GENEVA — Bangladesh came under growing international pressure Monday, spearheaded by the European Union and backed by the International Labor Organization, to usher in the necessary amendments to its labor laws to ensure trade-union rights are fully upheld in the country’s garment industry and its export processing zones.

This story first appeared in the July 9, 2013 issue of WWD. Subscribe Today.

The poor South Asian nation was also provided with a list of demands to strengthen fire and building safety inspections in all active export-oriented ready-made apparel factories by June 2014, with the most populated factories to be assessed by the end of 2013.

The list of proposed actions is contained in an eight-page report titled “Sustainability Compact for Continuous Improvements in Labor Rights and Factory Safety in the RMG and Knitwear Industry in Bangladesh,” released at the end of a meeting here Monday hosted by the EU and also attended by the government of Bangladesh and the ILO.

The U.S. also attended the meeting, “but was still in the decision-making process of whether or not they can officially join the compact,” EU Trade Commissioner Karel De Gucht told reporters.

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Representatives of buyers and retailers including Wal-Mart Canada, Target Corp., PVH Corp., Benetton and C&A, along with global and Bangladesh trade unions and associations, and civil advocacy groups such as Ethical Trading Initiative, attended the closed-door proceedings.

De Gucht said the compact commits the EU, Bangladesh and ILO to a number of time-bound actions. These included “reforming the Bangladesh labor law to strengthen workers’ rights, in particular regarding freedom of association and the right to collective bargaining, and to improve occupational health and safety,” he said, as well as improving building and fire safety, especially structures of buildings and fire safety in RMG factories by June 2014, and recruiting 200 additional inspectors by the end of this year.

The trade official said EU lawmakers and European consumers “expect reassurances” that Bangladesh is moving in the right direction, and added: “The first true test of Bangladesh’s commitment will of course be the adoption by its Parliament of a revised labor law at the end of this week or early next week.” De Gucht noted he also expected the revised law “to apply to all workers, including those in Export Processing Zones.” At present, workers in EPZs can join welfare associations but not trade unions, and the issue has been a sticking point in the overhaul of the labor laws, sources said.

The foreign minister of Bangladesh, Dipu Moni, confirmed that the revised labor law will also apply to workers in EPZs.

Guy Ryder, ILO director-general, said he hopes the coming legislative amendments “will provide the preconditions, which will enable our [Better Factories] program to move into Bangladesh, as well.”

But De Gucht warned if the rules are not followed by the government of Bangladesh or by companies that source in the South Asian nation, “we will take action and not hesitate in doing so.”

When pressed, he did not elaborate other than to say the European Commission could launch investigations. But he indicated that under the “Everything But Arms” plan, under which Bangladesh apparel exports enter the EU market duty-free and quota-free, Brussels may “consider appropriate action should there be no, or insufficient progress for Bangladesh workers.”

The EU is the biggest customer for apparel made in Bangladesh, with exports of $10.7 billion annually, representing about 50 percent of the sector’s market share. Bangladesh’s Moni emphasized that while her government is fully committed to the compact, she contended that the right pricing of products “must be addressed squarely” and be linked to the global supply chain, and also observed a unified code of conduct must be followed by all retailers in the inspection of factories.

“Our industry is totally committed and on board,” she said.

The compact also calls on multinational companies, brands and retailers “to deepen discussion on responsible business conduct with a view to addressing issues along the supply chain. We encourage retailers and brands to adopt and follow a unified code of conduct for factory audit in Bangladesh.”

The text also lauds the fire and building safety accord signed by more than 70 major fashion and retail brands sourcing from Bangladesh.

In Washington, a North America alliance led by Wal-Mart Stores Inc. and Gap Inc. that has chosen to go its own way in the wake of major catastrophes in Bangladesh that killed more than 1,200 garment workers and spurred an outcry for comprehensive change, revealed its new name, the Alliance for Bangladesh Worker Safety, and said it would release its much-anticipated action plan, dubbed “The Bangladesh Worker Safety Initiative” on Wednesday at the Bipartisan Policy Center.

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