatisfaction with the amount of time spent as a couple and an increase in the disruption of children's activities

The health implications of long working hours

The increased rate of injuries and the loss of working days resulting from excessive working hours also translate into an increase in company costs associated with insurance and workers' compensation, as well as a loss in productivity.

Long working hours and the loss in productivity are also linked to:

• Fatigue: Employers must be aware that long working hours result in fatigue and insufficient rest between work will exacerbate fatigue. Fatigue is likely to set in after 50 hours a week (when it could lead to occupational stress) to 60 hours a week, or a 10-12 hour day (though the study does not make it clear whether this is with or without a break). "The Working Long Hours" study states that working time regulations in various countries "suggests that there can be cut-off points when fatigue may become dangerous", resulting in accidents at the workplace and injury to employees.

The ILO states that it is vital for employees working long hours to also get adequate rest between working. According to the ILO, "[e]xcessive working hours can cause sleep disturbance, fatigue, cardiovascular, gasto-intestinal and mental health disorders." It can also lead to an increase in the incidence of accidents and injuries, decreased productivity and substandard work.

• Stress and psychological health: Working long hours can also be associated with stress and poorer psychological health outcomes. The level of stress and psychological health will depend on the individual and other factors, such as job rewards and whether the worker thinks he/she has a choice over the amount of hours he or she can work.

Although the word "stress" has been commonly adopted into everyday language and can be used to describe varying degrees of work pressures in modern working life, the effects of stress upon workers must not be underestimated and the symptoms of stress must be adequately recognised. According to the ILO, stress-related disorders are responsible for the majority of disease, deaths, disability and medical care use in most industrialized countries. Stress can have a number of adverse effects on health, from chronic fatigue to depression, insomnia, anxiety, migraine, emotional upsets, allergies and abuse of tobacco and alcohol.

The ILO reports that there are a number of long-term effects, such as hypertension. Hypertension can cause heart and cerebrovascular disease, peptic ulcers, inflammatory bowel diseases and musculoskeletal problems. It may cause an alteration of immune functions, which the ILO says, "may in turn facilitate the development of cancer."

Further, the ILO states that several recent studies have highlighted the links between work-related stress, violence at work, the abuse of drugs and alcohol and tobacco consumption. These studies suggest that stress at work contributes to negative emotions, which may lead to behaviours such as drinking, using drugs and other harmful substances which, in turn, can lead to other health issues.

The following are recent estimates which relate to the cost of work-related stress:

According to a 2010 study reported in The Independent by the charity Mind, there is evidence that hundreds of thousands of workers suffer mental distress due to their jobs. The charity claims that each year "UK businesses lose £26 billion and 70 million working days because of conditions like workplace stress".

In 2013, the annual cost of mental stress to Australian businesses was estimated at over AUD10 billion (approximately US$9 billion).

Work-related stress costs the US approximately US$50-US$150 billion each year, whilst 550 million working days are lost each year due to absenteeism in the United States and over half of these absences are stress-related

One American study found that overtime and extended work schedules resulted in an increase in the risk of hypertension, cardiovascular disease, fatigue, stress, depression, musculoskeletal disorders, chronic infections, diabetes, general health complaints and all causes of mortality. The study found that working in jobs with overtime schedules was associated with "61% higher injury hazard rate compared to jobs without overtime and working at least 60 hours per week was associated with a 23% increased hazard rate". These are all costs to business.

Another stress expert, Professor Cary Cooper from Lancaster University says that the increase risk is not just confined to those who work more than 60 hours, but extends to those who work more than 45 hours. Furthermore, Derek Simpson, secretary of the union Amicus, concurs with Professor Cooper, noting that an increase in working hours does not necessarily translate into an increase in productivity. He takes the UK as an example and says: "As well as being bad for individuals, [the UK's] long hours culture is also bad for business because lower working hours relate directly to higher productivity. It is no coincidence that the UK has the least-regulated economy in Europe and is the least productive in the industrialised world."

• Physical health: Studies revealed an increased incidence of suicide rate. Employees working over 48 hours a week in another study reported more chronic headaches and irritable bowel problems. Other negative effects include a reduction in immunity and a higher risk of diabetes (though not entirely conclusive). Although the study noted inconsistency in the various research findings, "it is agreed that current evidence is sufficient to raise concerns about a possible link between long hours and physical health outcomes, including cardiovascular disease, especially for hours exceeding 48 to 50 a week."

There is a link between long working hours, resulting in ill health and the direct and indirect costs to business. If workers are experiencing stress, sickness or ill health, a business may experience the direct effects of increased costs due to paying sick days, higher insurance costs and loss in productivity. However, it also leads to indirect costs such as the erosion of staff morale, a higher staff turnover, lower productivity due to days lost as a result of illness and, ultimately, higher staff turnover and reduced quality in the recruitment pool.

The Economics of Health, Safety and Well-being report by the ILO, the Ministry of Social Affairs and Health and the Department of Occupational Safety and Health reveals a number of cost implications for employers, including absenteeism, higher medical costs, a decrease in the morale of co-workers and a higher staff turnover, with the associated cost of recruiting and training new workers and reduced productivity and efficiency.

All of these studies are performed in developed countries; however, the same would apply in emerging economies, the difference being that the pool of labour is much greater and the costs of labour much lower. In fact, there is a greater chance of workers being subjected to longer working hours in the emerging economies, as evidenced in the country examples above, which means that the risks are greater.

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