The organization shall deal with nonconforming product by one or more of the following ways:

a)       by taking action to eliminate the detected nonconformity;

b)      by authorizing its use, release or acceptance under concession by a relevant authority and, where applicable, by the customer;

c)       by taking action to preclude its original use or application.

Records of the nature of nonconformities and any subsequent actions taken, including concessions obtained, shall be maintained (see 4.2.4).

When nonconforming product is corrected it shall be subject to re-verification to demonstrate conformity to the requirements.

When nonconforming product is detected after delivery or use has started, the organization shall take action appropriate to the effects, or potential effects, of the nonconformity.

From BS EN ISO 9001:2000

This is one of the eight clauses which require a documented procedure.

Organizations should note the natural link between control of nonconforming product and monitoring and measuring customer requirements. Clause 8.2.4 reviews how to inspect and measure products for conformance to requirements. Now Clause 8.3 describes what to do in the event that a product fails to meet those requirements, and it is somewhat prescriptive here with a few options on what to do. You can take the nonconforming product and fix it (repair), authorize its use for the customer under concession or relevant authority (rework), scrap it, or it can be authorized for another application (regrade).

Many organizations address the requirements of this clause with a Material Review Board (MRB), whose members are responsible for discussing the failure of materials and products to meet quality specifications and to determine the disposition of these materials. These people could be a multidisciplinary team of experts from operations, quality, manufacturing, or design. Whomever it is, that group will want to disposition the nonconforming product and evaluate the risk of releasing such product in the marketplace. Organizations should note that the authorized person(s) could be the customer as well. Note: There will be other perfectly acceptable solutions to satisfying this requirement other than an MRB.

When nonconforming product is discovered and corrected, it shall be subjected to re-verification to demonstrate conformity to the requirements. In other words, action is required at all times, and auditors will be looking for evidence of it.