Working conditions

Post Rana Plaza: A vision for the future

ILO Director-General Guy Ryder's address to the High Level Meeting on garment and textiles production in Bangladesh organized by the Government of Denmark in Copenhagen.

Statement | 03 April 2014

Thank you Minister for the opportunity to address this meeting on an issue of great importance to the people of Bangladesh, to its Government and to workers and employers.

It is very clear to me from my meetings in Copenhagen this week that safe and decent working conditions in the global garment industry are matters of tremendous concern to the people of Denmark, to Danish businesses and trade unions, to Minister Jensen and his government. It is also of crucial importance to the way we ensure in practice the respect of Decent Work and, in particular, action against unacceptable forms and conditions of work, not only in Bangladesh but throughout the world. In an interlinked world, these are common concerns, through the ties of globalization and trade and their effect on workers, companies and consumers.

It is now almost a year after the Rana Plaza collapse. With a recorded fatality toll of 1,135 this was the worst industrial catastrophe of its kind in history. Sadly, it was not the first. For instance the previous year the Tazreen factory fire in Dhaka claimed at least 117 lives. Similar accidents occurred around the same time in Karachi and Lahore in Pakistan.

The Tazreen fire almost mirrored something that happened 101 years earlier, in New York City. The Triangle Waistshirt Factory fire claimed 146 lives, many young women who could not escape because the bosses had locked the doors. That fire became a landmark in US action for factory inspection laws, led by a social worker called Frances Perkins who went on to become Franklin D. Roosevelt's Labour Secretary and a prominent figure of ILO history. It also gave a significant boost to action by the trade unions in the garment sector.

The reason I make the comparison is that already a century ago, it was clear that catastrophes such as Rana Plaza are entirely preventable. The methods are not complicated. They call for factory inspection, and giving workers, who are at the production site and see the fault-lines, the voice to say that things are wrong and that hazards have to be prevented, without them having to be afraid for their jobs, incomes or indeed physical safety.

Likewise, prompt and just compensation needs to be paid. It has to be paid to those whose families have lost not only loved ones but a livelihood and future security. It needs to be paid to those who have survived but with reduced prospects for future income. Compensation for loss and adversity is as much a right as a fair wage, and it needs to be paid for by those who have benefited from such unsafe conditions. In a globalized world, this extends to the consumers, the ultimate beneficiaries of those who have toiled in unsafe conditions. This is a global imperative and a shared responsibility.

Today we ask ourselves what has been achieved so far to make the Bangladeshi garment industry a better and safer place to work and what more must be done? Let's be honest in our answer to these questions and this afternoon, I will give you my own assessment.

Let me first remind you of the importance of the garment sector for Bangladesh.
In the past decade, the country has registered a GDP growth rate of around 6 per cent, which is double of what it was in the 1980s. This has been driven principally by exports, which has been largely due to the garment sector in Bangladesh.

Indeed, Bangladesh has increased its specialization in the garment sector, becoming one of the main exporters of ready-made garments (RMG). As a result, Bangladesh accounts for 4.8 per cent of global apparel exports, compared with only 0.6 per cent in 1990. The destination of Bangladeshi exports is mainly the United States and key Eurozone countries.

Bangladesh is eager to graduate out of the LDCs (least developed countries) and it is likely to achieve that in the coming years. But for that to happen it has to improve its manufacturing capacity to the current level of industrial production. What do I mean by this? Bangladesh is the only LDC in the world which has the level of industrial production (driven by garment) comparable to an emerging economy. But the country does not have the industrial capacity to support this level of production. The industrial disasters we have seen is a reflection of this gap.

The collapse of Rana Plaza demanded an immediate response to help those who were suffering and vulnerable. In the immediate aftermath of the tragedy I called for action to turn our shock into definitive action by the Government of Bangladesh, and the employers and workers and I made clear the ILO stood ready to help. I also called for action and assistance from international partners, both governments and the global garment companies.

Within days, my Deputy, Gilbert Houngbo, led a mission to Dhaka to support the government and social partners in developing an immediate plan of action. The plan was announced on May 4 last year, eleven months ago, and it included measures to strengthen the labour law, conduct safety inspections for all factories in the sector and dramatically improve the capacity of the labour inspectorate. The measures also called for support to compensation and for the rehabilitation of surviving victims, for the full implementation of the National Action Plan on Fire Safety and for a Better Work programme. Importantly, this “six-point plan” became the blueprint for all cooperation to rebuild this industry.

In the weeks that followed, the ILO supported the constituents to review and further develop what became known as the “National Tripartite Plan of Action on Fire Safety and Structural Integrity”. This is a comprehensive strategy to make the garment industry safer for its workers and to tackle some of the root causes that led to the Rana Plaza tragedy. The ILO was asked by the tripartite constituents for advice and support in implementing this plan. Within weeks we developed the Ready-Made Garment Sector Programme. The Netherlands, Britain and Canada joined in with a $24 million dollar package which will provide much-needed assistance and know-how to the government and social partners who will be implementing these actions over the next three years.

The response to Rana Plaza also needed engage the trading partners and global business and investors whose initial reaction - weakened confidence in Bangladesh - threatened to undermine the long-term future of the local industry which provides employment to 4 million workers, 80 per cent of whom are women. At their request, the ILO facilitated talks between the European Union, the Governments of the United States and Bangladesh about what needed be done to ensure respect for labour standards and improve the safety record in the industry. This led to the Sustainability Compact; an agreement of time-bound actions monitored by the ILO, which mirrors closely the Tripartite National Action Plan.

The ILO also responded to calls from both international trade unions and the garment brands which sought to establish a unified and collective response to the challenge of making factories in supply chains safer. In May last year I welcomed over forty global companies and trade unions to the ILO in Geneva, to discuss how to establish and implement what they called the “Bangladesh Accord”. The ILO supported a dialogue between international businesses and trade unions, and it has served as the neutral and independent chair of the Steering Committee of the Accord which now includes 158 company signatories.

The ILO also provided technical advice to the government’s Minimum Wage Board, which made recommendations on the wages of garment workers late last year. The monthly minimum wage was revised to $68, up from $38 before the revision, which was the lowest among the major apparel exporting countries in the world. The revised wage is still lower than countries such as Cambodia and Vietnam, but is a step in the right direction.

These actions represent an unprecedented level of cooperation, goodwill and practical action to improve safety and working conditions in Bangladesh. I say with some pride that the ILO remains at the heart of much of this coordinating, implementing, advising and innovating work to support real change.

Yet we must ask, what has actually changed for those to whom it matters most – the workers and the factory owners. And what more must be done to make change and improvements sustainable?

Almost 12 months after the Rana Plaza disaster, significant progress has been made in implementing the National Action Plan.

Three different factory inspection programmes have been established to make work safer. The Bangladesh Accord, a group of companies called the Alliance for Bangladesh, and the National Tripartite Committee have adopted a coordinated plan to ensure that every single exporting factory in the sector is assessed for structural integrity and fire safety. All three initiatives use a harmonized minimum inspection standard which is the result of an agreement brokered by the ILO.

The ILO provides direct technical assistance to the National Tripartite Committee programme, in partnership with the Bangladesh University of Engineering and Technology and an international engineering firm. To date the Bangladesh University has already assessed over 200 buildings. The Accord and Alliance also have started their assessments and it is expected that all the 3,500 factories will be assessed by August or September this year.

While the time-frame for this activity lags 9 months behind the government’s target of December 2013, even to inspect all factories by September this year would represent a very significant achievement. But let us remember, inspections, critical as they are, are only a diagnosis of the problem. It is incumbent on factories, the international brands and the government to prove that all required improvements have been made. In this respect the commitment by the Government to publish the inspection reports on a public database and develop a credible labour inspection system to take follow up action on the inspections are key measures to sustain the results.

The recruitment of 200 inspectors has missed the deadline in the National Action Plan, but the Government has fulfilled an important commitment by upgrading the Directorate of Labour Inspections to the status of Department and by creating 392 new labour inspector positions. The ILO is currently insisting that the recruitment of these new inspectors be completed without further loss of time.

The ILO is providing extensive training to the inspectors. As a first step, 42 newly-recruited inspectors have been trained. The ILO will also support the institutional development of the Inspection system with new business processes and procedures promoting efficiency and accountability, necessary equipment, inspection tools and a series of capacity development activities over the next three years. This is one of the key priorities in the programme: to build the capacity of government to take full responsibility for monitoring application of labour standards.

The Labour law was amended last year with important progress in the area of Occupational Safety and Health. Regrettably, there have been only modest improvements in freedom of association.

The Implementation Regulations, which are now in draft form, are urgently required to make the existing law and amendments a reality in workplaces. It is vital that International Labour Standards be fully respected and the regulatory framework guarantees the fundamental rights of freedom of association and the right to collective bargaining. The gap between national law and practice and Conventions such as Convention 87 (Freedom of Association) and 98 (Collective Bargaining) remains wide, despite the ratification of these two Conventions by Bangladesh.

This no doubt also calls for further cohesion and cooperation by the trade unions. From discussions on promoting freedom of association in recent years, we believe that the will is there on the workers' side. It is encouraging that since the reform of the trade union registration process 127 new factory level unions have registered since the beginning of last year. But it is crucial that at the same time employers and other key actors in Bangladesh, including the industrial police, realize that a strong and constructive voice of the workers is a key element for preventing disasters. It is also not helpful if international interests in practice discourage or outright oppose the Bangladeshi workers' organizing rights. Cooperation for better, safer working conditions has to start now to avoid another Rana Plaza and Tazreen.

Workers injured in the recent disasters are receiving support to rebuild their lives and find access to work. Rehabilitation programmes are underway for survivors of Rana Plaza, of whom approximately 550 are considered permanently or temporarily disabled. A Coordination Cell for the Rehabilitation of Victims was established to provide information, support or referral on issues such as medical care and job opportunities. Skills development and re-employment support has been provided to an initial 50 injured survivors in collaboration with BRAC, a prominent non-government organization and 250 survivors are receiving similar support in collaboration with Action Aid.

An in-depth survey of over 1500 survivors of Rana Plaza showed that the victims and their families need long- term support including counselling and guidance to enable them to make appropriate occupational choices as many are still recovering from injuries and trauma. The ILO is providing job counselling and placement support and helped facilitate an Arrangement for payment to the Rana Plaza victims, concluded late last year between the Government and social partners of Bangladesh and global unions and buyers, with NGOs. The ILO serves as an independent and neutral chair to the Coordination Committee responsible for governance and implementation of the claims process using a single approach to payments based on ILO Convention No. 121 on employment injury benefits. The claims process began last week and it is estimated it will take about six months to conclude. The maximum needed is some $40 million, and the workers will be paid in installment amounts to ensure that all receive an equitable distribution of the funds.

The Better Work programme of the ILO in partnership with the IFC, which works with both employers and trade unions in several countries around the world, will be active in factories in Bangladesh by the second half of this year. Better Work is completing the recruitment and training of its staff and will provide assessment and advisory activities to some 300 factories in the Dhaka area in its first phase. A key focus of this work will be to promote transparency, decent work standards and social dialogue in the workplace.

Some progress has been made in the past year to overcome the deficiencies and lack of engagement of the past four decades. However sustainable progress calls for more than solidarity, corporate social responsibility or technical assistance. It requires a clear and equitable regulatory environment, strong law enforcement and national institutions to enable social partners to do their part of the job. Progress towards these ends has only just begun and it must be kept up for years, indeed decades to come.

Let’s not forget the story of Bangladesh, beyond the headlines of industrial disasters. This is a country that has made enormous progress in terms of economic and social development. For example, the share of the population living under the upper poverty line as defined nationally declined from 56.7 per cent in 1991–92 to 31.5 per cent in 2010. That is a remarkable achievement.

Also, Bangladeshi women have been an integral part of Bangladesh`s shift towards manufacturing and industrialization. They have helped to enhance agricultural productivity, been central to the emergence of the RMG sector and participated in poverty reduction efforts through microfinance and social programmes.

In the agricultural sector, 65 per cent of workers are women and in RMG over 80 per cent of workers are women. This comes on the heels of the progress Bangladesh has made in bridging the gender gap across several areas such as health, education and political participation.

Therefore, what we do in Bangladesh matters not just for ensuring the safety and health of garment sector workers, but also being part of the story of a country that has made enormous strides in the right direction. The ILO is proud to be part of this process and welcomes the international efforts in ensuring this takes place smoothly.

Let me close by asking what lessons we can draw from the events of the past 12 months and looking to the future.

Rana Plaza highlighted the human cost of poor safety and working conditions and unacceptable forms of work. Every day, all over the world, thousands of people suffer death and injury in the workplace and millions more carry the burden of poor working conditions. Each day some six thousand people die as a result of work- related accidents and diseases, totaling over two million victims a year. Workers suffer an estimated 270 million accidents a year. Nearly one in six children between the ages of 5-14 are engaged in child labour around the world. Over twenty-one million people are victims of forced labor globally, trapped in jobs into which they were coerced or deceived and which they cannot leave.

Rana Plaza is a call for global action to address decent work deficits with improvements in the regulatory environment, the enforcement of law and the power of social dialogue. Decent working conditions are an essential pillar of a just and sustainable future everywhere. They are the basis for healthy production and global competition, not an impediment or a cost.

The ILOs mandate of social justice and decent work for all has never been more relevant to a world that needs more and better jobs. The Decent Work agenda is therefore a pressing priority in national and global development policy including the post 2015 goals and we must seize every opportunity to ensure it is realized.

Rana Plaza shows us just what can be achieved when government, social partners and the international community are sufficiently focused. The progress made in the past 12 months in Bangladesh would have been unimaginable on 23 April last year. It is often said that conditions of great adversity bring out the best in people. Yet not only adversity but also neglect is all too often a way of life for millions of people. We should not wait for future disasters before we act to make the worlds’ factories and workplaces safe and decent places to work. Bangladeshi employers must seriously invest in the physical and social conditions of their companies if they indeed wish to develop them into the pillars of the economy they should be, to the benefit of both themselves and those they employ.

Over the past century, major industrial disasters have highlighted the need for prevention through the double means of inspection and empowerment of workers to voice their concerns. I trust that the contributed efforts in Bangladesh will advance the more universal goal of ensuring that world production and consumption, and economic activity and employment, respect the parameters of Decent Work and help in countering the still too widespread phenomenon of unacceptable conditions of work. This needs to be an absolute priority for Member Countries and constituents of the ILO in next century.