Joe Fresh in Bangladesh

Crisis in
Banglades
h
Building
Safety in
Garment
Industry

Joe Fresh continues in

Bangladesh
http://www.cbc.ca/news/world/joe-fre
sh-continuing-garment-business-in-ba
ngladesh-in-year-after-tragedy-1.260
6120

Divided over Bangladesh?

http://
www.nytimes.com/video/world/asia/1
00000002208157/divided-over-bangla
desh.html

Rana Plaza
Five factories, owned by three companies: Ether Tex, New
Wave Style, Phantom Apparel
Buyers: Walmart, El Corte Ingles, Benetton, Inditex, JC Penney,
Childrens Place, Carrefour, Primark, Joe Fresh, KiK, others
Obvious warning signs of structural failure; workers pressured
to work anyway; threatened with loss of one months pay
Final toll: 1,127 dead; more than 2,000 injured, including
many on-site amputations
Worst factory disaster in the history of the global garment
industry
Three of the four worst have occurred in the last eight months

Rana
Plaza

Tazreen
Fashion
s

Background Sweater Factory - 2006

Massive building collapse

64 dead
Hundreds injured
Major buyer: Inditex
Retailers, factory owners,
government all vow to move urgently
to improve safety practices
Nothing changes: industry continues
down the road to Rana Plaza

Building Collapse in
Bangladesh

Garment factory producing for major

Western retailers
Poorly constructed building, located on a
drained swamp, with additional floors
added illegally
Workers notice cracks in walls, express
fear to management
Management tells workers building is
safe and they must work
The next day, the building collapses,
crushing workers en masse
Some escape, many die. Rescue workers

A horrific rash of events for

garment workers in
Bangladeshfactory collapse,
explosion and fires... The
Bangladesh garment industry is
notoriously stricken with labor
violations, but the recent
tragedies have incited
international pressure and
investigations
Yahoo News, 2006

Major Bangladesh Factory Disasters:

2005/2006
Moon Fashion
Fire
Biswas Garment
Fire
Shan Knitting
Fire
Phoenix Garment Collapse
Shamim Spinning Fire
Sayem Fashions
Stampede
Spectrum Sweater Collapse
Cumulative Death Toll: 205

After the Hameem fire: December

2010
Unions, NGOs convene meeting in Dhaka, April 2011,
and implore brands and retailers to commit to an urgent
program of independent inspections and to pay for
renovations are repairs.
Industry response, as conveyed by Walmart and Gap:
Specifically to the issue of any corrections on electrical
and fire safety, we are talking about 4,500 factories, and
in most cases very extensive and costly modifications
would need to be undertakenIt is not financially
feasible for the brands to make such investments.

Death Toll in Garment Factory Disasters Since 2010

Year Factory
Brand
Deaths
2010 Gharib & Gharib H&M
21
2010 Hameem/TIS Gap, Target, VF,
PVH, others 29
2012 Ali Enterprises KiK
262
2012 Tazreen Fashions Walmart,
Sears, ECI, others 112

Triangle
Shirtwaist

Triangle Shirtwaist to Rana

Plaza
Apparel sector in the Early 20th century: sub-poverty
wages, minimal regulation, abusive conditions, dangerous
factories
1911: Public revulsion over Triangle disaster spurs reform
1910s to 1930s: Unions and regulators progressively
reform the US apparel sector: decent wages, unions, safe
workplaces, reasonably tough regulation; golden age for
apparel workers through 1960s
1970s to 2000s: Brands and retailers outsource most US
apparel production to the Global South
Apparel sector in the early 21st century: sub-poverty
wages, minimal regulation, abusive conditions, dangerous
factories

Contemporary Apparel Production:

The Model
Brands and retailers place relentless price and delivery
pressure on local contractors
Local contractors meet these demands by ignoring worker
rights and safety standards to cut costs, speed production
Local government looks the other way; industry auditors
are ineffectual
Result: poverty wages, oppressive conditions, dangerous
factories
Not a Bangladesh problem, but a problem of the global
apparel industry
The problem manifests itself in a particularly destructive
way in Bangladesh, because local regulation is especially
lax and most factories are in multi-story buildings.

Bangladesh Garment Industry:

Thousands of Deathtraps
Many poorly constructed buildings with weak
foundations; floors added illegally after original
construction
Most factories lack proper fire exists:
Open stairwells, which act as chimneys rather than
escape routes
No external fire escapes
Missing safety systems
No emergency lighting
Missing fire extinguishers
No worker role in safety management, no unions, weak
or no safety training
Managers restrict egress: lock doors to control workers;
delay exit to avoid loss of production, hoping
alarms are false

Lethal Partnership: The Global

Apparel Brands and Bangladesh
Conditions:
Minimum wage: $37/months (18 cents an hour)
Routine harassment and intimidation as management
strategy to speed production
Unionists are fired or worse
Most dangerous place in the world to be an apparel worker

The industrys response to deteriorating labor

conditions in recent years? They have poured orders
into the country.
Bangladesh now 2nd largest apparel producer after China
5,000 factories; 3 million workers (far more than US peak)

More than 2,000 killed in fires and collapses since 2005

Buyers are getting what they pay for: an industry of
Triangle Shirtwaist factories
Bangladesh is winning the race to bottom, with room

The Bankruptcy of Industry Auditing

and the Voluntary CSR Model
All factories where major disasters have occurred had been
repeatedly audited under industry audit regimes
Ali Enterprises, 262 dead: SA-8000 certified 3 weeks before fire
Tazreen, 112 dead: Audited by WM (UL Responsible Sourcing), others
Hameem/TIS, 29 dead: Audited by Gap, A&F, VF, others
Gharib & Gharib, 21 dead: Audited by H&M
Rana Plaza, 1,127 dead: Passed audits by BSCI, multiple buyer audits

Industry auditing: massive conflicts of interest, no transparency

Industry auditors dont have expertise/time for proper inspections:
no fire safety training, no electrical or structural expertise
Industry auditors do not even look at biggest hazards
No assessment of emergency exit structures, despite deadly fires
No assessment of structural integrity, even after Spectrum

Auditors cant ask brands to raise prices, pay for repairs

BSCI: You cant expect too much from social audits. Yet brands
have claimed for years that audits are adequate to protect
workers.

"It's very important not to expect

too much from the social audit
BSCI and other initiatives
contribute to improve the situation.
... But it's a long way we have to
go.
Lorenz Berzau
Managing Director
Business Social Compliance Initiative
(Two Rana Plaza factories passed
BSCI audits)

Walmart: Dont Worry Workers

Are Protected by Our Incompetent
Inspections
Walmarts CEO, Mike Duke, in a public
statement: We will not buy from an
unsafe factory.
Walmarts head of labor rights
compliance, in an internal memo: Fire
and electrical safety are not currently
adequately covered in ethical sourcing
audits.

What is needed?
A radical shift away from voluntary selfregulation to binding labor-management
agreements
Not just inspections industry-wide program of
renovations and retro-fitting to make unsafe
structures safe
Many factories cant pay: progress cant be
achieved without financial support from buyers
Buyers must accept that safe factories cost more
Renovation program must be backed up by
inspections with public reports
Workers must be able to fight for their own
protection

Development of the Accord

Dec. 2010 WRC, CCC, others propose plan after TIS fire kills
29
Apr. 2011 Plan promoted at ITG- led meeting in Dhaka;
brands reject financial responsibility for safety upgrades
Mar. 2012 PVH signs agreement after ABC News story
Apr-Sep 2012 Unsuccessful negotiation with Gap, which
refuses any binding safety commitments
Sep. 2012 German retailer Tchibo signs agreement
Nov. 2012 Tazreen Fashions fire kills 112
Jan. 2013 Smart Export fire kills 8
Apr. 2013 Rana Plaza collapse kills 1,127
May 2013 Tung Hai fire kills 8
May 2013 40 brands and retailers sign revised safety
agreement, renamed Accord on Fire and Building Safety in
Bangladesh
June 2013 Implementation begins

Why is it a huge challenge to

get companies to sign?
Because the agreement is real, not the usual nonbinding, feel-good CSR fluff
Binding, enforceable and transparent
Companies must pay for repairs and renovations
Companies must end business with factories that
refuse to undergo renovations and operate safely
Companies must stay at least two years at safe
factories
Imposes higher costs and constrains sourcing
decisions, blunting the relentless push for lower
prices and faster delivery that define industry
sourcing strategy

Strategy Post-Rana
Seizing the media moment to secure
enforceable commitments
Out-maneuvering the industry and its
apologists and protectors

How Accord was achieved

Linking specific brands and retailers to recent disasters; proving
these connections with documents and labels found on-site
Focusing media attention on individual brand responsibility, the
total failure of industry CSR programs to protect workers, and
the small cost of saving lives (less than 10 cents per garment)
Holding firm on the need for a binding, enforceable agreement
with financial commitments from brands/retailers
Contributions from numerous key players: Clean Clothes
Campaign, UFCW, Machinists, Steelworkers, AFL-CIO, Change to
Win, SEIU/Workers United, ILRF, Maquila Solidarity Network,
Avaaz, SumOfUs, USAS, Corporate Action Network
Crucial leadership of Industriall and UNI

The Accord: Unprecedented

Commitments
Thorough, independent inspections with full
public reports
Brands/retailers must require factories to undergo
all necessary renovations and must pay for them
Brands/retailers must end business relationship
with any factory that refuses
Brands/retailers must make 2-year commitment
to safe factories
Central role for workers and unions: union access,
OHS committees, right to refuse dangerous work
All commitments binding and enforceable

Unprecedented
The first binding agreement ever signed
by global corporations that forces them
to pay to improve working conditions
and to align their sourcing decisions with
their labor rights obligations

Signatory Brands and

Retailers

40 signatory companies, from 13 countries

H&M largest producer in Bangladesh
Inditex worlds largest fashion retailer
Carrefour worlds 2nd largest general
retailer
Most major apparel retailers in W. Europe
North America: PVH/A&F/Loblaw
Gaps:
Gap, VF
Walmart, Target
JC Penney, Macys, Kohls
Signatories represent:
At least 1,500 factories and 1 million
workers

Implementation
Implementation plan in 45 days
12-member planning committee
focused on swift implementation
First priority: inspections and
renovations to mitigate most
serious widespread hazards

The road ahead.

Accord implementation: A huge
undertaking
Goal to get repairs/renovations started
in 3 months or less immediate focus
on swift mitigation of the gravest
hazards
Binding nature of Accord gives us the
tools to ensure compliance, but there
will be many battles
Effort to bring on additional US retailers
must be strengthened will get boost
from public inspection reports

A new model for labor rights reform

in global supply chains
1980s to 1990s: No private regulation
1990s to 2010s: Self-regulation: the CSR
Era
Voluntary corporate initiatives
Non-binding, minimal transparency
No obligations on prices or supply chain practices

2013 to?: Regulation thru enforceable pacts

Accountability to worker organizations through
binding, enforceable agreements
Supply chain practices aligned with labor rights
obligations, including higher prices to factories or
other means of paying for improved conditions
Full transparency