Employment conditions improve in post-Rana Plaza tragedy

Dhaka,  Fri,  22 September 2017
Published : 21 Apr 2017, 21:05:18

Employment conditions improve in post-Rana Plaza tragedy

Omar H. Khan
The blazing glory of Bangladesh's readymade garment (RMG) sector has also brought with some disrepute for the country. While the sector has made accelerated contribution to reducing unemployment by employing almost 4.2 million workers, majority of whom are women, widespread concern still remains as to whether such propitious traits outweigh the rampant sub-standard and outright shabby employment conditions that stakeholders resort to in order to sustain the 'cheap labour' of Bangladesh. 

The Rana Plaza tragedy of April 24, 2013 has ironically laid foundation for imposition of stricter inspection and regulatory requirements for ensuring better employment conditions in factories and paved the way for a sustainable development.

INITIATIVES TAKEN: As soon as the aftershock of the tragedy subsided even slightly, it was realised at all levels and by all stakeholders that other aspects of employment conditions required intervention and strict monitoring for genuine improvement is to be brought about. The International Labour Organisation (ILO), donor countries, NGOs, buyers, suppliers and intermediaries all joined hands to formulate projects, procedures and legal framework to ensure better working conditions in the RMG sector.

INCREASE IN MINIMUM WAGES: It has been a long-accepted reality of the RMG sector that garment workers were paid much less than their labour given to the industry on a daily basis. Things finally came to a head when in December 2013, following protests that broke out in the aftermath of the Rana Plaza collapse, the minimum wage was increased to US$68/month from US$39/month.

The minimum wage increase in 2013 embodies a significant 77 per cent increase compared to 2010. In order for Bangladesh to achieve the 'sustainable development' that it aims for, such initiatives need to be continuous, striking the right balance between fair wages to employees and the minimum costs for production whereby reasonable profit maximisation can be aimed at.

ILO INITIATIVE: The Better Work Bangladesh (BWB) programme, which has been running from April 23, 2014 and is scheduled to end on June 30, 2017 with the UK, France, Netherlands, the US, Switzerland (SECO) and Canada being major donors, aims at building capacity at factory and structural levels. The primary objectives include ensuring greater adherence to both national and international labour standards, and to support the country's development through building capacity. 

By 2016, BWB had already assessed 82 factories and made 344 advisory visits to member-factories. This monitoring  programme  of individual factory-oriented micro-management of employment conditions by a neutral entity like the ILO has immensely exemplified the willingness of all stakeholders to ensure better working conditions, paving the way for faster and more sustainable development. 

ACCORD AND ALLIANCE: With the devastation brought about by the Rana Plaza collapse, concerns regarding structural safety resulted in the formation of the 'Accord on Factory and Building Safety in Bangladesh'. The Accord is a five-year binding agreement signed in May, 2013, and it unites international unions (IndustriALL and UNI), NGOs (Clean Clothes Campaign and Workers Rights Consortium) and global buyers.

Remediation of sub-standard factories by formulating Corrective Action Plans (CAPs) and inspection of factory buildings have been the main aims of Accord. Immense progress has been made in this regard since, by now, a total of 3,700 factories have been inspected by the engineers of the Accord, Alliance and the National Action Plan (NAP).

Although there were qualms that these initiatives would subside soon, very recent and continuous steps taken by donors set at rest these concerns and evidence the continuity of efforts. Denmark's employment ministry initiated in January, 2016 a programme to train labour inspectors in Bangladesh and has also resolved to donate approximately 200 tablet computers to the labour inspectors for implementation in factory inspections.

GOOD GOVERNANCE: Following the devastation that the country was immersed into following the Rana Plaza collapse, it was nationally realised that good governance in the RMG sector should begin with laying down of robust legal foundations for enforcing best practices.  The government of Bangladesh (GoB) promptly reacted with enactment of the amendment to the Bangladesh Labour Act (BLA) on July 15, 2013. The long-awaited Rules were also formulated in September 2015. 

As per the previous law, whenever a list of employees contemplating to become union members was circulated to employers for registration, it resulted in arbitrary unfair terminations and harassment. The law, therefore, was amended to remove this requirement, and now, the employers no longer need to be informed of which employees have applied to form part of a union. Since then, statistically there has been a significant rise in trade union registrations, from 131 registered trade unions in the previous year to a total of 483 trade unions being registered in the RMG sector by March, 2016.

In addition, the government has already set up 30 labour welfare centres to provide basic medical support and training on raising awareness on labour law and workplace safety. 

Another notable initiative is the Centre of Excellence set up with support from the ILO, Sweden, leading Swedish fashion retailer Hennes and Mauritz (H&M) and the Bangladesh Garment Manufacturers and Exporters Association (BGMEA). The Centre of Excellence focuses on providing 'competency-based training in areas where demand from industry is greatest'.

MISCELLANEOUS INITIATIVES: As a measure to provide workers with greater job security, the worker's ID was introduced. This contains expertise of workers, and enables workers greater access to jobs and wages at the time of their termination. Other noteworthy initiatives include recruitment of new factory inspectors, formation of the Department of Inspection for Factories and Establishments, introduction of a hotline for workers and a factory database.

Although not accountable for direct impacts, international pressure following the Rana Plaza collapse led to the imposition of significant sanctions, on the ground of not adhering to international labour standards. One example is the suspension of the Generalised System of Preferences (GSP) by the USA which came as a result of extremely weak labour rights enforcement in Bangladesh and the pressure for implementing trade unions in the Export Processing Zones became stronger than ever. One direct consequence of such suspension is the speedy enactment of the long-awaited Bangladesh Labour Rules (BLR) in 2015. The BLR provides much-enhanced entrenchment for employment benefits and conditions, for instance, by making payment of two festival bonuses a year mandatory, each being equivalent to one month's basic salary, and by laying down clear guidance in relation to the administration of provident funds, to name a few. 

Having huge potential, soon after the collapse and even as early as December, 2015, apparel shipments of Bangladesh rose by 14.56 per cent year-on-year to $2.67 billion, according to the Export Promotion Bureau. In economic terms, the country is well on its way towards significant growth. Investment has been eased with the Bangladesh Bank withdrawing the requirement of mandatory guarantee against foreign loans taken by local firms. The Public-Private Partnership Act-2015 has been enacted to attract increased foreign investment. A programme has been undertaken to set up 100 new economic zones by Bangladesh Economic Zones Authority (BEZA). Besides, the Financial Reporting Act-2015 was approved to ensure increased transparency in financial reporting activities. 

All these point to renewed preparedness of Bangladesh to welcome foreign investors with stronger infrastructure and enhanced compliance. Of prime importance now is to adhere to the awakening brought about by the Rana Plaza collapse and continue the initiatives of sustainable development of the RMG sector so that the target of '$50 billion by 2021" can be realised by striking the right balance among healthy working conditions, increased productivity and maximisation of profit. 

The article is an abridged version of a research paper by Omar H. Khan, Bar-at-Law. He presented the paper at the 34th International Labour Process Conference (ILPC) held in Sheffield, UK on April 04, 2017.


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