BANGLADESH T&C UNDER INTENSE SAFETY NET: ‘ACCORD’ & ‘ALLIANCE’ TO HIT HEAVILY


BANGLADESH T&C UNDER INTENSE SAFETY NET: ‘ACCORD’ & ‘ALLIANCE’ TO HIT HEAVILY

ACCORDALLIANCEASM Tareq Amin & Shayekh Munir

Bangladeshi textile & clothing (T&C) industry is under polygonal safety net programs. The industry owners association has taken its own initiative and as always that was not trusted enough by the buyers’ community. And so they come with their solutions.  After ‘Rana Plaza’ and ‘Tajreen’ tragedy now no brand can avoid the responsibility of contributing to improve the working condition of the industries. So two big ‘safety assurance programs’ has been taken by two big brands group. Once again the industry is seeing two streams divided among Europe based and America based brands. EU based buyers’ forum has taken an integrated program incorporating labour union representatives, trade bodies, government and donor agencies and declared the program as ‘Accord’ along with a clear commitment to stay with Bangladesh and improve the industries fire & building safety conditions. On the other hand another group of retailers lead by Walmart & Gap under the supervision of US government recently has declared a new campaign with similar focus and presented their work plan. Both the programs are likely to start very soon and to be continued through out next five years and more in different phases. Meanwhile many brands and buyers already has taken some thorough assessment programs individually in their supply base as if they can make their factories ready before the main audit program hits them. Industry insiders are happy to see the initiatives taken by the brands and hope that the programs will be run effectively to have a positive impact on the industry not only in the short run but also to the long run.‘Accord’ integrates all stake holders:

We know that over 70 major fashion and retail brands sourcing RMG from Bangladesh have signed an ‘Accord’ on Fire and Building Safety to coordinate their efforts to help improve safety in Bangladesh’s factories which supply them. Following many activities now, Bangladesh Accord expected to bring tangible change on the ground and help make the Bangladeshi garment industry safe and sustainable. The successful culmination of the implementation process will bring Bangladesh closer to starting this important joint work. After 45 days of sustained work by the Implementation Team driven by IndustriALL Global Union, UNI Global Union, Clean Clothes Campaign, Worker Rights Consortium, Aldi, C&A, Inditex, N Brown Group, Otto Group, and PVH Corp being involved the final stage of implementing Accord is at motion now. The initiative between the Government of Bangladesh, the European Union and the International Labour Organisation (ILO) gives full backing to the Accord on Fire and Building Safety in Bangladesh. In this context, they encourage other companies, including SMEs, to join the Accord expeditiously within their respective capacities.

What is Accord?

The Accord is a binding agreement between companies and unions, governed jointly. Worker representation is essential if the effort to protect workers is to succeed. Under the Accord, all unsafe factories will be renovated and repaired with brands guaranteeing funds will be available for the necessary safety upgrade. The bottom line is factory safety in Accord and brands and retailers will pay what it takes to make all factories safe. Under the Accord, the right of workers to refuse dangerous work, including the right to refuse to enter a dangerous building, is protected. All reports of factory inspections will be made available to worker representatives and they will be notified right away of any imminent safety threats. All factory reports will be made public in a timely fashion and there is on-going public reporting on whether factories are being renovated as agreed.

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Figure 1: Groups involved, Selection of factory & Setting the inspection program in Accord.

The signatories to the Agreement ‘Accord’ agree to establish a fire and building safety program in Bangladesh for a period of five years and the programme will build on the National Action Plan on Fire Safety (NAP), as it mentioned in the ‘Accord’ statement. Factories are identified and categorized as per figure 1 and ‘Accord’ set up an inspection program involving necessary parties and expertise in a well balanced way. Figure 1 shows the scope and governance of the program.

As shown in figure 1, the SC shall have responsibility for the selection, contracting, compensation and review of the performance of Safety Inspector and Training Coordinator; oversight and approval of the programme budget; oversight of financial reporting and hiring of auditors; and such other management duties as may be required.

As per the ‘Accord’ constitution, the signatories shall appoint an Advisory Board involving brands and retailers, suppliers, government institutions, trade unions, and NGOs. . The advisory board will ensure all stakeholders, local and international, can engage in constructive dialogue with each other and provide feedback and input to the SC, thereby enhancing quality, efficiency, credibility and synergy. The SC will consult the parties to the NAP to determine the feasibility of a shared advisory structure.

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Figure 2: Inspection scopes, up gradation process and workers right protection in ‘Accord’

‘Accord’ also agrees that its administration and management will be developed by the SC in consultation with the ‘High-Level Tripartite Committee’ established to implement and oversee the National Action Plan on Fire Safety, as well as with the Ministry of Labour and Employment of Bangladesh (MoLE), the ILO and the Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH (GIZ), to maximize synergy at operational level; and the SC may make use of the offices of GIZ for administrative coordination and support.

As appointed by SC the Safety Inspector shall make all reasonable efforts to ensure that an initial inspection of each factory covered by this Agreement shall be carried out within the first two years of the term of this Agreement as shown in figure 2. The Safety Inspector will be available to provide input into the NAP legislative review and to support capacity building work regarding inspections by the MoLE foreseen under the NAP.

Signatory companies (eighty brands lead by H&M and Inditex ) wishing to have their inspection programme so considered shall provide the Safety Inspector full access to the findings of their inspections and he or she will integrate these into reporting and remediation activities. Notwithstanding this provision, all factories within the scope of this Agreement shall still be subject to all the provisions of this Agreement, including but not limited to a least one safety inspection carried out by personnel acting under the direction of the Safety Inspector.

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Figure 3: Transparency and funding of ‘Accord’

Accord also agrees that where corrective actions are identified by the Safety Inspector as necessary to bring a factory into compliance with building, fire and electrical safety standards, the signatory company or companies that have designated that factory as a Tier 1, 2, or 3 supplier, shall require that factory to implement these corrective actions, according to a schedule that is mandatory and time-bound, with sufficient time allotted for all major renovations.

Signatory companies shall require their supplier factories that are inspected under the Program to maintain workers’ employment relationship and regular income during any period that a factory (or portion of a factory) is closed for renovations necessary to complete such Corrective Actions for a period of no longer than six months. . Failure to do so may trigger a notice, warning and ultimately termination of the business relationship.

‘Accord’ itself built with mechanisms to ensure transparency as shown in figure 3. In addition to their obligations pursuant to this Agreement, signatory companies shall also assume responsibility for funding the activities of the SC, Safety Inspector and Training Coordinator as set forth in this Agreement, with each company contributing its equitable share of the funding in accordance with a formula to be established in the Implementation Plan. Each signatory company shall contribute funding for these activities in proportion to the annual volume of each company’s garment production in Bangladesh relative to the respective annual volumes of garment production of the other signatory companies, subject to a maximum contribution of $500,000 per year for each year of the term of this Agreement. A sliding scale of minimum contributions based on factors such as revenues and annual volume in Bangladesh will be defined in the Implementation Plan with annual revisions, while ensuring sufficient funding for the adequate implementation of the Accord and the Plan.

North American brands’ ‘Alliance’ for worker safety:

On the other hand we know that Walmart, the largest retailer in the world, has blacklisted about 250 Bangladeshi garment factories from producing products for it after Rana incident and these days they didn’t join Accord. But now Walmart with other 16 retailers have formed the Alliance for Bangladesh Worker Safety to support the binding five-year initiative, which sets aggressive timelines and accountability for inspections, training and worker empowerment to ensure safety through actions such as requiring that 100 percent of factories be inspected in the first year of the alliance, requiring safety training in 100 percent of these factories, and by regularly reporting on activities.

Then the group will move to next step to work in collaboration with government, factory owners, and NGOs to increase safety and improve the quality of life of the women and men in the supply chains whom Bangladesh depends on. The five year commitment would reach an initial mark by 10 November 2013 establishing fire, building safety protocols, engage 3rd parties to develop training programs, adopt training standards curriculum, common safety standard recommended for adoption. By 25 November 2013 available alliance factory safety reports will be shared with FFC. Fire and building safety training will begin from 10 October 2013. Within 10 November 2013, they alliance will finalize protocols for reporting and inspections. Within 10 June 2014, they targets achieving 100% inspections of alliance factories train workers, management. The final target is set within 2015-2018 to achieve transition from individual company to Alliance Fire and Building Safety Training Program.

What is ‘Alliance’?

It is the the Bangladesh Worker Safety Initiative from leading retailers of North America, developed Through Independent Facilitation of Senators Mitchell and Snowe.

A primary goal of the alliance is the engagement of and partnership with the Bangladeshi and U.S. governments, as well as with the factory owners to ensure that there is accountability among all parties and thus the opportunity for sustained and lasting change in Bangladesh.

The initiative calls for inspections of 100 percent of alliance member factories within the first year; common safety standards to be developed within the next three months; inspections results that are transparently shared; and that all alliance factories actively support the democratic election and successful operation of Worker Participation Committees (WPC) at each factory.

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Figure 4: Program plan of ‘Alliance’

Under the initiative’s inspection program, inspectors will prioritize factory safety risks for remediation efforts, and also are empowered to report immediately to the alliance, WPCs, building owners, and the Bangladeshi government any dangerous safety conditions, up to and including calling for factory closure and evacuation of workers.

The initiative also includes a key role for an independent chair of the Board of Directors that is responsible for oversight. Members of the alliance are providing the funding necessary over the five-year period. Each member of the alliance contributes a specific amount to support the initiative. The amount is based upon the amount of production each company has in the country, with companies with the higher levels of production paying
$1 million a year for five years. Currently, the alliance safety fund is $42 million and growing, and the alliance will designate 10 percent of the fund to assist workers temporarily displaced by factory improvements or in the event of a factory closure for safety reasons. To support the specific programs of the initiative, with some companies offering an additional combined total of over $100 million in loans and access to capital to assist factory owners they work with in Bangladesh for factory safety improvements.

To work with “one voice,” common safety standards will be developed in ‘Alliance’ and in place by October of this year. Members of the alliance will share inspection results, following the adoption of the Alliance Fire and Building Safety Standards. ‘Alliance’ ensures ongoing, mandatory training and education for factory workers and managers, and that all alliance factories actively support the democratic election and successful operation of Worker Participation Committees (WPC) at each factory. To further empower workers, an anonymous worker hotline will be established by November of this year that will use mobile technology and be administered by a third party. The alliance will work with the government of Bangladesh and its industry groups, worker rights organizations and others who support safer factory working conditions to coordinate the initiative’s activities with the National Tripartite Plan of Action (NAP) on Fire Safety for the RMG Sector in Bangladesh.

‘Accord’ vs. Alliance!

Meanwhile, IndustriALL and UNI, reacting to the announcement by Walmart and Gap as mentioning that another ‘toothless corporate auditing program’ for Bangladesh factory safety, also stated that these companies are only repeating the mistakes of the past. They mention that Walmart/Gap initiative falls short of the standard set by the binding of ‘Accord’ on Fire and Building Safety in Bangladesh. Unlike the Accord, the Walmart/Gap initiative is unclear on enforceability and there is no commitment from the brands to stay in Bangladesh, nor is there full transparency. In their opinion Walmart has a history of labour rights violations on a global scale. Gap and the other companies who have allowed it to take the lead on this initiative should ensure that standards are raised to the highest possible level as set by the Accord.

On the other hand Walmart informed that they are focusing on transparency more than anything. Transparency promotes worker safety by providing everyone with a window into conditions at individual factories.  Walmart believes companies and government have a responsibility to ensure that tragedies like Rana & Tajreen in Bangladesh do not happen again, and that they are willing to work together to empower government and private parties to act on safety conditions.

IndustriALL and UNI, the organizer of ‘Accord’ has been campaigning to include Walmart & Gap in their loop but failed. They were putting pressure on them in many ways and following those intensive negative propaganda, North American brands lead by Walmart & Gap comes up with new program ‘Alliance’. However, Walmart didn’t respond against ‘Accord’ at any stage of its inception. Now it seems like a competition between EU leader buyers program and North America lead buyers program. Industry insiders find this competition as a positive one and hoped that both the initiatives will be beneficiary for the Bangladeshi industry and its workers.

BGMEA accomplishes initial study:

Even though multilateral movements are being seen to ensure safety in the industries, Bangladesh Garment Manufacturer and Exporters Association (BGMEA) continue with its commitment to ensure safety. BGMEA has marked 1,822 factories as compliant in the apparel sector. These are listed organizations and have fulfilled compliance requirements. No factory except these compliant factories will be allowed to work even as a sub-contracted company. BGMEA asked the listed 2076 apparel factories to submit structural design and soil test reports after the incident of Rana Plaza. However 254 factories failed to submit the report within the scheduled deadline. All other factories are fully compliant according to BGMEA requirements. Under these circumstances BGMEA has decided to stop services, including issuance of ‘utilization declaration’ certificates to the non-compliant companies. In addition BGMEA has announced that non-listed factories including the 254 non-compliant factories will not be eligible to work as sub-contractors. As a result only 1,822 factories in the apparel sector are now eligible to work with buyers directly or as a sub-contractor. Recently BGMEA sent a letter to the listed factories saying sub-contracted factories must have membership of BGMEA or BKMEA; factories have to update their membership regularly; group insurance must cover the workers; before entering the sub-contract they have to take inter bond approval from BGMEA and respective buyers or buying house.

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ISSUE – MARCH 2014

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About Ehsan Abdullah

An aware citizen..
This entry was posted in CHALLENGES, CURRENT ISSUES, ECONOMY, FOREIGN RELATIONS & POLICY, INDUSTRIES, STRATEGY & POLICY. Bookmark the permalink.

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