Improving working conditions in the ready made garment industry: Progress and achievements

September 2015

A key sector for Bangladesh

The Bangladesh Ready-Made Garment industry has grown over the space of a few short decades to become the second largest in the world. The RMG sector has become a key driver of the Bangladesh economy and the nation’s development. RMG exports totalled US$24.5 billion (2013-14) accounting for over 80% of the nation’s export earnings and employing some 4.2 million workers, 80% of whom are women.

No more business as usual

The loss of 1,136 lives when Rana Plaza collapsed on 24 April 2013 sent shockwaves worldwide. Coming just months after the fatal fire at Tazreen Fashions in which 112 died it was clear that the Bangladesh Ready Made Garment (RMG) sector had reached a crucial juncture. Business could not continue as usual. Fundamental changes relating to safety, inspection and compliance had to be made if the lives of over four million workers were to be safeguarded and the confidence of global buyers retained.

The ILO response

The ILO responded quickly to the Rana Plaza tragedy with a high level mission to Dhaka at the start of May 2013, which agreed immediate and medium term actions with the Government of Bangladesh and employers’ and workers’ organizations. These were integrated into the National Tripartite Plan of Action on fire safety and structural integrity (NTPA), which was developed following the Tazreen factory fire in November 2012. The ILO since launched a US$31.4 million, three-and-a-half year programme funded by Canada, the Netherlands and UK to support implementation of the NTPA and improve working conditions in the ready-made garment (RMG) sector. Key elements are already being implemented, including building and fire safety assessments; labour inspection reforms; occupational safety and health; rehabilitation and skills training as well as the launch of Better Work Bangladesh.

Ensuring RMG factories are safe

Following the collapse of the Rana Plaza it was decided that 3,508 export-oriented RMG factories should undergo structural, fire and electrical safety inspections.

Two initiatives representing international brands and retailers: the Bangladesh Accord on Fire and Building Safety and the Alliance for Bangladesh Worker Safety have carried out inspections of the factories which their member companies source from. As part of its RMG programme, ILO is supporting the national initiative of the Government of Bangladesh to carry inspections of the remaining 1,500 RMG factories. As of 2 September 2015, the national initiative had inspected 1,335 of these factories. Combined together the Accord, Alliance and National Initiative have inspected some 92.3% of the target total. Any factories which have not been assessed by October 2015 will no longer be able to take advantage of the free inspections while their ability to continue exporting may also be affected.

Strengthening the labour inspectorate

The Tazreen and Rana Plaza disasters brought into stark relief the weak capacity at all levels in Bangladesh to effectively ensure safety and acceptable working conditions in the RMG sector. It was clear that the labour inspectorate required a complete overhaul if it was to be effective. As a result, the Government of Bangladesh made a series of major commitments to rebuild the Department of Inspections of Factories and Establishments (DIFE). The inspection service was upgraded to a department in January 2014, high level leadership installed, positions for 392 new inspectors created and budget boosted from US$900,000 in 2013-14 to US$4.1 million in 2015-16. By May 2015, 199 new inspectors (51 female) had been recruited or appointed bringing the total to 284.
Although the recruitment of inspectors is a positive development, both new and existing staff need intensive capacity building. ILO is implementing a comprehensive programme to train inspectors, build the capabilities of DIFE as well as to enhance governance and accountability of the labour inspection system.

A comprehensive labour inspection training programme was launched 16 August 2015 that will see 160 labour inspectors gain the skills needed to boost working conditions and worker safety in Bangladesh. The 40-day course entitled ‘Foundational Training for Labour Inspection Officials’ has been developed by the Department of Inspections for Factories and Establishments (DIFE) and Bangladesh Institute of Administration and Management (BIAM) with the support of the ILO’s Improving Working Conditions in the Ready-made Garments Sector Programme funded by Canada, the Netherlands and UK and the ILO’s International Training Centre in Turin. The course covers a wide range of subjects that will enhance the professional skills of inspectors. These include labour market-related policies and programmes, Occupational Safety and Health (OSH), International Labour Standards and Bangladesh Labour Laws. It also covers areas such as the Bangladesh and global economy, government service rules, procedures, team work and office management.
A labour inspection strategy and road map has been agreed between ILO and the Ministry of Labour that forms the basis for ILO support to this reform process. Standard operating procedures for DIFE, an inspection check list as well as more effective information management systems are all being developed. These will significantly strengthen the systems which form the foundation upon which DIFE operates. In addition, basic equipment such as motorcycles, office and inspection equipment is being provided to DIFE so that it can function effectively. Meanwhile, the planned establishment of an accountability unit within DIFE as well as the launch of a public data base and website where inspection reports can be accessed represent a step towards transparency and openness for the inspection service.

Strengthening the fire service

Recognizing the vital role of the Fire Service and Civil Defence Department (FSCD), emphasis has been placed on enhancing its capacity to carry out inspections and respond to incidents. The Government of Bangladesh has boosted the strength of the FSCD with the number of fire service staff working as inspectors up from 55 to 265.
ILO, with support from the US Department of Labor, is supporting this process by providing comprehensive training. A core of master trainers has been created within FSCD to build the skills of colleagues nationwide. Fire Service staff can now more effectively inspect factories, develop emergency action plans and carry out evacuation drills to ensure factory occupants evacuate buildings safely when the alarm sounds. Fire Service staff are also being trained on how to effectively follow up on inspection reports in a systematic manner and to collaborate with their counterparts from the Department of Inspections for Factories and Establishments. Meanwhile, ILO is also seeking to acquire for the fire service mobile training towers to help further enhance its operational ability.

Beyond inspections

The completion of RMG factory inspections is an important step towards boosting safety in the sector. However as the inspection process moves towards completion efforts are increasingly being placed on the process of remediation. Considerable efforts are underway to enhance the capacity of, and collaboration between, regulatory authorities responsible for building and worker safety to ensure that remediation work is implemented and monitored effectively. ILO is working to help develop guidelines for Detailed Engineering Assessments (DEA) that some factories need to carry out following initial inspections. A pilot scheme is also being undertaken by ILO to help 14 factories develop Corrective Action Plans (CAPs) that set out how issues identified in the inspection reports will be remediated. A number of DIFE inspectors are being trained in CAP development and a ‘CAP kit’ to help factories undertake this task has been devised. Collaboration between government regulators is essential. Fire inspectors will carry out factory visits alongside labour inspectors and are being trained to help explain the fire and electrical observations of assessment reports to them. Efforts are also being made to involve RAJUK in the process.

Meeting the cost of remediation is a major obstacle for many factories. ILO together with IFC are therefore undertaking a study on remediation costs and access to funding issues that will highlight recommendations and possible courses of action in this regard. 

Enhancing occupational health and safety

Building a culture of Occupational Safety and Health and the skills to implement it is a major challenge for the RMG sector. Efforts are therefore underway supported by ILO to reinforce the capacity of workers, supervisors and managers in the sector to improve the safety of their workplaces. Through training and education and the support of broad awareness campaigns and materials, workers and employers will benefit from improved safety practices and be better able to fulfil the objectives of the National Action Plan on Fire and Building Safety.

An initiative launched under the ILO’s RMG programme in late 2014 has seen a core group of 114 master trainers formed from the Bangladesh Garment Manufacturers Export Association (BGMEA), Bangladesh Knitwear Manufacturers Export Association (BKMEA), Bangladesh Employers Federation (BEF) as well as the private sector.
A second phase which was launched on 17 May 2015 will see the master trainers head out to 400 RMG factories and train 7,500 to 8,000 mid-level and line supervisors who in turn will pass on OSH knowledge to 750,000 to 800,000 workers. By doing so they will help create a culture of workplace safety and implement practical measures to reduce the risk of accidents. To date, 2,120 mid-level managers and supervisors have been trained.

Trade union trainers and women union leaders/organizers groups have also been organized under the auspices of the National Council for the Coordination of Workers' Education (NCCWE - covering 13 workers federations) to help increase the participation of workers in Safety Committees and to enhance women workers’ participation in OSH actions at factory level. A similar program is being developed together with the IndustriALL Bangladesh Council (IBC - covering 9 federations). A second phase of this initiative will see those trained pass on their skills to help develop awareness of safety issues amongst 2,700 workers.

Better Work Bangladesh

Better Work is a collaboration between the ILO and IFC. The objective of the Better Work Programme is to improve working conditions and promote competitiveness in the global garment industry. It does so by promoting compliance with international labour standards and national law in global supply chains as a basis for building socially responsible export strategies, and by enhancing enterprise-level economic and social performance.

The Better Work programme commenced its operations in Bangladesh in late 2014 and during 2015 became fully operational.
The Better Work model begins by getting to know the intricacies of each factory, building their trust in the programme and encouraging factories to take full ownership of compliance concerns. The first phase also requires that each factory, with the guidance of Enterprise Advisors (EAs) go through a self-evaluation of their working conditions. The interactions with the factories go beyond providing advisory services, to creating factory improvement plans, getting them to identify compliance deficiencies, and examining the sophistication of their Worker Participation Committees in relationship to their ability to resolve compliance issues.
As of 15 August, 78 factories had registered (159,868 workers). The target for factory registrations is 100 factories by end of 2015 and 225 by end of 2016. In all, 17 international buyer partners are currently participating. Examples of activities include 95 advisory visits/meetings conducted to develop compliance improvement plans; training on supervisory skills, financial literacy, industrial relations and workplace cooperation; seven pilot factory assessments completed; draft guidelines developed for forming functional Occupational Safety and Health (OSH) committees in coordination with Accord and Alliance.

Supporting rehabilitation for Rana Plaza survivors

In the aftermath of the collapse, ILO collaborated with GIZ and Action Aid Bangladesh to carry out an assessment of the needs of Rana Plaza victims. As a result, it was possible to develop a reintegration and rehabilitation programme that met the needs of victims and to identify active partners able to provide such services. In all ILO, has supported 300 injured workers who received counselling and livelihoods training in collaboration with NGOs Action Aid and BRAC. As of May 2015, 225 of these workers were either in paid employment of self-employed. Although most workers are in employment many continue to require ongoing medical assistance and support to cope with the challenges of returning to work after the trauma of Rana Plaza while others, who have set up small businesses require further mentoring. For this reason, ILO is planning to continue its support to this group.

A vulnerability assessment and after award services are being provided to Rana Plaza victims and family members. These assessments are being carried out with the collaboration of the International Organization for Migration and various civil society organizations. By the end of May 2015, 1,638 people had taken part in the assessments where they received career, financial and family counselling to help them better utilize compensation awards and develop a re-employment strategy. Additional groups are planned in the near future.

In view of the fact that many of those who received counselling and livelihoods training from ILO require ongoing assistance, further support will be provided to them based on the results of the vulnerability assessments and NGO mapping report.

The Rana Plaza Coordination Cell, with the support of ILO’s RMG project has organized two training sessions on health and safety for rescue workers and community volunteers who took part in the Rana Plaza Collapse. Around 50 volunteers have received training on how to provide ongoing support to Rana Plaza survivors to prepare them to combat any future accidents in the Savar area.

Compensation for Rana Plaza survivors

A coordinated approach was required to provide income and health protection to the victims of Rana Plaza and their dependents. ILO has played a major role in this process, undertaking a coordination role as well as providing technical expertise on the design and operation of a compensation scheme in line with ILO Convention No.121 concerning benefits in the case of employment injury. Agreement to provide compensation was formalised through the Rana Plaza Arrangement signed in November 2013 between the Bangladesh Ministry of Labour, leading buyers, employers’ and workers’ organizations as well as NGOs.

As of 7 September 2015, a total of 2,895 claims (720 deceased, 2,027 injured and 148 missing) had been received by the Rana Plaza Claims Administration relating to over 5,171 injured workers and dependents of the deceased and missing workers. An additional 630 claims were handled separately by retailer Primark relating to New Wave Bottom workers.

The Rana Plaza Compensation Fund is now fully funded, having received the US$ 30 million (including pledges) needed to make full compensation payments to all victims and their dependants. It is expected that the final payments will be completed by September 2015.

Establishment of an Employment Injury Insurance Scheme

ILO actively promotes policies and provides assistance to countries to help extend adequate levels of social protection to all members of society. The experience of setting up a mechanism to deliver compensation in the aftermath of the Rana Plaza highlighted the need for an Employment Injury Insurance (EII) Scheme to be established. An EII scheme will benefit workers and industry alike. Workers will receive payment in case of injury. Employers will benefit from low-cost and no-fault accident compensation insurance for workers. Such a scheme would also make the Bangladesh industry more attractive to international brands and retailers who would no longer fear being dragged into compensation issues.

An initial workshop was held in Dhaka in January 2015 to present the concept and principles of EII scheme to stakeholders. This was followed by an ILO mission to Dhaka in May and June 2015 to launch a feasibility study, the preliminary report of which has been completed. In July 2015, the Government formally requested the ILO Country Office in Bangladesh to directly coordinate any donor initiatives for establishment of an EII and to design a combined scheme for this purpose. As a result, ILO is cooperating closely with German organisations DGUV and GIZ in this regard.
Activities planned until the end of 2015 include study tours in the region; launch of a survey on employment injuries; setting-up the Committee on Medical Care, Disability assessment and Rehabilitation issues; preliminary costing based on available data on employment injuries; and the finalization of the feasibility study on design and institutional structure. Establishment of an EII scheme in Bangladesh would likely take some years in view of the legislative changes and institutional development/creation needed.

Coordination and collaboration

ILO has played a leading role to help coordinate the response to the Rana Plaza collapse. The Government of Bangladesh formally asked the ILO to assist in the implementation and coordination of the NTPA. The ILO works with the National Tripartite Committee (government, workers’ and employers’ organizations), the Accord and Alliance to help ensure coordination.

The ILO serves as the neutral chair of the Accord, which brings together more than 150 international brands and retailers who have suppliers in Bangladesh, and two global unions (IndustriALL, UNI Global). ILO also cooperates closely with the Alliance on issues relating to factory inspections and remediation.
ILO is the neutral chair of the Rana Plaza Coordination Committee that oversees the compensation process and is the trustee of the Rana Plaza Trust Fund that manages donations.

Furthermore, ILO is part of the “3+5+1” group. This brings together three Bangladesh Secretaries (Labour, Commerce and Foreign Affairs); five Ambassadors (US, EU, Netherlands, Canada and a 5th EU member state -- filled on rotation), and the ILO to follow progress made in commitments made under the National Tripartite Plan of Action and the EU Compact.

In addition, ILO is playing a key coordination role with regards to the establishment of an Employee Injury Insurance Scheme for the RMG sector.

Enhancing workers rights

ILO is providing technical assistance for trade union organizations to improve the capacity of workers to organize through a workers education programme organised in collaboration with the National Coordination Committee for Workers Education (NCCWE) and the IndustriALL Bangladesh Council (IBC).

The programme aims at creating an enabling environment for worker organizations and collective bargaining at factory level that will lead to workers participating in occupational safety and health as well as rights related matters. Recognising that the majority of garment workers are women, special emphasis is also being placed on training women trade union leaders and organizers on key labour rights.

Furthermore, initiatives carried out by ILO under the umbrella of its Ready Made Garment Sector programme are also helping workers and their representatives to exercise their rights and improve labour-management cooperation at the enterprise level. Funded by the US Department of Labor, Norway and Denmark the projects address specific challenges faced by workers’ and employers’ organisations by building local capacity in relation to freedom of association and collective bargaining.
In all, the capacity of over 2,500 workers’ representatives, trade union organizers, mid-level managers and employers’ organization members has been enhanced through various training events.
A process is ongoing to set up a dispute settlement and mediation system with the Department of Labour to help address anti-union discrimination and terminations. A pilot hotline/telephone service has been launched to address labour disputes and grievance related issues. Meanwhile an online registration process and electronic database established within the Department of Labour is helping facilitate trade union registration and transparency. In addition, representatives of government, employers and workers organizations as well as Industrial Relations Institutes (IRI) have been trained on the use of Interest Based Negotiation (IBN) techniques to help develop mutual trust and cooperation. The physical infrastructure of the IRIs is also being rehabilitated and their capacity built so they can play a more effective role in enhancing labour relations across all industrial sectors.