Read the Initial Assessment published by the NCP 18 April 2022: English

Read the Final Statement published by the NCP 19 December 2023: English

Read the Follow-up Statement published by the NCP 5 November 2024: English

On 10 December 2021, the Chanel Korea Branch of the Korean Department Store and Duty Free Shops Sales Service Workers’ Union submitted a specific instance to the Korean NCP alleging that Chanel Korea, a company active in luxury fashion, had not observed the General Policies (Chapter II), Disclosure (Chapter III), Human Rights (Chapter IV), and Employment and Industrial Relations (Chapter V) provisions of the Guidelines in relation to rights of Department Store and Duty Free Shops Sales service workers. Specifically, the issues related to the company’s alleged refusal to provide information and consultation rights to the labour union after allegations of the sexual violence against staff member by a manager, refusal to provide information necessary for group negotiations, violation of the Labour Standards Act relating to holiday pay, improper communication with employees, and a lack of regard for Covid related safety measures in the workplace.

While the case was being submitted to the KNCP, the parties reached agreement on several issues, including the development of a project (‘Better Workplace for Women’), by signing wage and group agreements. The submitter still wished to continue engagement with the KNCP to address remaining issues. The KNCP adopted an initial assessment on 18 April 2022, deciding to accept the specific instance for further consideration.

Following mediation, the parties were able to reach agreement on three of five issues raised in good offices. Notably, the parties reached agreement on matters related to holiday work, discrimination against union members and COVID-19 response. The parties were not able to reach agreement on matters related to alleged inadequate responses to sexual harassment claims in the workplace and denial of the trade union’s right to information and consultation, and refusal to comply with the principles of good corporate governance and refusal to disclose information, including the company’s financial circumstances, for collective bargaining.

On 19 December 2023, the NCP published a final statement concluding the process with a partial agreement between the parties. The NCP issued the following recommendations to the enterprise:

• With respect to the workplace sexual harassment claims, the enterprise shall ensure the meaningful participation of interested parties in the implementation of the Better Workplace for Women project to which it had agreed with the submitter.
• With respect to the issue of disclosure, the enterprise shall establish and implement a disclosure policy to ensure the full provision of true and fair information to interested parties, etc. without infringing on any trade secrets.
• The enterprise shall ensure that the Guidelines and the OECD Due Diligence Guidance on Responsible Business Conduct are taken into consideration during the course of corporate management activities.

Chanel Korea submitted a progress report on 28 June 2024. The KNCP reviewed the enterprise’s implementation based on the report and, on 5 November 2024, published a follow-up statement. The KNCP welcomed Chanel Korea’s efforts to implement projects with the submitter’s engagement, share information that does not constitute corporate trade secrets, and implement due diligence on responsible business conduct. The KNCP particularly commended the enterprise for acting on its recommendations and submitting a progress report. However, it noted a lack of proactive communication between the parties to foster mutual understanding during the implementation process.

#duediligence #corporategovernance #labourrights #FACB #labourconditions #cosmetics #localsubsidiary #ILOtripartitedeclaration #agreement #recommendations