Policy Against the Use of Child and Forced Labour

POLICY STATEMENT

Appficiency Inc. (the “Business”) is committed to ensuring that forced labour and child labour are not used in any part of our operations or supply chains. This policy aligns with Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act (the "Act") and reflects our commitment to ethical business practices, transparency, and the protection of human rights. We will take all reasonable steps to prevent and reduce the risk of forced labour and child labour in our supply chains and will comply with all reporting obligations under the Act. In this sense, the Business is committed to work towards increasing industry awareness and transparency to drive improved practices in the sector.

SCOPE

This policy applies to all employees, contractors, suppliers, vendors, and business partners involved in the production or procurement of goods or services for Appficiency Inc. both domestically and internationally (where applicable).

PURPOSES

The purpose of this policy is to:

·        Outline Appficiency Inc.’s commitment to eradicating forced labour and child labour from its domestic and foreign supply chains, where applicable.

·        Establish clear expectations for employees, suppliers, and business partners.

·        Ensure and work towards monitoring fair employment practices, including those prohibiting child labour, prison, or forced labour, or any from of indentured servitude with stipulations of fair working hours and compensation as well for a safe working environment.

·        Ensure compliance with Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act.

KEY DEFINITIONS

To ensure clarity, the following terms are defined as per the Act:

“Forced Labour”: any work or service performed involuntarily under threat of penalty, where individuals are compelled to work through force, fraud, or coercion. This includes situations where workers face threats to their own safety or that of their family members. Such exploitation can occur across all economic sectors and regions, often hidden within supply chains.

“Child Labour”: any work performed by individuals under age 14 that is unsafe, interferes with education, or causes harm to their physical, mental, social, or moral development, as defined by Canadian law.

“Supply Chain”: The sequence of processes involved in the production and distribution of goods or services. This can take place domestically or internationally.

“Due Diligence”: Processes undertaken to identify, assess, and mitigate risks related to forced labour and child labour in supply chains.

POLICY REQUIREMENTS

PROHIBITIION OF FORCED AND CHILD LABOUR

Appficiency Inc. strictly prohibits:

- The use of forced labour or child labour in any part of its operations or supply chains.

- Engaging with suppliers who fail to meet this standard.

SUPPLIER CODE OF CONDUCT

All suppliers must adhere to Appficiency Inc.’s Supplier Code of Conduct, which explicitly prohibits forced labour and child labour. Suppliers are required to:

- Conduct due diligence on their own supply chains.

- Provide evidence of compliance with this policy upon request.

To this purpose, the Business’ suppliers and contractors must apply a risk-based verification process to identify high-risk suppliers. Where risks are identified, the Business will implement a process where suppliers or contractors will apply a responsible sourcing approach to help ensure the Business’ product suppliers or contractors are compliant with our Code of Conduct.

REPORTING OBLIGATIONS

In compliance with the Act, Appficiency Inc. will:

- Submit an annual report by May 31 detailing steps taken to prevent forced and child labour in its supply chains.

- Include information on supply chain risks, due diligence processes, remediation measures, training programs, and effectiveness assessments.

TRAINING

All employees involved in procurement or supply chain management will receive training on fair treatment of employees as well as identifying and addressing risks related to forced labour and child labour.

REPORTING MECHANISMS

Employees, suppliers, or stakeholders can confidentially report suspected violations of this policy through:

- Anonymous hotline: 1-800-531-5551

- Email: hr@appficiencyinc.com

Reports will be investigated promptly, and whistleblowers will be protected from retaliation.

REMEDIATION MEASURES

If instances of forced or child labour are identified:

- Immediate corrective action will be taken.

- Suppliers found non-compliant may have contracts terminated.

- Steps will be taken to mitigate harm caused by such practices.

MONITORING AND COMPLIANCE

Appficiency Inc. will:

- Conduct regular audits of high-risk suppliers.

- Require suppliers to complete self-assessment questionnaires on forced labour and child labour risks.

- Review risk-based verification processes to identify gaps or opportunities for improvement.

- Use third-party monitoring services where necessary.

RESPONSIBILITIES

EMPLOYEES

All employees must comply with this policy and report any suspected violations.

MANAGEMENT

Managers are responsible for ensuring their teams understand this policy and adhere to its requirements.

SUPPLIERS/CONTRACTORS

Suppliers/Contractors must comply with the Supplier Code of Conduct and provide documentation demonstrating compliance when requested.

ANNUAL REPORTING

Appficiency Inc. will publish an annual report detailing:

1. Its structure, activities, and supply chains.

2. Policies and due diligence processes related to forced labour and child labour.

3. Identified risks in its supply chains and steps taken to address them.

4. Training provided to employees on these issues.

5. Measures taken to assess the effectiveness of these efforts.

The report will be approved by the governing body (e.g., Board of Directors) as required under the Act.

ENFORCEMENT

Violations of this policy may result in disciplinary action up to termination for employees or termination of contracts for suppliers found non-compliant.

POLICY REVIEW

This policy will be reviewed annually by [Policy Owner], updated as necessary to reflect changes in legislation or company practices.

CONTRAVENTIONS OF THE POLICY

Contraventions of the Policy may lead to disciplinary action up to and including termination of employment.