Bangladeshi government passes the Accord on Fire and Building Safety

After a tragic fire at a garment factory, the Bangladeshi government passed the Accord on Fire and Building Safety. While the reform has been successful in preventing more tragedies, its future is uncertain. Ahead of the upcoming Supreme Court ruling on April 7th, Online Editor Ritika Iyer argues that the accord should be protected.

On November 24, 2012, the Tazreen Fashions garment factory outside Dhaka, Bangladesh caught on fire and killed 117 workers — a tragedy that a preliminary government investigation concluded was due to the owner’s negligence. The incident exposed serious concerns about the global fashion supply chain, particularly bringing worldwide attention to the harsh realities of the fast fashion industry, which facilitates the rapid mass production of inexpensive versions of high-fashion styles.

Five months later, on April 24, 2013, fast fashion in Bangladesh was put on center stage once again. Rana Plaza, an eight-story commercial building outside Dhaka, collapsed, killing over one thousand people and reigniting global outrage. The collapse was recorded as the worst-ever garment industry disaster.

Rana Plaza was originally built for retail and apartment housing, and not for production or heavy machinery that could vibrate and weaken its structure. However, at the time of its collapse, Rana Plaza housed multiple garment factories supplying major Western brands, including Mango, Primark, and Walmart. Contributing to its collapse were four illegal upper floors, constructed without permits, and massive generators to maintain garment production despite spotty power in the city.

The global reaction from government leaders, the media, and consumers to the Rana Plaza collapse was swift and severe, not simply because of the tragic loss of life, but also because the deaths could have been prevented. Several large cracks appeared on the building just one day before the collapse, and though many shopkeepers closed their offices, all garment workers were still ordered to report back the next day.

With growing demand from fast fashion labels, the costs of declining business for Bangladeshi factory owners are high. Bangladesh’s ready-made garments (RMG) industry is colossal, employing over four million people and making up approximately 12 percent of the country’s GDP and over 80 percent of its total export earnings in 2016. As a result, its outcomes have major implications for the country’s economy and labor force participation rate. In addition to unsafe and unsanitary working conditions, Bangladeshi garment workers are often subject to long hours and low pay. The industry’s minimum wage, recorded at $37 per month in 2012, was raised in 2018 to its highest-ever monthly value of approximately $63.

THE ACCORD ON FIRE AND BUILDING SAFETY IN BANGLADESH
In the immediate aftermath of the incident, stock prices for retailers sourcing from Rana Plaza fell and fast fashion brands faced significant negative media coverage. Customer boycotts of garments made in Bangladesh were short-lived, but attention remained on major American and European apparel brands. The incident fundamentally changed how garmenting in Bangladesh worked, particularly in regards to increased pressure to ensure the basic safety of garment workers.

The outcome was the Accord on Fire and Building Safety in Bangladesh, a five-year agreement signed in May 2013 immediately after the collapse, as a means of oversight over the RMG industry. According to the Accord’s website, it was designed as an “independent, legally binding agreement between brands and trade unions to work towards a safe and healthy garment and textile industry in Bangladesh.”

Specifically, the Accord oversees safety regulations at 1,600 RMG factories across the country, funds independent safety inspection and remediation programs, requires signatory brands to publicly disclose their factories, and promotes worker rights through the implementation of a training program, a complaint mechanism, and health and safety committees. All activities are funded by major apparel brands that have signed onto the legally binding Accord, including Abercrombie & Fitch, H&M, Primark, Mango, American Eagle Outfitters, and Adidas.

EXPIRATION OF AND OPPOSITION TO THE ACCORD
In anticipation of the Accord’s five-year expiration date, most of those involved with it signed a continuation of its activities in June 2017, extending its reach until May 2021. This extension is important because it ensures that ongoing safety improvements under the Accord are not halted, and that currently identified but not yet remediated issues will still be funded. The new agreement also allows for more time to continue strengthening public institutions in Bangladesh to ensure that garment worker safety will be prioritized at the same level as under the Accord.
In May 2018, the Accord’s extension was rolled back to just six months by a national high court. After an appeal to this decision and some back and forth between the two parties, a division of Bangladesh’s Supreme Court has left the Accord as is until April 7, 2019, after which the case will be ruled on again.

Despite major gains in building safety across Bangladesh, some factory owners and their unions have opposed the Accord, arguing that Bangladesh is a sovereign country that can make its own decisions on the health and safety of its people. These opponents have increased political pressure on the Bangladeshi government to consider how international companies can influence local factories.

On Transparency International’s 2018 Corruption Perception Index, which measures perceived public sector corruption, Bangladesh ranks 149th out of 180 countries. Government corruption isn’t the only issue – over 10 percent of Parliament members in Bangladesh are also involved in garment factory ownership; and therefore, they may have a strong political incentive to maintain the industry’s status quo of low wages and lenient safety enforcement. Recent crackdowns by the Bangladeshi government on worker strikes have raised concerns that repealing the Accord would result in the detriment of the initiative’s original goal: prioritizing and improving garment worker safety.

Although the ultimate goal is to fully hand over Accord activities to local regulatory agencies, NGOs, and the Bangladeshi government, it is important to first make sure that a strong public regulatory regime is in place to manage the volume of remediation requests and handle safety concerns. In order to ensure sustainable outcomes, it is imperative that this complete handover isn’t premature or rushed.

While the Bangladeshi government has suggested utilizing the Remediation Coordination Cell of the Department of Inspections for Factories and Establishments (RCC-DIFE) to take over the Accord, it does not currently have sufficient bandwidth or funding. As of February 2019, the RCC-DIFE was still in its “earliest stages of development” and is unprepared to take over building safety regulation responsibilities, which can cost up to 11 million USD annually.

THE SIGNIFICANCE OF THE ACCORD
The Accord addresses multiple safety provisions: it includes independent inspection requirements that introduce accountability and worker protection, funds safety trainings, and allows workers to raise safety concerns in a trackable way. Over 190 brands, 1,600 factories, and two million garment workers were involved with or affected by the Accord. The agreement was unique in its inclusion of legally binding language requiring brands to take responsibility for the safety of the factories they source from.

In a recent report, the Center for Global Workers’ Rights at Pennsylvania State University found dramatic gains in building safety in Bangladesh since 2013 and attributed that result to the required safety renovations mandated under the Accord. Additionally, the enforcement mechanism to ensure compliance with remediation requests has worked – complaints of non-compliance from local factory unions were appropriately addressed by global fashion brands once raised.

The Accord has also been successful in terms of safety concern remediation, especially relative to two non-binding agreements that arose in Bangladesh’s garmenting industry around the same time, the Alliance for Bangladesh Worker Safety and the National Action Plan on Fire Safety and Structural Integrity (NAP). Engineers have been able to fix 79 percent of factory safety issues identified under the Accord. The Bangladeshi government’s NAP, which did not establish an accountability link between fashion companies and garment workers, resulted in just a 20 percent remediation rate.

Most experts attribute the Accord’s high remediation rate to the commitment and funding from global fashion brands. Historically, many major brands have been reluctant to publicly prioritize worker safety, but this attitude changed in the aftermath of Rana Plaza. If this Accord is no longer in place and the RCC is unable to uphold the same quality of regulation, Bangladesh is brand support. Most fashion companies might not want to take the risk of sourcing from a factory that could result in another Rana Plaza. This consequence can have severe negative impacts on the Bangladeshi economy, namely in exports and unemployment.

LOOKING AHEAD
In just a few days, on April 7, 2019, the Accord’s future will once again become uncertain. Rather than give into short-term political pressure or perceived economic benefits, it is critically important that courts and politicians in Bangladesh take a long-term vision for their country that allows the Accord to remain in effect and protect garment workers.

In the next few years, there is strong potential for garment companies and the Bangladeshi government to work together to get to a place where a handoff is both practical and effective. This includes appropriate staffing and development of thought leaders at the RCC-DIFE, improved infrastructure of the unit, and a process for knowledge transfer to ensure that the quality of remediation is not affected by the handover.

Apart from worker safety, more can be done to create a more equitable global fashion supply chain. Since 2010, demand for fast fashion production from Bangladesh has been steadily increasing, while profit margins for Bangladeshi factory owners have declined, implying that the issues related to the garmenting industry are far from solved. Despite giving work to Bangladeshi factories, major fashion brands are not necessarily contributing to the country’s development or investing in the local economy. Progress has been made in recent years, but most garment workers across Bangladesh still experience low pay and long hours, and many open safety concerns have been flagged but not yet remediated.

Though the Accord does not address every problem with the garmenting industry in Bangladesh, it is a first step and symbolic victory for the protection of garment workers’ rights. Prematurely repealing or replacing it will likely force the Bangladeshi garmenting industry to take many steps backwards, closing the door on potential progress in other issue areas and representing a huge injustice to the millions of garment workers it currently protects.

Continued international support for initiatives like the Accord on Fire and Building Safety is imperative to ensuring safe working conditions. As long as demand for fast fashion production remains strong, high standards for worker safety are essential.

Courtesy: Georgetown Public Policy Review