Bangladesh, ILO Agree on Labor Reform After Factory Death

Photographer: Jeff Holt/Bloomberg

A fire extinguisher hangs on the wall as workers make garments on the production line of the Fashion Enterprise garment factory in Dhaka. Close

A fire extinguisher hangs on the wall as workers make garments on the production line... Read More

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Photographer: Jeff Holt/Bloomberg

A fire extinguisher hangs on the wall as workers make garments on the production line of the Fashion Enterprise garment factory in Dhaka.

Bangladesh’s government, workers, employers and the International Labour Organization agreed to a plan to improve employee rights and safety after more than 600 people were killed in a factory building collapse last month.

The ILO proposals, which include better worker protection and the right to collective bargaining, will be submitted to parliament during its next session, expected to start in June, the Geneva-based organization said in a statement on its website. The government will cooperate in the implementation of the plan, Commerce Secretary Mahbub Ahmed said by phone yesterday.

“The initiative is a turning point in Bangladesh’s history,” Foreign Secretary Shahidul Haque said May 4 at a press briefing in Dhaka where the ILO proposals were released. “There is a convergence of interests for bringing about a change in the industry.”

The agreement on steps to improve worker conditions comes after a building housing garment factories collapsed on April 24 in Bangladesh’s worst industrial disaster. The 27-nation European Union is considering trade sanctions against the country, and months before the incident, the U.S. government said it may revoke the nation’s preferred trade status over treatment of workers.

Photographer: Jeff Holt/Bloomberg

Rescue workers and volunteers search by hand for victims amongst the debris of the collapsed Rana Plaza building in Dhaka on April 26, 2013. Close

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Photographer: Jeff Holt/Bloomberg

Rescue workers and volunteers search by hand for victims amongst the debris of the collapsed Rana Plaza building in Dhaka on April 26, 2013.

“The only way forward is fast implementation of promises the government and owners have made,” said Kalpona Akter, executive director of the Bangladesh Center for Worker Solidarity, an organization that promotes labor rights. “No more of talking. No more of saying it’s high time to do this and that.”

Death Toll

The death toll from the collapsed Rana Plaza building has climbed to 660 as the army continues to clear out debris.

The ILO and its partners will “assess by the end of 2013 the structural building safety and fire safety of all active export-oriented ready-made garment factories in Bangladesh, and initiate remedial actions, including relocation of unsafe factories,” it said.

Bangladesh’s government, employers and workers have asked the ILO to start a training program for those injured in the building collapse, the organization said in the statement on May 4. The government will recruit 200 additional building inspectors within six months, with the budget to be increased for a minimum of 800 inspectors.

Deadly Fire

The Rana Plaza building collapse came after at least 112 people were killed in November in a fire at the Tazreen garment factory that was producing clothes for companies including Wal- Mart Stores Inc. (WMT) Another deadly blaze in 2006 left 54 people dead at KTS Textile and Garments in the port city of Chittagong.

“Just after the Tazreen fire, the government and the owners made a lot of promises -- factory inspection and safety for workers,” Akter said. “Within five months, the disaster struck again.”

As wages have risen in China, companies such as Li & Fung Ltd. (494), the world’s largest supplier of clothes and toys to retailers, are tapping Bangladesh and other lower-cost Asian countries.

Textiles contribute more than 10 percent of Bangladesh’s gross domestic product and about 80 percent of the nation’s exports, mainly to the U.S. and the European Union, according to Bangladesh Garment Manufacturers and Exporters Association.

International Pressure

European Union Trade Commissioner Karel De Gucht called for “immediate” action by the Bangladesh government to improve health and safety conditions in the garment industry. In the absence of any steps, the commission will be ready to start an investigation that may lead to the suspension of the country’s trade status with the EU, he said on RTBF radio.

The U.S. Trade Representative’s office said in a Jan. 8 notice in the Federal Register that “the lack of progress by the government of Bangladesh in addressing worker rights issues in the country warrants consideration of possible withdrawal, suspension or limitation of Bangladesh’s trade benefits.”

Retailers including Wal-Mart and J.C. Penney Co. (JCP) and labor activists have been considering an agreement to improve factory safety in Bangladesh for at least two years. Walt Disney Co. (DIS), the world’s largest entertainment company, which has partners in various countries that make clothing and merchandise, decided in March to pull out of the country.

To contact the reporters on this story: Pratish Narayanan in Mumbai at pnarayanan9@bloomberg.net; Arun Devnath in Dhaka at adevnath@bloomberg.net

To contact the editor responsible for this story: Stanley James at sjames8@bloomberg.net

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