GRI 401: Employment 2016 contains disclosures for organizations to report information about their employment-related impacts, and how they manage these impacts.
The Standard is structured as follows:
The rest of the Introduction section provides a background on the topic, an overview of the system of GRI Standards and further information on using this Standard.
Background on the topic
This Standard addresses the topic of employment. This includes an organization’s approach to employment or job creation, that is, an organization’s approach to hiring, recruitment, retention and related practices, and the working conditions it provides. The Standard also covers the employment and working conditions in an organization’s supply chain.
An employment relationship is a legal relationship between a worker and an organization that confers rights and obligations to both parties. This relationship is usually the means for determining whether employment or labor law is applicable or whether commercial law is applicable.
These concepts are covered in key instruments of the International Labour Organization, the Organisation for Economic Co-operation and Development, and the United Nations: see the Bibliography.
System of GRI Standards
This Standard is part of the GRI Sustainability Reporting Standards (GRI Standards). The GRI Standards enable an organization to report information about its most significant impacts on the economy, environment, and people, including impacts on their human rights, and how it manages these impacts.
The GRI Standards are structured as a system of interrelated standards that are organized into three series: GRI Universal Standards, GRI Sector Standards, and GRI Topic Standards (see Figure 1 in this Standard).
Universal Standards: GRI 1, GRI 2 and GRI 3
GRI 1: Foundation 2021 specifies the requirements that the organization must comply with to report in accordance with the GRI Standards. The organization begins using the GRI Standards by consulting GRI 1.
GRI 2: General Disclosures 2021 contains disclosures that the organization uses to provide information about its reporting practices and other organizational details, such as its activities, governance, and policies.
GRI 3: Material Topics 2021 provides guidance on how to determine material topics. It also contains disclosures that the organization uses to report information about its process of determining material topics, its list of material topics, and how it manages each topic.
Sector Standards
The Sector Standards provide information for organizations about their likely material topics. The organization uses the Sector Standards that apply to its sectors when determining its material topics and when determining what to report for each material topic.
Topic Standards
The Topic Standards contain disclosures that the organization uses to report information about its impacts in relation to particular topics. The organization uses the Topic Standards according to the list of material topics it has determined using GRI 3.
Using this Standard
This Standard can be used by any organization – regardless of size, type, sector, geographic location, or reporting experience – to report information about its employment-related impacts. In addition to this Standard, conditions of work are also covered in detail in other GRI Standards:
In addition, Disclosure 2-7 and Disclosure 2-8 in GRI 2: General Disclosures 2021 require information on employees and other workers performing work for the organization, such as the total number of employees, and the total number of permanent and temporary employees, by gender and by region.
An organization reporting in accordance with the GRI Standards is required to report the following disclosures if it has determined employment to be a material topic:
See Requirements 4 and 5 in GRI 1: Foundation 2021.
Reasons for omission are permitted for these disclosures.
If the organization cannot comply with a disclosure or with a requirement in a disclosure (e.g., because the required information is confidential or subject to legal prohibitions), the organization is required to specify the disclosure or the requirement it cannot comply with, and provide a reason for omission together with an explanation in the GRI content index. See Requirement 6 in GRI 1: Foundation 2021 for more information on reasons for omission.
If the organization cannot report the required information about an item specified in a disclosure because the item (e.g., committee, policy, practice, process) does not exist, it can comply with the requirement by reporting this to be the case. The organization can explain the reasons for not having this item, or describe any plans to develop it. The disclosure does not require the organization to implement the item (e.g., developing a policy), but to report that the item does not exist.
If the organization intends to publish a standalone sustainability report, it does not need to repeat information that it has already reported publicly elsewhere, such as on web pages or in its annual report. In such a case, the organization can report a required disclosure by providing a reference in the GRI content index as to where this information can be found (e.g., by providing a link to the web page or citing the page in the annual report where the information has been published).
Requirements, guidance and defined terms
The following apply throughout this Standard:
Requirements are presented in bold font and indicated by the word 'shall'. An organization must comply with requirements to report in accordance with the GRI Standards.
Requirements may be accompanied by guidance.
Guidance includes background information, explanations, and examples to help the organization better understand the requirements. The organization is not required to comply with guidance.
The Standards may also include recommendations. These are cases where a particular course of action is encouraged but not required.
The word ‘should’ indicates a recommendation, and the word ‘can’ indicates a possibility or option.
Defined terms are underlined in the text of the GRI Standards and linked to their definitions in the Glossary. The organization is required to apply the definitions in the Glossary.
An organization reporting in accordance with the GRI Standards is required to report how it manages each of its material topics.
An organization that has determined employment to be a material topic is required to report how it manages the topic using Disclosure 3-3 in GRI 3: Material Topics 2021 (see clause 1.1 in this section).
This section is therefore designed to supplement – and not replace – Disclosure 3-3 in GRI 3.
1.1 The reporting organization shall report how it manages employment using Disclosure 3-3 in GRI 3: Material Topics 2021.
1.2 The reporting organization should describe:
1.2.1 its policies or practices covering the relationships under which work is performed for the organization;
1.2.2 actions taken to determine and address situations where work undertaken within its supply chain does not take place within appropriate institutional and legal frameworks;
1.2.3 actions taken to determine and address situations where persons working for suppliers are not provided the social and labor protection that they are entitled to receive by national labor law;
1.2.4 actions taken to determine and address situations where working conditions in its supply chain do not meet international labor standards or national labor law;
1.2.5 actions taken to determine and address situations where work undertaken in its supply chain is inadequately remunerated;
1.2.6 actions taken to determine and address situations of disguised employment relationships where workers in its supply chain are falsely considered to be self-employed or where there is no legally recognized employer;
1.2.7 actions taken to determine and address situations where work undertaken in its supply chain that is performed at home is not subject to legally recognized contracts.
Guidance for clause 1.2
Policies or practices covering the relationships under which work is performed for an organization can include recognized employment relationships, the use of employees of other organizations (such as workers supplied by agencies), and the extent to which work is performed on a temporary or part-time basis. A description of policies and practices can include policies and practices with respect to discrimination, compensation, promotion, privacy, human resource development and industrial relations.
Work taking place within an appropriate institutional and legal framework usually entails a recognized employment relationship with an identifiable and legally recognized employer.
Conditions of work can include compensation, working time, rest periods, holidays, disciplinary and dismissal practices, maternity protection, the workplace environment, and occupational health and safety. They can also include the quality of living accommodations where provided, and welfare matters, such as safe drinking water, canteens and access to medical services.
Adequately remunerated work is work where wages and compensation for a standard working week, excluding overtime, meet legal and industry minimum standards, and are sufficient to meet the basic needs of workers and their families, and to provide them with some discretionary income. Actions taken to address situations where work is inadequately remunerated can include:
The reporting organization shall report the following information:
Compilation requirements
2.1 When compiling the information specified in Disclosure 401-1, the reporting organization shall use the total employee numbers at the end of the reporting period to calculate the rates of new employee hires and employee turnover. See Standard Interpretations.
2.2 When compiling the information specified in Disclosure 401-1, the reporting organization should use data from Disclosure 2-7 in GRI 2: General Disclosures 2021 to identify the total number of employees.
Guidance for Disclosure 401-1
An organization can use the following age groups:
Background
The number, age, gender, and region of an organization’s new employee hires can indicate its strategy and ability to attract diverse, qualified employees. This information can signify the organization’s efforts to implement inclusive recruitment practices based on age and gender. It can also signify the optimal use of available labor and talent in different regions.
A high rate of employee turnover can indicate levels of uncertainty and dissatisfaction among employees. It can also signal a fundamental change in the structure of an organization’s core operations. An uneven pattern of turnover by age or gender can indicate incompatibility or potential inequity in the workplace. Turnover results in changes to the human and intellectual capital of the organization and can impact productivity. Turnover has direct cost implications either in terms of reduced payroll or greater expenses for the recruitment of employees.
The reporting organization shall report the following information:
Compilation requirements
2.3 When compiling the information specified in Disclosure 401-2, the reporting organization shall exclude in-kind benefits such as provision of sports or child day care facilities, free meals during working time, and similar general employee welfare programs.
Background
Data reported under this disclosure provide a measure of an organization’s investment in human resources and the minimum benefits it offers its full-time employees. The quality of benefits for full-time employees is a key factor in retaining employees.
The reporting organization shall report the following information:
2.4 When compiling the information specified in Disclosure 401-3, the reporting organization should use the following formulas to calculate the return to work and retention rates:
| Return to work rate | = |
Total number of employees that did return to work after parental leave Total number of employees due to return to work after taking parental leave |
x 100 |
| Retention rate | = |
Total number of employees retained 12 months after returning to work following a period of parental leave Total number of employees returning from parental leave in the prior reporting period(s) |
x 100 |
Guidance for Disclosure 401-3
Employees entitled to parental leave means those employees that are covered by organizational policies, agreements or contracts that contain parental leave entitlements.
To determine who returned to work after parental leave ended and were still employed 12 months later, an organization can consult records from the prior reporting periods.
Background
Many countries have introduced legislation to provide parental leave. The aim of the legislation is to allow employees to take leave and return to work in the same or a comparable position.
The application of legislation varies according to interpretation by government, employers and employees. Many women are discouraged from taking leave and returning to work by employer practices that affect their employment security, remuneration and career path. Many men are not encouraged to take the leave to which they are entitled.
Equitable gender choice for maternity and paternity leave, and other leave entitlements, can lead to the greater recruitment and retention of qualified employees. It can also boost employee morale and productivity. Men’s uptake of paternity leave options can indicate the degree to which an organization encourages fathers to take such leave. Men taking advantage of leave entitlements positively impacts women to take such leave without prejudicing their career path.
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This glossary provides definitions for terms used in this Standard. The organization is required to apply these definitions when using the GRI Standards.
The definitions included in this glossary may contain terms that are further defined in the complete GRI Standards Glossary. All defined terms are underlined. If a term is not defined in this glossary or in the complete GRI Standards Glossary, definitions that are commonly used and understood apply.
direct benefit provided in the form of financial contributions, care paid for by the organization, or the reimbursement of expenses borne by the employee