[Senate Hearing 113-147]
[From the U.S. Government Printing Office]
S. Hrg. 113-147
LABOR ISSUES IN BANGLADESH
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON FOREIGN RELATIONS
UNITED STATES SENATE
ONE HUNDRED THIRTEENTH CONGRESS
FIRST SESSION
__________
JUNE 6, 2013
__________
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COMMITTEE ON FOREIGN RELATIONS
ROBERT MENENDEZ, New Jersey, Chairman
BARBARA BOXER, California BOB CORKER, Tennessee
BENJAMIN L. CARDIN, Maryland JAMES E. RISCH, Idaho
ROBERT P. CASEY, Jr., Pennsylvania MARCO RUBIO, Florida
JEANNE SHAHEEN, New Hampshire RON JOHNSON, Wisconsin
CHRISTOPHER A. COONS, Delaware JEFF FLAKE, Arizona
RICHARD J. DURBIN, Illinois JOHN McCAIN, Arizona
TOM UDALL, New Mexico JOHN BARRASSO, Wyoming
CHRISTOPHER MURPHY, Connecticut RAND PAUL, Kentucky
TIM KAINE, Virginia
Daniel E. O'Brien, Staff Director
Lester E. Munson III, Republican Staff Director
(ii)
C O N T E N T S
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Page
Biel, Eric, Acting Associate Deputy Under Secretary for
International Affairs, Bureau of International Labor Affairs,
U.S. Department of Labor, Washington, DC....................... 9
Prepared statement........................................... 11
Responses to questions submitted for the record by Senator
Jeanne Shaheen............................................. 62
Blake, Hon. Robert, Assistant Secretary of State for South and
Central Asian Affairs, U.S. Department of State, Washington, DC 4
Prepared statement........................................... 5
Responses to questions submitted for the record by Senator
Robert P. Casey, Jr........................................ 58
Responses to questions submitted for the record by Senator
Jeanne Shaheen............................................. 60
Corker, Hon. Bob, U.S. Senator from Tennessee, opening statement. 3
Drake, Celeste, Trade Policy Specialist, American Federation of
Labor and Congress of Industrial Organizations, Washington, DC. 32
Prepared statement........................................... 34
Karesh, Lewis, Assistant U.S. Trade Representative for Labor,
Office of the U.S. Trade Representative, Washington, DC........ 13
Prepared statement........................................... 14
Responses to questions submitted for the record by Senator
Robert P. Casey, Jr........................................ 57
Responses to questions submitted for the record by Senator
Jeanne Shaheen............................................. 59
Lubbe, Johan, International Labor and Employment Partner, Littler
Mendelson, P.C., New York, NY.................................. 41
Prepared statement........................................... 43
Menendez, Hon. Robert, U.S. Senator from New Jersey, opening
statement...................................................... 1
Additional Written Statements Submitted for the Record
Akter, Kalpona, executive director, Bangladesh Center for Worker
Solidarity (BCWS).............................................. 67
Kaufman, Peter J................................................. 64
Qader, Akramul, Ambassador of Bangladesh to the United States.... 73
(iii)
LABOR ISSUES IN BANGLADESH
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THURSDAY, JUNE 6, 2013
U.S. Senate,
Committee on Foreign Relations,
Washington, DC.
The committee met, pursuant to notice, at 11:01 a.m., in
room SD-419, Dirksen Senate Office Building, Hon. Robert
Menendez (chairman of the committee) presiding.
Present: Senators Menendez, Casey, Murphy, Kaine, Corker,
and McCain.
OPENING STATEMENT OF HON. ROBERT MENENDEZ,
U.S. SENATOR FROM NEW JERSEY
The Chairman. This hearing of the Senate Foreign Relations
Committee will come to order.
I know that the ranking member, who was just with me on the
floor voting, will be here any minute. My apologies to our
witnesses for the delay, but there were several votes on the
Senate floor, and that is one thing we do not control the
timing of.
It is not often that the Foreign Relations Committee holds
a hearing like this. In fact, the last labor hearing this
committee chaired was the debate giving PNTR status to China in
2000, so it has been a while. But as I said in an op-ed that
was published today, the tragedy at Rana Plaza--the deadliest
accident of the global apparel industry--should be a wake-up
call for all of us.
We have a range of witnesses in our two panels this
morning, from the State Department, the Department of Labor,
the Office of the U.S. Trade Representative, the AFL-CIO, and a
representative from the American retail and apparel
manufacturers.
We have also received written testimony from outside
groups, and I ask unanimous consent that their testimony be
included for the record. And without objection, it will be.
The Chairman. I also want to recognize the Bangladeshi
Ambassador to the United States who is with us in the audience
today. Welcome, Ambassador Qader, and thank you for being here.
Let me say how much the United States values its
relationship with Bangladesh, a moderate, Muslim-majority
democracy and a trade partner with annual flows topping $6
billion and supporting 10,000 American jobs.
As the world's seventh most populous country, Bangladesh
has made dramatic strides on everything from global food
security to gender equality to maternal and child health, and
we applaud those elements. But, not unlike other apparel
exporters, Bangladesh is a poor, developing country with lots
of economic challenges. What sets it apart from other countries
is the sheer size of the industry and the rate of growth. In my
view, what happens in Bangladesh will have a dramatic ripple
effect on the global apparel industry. A change in working
conditions there has the potential to change conditions for
workers everywhere.
That is one reason why we want global retailers to stay in
Bangladesh, to work together and adopt industrywide standards
to do everything possible to improve working conditions and
make sure another Rana Plaza never happens again, anywhere in
the world.
The fact is, most of us in this room own clothing that was
made in Bangladesh, the second-largest supplier of clothes.
Major American retailers--Target, Gap, Tommy Hilfiger, Calvin
Klein, and Walmart--all buy apparel from Bangladesh.
The reasons are clear: labor is cheaper in Bangladesh; the
regulatory process is more flexible in Bangladesh; hours,
working conditions, and building safety concerns clearly are
less cumbersome in Bangladesh; and that means products are
cheaper and profit margins are higher.
The Bangladeshi apparel industry now employs about 4
million, at least 80 percent of whom are women. It finances the
government and influences its politics. It is no coincidence
that numerous members of Parliament have ties to the garment
industry. The question is, Are we seeing a global race to the
bottom?
Bangladesh offers some of the cheapest labor in the world
with limited workers' rights and protections. As a result,
global retailers enjoy high profits, and global consumers
delight in low costs. So how can we improve conditions without
prices going up and manufacturers moving on to the next
Bangladesh?
Today, with the Rana Plaza collapse that killed at least
1,127, and the Tazreen factory fire in November which killed at
least 112 workers in conditions similar to the Triangle
Shirtwaist Factory fire, and 44 more factory fires since, the
brand ``Made in Bangladesh'' is in jeopardy.
Just as the Triangle Shirtwaist fire galvanized the labor
movement in the United States over 100 years ago, Rana Plaza
and Tazreen should be a turning point toward real systematic
change in Bangladesh, and we can only hope.
As the son of a seamstress who worked in the factories of
northern New Jersey, and worked very hard under some very
difficult conditions but far better than in Bangladesh, I know
firsthand how difficult this work can be, but it should never
be fatal.
Since Rana Plaza, the Bangladeshi Government has committed
to a number of steps to improve conditions, including amending
its labor laws, raising the minimum wage for garment workers,
registering more trade unions, and increasing the number of
building inspectors. But unfortunately, past promises have gone
largely unfulfilled.
Bangladesh has a long way to go in shifting from a culture
favoring corruption to one that is friendlier to workers,
enforcing prolabor legislation, allowing for the freedom of
association without repercussion, and enforcing building and
fire inspection codes.
But factory owners must do their part, as well, to bring
the workplace up to code. A recent survey by Bangladeshi
engineers found that 60 percent of the factories it inspected
are vulnerable to collapse. With somewhere between 3,000 and
5,000 factories, the sheer scale of the problem is mind-
boggling.
Global retailers have a real role to play. Major European
retailers have signed a binding building and fire safety
agreement, but American retailers and manufacturers now need to
cooperate on a similar industrywide plan that includes
workplace safety standards, cost-sharing for improvements, and
compensation for injured workers. It is time for collective
action if there is going to be any systemic change. Absent
significant collective changes that improve labor conditions
and worker safety, the administration should seriously consider
suspending, with conditions, the Generalized System of
Preferences benefits to Bangladesh.
While only a small fraction of Bangladesh's exports would
be affected, given ongoing violations of the GSP workers'
rights criteria, GSP suspension would send a strong signal that
the United States is serious about protecting workers and
improving workplace safety.
With that, let me turn to the ranking member, Senator
Corker, for his remarks.
OPENING STATEMENT OF HON. BOB CORKER,
U.S. SENATOR FROM TENNESSEE
Senator Corker. Thank you, Mr. Chairman. I appreciate you
having the hearing; and the two panels of witnesses we have, we
thank you for coming today.
I think all of us have seen the images of what happened in
Bangladesh, and our heart goes out to people who are trying to
make a living and working in conditions obviously that were not
safe. So I appreciate you having this hearing.
I think the most important objective that we can accomplish
today is to determine how all the stakeholders can figure out
how to move ahead in a way that is far more safe and keeps this
kind of thing from happening again. Obviously, there are a lot
of stakeholders. I mean, it is not just the people that have
been mentioned but the Government of Bangladesh, the unions,
the workers, the United States, the European Union, and many
other governments, and also the garment industry factory owners
and others.
It is my understanding that here in the United States,
retailers are working together toward something that I hope is
going to be sustainable. I think the goal is to have that done
by the end of the month, and I think this hearing will help us
toward that end.
So I appreciate the witnesses being here. I know that all
of us want to see a sustainable, long-term solution. There are
a lot of stakeholders involved here, and I think the goal of
this hearing should be to come up with a solution that we know
is in the long-term interests of all involved.
So I appreciate you being here, and I appreciate the
chairman calling this hearing.
The Chairman. Thank you, Senator Corker.
Let me introduce our first panel.
Assistant Secretary of State for South and Central Asian
Affairs, Robert Blake.
Eric Biel, who must have one of the longest business cards
in Washington, is the Acting Associate Deputy Under Secretary
for International Affairs, Bureau of International Affairs in
the Department of Labor.
That is quite a title, Eric. I hope you get compensated
commensurate with that title.
And Mr. Lewis Karesh, who does not have quite as long a
title but plays a very important role as the Assistant U.S.
Trade Representative for the Labor Office of the U.S. Trade
Representative.
Thank you all for being here.
Mr. Secretary, we will start off with you. Your full
statements will be included in the record, without objection.
We ask you to synthesize it to around 5 minutes so that we can
then have a good conversation.
STATEMENT OF HON. ROBERT BLAKE, ASSISTANT SECRETARY OF STATE
FOR SOUTH AND CENTRAL ASIAN AFFAIRS, U.S. DEPARTMENT OF STATE,
WASHINGTON, DC
Mr. Blake. Well, thank you, Chairman Menendez and Ranking
Member Corker, and all the other members of this committee, for
this opportunity to speak to you today about labor issues in
Bangladesh. I am very honored to join my colleagues Eric Biel
and Lewis Karesh before this committee today.
Mr. Chairman, as you said, engagement on labor issues is
part of our broad and expanding partnership with Bangladesh's
Government and its people. Bangladesh works closely with us on
all of the President's signature development initiatives in
climate, health, and food security, and in encouraging greater
regional integration and connectivity.
In the past two decades, as you remarked in your very
constructive op-ed, Bangladesh has made remarkable development
progress, in part because of the growth of its ready-made
garment sector. Despite the benefits the industry has brought,
however, the tragedies at Rana Plaza and Tazreen Fashions have
made clear that significant challenges remain.
Our goal is to help Bangladesh continue to build on its
economic achievements but to do so in a way that ensures the
growth of its export sector, does not come at the expense of
safe and healthy working conditions.
We believe three key reforms are particularly important to
improving labor rights and conditions in Bangladesh,
guaranteeing workers' rights to organize, guaranteeing fire
safety, and ensuring structural soundness of factories and
other facilities.
Last month, Secretary Kerry underscored to Bangladeshi
Foreign Minister Moni that the recent tragedies and weak
progress on labor rights and safety had undermined the
Bangladesh brand and placed the country's future development at
risk. He urged Bangladesh to make transformative and
sustainable improvements in worker rights and working
conditions. He pressed for further labor union registrations
and the enactment of amendments to the labor law that will
address freedom of association and worker safety.
These changes would enable the International Labor
Organization and the International Finance Corporation to
launch a better work program for the garment industry in
Bangladesh that would lead to still more improvements. We hope
that these changes will be enacted by Parliament before the end
of this month.
We are seeing some results of our advocacy, 27 trade unions
registered since September 2012, the signing of a comprehensive
fire safety plan, and a Bangladeshi commitment to dramatically
increase the number of government labor inspectors.
We have also engaged United States companies sourcing from
Bangladesh. On May 8, Special Representative for International
Labor Affairs, Barbara Shailor, and I, along with colleagues
from USTR and the Department of Labor, organized a conference
call with United States buyers, and we urged them to coordinate
efforts with each other and with European counterparts to
communicate their concerns about labor conditions to key
officials in Bangladesh, and to provide assistance to
independent safety and fire inspectors. We shared our best
practices for companies operating in Bangladesh, which I have
submitted along with my written statement.
Mr. Chairman, Bangladesh is now at a critical moment in its
history. Last week, Ambassador Mozena met with leaders in a
recently formed union in the garment industry, one of the 27
unions that I mentioned. These workers highlighted their
successful efforts since forming the union to improve factory
floor conditions such as obtaining potable water, a clean lunch
room, the removal of electrical hazards, and the unblocking of
exit stairwells. Their efforts show the potential for a broader
sea change in Bangladesh's approach to labor issues, but much
more work needs to be done.
Our hope is that Bangladesh will seize the current moment
to strengthen labor rights and improve working conditions. This
administration wants to see Bangladesh succeed, and we will
remain engaged with all the relevant actors, both here and
overseas, to support those efforts.
So again, I thank you, Mr. Chairman, for your interest in
this important endeavor, and I look forward to taking your
questions.
[The prepared statement of Mr. Blake follows:]
Prepared Statement of Assistant Secretary Robert Blake
Good morning. Thank you Chairman Menendez, Ranking Member Corker,
and all the members of the committee for this opportunity to speak with
you today regarding labor issues in Bangladesh. Your interest and
engagement will play a vital role as the Government of Bangladesh moves
to address important labor rights issues.
The tragic collapse of the Rana Plaza building in April and the
deadly fire at the Tazreen clothing factory last November have resulted
in unprecedented public concern about labor conditions in Bangladesh.
Since long before these tragedies, we have been working hard on the
fundamental labor rights concerns that these events have highlighted.
We are continuing and expanding our efforts.
Before delving into our efforts on the labor front, I would like to
note that our engagement with the government and people of Bangladesh
is broad--and it is growing still broader, reflecting the important
strides that Bangladesh has made over the past decades. The policy
choices Bangladesh has made have led it to a path of economic growth,
impressive gains for women and children, successful work combating
terrorist networks, and an increasingly prominent role in multilateral
organizations.
Indeed, over the past two decades, Bangladesh has made remarkable
development progress. Life expectancy has increased by 10 years, infant
mortality has declined by nearly two-thirds, female literacy has
doubled, and economic growth has averaged over 5 percent annually. A
vibrant democracy has taken root in the world's third-largest Muslim-
majority nation and seventh most populous country. Bangladesh offers a
moderate, tolerant, secular, democratic alternative to violent
extremism. As the largest contributor of forces to U.N. peacekeeping
missions in some of the world's most dangerous conflicts, Bangladesh is
committed to sharing its experiences with the world. Bangladesh also is
a focus country for all of the President's signature development
initiatives, including Global Health, Global Climate Change, and Feed
the Future.
Over Memorial Day weekend, Under Secretary of State Sherman
travelled to Dhaka to lead the U.S. delegation at the second annual
U.S.-Bangladesh Partnership Dialogue. The dialogue highlighted the
robust ties between the United States and Bangladesh and reaffirmed our
commitment to further broaden, deepen, and strengthen the partnership.
The discussions focused heavily on labor rights and working conditions,
but they also covered the full range of our relations, including our
close cooperation on security issues, Bangladesh's leading role
supporting regional integration, and our growing trade relationship.
The United States and Bangladesh cooperate closely on security issues
ranging from counterterrorism to counterpiracy and the mitigation of
natural disasters. The Government of Bangladesh has also consistently
prioritized improved relations with India and greater regional economic
integration--a key U.S. interest in a region that remains among the
least integrated in the world.
As Under Secretary Sherman said in Dhaka, ``The success of the
Bangladesh story has implications not just for Bangladeshis, but for
the entire global community. Millions around the globe see Bangladesh
as a powerful model for democratic and economic development and seek to
replicate its success.''
Bangladesh's development gains have come in part because of the
growth of its ready-made garment sector, now the second-largest in the
world behind China, a sector that employs between 2 and 3 million
Bangladeshi women, helping to lift them out of poverty and empowering
them socially and economically. Despite the benefits the industry has
brought, however, the tragedies at Rana Plaza and the Tazreen Fashions
have made clear that significant challenges remain to ensure that
workers fully benefit from this growth.
In interactions with the Government of Bangladesh, with U.S.
companies sourcing from Bangladesh, with factory owners in the country,
with labor rights groups, and with our partners in Europe, our goal is
to help Bangladesh continue to build on its economic achievements, but
to do so in a way that ensures that the growth of its export sector
does not come at the expense of safe and healthy working conditions and
respect for worker rights. Success will depend on the will and
commitment of Bangladeshis in government, in industry, and in the labor
community to come together to change the culture of workplace safety
and worker rights in Bangladesh.
We believe three key reforms are particularly important to improve
workers' lives in the near term: guaranteeing workers' rights to
organize, guaranteeing fire safety, and ensuring structural soundness
of factories and other facilities. I would like to briefly highlight
some of the actions the State Department, working closely with
colleagues from the Department of Labor and the United States Trade
Representative (USTR) have been taking to achieve these and other
important goals in Bangladesh:
Last month, during a meeting at the State Department,
Secretary Kerry underscored to Bangladeshi Foreign Minister
Dipu Moni that the recent tragedies and weak progress on labor
rights and working conditions are contrary to Bangladesh's own
expressed goal of improving workers' lives, have undermined the
Bangladesh brand, and have placed the country's future
development at risk. Secretary Kerry encouraged the Bangladeshi
Government to respond to these tragedies by making
transformative and sustainable improvements in workers' rights
and working conditions.
Secretary Kerry pressed for continued labor union
registrations as well as enactment of amendments to the
country's labor law that will allow for the creation of a
``Better Work'' program, backed by the International Labor
Organization (ILO) and the International Finance Corporation.
Proposed in 2010 and funded in part by the U.S. Department of
Labor, this program would strive to achieve sustainable
improvements in working conditions in the garment sector. The
labor law amendments we seek, which have been negotiated by
stakeholders with help from a related ILO project, would
strengthen the rights of workers to organize and negotiate with
their employers and would improve some aspects of workplace
safety. Specifically, they would (1) abolish a requirement that
the Ministry of Labor inform factory owners of the names of
workers applying for union registrations; and (2) allow unions
access to outside expertise during collective bargaining
negotiations. These amendments have been approved by the
Bangladeshi Cabinet, and we have been working to make sure they
are adopted by Parliament by the end of the month.
Under Secretary Sherman carried the same messages in her
discussions in Dhaka as part of the Partnership Dialogue and in
her meetings with Prime Minister Hasina and Foreign Minister
Moni over the Memorial Day weekend.
U.S. Ambassador to Bangladesh Dan Mozena has met repeatedly
with industry leaders, including the Bangladesh Garment
Manufacturers & Exporters Association, and with the Bangladeshi
Government to emphasize the need for concrete action following
the Rana Plaza tragedy. Our Embassy worked with the ILO and
industry, labor, and government representatives to secure a
pledge to recruit 200 additional building safety inspectors
within 6 months, with the eventual goal of adding another 800
inspectors. Separately Bangladesh manufacturers are also
working with the German development organization GIZ and BRAC,
a leading Bangladeshi NGO, to create a 300-person inspectorate
focused on fire safety.
These engagements come after many months of efforts, predating the
Rana Plaza collapse, in which we have sought to effect change on a
range of labor rights and workplace safety concerns. We are seeing some
results: our advocacy has been an important factor leading to the
registration of 27 trade unions since September 2012 (compared to 3 in
the previous 5 years); signing of a comprehensive fire safety plan; and
a significant Bangladeshi commitment to dramatically increase the
number of government labor inspectors. However, there are areas where
we still need to see progress and we will continue to press the
Government of Bangladesh to address our concerns in these areas. Some
of these concerns could be resolved relatively quickly--such as
registration of labor-related nongovernment organizations and court
cases against labor activists, while others will require sustained,
long-term investment--such as building the capacity of government
inspectorates.
We have also engaged with U.S. manufacturers and retailers sourcing
from Bangladesh. On a regular basis, our officers are briefed by major
U.S. buyers so we have a good sense of their unfolding concerns. Over
the past year, as our concerns about workplace safety and labor
conditions continued, I and my colleagues in State and across the U.S.
Government began to convene larger conference calls open to all U.S.
companies to share with them the steps we were taking, and hear from
them about theirs. Most recently, on May 8, Special Representative for
International Labor Affairs Barbara Shailor and I, along with
colleagues from USTR and the Department of Labor, led a conference call
with U.S. buyers that source from Bangladesh's garment industry. We
urged them to coordinate efforts with each other, with the Government
of Bangladesh and BGMEA, and with civil society and labor groups on
factory safety and fire initiatives, including helping pay for
independent safety and fire inspectors. We encouraged the buyers to
communicate their concerns about labor conditions to the BGMEA and the
Bangladeshi Government, and to urge prompt passage of the labor law
amendments I referenced earlier.
In calls with buyers in March and again in May we reviewed our
expectations of U.S. companies' engagement and shared a ``Best
Practices for Companies Operating in Bangladesh'' document (attached).
As many of you know, more than 40 brands, mostly from Europe but
including U.S. companies PVH, Abercrombie & Fitch, and now Sean John,
have coalesced around an accord developed in coordination with the
global union IndustriALL that is intended to improve working conditions
and respect for worker rights in Bangladesh, while also making clear
the brands' commitment to continue to source from Bangladesh. The
Accord involves worker organizations, brings multiple retailers
together behind one initiative, fosters information sharing, and
commits retailers to invest in improving workplace safety and other
labor standards. We recognize that U.S. companies must make their own
judgment about whether or not to sign the Accord, but we have
encouraged them to carefully examine what they can do to support
improved working conditions in Bangladesh.
I should also note that at the same time we are engaging with the
Government of Bangladesh, industry, and labor groups, USTR is leading
the administration's review of Bangladesh's Generalized System of
Preferences (GSP) trade benefits. My colleague from USTR, Lewis Karesh,
will discuss more about the GSP review in a moment.
Bangladesh is now at a critical moment in its history. Over a
century ago, our country confronted a similar challenge. After the 1911
Triangle Shirtwaist Factory fire in New York killed 129 workers,
political momentum was created from that tragedy to transform our
approach to workplace safety and building codes. Within Bangladesh, the
Tazreen and Rana Plaza tragedies may create a similar impetus for
significant and lasting improvements in worker rights and working
conditions.
Last week Ambassador Mozena met with leaders in a recently formed
union in the garment industry, one of the 27 new unions which have been
registered since last fall that I mentioned earlier. These workers
highlighted to the Ambassador their successful efforts, since forming
the union, to improve factory floor conditions, such as obtaining
potable water, a clean lunchroom, the removal of electrical hazards,
and the unblocking of exit stairwells. This one case shows the
potential of a broader sea change in Bangladesh's approach to labor
issues. Still, more work needs to be done, and more unions need to be
registered.
Our hope is that Bangladesh will seize the current moment to
strengthen its protection of labor rights and improve working
conditions. We want to see Bangladesh succeed, and we will remain
engaged with all the relevant actors to support those efforts.
Attachment:
U.S. Government Recommendations on Best Practices for
Companies With Operations in Bangladesh
On Tuesday, March 5, 2013, Assistant Secretary of State for
Democracy, Human Rights, and Labor Michael Posner and Assistant
Secretary of State for South and Central Asia Robert Blake hosted a
conference call with over 70 U.S. brands and civil society groups to
discuss fire safety issues in manufacturing facilities in Bangladesh.
On the call, Assistant Secretary Posner and Assistant Secretary Blake
summarized important labor rights issues, including the status of the
Aminul Islam case, union registrations, and legal reforms. They also
outlined what the U.S. Government views as best practices for companies
with operations in Bangladesh. Eric Biel, Acting Associate Deputy Under
Secretary for International Affairs at the Department of Labor,
discussed his recent trip to Bangladesh, including numerous meetings on
fire safety and labor law reform, and possible areas for bilateral
technical assistance.
Unsafe working conditions in Bangladesh were brought into the
international spotlight by the Tazreen factory fire of November 2012,
the worst of many deadly manufacturing fires in the country in recent
years. The ILO has been engaged with the Government of Bangladesh on a
Tripartite National Action Plan on Fire Safety to address this issue,
and as of today the Plan is being finalized by the Ministry of Labor
and Employment. They also have worked with the Government to identify
necessary steps, including reforms to labor law and an improved and
more transparent union registration process, to create an ``enabling
environment'' for the establishment of a Better Work program.
The National Action Plan and Better Work program both offer
opportunities to sustainably improve labor standards in Bangladesh and
could both benefit from the support and cooperation of international
buyers, including in coordination with buyers' own initiatives. The
practices outlined below are recommendations from the U.S. Government
to U.S. brands as they promote respect for human rights and
international labor standards, as well as encourage engagement with the
Government of Bangladesh and other stakeholders on these issues.
1. Act Collectively: Companies should work together to figure out
how they can make a difference collectively. And it's important that
responses meet three criteria: they're credible; they're relevant; and
they're effective. There are several ongoing collaborative initiatives
in various stages of development. We encourage companies to link
efforts on labor and human rights with collaborative work being done
through multi-stakeholder initiatives, third-party auditors, industry
associations, and cooperative agreements. The Tripartite National
Action Plan on fire safety may offer entry points for buyers and civil
society to support and enhance a Bangladesh-owned process to improve
fire safety.
2. Develop Broad Principles and Policies and Procedures for
Implementation: Companies should have clearly defined labor and human
rights principles, policies and procedures that guide their behavior
and that of their suppliers and subcontractors. Such policies should be
based on internationally recognized human rights and international
labor standards and there should be effective and transparent means of
monitoring compliance. Senior leadership of the companies should
visibly support such efforts and encourage implementation throughout
the entire supply chain.
3. Develop Credible Internal Benchmarks: In order to assess
progress and effectiveness, companies should have internal metrics to
manage and measure performance on labor and human rights.
4. Conduct Independent Third-Party Verification: Third-party
verifiers should assess performance of company policies and procedures.
Inspections by verifiers should be thorough, timely, unannounced,
independent, and include confidential interviews and consultations with
workers about workplace conditions. Inspections should look at serious
and common hazards, implementation of the local law and respect for
internationally recognized human rights and international labor
standards, and mechanisms for tracking non-compliance with company
policies and procedures.
5. Corrective Actions and Penalties: Corrective action may be
necessary to address non-compliance with company policies and
procedures at any point in the supply chain. When suppliers are found
to be in non-compliance, there should be timely identification and
financial or technical assistance to help address hazards in factories.
There should be contractual penalties for non-compliance that are clear
and meaningful. Also, when non-compliance is discovered, corrective
actions should be shared with stakeholders to the extent possible and
appropriate to disseminate lessons learned and best practices for
avoiding or mitigating future incidents.
6. Cultivate Worker Voice and Education: In manufacturing
facilities within a company's supply chain, buyers should seek to
engage with workers to (a) promote education; (b) prevent retaliation
against those reporting hazards; and (c) compensate workers, including
those put out of work during corrective actions. Companies should
communicate with workers through legitimate representatives selected by
the workers themselves, and should avoid factories where no such
representative mechanism exists.
7. Share Information: Companies should share information with each
other, stakeholders, and relevant host government officials about
factories that fail to comply with policies and procedures or
corrective measures, so as to bring the greatest leverage to bear with
the greatest effect, and to avoid undercutting each other's efforts.
Information-sharing will ensure maximum coordination and knowledge.
8. Work with Stakeholders: Draw on the expertise and experiences of
other companies, NGOs, unions, the ILO, the Government of Bangladesh,
and others to develop sophisticated responses to the current human
rights challenges.
The Chairman. Mr. Biel.
STATEMENT OF ERIC BIEL, ACTING ASSOCIATE DEPUTY UNDER SECRETARY
FOR INTERNATIONAL AFFAIRS, BUREAU OF INTERNATIONAL LABOR
AFFAIRS, U.S. DEPARTMENT OF LABOR, WASHINGTON, DC
Mr. Biel. Mr. Chairman, thank you for the kind
introduction. I know the job title is a mouthful, and I
appreciate your getting all the words in there. I am delighted
to be here with my friends and colleagues, Assistant Secretary
Blake and Assistant USTR Karesh. Thank you, Ranking Member
Corker, and Senators Casey, Kaine, and Murphy as well. We are
pleased on behalf of the Department of Labor to be able to
participate in this important and timely committee hearing on
Bangladesh.
We have been deeply engaged at the Department, working with
our colleagues at State, USTR, and elsewhere in the Government,
with the Government of Bangladesh, with workers and other civil
society organizations, with United States buyers and retailers,
and with other stakeholders on a range of crucial labor-related
issues, both legal and policy.
Now, this is not something new, by any means. The
engagement has gone on for some time. But certainly it has
increased and intensified in recent months in the wake of the
Tazreen fire at the end of November that you, Mr. Chairman,
mentioned, and then the terrible Rana Plaza building collapse
in late April.
We have pressed the Government of Bangladesh to address
issues in areas ranging from the ready-made garment sector,
which we have already focused on, to the shrimp processing
sector, to the governance of Bangladesh's export processing
zones. We have also pressed on a number of other labor rights
concerns, including but not limited to the investigation of the
murder some 14 months ago of labor organizer, Aminul Islam.
In this regard, we are also working closely with the
International Labor Organization, the ILO, on a number of
fronts in Bangladesh, having funded--when I speak of having
funded, the Department of Labor having funded--different ILO
projects to promote labor rights and workplace safety in
Bangladesh.
Our coordination with the ILO includes, as Assistant
Secretary of State Blake already mentioned, close engagement
with the ILO-International Finance Corporation-run Better Work
Program. Last fall, Better Work's management team set out
several labor issues that it expected the Government of
Bangladesh to address prior to any launch of a new Better Work
Program in the ready-made garment sector in Bangladesh.
Now, if the Better Work leadership team determines that the
time has come to launch a program there, it will be a major
program given the size of the sector, and we will be closely
engaged in the implementation process of that program moving
forward.
We are also working with parties in Bangladesh and with the
ILO with respect to commitments specifically on fire and
building safety made under the umbrella of the ILO-Facilitated
National Tripartite Plan of Action that was announced by the
Government of Bangladesh and other stakeholders in mid-March.
Finally, the Department of Labor is prepared and ready to
play a direct role in helping to address these fire and
building safety concerns and other workers' rights concerns
that were illustrated so dramatically and tragically by the
Tazreen fire and the Rana Plaza building collapse. We have
crafted a detailed plan to provide funding to one or more
grantees to help strengthen the capacity of both the Government
of Bangladesh and workers' organizations within the country to
improve fire and building safety in the ready-made garment
sector as part of our overall technical assistance programs,
and we have posted notice of that, what we call a Notice of
Intent, and will be issuing the full project proposal very
shortly.
Finally, in my remaining time, a few words about the role
that the private sector can and must play to help advance
positive change, Mr. Chairman, as you mentioned, for workers in
Bangladesh.
Within Bangladesh, it is essential that the powerful
garment industry do more to ensure workplace safety and greater
respect for worker rights. In addition, buyers and retailers
need to play a more active role in addressing labor concerns in
their supply chains from Bangladesh, as you also talked about
in both your op-ed and opening statement.
Assistant Secretary Blake's testimony referenced what has
come to be known in the last few weeks as the IndustriALL
Accord; the agreement between several workers' organizations
and more than 40 brands, including three from the United
States, primarily Europe, but also three from the United States
and one from Canada. As important as any particular element of
that agreement, and I know you will be hearing more details of
that agreement in the second panel from different perspectives,
but as important as any particular element of that agreement is
its likely impact on workers. It creates a clear and
enforceable plan for sustained buyer engagement, as well as
financial obligations and commitments to continued sourcing
from Bangladesh, something that is of critical importance to
those who depend on the garment sector, as you mentioned,
largely young women, 80 percent of the workforce, as a stepping
stone to a better life.
So in sum, Mr. Chairman, members of the committee, our goal
in all of this is not to stifle Bangladesh's remarkable story
of growth and development, but rather to work with the
government, industry, workers and other civil society groups,
and others to ensure that job creation and economic development
go hand in hand with increased respect for worker rights and
improved workplace health and safety.
Thank you again for the opportunity to testify, and
following Mr. Karesh's testimony, we look forward to your
questions and dialogue.
[The prepared statement of Mr. Biel follows:]
Prepared Statement of Eric R. Biel
Good morning. Chairman Menendez, Ranking Member Corker, and members
of the committee, thank you for inviting the Department of Labor to
participate in this important and timely hearing concerning labor
issues in Bangladesh. I am honored to join my colleague, Assistant
Secretary of State Blake, in appearing before you this morning. We look
forward to working closely with you and other Members of Congress in
the days and weeks ahead to improve the protection of workers' rights
and strengthen workplace safety in Bangladesh.
The Departments of State and Labor, the Office of the U.S. Trade
Representative, and others in the U.S. Government are deeply engaged
with the Government of Bangladesh, workers' and other civil society
organizations, U.S. buyers and retailers, and other stakeholders both
in the United States and Bangladesh on a range of critical labor-
related legal and policy issues.
This is not something new by any means; indeed, last summer,
Assistant Secretary Blake and I appeared together before a House panel
to discuss a number of longstanding labor and trade policy challenges
in Bangladesh--nearly all of which remain front and center for us
today.
At the same time, the focus on Bangladesh has increased
considerably over the past several months in the wake of the tragic
Tazreen Fashions factory fire last November, subsequent garment factory
fires that fortunately caused less loss of life, and then the horrific
Rana Plaza building collapse about 6 weeks ago.
We are continuing to move forward with the interagency process,
chaired by our colleagues at the Office of the U.S. Trade
Representative, to determine the appropriate actions under our
Generalized System of Preferences (GSP) trade preference program.
Different options remain under consideration, and a decision will be
announced before the end of this month.
Through regular engagement with the Government of Bangladesh--
including during a weeklong trip I made to Dhaka in late February that
included meetings with senior officials across different ministries and
leaders from industry and workers' and civil society organizations--we
have pressed the government to address issues in areas ranging from
workers' rights and working conditions in the ready-made garment and
shrimp processing sectors to the governance of Bangladesh's Export
Processing Zones.
We have also pressed on a number of other labor rights concerns,
including with respect to the investigation of the murder 14 months ago
of labor organizer, Aminul Islam, and the treatment of the Bangladesh
Center for Workers Solidarity (BCWS)--the workers' advocacy
organization with which he was affiliated--and its leadership, as well
as the organization Simple Action for the Environment (SAFE). While
modest measures have been taken, much more remains to be done on both
fronts. We will continue to press the Government for greater
transparency, accountability, and justice with respect to both the
murder investigation and the treatment of BCWS and its leaders.
We also are working closely with the International Labor
Organization (ILO) on a number of fronts in Bangladesh, having funded
different ILO projects to promote labor rights by strengthening the
capacity of workers' organizations to advance workplace health and
safety and by ensuring that workers' voices are heard.
Our coordination with the ILO includes close engagement with the
ILO-International Finance Corporation Better Work Program, including
through our participation on the Better Work advisory and donor
committees. Several months ago, Better Work's management team set out
several labor issues that it expected the Government of Bangladesh to
address prior to any launch of a Better Work program in the ready-made
garment sector. We have seen progress on one of those fronts, the
registration of unions, which has increased significantly--with, as
Assistant Secretary Blake noted in his testimony, 27 registrations
since September compared with 3 in the previous 5 years.
That is certainly welcome and encouraging, although important
challenges remain to workers' ability to exercise their right to
freedom of association and collective bargaining in practice, once a
union is registered. At the same time, Better Work is still waiting on
several changes to Bangladesh's Labor Code, which are part of the
larger labor law package awaiting action by the Parliament.
If those amendments are enacted and the Better Work leadership team
then determines that the time has come to launch the program there, we
at the Department of Labor will be closely engaged in that process
moving forward. To be sure, Better Work will not be a panacea; even
after 5 years, it will only cover a relatively small part of the huge
garment sector. But it will be another important measure in advancing
worker rights and workplace safety in that sector.
We are also working with parties in Bangladesh and the ILO with
respect to the commitments on fire and building safety made by the
Government of Bangladesh and its industry and workers' organizations
under the umbrella of the ILO-facilitated National Tripartite Plan of
Action launched in March. We welcome the lead role being played by the
ILO in that regard, as underscored by Deputy Director General for Field
Operations and Partnerships Houngbo in early May following the Rana
Plaza collapse, and in the ``road map'' he outlined at the end of that
high-level mission.
That ``roadmap'' recognizes the need for an action plan to
implement several specific short- and medium-term measures. These
include labor law reform, expedited action on fire and building safety
under the National Action Plan, and, as Assistant Secretary Blake noted
in his testimony, the recruitment of 200 new labor inspectors in 6
months--with plans for a minimum of 800 new inspectors.
We at the Department of Labor are prepared to play a direct role in
helping advance the effort to make tangible progress in addressing the
fire and building safety and other workers' rights-related concerns
highlighted by the Tazreen and Rana Plaza tragedies.
As promised by our Department leadership soon after Tazreen, we
have crafted a detailed plan to provide funding to one or more grantees
to help strengthen the capacity of both the Government of Bangladesh
and workers' organizations within the country to improve fire and
building safety in the ready-made garment sector. We have published the
Notice of Intent with respect to this technical assistance project and
shortly will be issuing the detailed solicitation document.
We recognize that this funding will only be a small piece of the
puzzle, but hope that, along with the support of other donors within
the U.S. Government and from around the world, it will play an
important role in helping to remedy the shortcomings that have impeded
effective enforcement of laws and regulations and the protection of
workers' rights in the garment sector--often with terrible
consequences.
Finally, a few words about the role that the private sector can and
must play to leverage its market power to help advance positive change
for workers in Bangladesh.
Within Bangladesh, it is essential that the powerful garment
industry, including the Bangladesh Garment Manufacturers and Exporters
Association (BGMEA), step up and do more to ensure workplace safety and
greater respect for the rights of the largely young, female garment
sector workforce. In addition, buyers and retailers based in the United
States and elsewhere need to play a more active role in addressing
labor concerns in their supply chains from Bangladesh.
Assistant Secretary Blake's testimony referenced what has come to
be known as the Accord, the agreement reached between several workers'
organizations and more than 30 brands--mainly from Europe but including
PVH (the first to sign on), Abercrombie & Fitch, and as of last week
Sean John from the United States. There is much to commend in that
agreement, including commitments to ensure that fire and building
safety improvements are made and greater respect for worker rights is
achieved in the garment sector.
As important as any particular element of that agreement, however,
is its likely impact on the workers of Bangladesh: it creates a clear
and enforceable roadmap for sustained buyer engagement, financial
obligations, and commitments to sourcing from Bangladesh--something of
critical importance, especially to those young workers who have come to
depend on garment sector jobs as a steppingstone to a better life.
Our goal in all of this is not to stifle Bangladesh's remarkable
growth and development, but rather to work with the Government,
industry, workers' and other civil society groups, and other
stakeholders to ensure that job creation and economic growth occur hand
in hand with increased respect for worker rights and improved workplace
health and safety.
Tazreen and Rana Plaza have helped highlight the shortcomings in
labor law, policy, and enforcement that we have discussed with our
counterparts during meetings in Dhaka and Washington, and they have
demonstrated, in the most tragic way imaginable, how essential it is
that we all urgently address labor rights and workplace safety issues
in Bangladesh with an unprecedented degree of commitment and vigor.
Thank you again for this opportunity to testify, and I would be
pleased to take your questions.
The Chairman. Thank you.
Mr. Karesh.
STATEMENT OF LEWIS KARESH, ASSISTANT U.S. TRADE REPRESENTATIVE
FOR LABOR, OFFICE OF THE U.S. TRADE REPRESENTATIVE, WASHINGTON,
DC
Mr. Karesh. Good morning. Chairman Menendez, Ranking Member
Corker and other members of the committee, thank you for the
opportunity to testify at this hearing. I am very pleased to be
here with my colleagues from the Departments of Labor and
State.
As the recent tragedies involving building and fire safety
demonstrate, this is a critical time to work with Bangladesh to
ensure that workers' rights and safety are protected. Today I
will talk about our trade relationship with Bangladesh and in
particular our ongoing review of worker rights under the
Generalized System of Preferences, or GSP, Trade Preference
Program.
Bangladesh is an important trade partner of the United
States, and we have a strong and growing trade relationship.
We, the United States, are the largest single-country market
for Bangladesh's chief export of apparel products. One of the
ways we are seeking to strengthen that trade relationship is
through a regular mechanism for dialogue and cooperation. In
this regard, we have proposed to establish a U.S.-Bangladesh
Trade and Investment Cooperation Framework Agreement and are
awaiting Bangladesh's response to that request.
Bangladesh currently receives special duty-free access to
the United States market through GSP. The GSP program has
several eligibility criteria, including worker rights. To
maintain its GSP benefits, a country must be taking steps to
afford internationally recognized worker rights. In 2007, the
AFL-CIO submitted a petition to USTR under GSP alleging serious
shortcomings in Bangladesh's recognition of worker rights. The
AFL-CIO petition described a wide array of worker rights
issues, including serious obstacles to freedom of association
and collective bargaining, particularly in export processing
zones, the ready-made garment industry, and the shrimp
processing sector.
The petition also alleged a pattern of harassment and
violence against trade unionists and nongovernmental
organizations that work on labor rights issues, and a neglect
of worker protections in the areas of fire safety and health.
We at USTR and other government agencies have taken and
continue to take these allegations very seriously. From the
moment we accepted the AFL-CIO petition, and indeed prior to
the petition because many of the issues have been longstanding,
USTR has worked with all stakeholders to address the many
concerns. While we have seen progress in some areas over time,
we are concerned that the situation in other areas has
deteriorated, particularly in the past year.
United States officials have been explicit with the
Government of Bangladesh concerning specific actions it should
take to provide greater freedom of association and to ensure
that workers have safe factories in which to work. Despite our
many efforts with Bangladesh, beginning in late 2012 we grew
increasingly concerned that the worker rights situation was, in
fact, deteriorating. We concluded that the situation warranted
consideration of possible withdrawal, suspension, or limitation
of Bangladesh's trade benefits under GSP.
We issued a Federal Register notice in January of this year
to make stakeholders aware of the seriousness of our concerns,
and then held a hearing on the issue in March. The Tazreen fire
in November 2012 and the Rana Plaza building collapse that
others have spoken about this past April demonstrated the
deadly implications of the failure to address the underlying
issues of worker rights and safety, especially in the garment
sector.
Over the past several months, the administration has
intensified its engagement with the Government of Bangladesh
and relevant stakeholders. We have stressed the importance of
seizing this moment to make concrete and lasting change. The
GSP review has given us a much better understanding of the
range of labor issues workers face in Bangladesh and provides a
specific mechanism to engage the government. The administration
will announce a decision on next steps in the GSP review of
Bangladesh by the end of June. All options remain under
consideration, including possible suspension, limitation, or
withdrawal of GSP benefits.
The challenges Bangladesh faces require both short-term and
long-term actions. Overcoming these challenges will take the
efforts of all parties--the Government of Bangladesh, factory
owners, workers, nongovernmental organizations, international
buyers, and, of course, the United States and other
governments--that have an interest in the growth and
development of Bangladesh. We recognize that now is the time,
and we need to see meaningful and sustained change on these
matters in Bangladesh.
Thank you again, Chairman and this committee, for the
opportunity to testify, and I look forward to your questions.
[The prepared statement of Mr. Karesh follows:]
Prepared Statement of Lewis Karesh
Good morning. Chairman Menendez, Ranking Member Corker, and members
of the committee, thank you for the opportunity to testify at this
hearing concerning labor issues in Bangladesh. As the recent tragedies
involving building and fire safety demonstrate, this is a critical time
for our Government, U.S. companies, and American consumers to
understand the challenges presented, and work with Bangladesh to ensure
that workers' rights and safety are protected. Today, I would like to
touch on our overall trade relationship with Bangladesh, but discuss in
much greater detail our ongoing review of worker rights in Bangladesh,
under one of our trade preference programs, the Generalized System of
Preferences (GSP).
The United States and Bangladesh have a strong and growing trade
relationship. The United States is a key market for Bangladesh,
importing nearly $5 billion in goods from Bangladesh in 2012. We are
also the largest single-country market for Bangladesh's chief export,
apparel products. The United States engages with Bangladesh on trade
and investment-related matters in bilateral and multilateral settings,
including at the World Trade Organization (WTO). In an effort to
bolster our engagement in these areas, the U.S. Government has proposed
a Trade and Investment Cooperation Framework Agreement (TICFA), which
would provide a regular mechanism for dialogue and cooperation. We
would like to complete the agreement with Bangladesh soon and are
awaiting a response to our proposal.
As a least-developed beneficiary developing country under the U.S.
GSP trade preference program, Bangladesh is eligible to export duty-
free nearly 5,000 otherwise-dutiable products to the United States. In
2012, the United States imported nearly $35 million in products from
Bangladesh under GSP, across almost 150 different Harmonized Tariff
Schedule (HTS) categories. Leading GSP-covered imports from Bangladesh
include tobacco, ceramics, plastic products, sporting equipment, and
nonapparel textiles such as national flags and rugs. However, because
most apparel products are excluded from the GSP program by statute, GSP
imports represented less than 1 percent of total U.S. imports from
Bangladesh last year.
The statute governing the GSP program lists several eligibility
criteria, including some related to worker rights,\1\ which
beneficiaries must meet in order to maintain their benefits. USTR,
based on the advice of the GSP Subcommittee of the interagency Trade
Policy Staff Committee, accepted for review a GSP country practice
petition filed by the AFL-CIO in 2007 alleging serious shortcomings in
the Government of Bangladesh's recognition of worker rights. The AFL-
CIO petition described a wide array of worker rights issues in
Bangladesh, including serious obstacles to freedom of association and
collective bargaining, especially in Export Processing Zones (EPZs),
the ready-made garment and the shrimp processing sectors. The petition
and subsequent updates also allege a pattern of harassment and violence
against trade unionists and nongovernmental organizations (NGOs)
working on labor rights issues, and a neglect of worker protections in
the areas of fire safety and health.
We have taken, and continue to take, these allegations seriously.
From the moment we accepted the AFL-CIO petition--and indeed prior to
accepting the petition because many of the issues have been
longstanding--USTR has worked to address these issues. We worked with
the petitioners, other U.S. Government agencies, the Government of
Bangladesh, and stakeholders in Bangladesh to achieve progress and
resolve the concerns that the petition raised. While we have seen
progress in some areas over time, the situation in other areas has
deteriorated, particularly in the past year. U.S. officials have been
explicit with the GOB concerning the specific actions they should take
to allow greater freedom of association, including to enable workers to
form and operate unions of their choosing and for labor NGO's to assist
them, and to ensure workers have safe factories in which to work.
Parallel to these efforts, as is also our practice, the GSP
Subcommittee continued to invite public comments on the petition on
several occasions and has held four public hearings on the case, most
recently on March 28, 2013.
Despite our many efforts with Bangladesh, beginning in late 2012
the USTR-led GSP Subcommittee grew increasingly concerned that the
worker rights situation in Bangladesh was in fact deteriorating and
concluded that the situation warranted consideration of possible
withdrawal, suspension, or limitation of Bangladesh's trade benefits
under GSP. Consequently, on January 8, 2013, USTR published a notice in
the Federal Register seeking comments on the possible withdrawal,
suspension or limitation of Bangladesh's GSP benefits. The primary
purpose of the notice was to make stakeholders aware of the seriousness
of our concerns and the need for action by the government of
Bangladesh.\2\ At the same time, we communicated our concerns to senior
officials of the Government of Bangladesh that we would be making a
decision on next steps in the GSP review by mid-2013, that the
country's GSP trade benefits were at stake, and that we would be
looking for evidence of substantive progress by the government in
improving the worker rights situation.
As noted, on March 28, 2013, the GSP Subcommittee held a public
hearing on the Bangladesh review at which Bangladeshi officials,
representatives of the Bangladesh Garment Manufacturers and Exporters
Association (BGMEA), the Bangladesh Export Processing Zone Authority
(BEPZA), and the AFL-CIO testified. The Bangladesh officials and the
BGMEA cited a number of measures they had taken or committed to
undertake to address the worker rights and worker safety concerns that
the U.S. Government had raised.
The AFL-CIO testified that while the Government of Bangladesh and
the Bangladesh garment industry had begun to address fire safety
issues, little had been done to address the core worker rights issues
cited in the original petition and subsequent updates.
The Rana Plaza building collapse in April demonstrated the deadly
implications of the failure to address the underlying issues of worker
safety and worker rights, especially in the garment sector.
In response to widespread criticism following the Rana Plaza
collapse, the Government of Bangladesh has announced several
initiatives, mostly related to building and fire safety. At the same
time, many U.S. and European apparel brands have committed to
additional initiatives designed to improve compliance with fire and
safety standards among their Bangladeshi suppliers. In addition, the
European Union (EU) announced that it is considering a review of
Bangladesh's benefits under its own trade preference program.
The administration has also intensified its engagement with the
Government of Bangladesh and other stakeholders. In particular, the
three agencies represented at this hearing--USTR, State, and Labor--
have each been using the particular venues and contacts we have with
the government to stress the importance of seizing this moment to make
concrete and lasting change. The GSP review has given us a much better
understanding of the range of labor issues workers face in Bangladesh
as well as a specific mechanism to engage their government. The
administration will announce a decision on the petition by the end of
June; and all options remain under consideration, including possible
suspension, limitation, or withdrawal of Bangladesh's GSP benefits.
Based on our experience from the GSP review, let me provide you
with a few observations on the challenges related to ensuring worker
rights and safety in Bangladesh.
First, the issues are broad, but interrelated. One of the most
tragic aspects of the Rana Plaza disaster was that workers were
allegedly coerced into returning to work in a building with known
structural risks. Had these workers been able to effectively organize
themselves, it is possible that they would have felt less intimidated.
An important tool to ensure worker safety is the voice of the workers
themselves, which comes from their ability to freely associate.
Second, the challenges facing Bangladesh require both short- and
long-term action. The government can take several steps now to
strengthen freedom of association, including ensuring that labor
activists are able to operate freely and to support the development of
independent unions that effectively represent their workers. At the
same time, the government needs to devote resources to developing its
own capacity to regulate and enforce labor laws and building and fire
safety codes. This is a longer term endeavor that will require
sustained focus.
Third, all stakeholders involved in Bangladesh have a
responsibility to work together to address labor issues effectively and
sustainably. The government has a primary responsibility to ensure
enforcement of its laws and to create an environment in which workers
can exercise their rights and work in safe and healthy factories. But
factory owners, workers, international buyers, and consumers each have
a responsibility and role to play as well. There are a large number of
initiatives underway to address these challenges; we welcome these as a
strong sign both of stakeholders' recognition that change is necessary,
as well as their willingness to be a positive part of that change. It
will be critical that these initiatives work in tandem and not at cross
purposes.
Finally, the United States, through our trade relationship and
trade programs, and through our diplomatic and development policies,
has an important interest in seeing Bangladesh succeed in addressing
the labor challenges it faces and continuing to grow and prosper
economically. The administration is committed to working with the
Government of Bangladesh and other stakeholders to achieve these goals.
Thank you again for this opportunity to testify, and I would be
pleased to take your questions.
------------------
End Notes
\1\ Section 502(b)(2)(G) of the Trade Act of 1974, as amended,
(``the Trade Act'') provides that the President ``shall not designate
any country a beneficiary developing country'' under GSP if ``such
country has not taken or is not taking steps to afford internationally
recognized worker rights in the country (including any designated zone
in that country).'' Section 507(4) of the Trade Act provides a
definition of ``internationally recognized worker rights,'' which
includes ``the right of association,'' ``the right to organize and
bargain collectively,'' and ``acceptable conditions of work with
respect to minimum wages, hours of work, and occupational safety and
health.''
\2\ The Government of Bangladesh (opposing any change to its GSP
benefits) and the AFL-CIO (supporting suspension) were among the 30
individuals and organizations that submitted comments.
The Chairman. Well, thank you all for your testimony. Let
me, however, characterize what I heard, which is that we have
been sabre rattling, but that has not produced the results that
we collectively want to see.
Mr. Karesh, you said that we have been very explicit about
what we think needs to be done. Obviously, on freedom of
association, it is pretty clear that if the workers at Rana
Plaza had had the right to associate, they very well might not
have been forced to work in an unsafe building, and they would
not have died.
So in my mind, the question is, When do we go from saber
rattling to some action? Because while we have seen some
movement in laws that have been proposed and/or passed, we have
seen very little, if any, enforcement at the end of the day.
So the question is, How many more people have to die before
we decide that, in fact, that is not something that we can
morally sustain?
Do not all jump to answer the question. [Laughter.]
Mr. Blake. Let me start, Mr. Chairman. First of all, let me
agree with what you just said, and that is the message that we
have been sending all along to our friends in Bangladesh and to
all the other stakeholders, is that this is a defining moment
now for action.
I think there has been some action, as I said in my
testimony, in terms of 27 new unions registered, in terms of
the new fire safety plan, in terms of quite substantial
progress on these labor law amendments which we have been
assured by the Government of Bangladesh will be passed by the
end of this month. So that will be a very important step, I
think.
But we are also working, as I said, with all buyers and
with BGMEA--the Bangladesh Garment Manufacturers and Exporters
Association--because they too have a very important role to
play in terms of hiring new inspectors both on the fire safety
side and on the structural soundness side. And then we need to
bring all of these efforts together in a coherent fashion so
that there is a plan that everybody agrees on, that all the
stakeholders can agree upon.
The Chairman. Well, I appreciate that. But, Mr. Secretary,
as we know here in our own country, passing laws and putting
them on the books versus enforcing them is a huge gulf.
Mr. Blake. Right.
The Chairman. And to be honest with you, every law that we
pass that gets signed into law but that does not get enforced
is meaningless. It is a toothless tiger. So my concern is not
that we continue to see a plethora of laws passed, which I
applaud, of course. But what is it that we are seeking in
enforcement activities to make sure that the laws are pursued
and the message is sent to the industry?
So, Mr. Karesh, why not, considering I recognize we have a
very significant bilateral agenda with Bangladesh. As I said, I
have applauded many of their successes. But that does not mean
that we should sit by and watch workers die, and to permit
American companies to, in essence, exploit conditions under
which labor is cheap but safety is none. So, why not, when
basically you have a very limited opportunity in terms of maybe
the impact on Bangladesh but an opportunity to send a very
clear message, why not suspend the GSP benefits here as a
global message? Because it is not about having manufacturers
leave Bangladesh to the next lowest priced place. That does not
accomplish the goal.
The question is, How do we send a message and work to
create a universal standard that at the end of the day can
allow Bangladesh to continue to thrive, but to make sure that
it is not done on the death of individuals who work for these
industries?
Mr. Karesh. Thank you, Chairman. I think you have hit on
really the key question that we are facing ourselves right now.
GSP offers one mechanism to engage countries, and we are
currently reviewing that, as I expressed, because we have
concerns about whether there has been continuing progress. As I
said and as Assistant Secretary Blake mentioned, there have
been some actions that have occurred in Bangladesh, and we have
worked with the government over a sustained period of time to
try to make sure that those are meaningful steps and that they
are sustained. We have recently become more concerned that
there has not been sustained improvement in addressing these
issues.
What we search for is what is the best way to achieve the
result that I think we all want to achieve, which is safer
workplaces where workers can exercise their rights and where
they can go to work and come home from work safe and healthy.
We are searching for the best ways to engage with the
Bangladeshi Government and other stakeholders to do that.
We are taking a serious look at GSP because it is one way--
--
The Chairman. What they send under GSP is less than 1
percent of GDP for them, right?
Mr. Karesh. Less than 1 percent of their exports to the
United States come in under GSP. That is correct, sir.
The Chairman. So, while not an insignificant action, the
damage is relatively small. The message, however, universally
is very strong. I am going to ask Senator Kaine in a little
while to chair the hearing as I step out to go to the Finance
Committee, where the new U.S. Trade Ambassador's nomination is,
and I am going to ask him the same questions, and I am hoping
that he gives me the right answers.
Mr. Biel, let me ask you, why is it that only a handful of
American retailers are signed on, but the Europeans have
largely signed on to the IndustriALL Accord? I wonder--you
know, some businesses are debating whether to leave Bangladesh.
That is not our purpose here, to relocate elsewhere. Otherwise,
we are just chasing this process. But only Disney so far has
stated that it will no longer source from Bangladesh. Forty-one
companies have signed on to the IndustriALL Accord on fire
safety and building improvements, which is hailed by labor and
consumer groups as a major breakthrough, since global brands
have often sought to deflect any direct responsibility of the
problems. But there are only three American retailers who have
signed the Accord so far.
So what confidence can you give me, or any of you who may
be dealing with the industry, that there are serious efforts
underway by American retailers to help improve labor
conditions?
Mr. Biel. Thank you for the question, Mr. Chairman, and my
colleagues may want to jump in as well. Obviously, the industry
which is represented on the second panel will have to explain
for themselves their decision collectively to pursue a
different route than the Accord. As you mentioned, only three
U.S.-based companies--PVH, which was the very first to sign on
some time ago, and more recently two additional ones, as you
mentioned, have signed on, but that is a small number compared
to the number from Europe. They have outlined, including in the
written testimony, their legal and policy reasons; and, of
course, the AFL-CIO has outlined a very different account of
it. We have talked to all parties concerned.
The Chairman. Are the Europeans less astute about legal
liability?
Mr. Biel. Not that we are aware of, nor are the three
American companies that did sign on. At one time, we thought
just a few weeks ago there was a very narrow divide, and the
hope was that the momentum would bring additional U.S. parties
on board. That obviously has not happened.
What we are hoping to do, as my written testimony reflects,
is indicate that we see a process forward, and I speak for the
Department of Labor in this regard, as needing to be a bit of a
game changer: not just for the Government of Bangladesh in
terms of your previous question about the need for greater
enforcement mechanisms, greater capacity, the small number of
labor inspectors, the fact that there is so little oversight
and capacity to do the kind of work not just on fire and
building safety but on broader workers' rights concerns, but in
addition there needs to be a real partnership with the private
sector that, frankly, has been less than robust to date.
So our goal--we are not as a government endorsing one
particular plan--but our goal is to set some benchmarks for
what needs to be done, especially given that there is a growing
recognition, interestingly enough, as both sets of testimony on
the second panel recognize, of a corporate responsibility, but
there seems to be a difference in what the details of that
involve.
So we have continued to press the case for the fact that
government responsibility is paramount. That is why there needs
to be more oversight, more funding, more training, and other
initiatives that we can talk more about, but there also needs
to be a stepped-up private sector role.
The last thing I will say is the Accord itself is still
being implemented. There is a 45-day period that began in late
May for putting additional details in place. And so our hope is
that as some of those details become clear, maybe some of the
concerns will be alleviated and there will be more momentum for
additional brands to sign on. But again, that will have to be
their own determination.
The Chairman. Well, for the purposes of this governmental
panel, let me just tell you I can assure you that this is not
going to go away gently into that good night with one hearing.
Senator Corker.
Senator Corker. Thank you, Mr. Chairman, and again, all of
you for being here.
Let us talk a little bit about the Government of
Bangladesh. I think all of us have heard the story of the
person who showed up, the inspector, the day before at the
particular facility we are talking about, and determined that
it was unsafe. He was turned away, and the building later
collapsed, and 1,100 people died. I know we are talking here
about regulations and rules. I am just curious about what kind
of regulations and rules already exist. It sounds to me like
maybe it is more a question of whether those are being enforced
in Bangladesh. I am just wondering if one of you might respond
to that.
Mr. Biel. I think it is a combination of the laws on the
books and the lack of enforcement. There are some shortcomings
in the laws themselves. As was referenced in more detail in the
written testimony, Bangladesh is currently, we understand that
the Cabinet, the senior leadership, is now moving a
comprehensive labor law reform package to the Parliament, and
as Assistant Secretary Blake mentioned, the hope is that it
will be passed by the end of this month. That is about 145
pages translated, so it is a detailed plan. Those of us who
have had a chance to examine it recognize it is just the first
step. There are some things in it that still do not go as far
as making it compliant with internationally recognized
standards of the ILO and so forth.
But there are some significant improvements, including the
four specific provisions that tie into what the Better Work
management team asked for last fall. So on the legal side there
are some signs of progress, although I would also note--and
again, this is referenced in the testimony--that the export
processing zones are subject to an entirely separate set of
provisions, not part of that same labor code, and that is why
that has been a particular area of concern, because there is
vast discretion in that area, and you do not have the same kind
of union structure in that area.
So there are some legal gaps, some that are on the way to
being remedied, others that remain a ways away. But in
addition, there is the issue of enforcement. Currently, given
the size of the sector, the fact that you have got only a
double-digit number of labor inspectors is something that is an
obvious shortcoming. In connection with the ILO roadmap
announced at the beginning of May, that number will grow to
200, and there should be budget to get it up to 800 before too
long. That is still not a vast number, but it is almost a
tenfold increase.
So you begin to see, with the help that we can provide,
technical assistance training, hopefully a more robust
government enforcement capability, although again that needs to
be complemented by more work by the private sector at the
factory level.
Mr. Blake. May I just jump in for a minute, Senator, and
just say I think the Rana Plaza tragedy really underlined the
number of failings that now exist. One, there was a management
failure on the part of the management of that factory which, of
course, ordered those workers back in when they knew full well
that there were cracks in the building.
Second, it underlined the need for independent unions. Had
there been an independent union representative at that facility
at that time, they would have ordered the evacuation of those
workers.
Third, I think it underlined the immense governance
challenges that still exist in Bangladesh. This building was
built on unstable land. There were floors that were added
illegally. So there is a great deal of corruption and
governance challenges that still need to be met.
And fourth, as my colleague said, it underlines the need
for much greater and more capable inspections, not just by
government inspectors but by independent inspectors who can
hopefully reinforce whatever the work that is being done by the
government.
Senator Corker. Well, I appreciate that. It seems to me
that there ought to be some mechanism, maybe, for these owners
of the companies that are manufacturing to somehow certify that
they are meeting the standards also, the standards that have
been put in place. But it does sound like there is a huge
inside-the-country issue and that is going to take Bangladesh
really stepping up to make sure that the employees there are
well taken care of.
On the Accord, I guess I have never been and--I did not
come to the Senate to be someone who does what everybody else
does. I guess it really does not trouble me that our companies
did not sign an agreement that the Europeans did. I do not
think that is necessarily a standard that matters that much.
I think what does matter is that our companies enter into
an agreement that is sensible and really moves things. I am
glad to hear the chairman say that he is going to have
additional hearings. I think one of the things we might want to
do is have a hearing after the U.S. retailers decide what this
agreement is going to be, and then maybe we go through that and
understand the kind of statements that they have made and plan
to enforce.
But I just wonder, Mr. Biel, if you could tell us a little
bit about what those characteristics of that agreement may be,
to your knowledge, as far as what the U.S. companies are
planning to do. Again, it is my understanding that they have
committed to some June 30 deadline. I think all of us would
look with anticipation to what they might do. Maybe you could
give us a little preview.
Mr. Biel. My review will be fairly sketchy, I am afraid, in
that it has only been about a week since we first heard of the
unification of a number of U.S. brands and trade associations
around what is now being coordinated by the Bipartisan Policy
Center and former Senators Mitchell and Snowe. So that just
goes back a
few days. We have not seen an action plan or any specifics
about that. Hopefully on your second panel, the panelists--
certainly Mr. Lubbe, on behalf of the retail industry--can
share more details on where that stands. But it is fairly new
and very much a work in progress that we just have not seen the
specifics of.
The Accord has been in place for a couple of years. There
were only two companies that were participants in it until
recently, when the momentum in recent weeks, including post-
Rana Plaza, led some three dozen additional ones to come on
board. And it, too, is still being developed in the sense of
going from a six-page document to a much more detailed plan in
this 45-day period.
So I think your point is well taken. In the next few weeks
there will be an opportunity perhaps to compare and contrast
two different models as you learn more about how the Accord is
being implemented and perhaps learn what this initiative that
is brand new involves.
In my written testimony--I do not want to dominate the
time--I lay out a few points that are kind of bottom lines from
our point of view, speaking for the Department of Labor, for
what a strong multistakeholder agreement includes, and we are
encouraged with the Accord that you have got different parties
at the table, industry as well as workers' organizations
representatives, and some clear provisions that meet those
criteria.
Senator Corker. I think there have been a number of points
that have been brought up. But at the end of the day, what we
do not want to see happen is for us to do the typical cut-your-
nose-off-to-spite-your-face effort where, in essence, an
industry moves from a country, like Bangladesh, that needs
jobs. We do not want to see that happen. What we would like to
see is the people who were working there to be able to work in
safe conditions and have jobs that are moving them up mobility-
wise into a better standard of living. I think that is what we
would all like to accomplish.
So it sounds to me like there are tremendous enforcement
issues on the ground that the government is not carrying out.
Either they have been influenced to not act or they are simply
not acting, but certainly there is a responsibility there
amongst the Government of Bangladesh to make sure they take
care of their own citizens.
And then it seems like to me, since the chairman has
mentioned this is not going to go away, one of the great things
we might do as a committee is to have some of the industry
leaders come up after this United States and Canadians
retailers agreement has been reached and just share with us. I
think most of them certainly like to have good corporate images
and want people who buy goods from their stores to feel good
about what they are doing. Maybe we can have them come up and
share with us what they are planning to do to implement
standards within their own companies that create a better
culture in this regard as to how they are purchasing.
So, Mr. Chairman, I thank you for this and appreciate all
of you being here.
The Chairman. Thank you, Senator Corker. We have exactly
that in mind, so we look forward to it.
Senator Casey.
Senator Casey. Thank you, Mr. Chairman. I will be very
brief. I will not take all of the 7 minutes because I have to
run, and I know everyone is pressed for time.
Thanks for your testimony, and we are grateful for your
work.
Assistant Secretary Blake, I wanted to ask just one
question, and I will submit a number of other questions for the
record. It is one of capacity. If you can assess--and I know
you have spoken to this in one way or another in your testimony
and otherwise--the capacity of the Government of Bangladesh to
provide enforcement of existing rules, but then also the
capacity in terms of reform and making the improvements we
think are vitally necessary. Just in terms of capacity, if you
could just address that.
Mr. Blake. Thank you, Senator. I think when you talk about
capacity, you are talking about both are there sufficient
numbers of inspectors, but then also even more critically is
there the will to actually enforce these things.
Senator Casey. Both efforts.
Mr. Blake. Right. And I think we are making significant
efforts, and the government is making significant efforts to
hire the necessary number of inspectors, and we are also
encouraging again a parallel industrial effort on the part of
the buyers and BGMEA so that they will have their own cadre of
independent inspectors as well, because we think that is very,
very important.
But then there is the question of governance, and that is
something that Bangladesh really needs to take ownership on.
Again, I think that is where there is the most, in many ways
the most significant challenges, is to ensure that the sort of
culture of corruption that has persisted for so long is finally
brought to an end and that there are serious efforts at
remediation and serious efforts to ensure that all of these
inspections not only take place but that then, whatever
decisions are made, are actually enforced.
BGMEA does have the ability to enforce this in the sense
that they control the import and export licenses for all of
these suppliers. So they have the teeth to be able to enforce
this, and I think they have the will for this reason, because
they know very well that brand Bangladesh is under threat now.
Senator Casey. Thank you very much.
Thank you, Mr. Chairman.
The Chairman. Thank you.
Senator Murphy.
Senator Murphy. Thank you very much, Mr. Chairman, and
thank you for this hearing and for your great work and interest
on this issue.
I wanted to come back to the industry Accord and our path
forward. I am glad to hear that there may be a revisiting of
some American companies of their willingness to step up and
make some commitments, but thus far their response has been
inadequate. They have, with the defense of potential legal
liability, essentially said that they are better off today
coming up with individual policies that may make things better
rather than coming together, and some of the individual
policies seem to make some sense. Gap, for instance, has a
fairly comprehensive response here that, if you read it,
certainly suggests they are taking things seriously. But, of
course, this has been how we have been doing things for years.
Each company has worked individually on trying to make things
better and, of course, with the recent events, there is little
evidence to suggest that it has worked.
And so, Mr. Blake, you were sort of careful in your
testimony. It did not sound like you suggested that we were
actively encouraging companies to come together on a joint
standard. So I wanted to ask all three panelists, and let me
start with you, as to what role we are going to be playing to
try to facilitate American companies, whether it be in an
agreement with European countries or on their own, to have some
common commitment rather than just doing what we have been
doing for a long time, which is asking each one of them to come
up with their own standards.
Mr. Blake. Thank you, Senator. Let me start, and I will ask
my colleagues to jump in.
As I said in my testimony, we have had several rounds of
conference calls with all of the buyers already hosted by the
State Department with our other interagency colleagues, and we
have encouraged them to come up with an agreement that they can
all coalesce around, and hopefully one that also is consistent
with the IndustriALL Accord. As my colleagues said, there are
some concerns on the part of the American companies about
liability questions, and obviously that is a judgment they are
going to have to make.
But many other parts of the IndustriALL Accord they seem to
be willing to embrace. So to the extent possible, we would like
to see something that is reasonably coherent so there is not a
jumble of different standards and requirements that will make
it more complicated to really achieve the outcome that we all
desire.
Mr. Biel. Assistant Secretary Blake has covered it well. I
guess what I would add, building on my previous response, is
that there are moments in time, and the chairman highlighted
the one in our own country from 1911 with Triangle Shirtwaist,
which led to a whole set of changes in terms of enforceable
laws, a lot of the things that the Department of Labor
administers today coming out of that, a moment in time in the
mid-1990s after Kathy Lee Gifford and other things where some
of the voluntary mechanisms, the principles, the
multistakeholder agreements came into being, and this is
another moment in time. And it is true, it cannot just apply to
Bangladesh, but Bangladesh may be a stepping stone.
We deal at the Department and through the Better Work
Program with conditions in other countries around the world,
from Haiti to Honduras to Lesotho and so forth, but Bangladesh
is the second-largest export market to us. It is a massive
industry, and so we really need to get it right, not just with
respect to government enforcement but how brands and retailers
see their own responsibilities.
The last thing is that the state of international law and
policy has evolved. There is a new recognition based on the
U.N. Guiding Principles on Business and Human Rights that while
government has paramount responsibility, corporations have a
delineated set of responsibilities. So we have stressed against
the backdrop of that, as well as the specific circumstances in
Bangladesh, the need to meet some minimum criteria.
So far, as we said, the momentum that looked like it was
building in May has kind of taken a bit of a detour. But our
hope is, through the processes we have mentioned, that there
will be a coalescing around strong common principles in the
coming weeks, and again some oversight in the future can
certainly play a key role in holding people's feet to that.
Senator Murphy. Mr. Karesh.
Mr. Karesh. Thank you, Senator Murphy. I support the
comments made by both State and Labor on this. We have always
worked together to support corporate social responsibility and
efforts on the part of the buyers and the manufacturers to
address these issues. But it is our view that that is not going
to be enough in and of itself, that there has to be a culture
change within Bangladesh, within the government.
And because of Rana Plaza and Tazreen, we have talked a lot
about fire and building safety issues, but there are also other
issues principally focused on freedom of association and
collective bargaining and the right of workers to assert
themselves and the protections that are in place for that. That
is partly legal, and they are working on labor reforms in
Bangladesh. But it is also partly attitude. It is intimidation
and harassment of groups that try to support the labor unions,
support the workers.
So we have to work on that issue, and the government has to
be involved and has to address those issues, and it has to have
the political will to address them as well as working with the
buyers and manufacturers and others.
Senator Murphy. Mr. Blake, I would just direct my last
question you, and possibly others can comment. This is on the
issue of liability. It seems to me to be a bit of a red
herring. We have the Koibel case and others which have greatly
limited the ability of people in other countries to submit
claims in the United States. Are we advising these companies on
their potential U.S. liability, or are we leaving it up to
their individual judgment?
Mr. Blake. No, sir. We have not taken a position on that
very narrow issue. We just, again, have taken a wider view that
they should come together and coalesce around whatever plan
they can agree on, and that ideally that could be something
that is consistent with the IndustriALL Accord.
Senator Murphy. Thank you.
Thank you, Mr. Chairman.
The Chairman. Senator Kaine.
Senator Kaine. Thank you, Mr. Chairman.
To the witnesses, Bangladesh is a sovereign nation, and
they have their own sets of rules. There could be a culture of
corruption. There could be labor challenges. There could be
safety standards that we would not accept. We do not have the
command and control of them that we would in this country, but
we do have levers, and I want to just spend time talking about
the levers.
It strikes me that you could look at levers as our own
governmental levers, the GSP, and there may be other
mechanisms. You have private sector levers, and then some
multinational organization levers, the ILO and the World Bank,
for example.
So on the levers that the United States would have, share
with me a little bit about the General System of Preferences.
It is my understanding that the AFL-CIO had filed a complaint
seeking to diminish or reduce the GSP status of Bangladesh in
2007. Has that been under consideration for 6 years?
Mr. Karesh. Yes, Senator Kaine. They filed that in 2007,
and we did accept it for review, and we have been reviewing it
and engaging with the Government of Bangladesh ever since. As I
indicated earlier, as well, even prior to the petition, because
there had been longstanding issues related to freedom of
association, there had been previous submissions, and we had
seen progress at times. In fact, previously we closed some GSP
petitions prior to this petition being opened because we saw
progress.
We continued to work with the government ever since this
petition was received to address issues. We did see some action
taken. But recently our feeling has been that we are not seeing
sustained and meaningful progress on issues and we have
concerns that, in fact, in some areas there seems to be a
deterioration. The current situation that happened in Rana
Plaza and Tazreen I think are evidence of the difficulties in
the deterioration, and the question about whether there is the
political will and the proper means are in place to ensure that
Bangladesh can meet its challenges.
Senator Kaine. Let me just ask about the structure of the
GSP program. I gather that it was something established as part
of the Trade Act in 1974. The Congress set the parameters of a
program. The granting of GSP treatment is something that is
handled administratively through the USTR. Do I understand it
correctly?
Mr. Karesh. That is correct. The U.S. Trade Representative
Office is the primary office responsible for the trade
programs. A decision with regard to GSP itself, eligibility for
countries and whether there can be a suspension or limitation,
is actually a Presidential determination based on a
recommendation from USTR, and we have currently indicated that
we will make a decision with regard to steps on GSP for
Bangladesh by the end of June, and we are in interagency
discussions on forwarding our recommendation to the President.
Senator Kaine. So the recommendation will be done by the
end of June to the White House.
Mr. Karesh. That is correct, sir.
Senator Kaine. I noticed there was one reference to an
earlier
instance where GSP status was suspended to Burma over workers'
rights issues. How about just generally in terms of the
program? Is suspension of GSP status something that has
commonly been done in the last 40 years, or is it extremely
rare?
Mr. Karesh. It is not common. It has happened in a few
instances. Burma is one of those instances.
Senator Kaine. And Burma was over workers' rights issues?
Mr. Karesh. That is correct.
Senator Kaine. And when was that suspension, just
generally?
Mr. Karesh. 1989. We currently are reviewing whether to----
Senator Kaine. To restore?
Mr. Karesh [continuing]. To restore, yes.
Senator Kaine. And are there other instances of GSP
suspension, other than the Burmese example?
Mr. Karesh. Yes, there has been. There have been several
cases. I know of situations with Nicaragua, Paraguay, Romania,
Chile, Burma, the Central African Republic, Liberia, Sudan,
Syria, Mauritania, the Maldives, Pakistan, and Belarus.
Senator Kaine. OK. So a number?
Mr. Karesh. Yes.
Senator Kaine. The chairman brought up in his questions the
fact that the GSP only covers a portion of our trade with
Bangladesh because there are a number of exclusions. In your
judgment--and this is now a question to all three of you--what
would the consequences of a GSP suspension be, recognizing you
have not made that recommendation? But is it a minor thing
because it only covers a certain amount of trade? Or is it a
major thing because it sends a signal about the working
conditions in Bangladesh that would affect them, either sort of
diplomatically or affect the willingness of private-sector
partners to invest?
Mr. Karesh. I know Assistant Secretary Blake would like to
respond to that as well, but let me just say briefly that there
are a limited number of products that can come in under GSP
that would be affected. But we believe that if that decision
were made, it is a serious decision. It is a Presidential-level
decision for the United States, and we believe Bangladesh
understands that it would send a significant message with
regard to doing business in Bangladesh.
Mr. Blake. Yes, sir. I think it would send a very
significant signal because it is symbolically important, and it
would also potentially have an impact on the EU's decision,
because the EU has its own GSP program which covers a much
wider range of products than our own. Their whole process is a
much longer term one than ours, but nonetheless this could have
an influence on that as well. So I think it does have quite an
important impact.
Senator Kaine. And based on the format of the program as
you described it, I gather it is sort of an iterative process.
It is not just you are in or you are out. But the USTR, the
United States, in dialogue with the Bangladeshi Government,
could lay down some conditions and say if you do not do X by a
certain date, our intent would be to recommend to the White
House--or the President could even say our intent would be to
withdraw GSP status. Do I understand the program correctly?
Mr. Karesh. Yes, sir. That is correct. You have a choice of
withdrawing, suspending, or limiting. There has been one
situation where we did not fully take all of the benefits away
but partially took them away, and then our intention, if that
were to happen, would be exactly that, to have an action plan
so that if Bangladesh took those steps, it could regain
eligibility.
Senator Kaine. In the instances where we have withdrawn GSP
benefits, and you gave a number, have there been instances
where when that has happened, the countries have wanted to come
back and work to regain them? So I know you are analyzing with
respect to Burma right now, but has it proven to get their
attention so that they want to come back and regain GSP status?
Mr. Karesh. Yes, absolutely.
Senator Kaine. OK. I will save my private-sector questions
for the next panel, but just one on the international
organizations. The World Bank has a Work Better Program that is
trying to focus on these issues as well. Could you describe the
status of that?
Mr. Biel. Sure, sure. It is actually jointly administered
by the International Labor Organization and the International
Finance Corporation, part of the World Bank Group. The Better
Work Program has been around for more than a decade. The first
such program was what is called Better Factories Cambodia. So
it is not a terribly old program, about 12 or 13 years old. It
has expanded to a few other countries around the world. I
mentioned some, but also including Haiti and Vietnam and
Lesotho, Jordan and so forth.
In terms of going back to your question about leverage, we
sit on both the donors committee and the advisory committee of
the Better Work Program and have the ability to have some
influence. We are not the final decisionmakers. That is the
management group led by senior officials at the ILO and IFC.
So, for example, in this case, Bangladesh has long indicated
they want to be part of Better Work. We see that as
potentially, if it is well administered, a step forward in
terms of regularizing some of the issues and having a more
systemic program of dealing with freedom of association and
other issues in the workplace.
So it was last fall that that management group laid down
some markers--they have variously been called conditions, risk
factors--for what would be necessary for Better Work to take
hold in Bangladesh. Thus far, they have not been met. There has
been progress in one bucket, on union registration, that
Assistant Secretary Blake mentioned and that I also mentioned
in the written testimony. The other is these labor law reform
amendments, not the entire package but four specific ones, and
we think that things are moving in the right direction,
although it is a bit complicated by the fact that there have
been some different versions, at least an English translation,
of one or two of those.
So we are eager to see, and more importantly the Better
Work leadership is eager to see in the coming days, exactly
what gets introduced and taken up by Parliament so we know
whether those are met, and then Better Work can decide whether
the situation is sufficient to move forward. If it does, then
there are a lot of big questions for us as well as other
donors, such as the Australians and the British and some of the
Scandinavian countries and the Dutch and others, who have
supported Better Work and have indicated some interest in doing
so in Bangladesh.
Senator Kaine. Thank you, Mr. Chairman.
The Chairman. Thank you, sir.
Senator McCain.
Senator McCain. Thank you, Mr. Chairman, and thank you for
holding this hearing, Mr. Chairman. This is, according to what
I understand, one of the most horrific accidents, industrial
accidents in history, and it certainly deserves everyone's
attention. Unfortunately, some of these conditions, I am told,
exist not only in Bangladesh but in other places in the world.
Secretary Blake, you probably already addressed this, but
what are your short- and long-term priorities in this area
which you enumerated, including improving the Government of
Bangladesh's capacity to improve the infrastructure within
Bangladesh to address building and worker safety?
Mr. Blake. Senator, we earlier talked about how this is
going to have to be a comprehensive program on the part of all
of the stakeholders. But since you talk about the Bangladeshi
side of it, it will be very important that there first be
freedom of association, and we have been talking about it
earlier. Twenty-seven unions have been registered. Had there
been a union representative on the ground at Rana Plaza, that
tragedy would not have happened.
But there also needs to be a comprehensive effort on the
inspection and safety side, and the enforcement of that as
well. Again, we had a detailed discussion of that. We think
that the buyers and the Bangladesh Garment Manufacturers and
Exporters Association have a key role to play, both of them, in
helping to build up an independent cadre of inspectors, both on
the fire safety side and on the structural soundness side as
well, to back up whatever inspections are done by the
government.
So there is a very comprehensive series of steps that have
to be taken but that are only really just beginning now.
Senator McCain. Are you confident that they will be taken?
Mr. Blake. Well, I do not want to--we are pushing hard on
those. I think--I am fairly confident----
Senator McCain. In other words, I guess, what kind of
cooperation are you getting?
Mr. Blake. I think we are getting a lot of cooperation. We
have certainly gotten the government's attention, and we have
certainly gotten the BGMEA's attention, and as we discussed
earlier, our own buyers are now working with former Senators
Snowe and Mitchell to see if they can come up with their own
plan that we hope will be consistent with the IndustriALL
Accord that the European buyers have coalesced around.
Senator McCain. Are you satisfied with the progress so far?
Mr. Blake. Certainly not. There needs to be much greater
progress.
Senator McCain. No, but I mean what you have done so far,
is this on a timetable?
Mr. Blake. Yes. I mean, I think we are making progress, but
there is much more that needs to be done on the part of all the
stakeholders.
Senator McCain. Thank you.
Mr. Karesh, you observed in your prepared testimony the
USTR's review of Bangladesh's Generalized System of
Preferences, GSP, trade benefits. What impact would the
suspension of GSP benefits have on our efforts to improve the
safety conditions of Bangladeshi workers?
Mr. Karesh. Thank you, Senator McCain. As others have
mentioned, our view is that we need a comprehensive effort to
address these issues, of which GSP is one mechanism that
provides leverage. It is a significant step. If we were to make
a determination to suspend or limit, it is significant. We
believe that there are people within the Bangladeshi Government
who understand that and would be concerned about taking
measures to ensure that did not happen.
Senator McCain. I guess I am curious whether in your
assessment it would help or hurt if we suspended the GSP?
Obviously, it would have significant unemployment impact in
this impoverished country.
Mr. Karesh. I mean, clearly, in making this type of a
decision, which ultimately is a Presidential decision--the USTR
can only make a recommendation to the President--there are
consequences in any action. Our goal is to address the concerns
about freedom of association and safety and health, and that is
why we are taking a very close look at this issue and trying to
answer that question right now ourselves as to what we can do
under GSP and with other means to improve the lives and working
conditions for workers in Bangladesh.
Senator McCain. So, actually it seems to me that suspension
of GSP might be the last bullet to shoot rather than the first.
Would that be correct? In other words, as Secretary Blake was
saying, lay out what we expect of them and see if they make
progress or not on it. And then if not, then obviously other
alternatives have to be considered. Is that an appropriate way,
or is it the way you are approaching this situation?
Mr. Karesh. Yes, sir. I mean, we would never take that step
lightly. We have been engaged on these issues with the
Bangladeshis for quite a long period of time, and we have not
seen the meaningful progress that we would like to have seen,
and that is why we are currently in a review of whether we
would take that action or not. But it is not something that we
would take lightly if we were to do that.
Senator McCain. Tell me a little bit, you and Mr. Biel,
about what they have not done that you want them to do or that
they have been slow in doing.
Mr. Karesh. Do you want to start?
Mr. Biel. Sure. It covers a number of different areas, and
it has been mapped out, as Mr. Karesh mentioned, and as Senator
Kaine mentioned. The petition goes back 6 years. In fact, there
had been a previous cycle. So the issues are not new, but you
have got a few different buckets of activity. The ready-made
garment sector which is, obviously, the focus of this hearing
and is the largest and most dynamic sector in Bangladesh. The
shrimp processing sector is another area where there has been a
history of labor rights abuses. There have been some signs of
progress made, although interestingly enough, less on----
Senator McCain. I guess I am asking what you want them to
do.
Mr. Biel. Yes. So in these areas, in the sectors, ready-
made garments, shrimp processing, the export processing zones
which is a separate legal authority, and with regard to fire
safety, although that is kind of on the margins of GSP, a
specific set of steps have been delineated to deal with freedom
of association and protection of workplace safety. There have
also been some specific actions laid out, and this has been
directly communicated in writing from our former U.S. Trade
Representative Kirk, from our Ambassador in Bangladesh, Dan
Mozena, to the Bangladeshis, also with regard to some
investigations of killing of a labor activist and the
deregistration of civil society groups.
So it is not an exhaustive list in terms of being something
that cannot be achieved within a time bound period. So there is
no misunderstanding of what is on the table and what would be
at the focal point of a decision on whether to suspend in full,
suspend in part, not suspend, all the different options.
But it has all been made quite clear in the last several
months: here are the steps that need to be taken, and there was
a GSP hearing that USTR chaired on March 28 and a long
discussion bilaterally the next day with the two governments
across the table. So those have been laid out in those areas I
mentioned and a couple of others.
Senator McCain. Well, I would appreciate it for the record
if you would provide us with--and I know, I hope it is not too
hard--what we expect of them, and also what we expect of
companies and corporations that do business there. We have not
addressed that, I think, perhaps in as much depth as I would
like. What do we expect of the companies and corporations that
do business there? Obviously, it is a two-way street. And also,
frankly, it would really ratchet up the unemployment in
Bangladesh, and I think that is something that at least we
ought to have as a consideration, not the primary consideration
but as a consideration, before we take the kind of ultimate
action.
Do you agree, Secretary Blake?
Mr. Blake. Again, I do not want to compromise what the
President will decide, but I do think that this will have quite
a far-reaching----
Senator McCain. But you give the President advice and
counsel. I expect the President will know a lot of things, but
not too much about this particular issue, although I am sure he
is aware.
Mr. Blake. Well, I think this is quite an important tool.
The issue is how do we best leverage that tool to get the
progress on the ground that we are seeking, and that is the
issue that we are now discussing internally.
Senator McCain. Well, I thank you for the nonanswer.
[Laughter.]
Senator McCain. Thank you, Mr. Chairman.
The Chairman. The State Department is very good at that.
[Laughter.]
Senator Corker wants to make a comment, and then I have one
final question, and then we will go to the next panel.
Senator Corker. Mr. Chairman, I have another hearing that
got moved back because of votes today, and I know this is an
important time to go ahead and have this hearing. I appreciate
you doing that. I need to step out for something that has been
set for some time, but I know the next panel is coming up. One
of the questions I have after hearing the first panel is, it
would seem to me that in a supply chain, especially for larger
enterprises, there are certifications that you can get all
throughout the supply chain. Even if the Government of
Bangladesh is not enforcing certain standards, by contract, you
can ensure that those things are occurring. I hope the next
panel will address that.
I do look forward to the industry here coming together on a
uniform agreement that they are working on, and I look forward
to them coming up and talking with us after June 30 about the
results of that.
Thank you for being here, and thank you for the second
panel that I will not see. Thank you.
The Chairman. I have one final question, and I think the
Secretary might be the right person to answer it, but I welcome
anyone of you who may be involved in this.
What is the status of the investigation into the April 2012
murder of Bangladeshi labor organizer, Aminul Islam? It is my
understanding that case remains unsolved, and key leads have
apparently been dropped.
Mr. Blake. Sir, the case does remain unsolved. A suspect
was identified in November 2012, but since then there has been
no progress that I am aware of on that case. So this remains a
very important part of our dialogue with the Government of
Bangladesh, to see this solved, because it sends a signal,
quite frankly, about what kind of respect is going to be
accorded to labor activists.
So it is very, very important that this be fully
investigated and that the people who are responsible be brought
to justice.
The Chairman. Well, April 2012, so that is over a year. You
say it is part of our dialogue. I am not quite sure what that
means. How intense are we actually asking about this case? What
followup are we seeking from this case? I mean, how is it that
there are suspicions about why this case has ended up in dead
ends?
Mr. Blake. We do ask about it. It was when former Secretary
Clinton was in Bangladesh the last time, she raised this in all
of her meetings. She talked about it publicly. I raise it in my
meetings with the Bangladeshis here, and of course our
Ambassador on the ground is very active on this.
The Chairman. And what do they say?
Mr. Blake. Well, just exactly what I just said, that the
case remains under investigation but they do not have anything
further to report.
The Chairman. And the person who was arrested, is he still
in incarceration?
Mr. Blake. He is not incarcerated, to my knowledge.
The Chairman. Well, I look forward to getting a further
report from State on this.
Mr. Blake. Thank you.
The Chairman. With the thanks of the committee to all of
you, we will continue to be engaging with you on this issue. We
thank you, and the panel is excused.
As we do that, let me introduce our second panel this
morning.
Ms. Celeste Drake, who is a Trade Policy Specialist with
the AFL-CIO; and Mr. Johan Lubbe, an international labor and
employment partner at Littler Mendelson, who is advising
American retail and apparel industry associations, including
the American Apparel and Footwear Association, the National
Retail Federation, the Retail Industry Leaders Association, the
U.S. Association of Importers for Textiles and Apparel.
And I would ask Senator Kaine to assume the chair. I look
forward to coming back because I do have questions for this
panel.
Once you are situated, we will start off with Ms. Drake and
then move to Mr. Lubbe.
Senator Kaine [presiding]. Thank you to the witnesses.
Mr. Lubbe, please proceed with your testimony, and then we
will move to questioning after Ms. Drake's testimony.
I am sorry. It was Ms. Drake first, and then Mr. Lubbe.
Thanks.
STATEMENT OF CELESTE DRAKE, TRADE POLICY SPECIALIST, AMERICAN
FEDERATION OF LABOR AND CONGRESS OF INDUSTRIAL ORGANIZATIONS,
WASHINGTON, DC
Ms. Drake. Thank you, Senator. I thank you for the
opportunity to testify today on important labor issues in
Bangladesh. I have submitted written testimony for the record
and will summarize my testimony here.
Many of Bangladesh's 4 million garment workers, the vast
majority of them young women, risk their lives every day,
working in thousands of unregulated and poorly constructed
factories. Their contribution to Bangladesh's $19 billion
garment industry has been rewarded by abysmally low wages,
denial of rights, and unacceptable workplace conditions.
No silver bullet will provide an overnight solution to this
longstanding problem, but the clear path forward requires
unprecedented efforts by the Government of Bangladesh, local
factory owners, international brands, and workers themselves.
Bangladesh's labor practices and working conditions have
been at issue for more than 20 years, and yet recent
catastrophes at Rana Plaza and Tazreen Fashions leave no doubt
that the current approach is an abject failure.
While it is, of course, the responsibility of the
Government of Bangladesh to enact and enforce laws regarding
workplace safety and worker rights, workers and employers are
critical partners. That is why the first step in the path
forward is for all clothing brands sourcing in Bangladesh to
sign the binding Accord on fire and building safety. This
Accord will ensure that factories become safer, brands provide
their fair share, and workers can advocate on their own
behalves, free from retribution.
Already 45 brands, including the largest producer in
Bangladesh, the second-largest general retailer in the world,
and three American brands have signed. The other large American
brands, including Walmart, Target, the Gap, JCPenney, and more,
have refused to sign. Some of these American brands are
pursuing an alternate agenda, an agenda that, if based on
existing corporate social responsibility programs, simply will
not work. These unilateral schemes have already proven
themselves ineffective, and their failures can be measured in
corpses.
Given that about 60 percent of Bangladesh's factories are
at risk of collapse and that two of the four worst factory
disasters in the history of the garment industry happened in
Bangladesh in the last 7 months, it is time for those profiting
most from the system to help reform it.
Instead of abdicating responsibility to social compliance
organizations, international brands, by signing and complying
with the Accord, can help reverse some of the damage of their
relentless race to the bottom. PVH, Sean John, and Abercrombie
& Fitch have already decided that is good business.
The importance of the Accord actually serves to underscore
the role of the government. The agreement may have little
practical impact if workers cannot organize and act
collectively. Organized workers are the most effective monitors
of their own safety and rights. But without laws securing those
rights and a credible threat of sanctions to deter violations,
some employers will just simply continue to cut corners.
Which brings me to point two: The administration must act
to withdraw or limit Bangladesh's GSP benefits until the
government has taken meaningful, concrete, and measurable steps
to ensure its workers can exercise their internationally
recognized labor rights, including the rights of freedom of
association, collective bargaining, and acceptable conditions
of work.
The time for granting the benefit of the doubt has passed,
and workers have paid for U.S. patience with their lives.
During nearly 6 years under the current GSP petition, steps
forward on worker rights have come hand in hand with steps
backward. For example, when a union has been allowed to
register, the government has also often looked the other way
when its founding officers were fired. When fires or other
workplace catastrophes have occurred, the government has formed
high-level commissions or announced new safety plans, none of
which make workers appreciably safer.
Superficial changes or promises to make change are
insufficient to meet the GSP standard. Promises do not provide
workers the confidence they need to exercise their rights and
will not reverse the race to the bottom.
If it fails to act to limit or withdraw GSP benefits, the
administration will send the wrong signal to all GSP
beneficiaries, that the United States is not serious about
labor rights and working conditions. Bangladeshi workers should
not be given the false choice between low-wage, no-rights jobs,
or no jobs at all. Instead, their government must defend their
rights, reverse the status quo, and make Bangladesh a more
attractive investment in the process.
The Government of Bangladesh can implement concrete,
measurable changes quickly; and if it does so, it can earn back
its tariff preferences, attract new customers and investors,
and build the value of brand Bangladesh. None of this is easy
nor instantaneous, but with enforceable standards and a
commitment to tripartite problemsolving, a win-win solution
really is possible.
I would be happy to answer any questions you may have.
[The prepared statement of Ms. Drake follows:]
Prepared Statement of Celeste Drake
i. introduction
The AFL-CIO, on behalf of its 57 affiliated unions, appreciates
this opportunity to testify on Labor Issues in Bangladesh. We represent
workers in every industry and economic sector, from manufacturing to
mining to services. Collaborating with working people around the world,
we work to improve labor laws, increase compliance with labor
provisions of trade and preference agreements, and empower workers to
improve their own lives and conditions of work.
Bangladesh, with nearly 150 million inhabitants, is a low-income
country that aspires to become a middle-income country by 2021. The
State Department has documented numerous and persistent human rights
abuses in Bangladesh, the most significant being ``enforced
disappearances, discrimination against marginalized groups, and poor
working conditions and labor rights.'' \1\ It is against this backdrop
that Bangladesh's garment sector--its export growth engine--sits,
employing about 4 million workers, over 80 percent of them women, many
of them young and not fully literate. Workers in this sector earn about
$38 a month, the global low for the industry, yet they sew for some of
the world's best-known brands.
Bangladesh was most likely not on most American consumer's radar a
year or two ago, but that is no longer the case. The catastrophic
collapse of the Rana Plaza Building which killed 1,129 Bangladeshis,
mostly young women, on April 24, has raised this least-developed
country's profile--and created an opportunity that's being called a
``turning point.''
This is indeed a critical moment for Bangladesh. If the Government,
factory owners, and international brands cooperate to make profound
reforms to ``business as usual'' in Bangladesh, committing to
enforceable standards for workplace safety and worker rights, it can be
the point at which brand Bangladesh begins to grow in stature. If
instead, this moment is not seized, and a flurry of unenforceable
promises are made in order to obscure the fact that little will change
for Bangladesh's workers, this moment will not be remembered, but will
simply become another in a long line of preventable tragedies for which
the world's most vulnerable bear the costs.
Achieving real change for Bangladesh's workers will require
determination and followthrough by both the public and private sectors.
The U.S. Government must take action on the petition to limit or
suspend Bangladesh's benefits under the Generalized System of
Preferences to signal to the Bangladesh Government that its lack of
progress will no longer be tolerated and that substantial changes to
its labor regime are necessary. And the U.S. brands who source in
Bangladesh, but who have so far refused to sign on to the Accord on
Factory and Building Safety in Bangladesh, must also join in the
binding agreement to protect the very workers whose daily efforts
create the brand's products--voluntary compliance plans, which do not
work, are not an acceptable substitute.
ii. overview
Many of Bangladesh's 4 million garment workers, the vast majority
of whom are young women, risk their lives every day, working in
thousands of unregulated and often poorly constructed factories. Their
contribution to the $19 billion garment industry has been rewarded by
abysmally low wages, consistent denial of internationally recognized
rights, and workplace conditions reminiscent of the U.S. sweatshops of
100 years ago. Their jobs can literally kill them.
The U.S. and Bangladesh Governments have for years talked about
improving the situation for workers. Likewise, Bangladesh's employers
and international brands have explained their commitments to protecting
workers and upholding standards. Despite the creation of a plethora
committees, working groups, and voluntary compliance programs, the
unacceptable labor conditions and practices remain.
In the last 15 months alone:
Labor organizer Aminul Islam was tortured and murdered in
April 2012--the case remains unsolved and key leads have
apparently been dropped.
A deadly fire at Tazreen Fashions in November 2012 killed at
least 112 workers in conditions strikingly similar to the
Triangle Shirtwaist factory fire.
Forty-four factory fire incidents have occurred since the
Tazreen fire, many of which caused injuries as workers sought
to escape blocked exits, and three of which were deadly--the
most recent factory fire, which injured 20 workers, occurred on
May 22.
Many of the workers who have successfully registered with
new unions during 2013 (22 new unions in the ready-made garment
sector, for example) have faced termination and other antiunion
discrimination; none have been able to secure formal collective
bargaining agreements (though there have been spot agreements
on specific issues).
Thousands of workers have engaged in protests over poor and
unsafe working conditions and nonpayment of wages--many of the
protests could have been avoided if workers had effective
mechanisms to solve workplace disputes in an orderly fashion.
The Rana Plaza building, which contained several garment
factories, collapsed, killing 1,129 workers and injuring at
least 1,500 more--the deaths and injuries could have been
avoided if the workers who saw the cracks and at first refused
to enter the building had not been forced to work by employer
threats to fire them or withhold their pay.
The Bangladesh University of Engineering and Technology,
which is performing a survey of garment factories in
Bangladesh, reported that 60 percent of the buildings housing
factories are vulnerable to collapse.\2\
It is worth noting that three of the four worst disasters in the
history of the global apparel industry have happened in the last 8
months, two of them (Rana Plaza and Tazreen Fashions) in Bangladesh.\3\
Bangladesh's labor practices and working conditions have been at issue
for more than 20 years \4\--and yet these recent catastrophes leave no
doubt that the current approach (weak to nonexistent governmental
efforts combined with voluntary corporate compliance programs) is an
abject failure.
The problems that workers face in asserting their rights in
Bangladesh are complex--but not insoluble. To make real changes for
workers--who should not be forced to choose between working in a
deathtrap and having no job at all--will take a truly tripartite
effort, in which workers, business interests, and the relevant
governments agree to work together to implement a high-road approach to
economic development in Bangladesh.
While it is of course the responsibility of the Government of
Bangladesh to adopt, maintain, and enforce laws that secure fundamental
labor rights for its workers--workers and employers are critical
partners in that effort. When workers are free to form unions and
exercise labor union rights without fear of recrimination, workers
become full partners in creating safer workplaces and higher
productivity. Likewise, employers are critical partners--particularly
when applicable labor laws and practices are strong and effective
enough to deter those who would otherwise cut corners on safety and
deny rights to their workers. Employers who cooperate in labor law
compliance reap benefits as well, in the form of more productive
workers with increased longevity (instead of workers who jump from
factory to factory looking for better wages and working conditions).
In Bangladesh, the role of the employers is severely constrained by
the pressure they face to minimize costs in order to win contracts from
global brands that form part of the $1.5 trillion international fashion
industry. The global fashion industry pays rates that, in effect, cause
the very problems that plague Bangladesh's factories and their workers.
Some factories may wish to do the right thing, but feel they cannot
afford to do so. Individual factories that invested in needed repairs
and upgrades would be unable to charge competitive prices and would
soon find themselves out of business. To resolve this ``prisoner's
dilemma,'' the international brands must take responsibility for their
role in Bangladesh's low-road, no-rights development model.\5\
This is why the AFL-CIO, along with partners including IndustriALL,
UNI Global Union, the Worker Rights Consortium, the Clean Clothes
Campaign, United Students Against Sweatshops, the International Labor
Rights Forum, and others, has strongly endorsed the Accord on Fire and
Building Safety in Bangladesh, already signed by more than 40 major
brands including American brands PVH (parent company of Calvin Klein
and Tommy Hilfiger), Sean John, and Abercrombie & Fitch. This historic
Accord is a binding agreement regarding workplace fire and building
safety in Bangladesh, which means it has a chance to make a real
difference instead of papering over problems with certificates and
audits that bear little relation to the real conditions prevailing in
Bangladesh's factories.
The agreement guarantees worker participation through
representative organizations, recognizes the role of government and
takes measures to combat corruption by requiring rigorous inspections,
transparent reporting of audits, and public oversight of results. This
agreement offers an integrated and sustainable solution. Brands that
have signed it have recognized that cutting and running from the
problems the fashion industry helped to create in Bangladesh is simply
not an option.
The existence of this new binding Accord also serves to underscore
the role of the Government. The agreement is likely to have little
practical impact if workers are not allowed to organize and act
collectively. Organized workers are empowered to stand up for their own
safety and rights. However, they can only do so if the Government of
Bangladesh turns its words of support for labor rights into active,
effective efforts to defend those rights--which includes changes in
labor law and in enforcement regimes. Mere lip service will only result
in the status quo, in which impoverished young women take their lives
into their hands every single day just by going to work.
iii. international brands cannot avoid responsibility for their role in
denying bangladesh's workers safe workplaces and free exercise of
rights
While all participants in the supply chain--suppliers, brands, and
especially workers--have a role to play in ensuring that workplace
safety and respect for international labor standards improve, the role
of international brands is especially critical. Brands have the
financial leverage to incentivize meaningful change. The question is
whether or not they will. While state-of-the-art factories do not
happen overnight, the binding and legally enforceable Accord on Fire
and Building Safety in Bangladesh ensures that owners will repair
factories or lose access to contracts. It also ensures that
multimillion dollar international brands pay their fair share of the
costs. Importantly, the agreement will strengthen workers' right to
organize and defend their own rights--including the right to refuse to
enter or remain in an unsafe workplace.
Clothing brands that have sourced from Bangladesh over the past two
decades have made plentiful profits based on the world's lowest wages
and most dangerous conditions. Instead of now leaving this developing
country and its workers with the mess created by the ``race to the
bottom'' of the global fashion industry, international brands must stay
in Bangladesh and help usher in a ``high road'' strategy.
While more than 40 global brands have signed the Accord, including
three leading American brands (PVH, Sean John, and Abercrombie &
Fitch), many other leading American brands, including the Gap, Walmart,
Target, and JCPenney have not.
Reportedly, Walmart and the Gap are joining other unnamed brands to
develop an alternative proposal.\6\ The AFL-CIO strongly believes there
is no need for an additional proposal. The new effort reportedly
includes no worker input, merely ``representatives from retailers and
brands, as well as participants from industry associations.'' \7\ An
agreement that does not include workers in its development is likely to
lack buy-in and exclude provisions to ensure worker engagement and
empowerment. Given that workers are the best monitors of their own
safety, this omission is critical.
It is unclear what an alternative proposal would achieve. If it
were to create binding but different standards, that would only
complicate compliance and enforcement for Bangladeshi factories and
their employees--how would workers (many of them illiterate) know which
safety regime applied to their workplace at any given time?
The AFL-CIO's bigger concern, however, is that any new proposal
would create voluntary, rather than binding standards. Unfortunately,
as the AFL-CIO demonstrated in its recent publication ``Responsibility
Outsourced: Social Audits, Workplace Certification and Twenty Years of
Failure to Protect Worker Rights,'' \8\ voluntary standards don't work.
Voluntary corporate social responsibility (CSR) standards have
problems with governance, transparency, proper inspection methodology,
independent conciliation and mediation involving unions, and long-term
commitments by global brands. Their unilateral nature fails to provide
meaningful roles for governments and workers--and certainly does not
``empower'' workers to become leaders in creating safe and productive
workplaces.
For example, while the programs may require ``audits,'' these
``audits spot some very particular and relatively easy to identify
problems, but even then there usually are no consequences for
noncompliance or rewards for improvements. Harder-to-spot problems
related to gender discrimination or freedom of association remain
invisible. As few auditors come from backgrounds sensitive to these
issues and often do not understand what freedom of association means.''
\9\
For example, Ali Enterprises in Pakistan, site of a September 2012
fire that was one of the four deadliest disasters in the history of the
garment industry, had been newly awarded an ``SA8000'' certificate by
Social Accountability International (SAI), a multi-stakeholder
initiative operating in the social audit industry.\10\ But the
certificate clearly did not provide safety for the nearly 300 workers
killed in the fire.\11\ Likewise, various programs had audited Tazreen
Fashions and Rana Plaza--none of which helped save the workers employed
there.
Twenty years of evidence from Bangladesh and other developing
countries demonstrates that corporate social responsibility programs,
which are based ``mainly on short and cursory visits to factories and
no proper discussion with workers . . . will never achieve decent,
secure jobs for the millions of workers at the sharp end of the global
economy.'' \12\
In addition, the voluntary nature of these programs means that
brands can change, weaken, or drop the programs at any time, leaving
workers in the lurch. To the extent that local factories and the
Government of Bangladesh begin to engage in efforts to improve labor
conditions and secure rights for workers, voluntary programs that can
be withdrawn at any time could harm these efforts.
While the diversity of CSR programs means that each may have
stronger and weaker elements, the AFL-CIO report makes clear that where
workers are represented in the process, especially through unionism,
the chances of success are real, while corporate-driver initiatives
have largely failed to deliver for working people and their
communities.\13\
The global industry that played a role in creating the conditions
in Bangladesh's garment industry must play a role in fixing it, not
outsource that role to compliance firms or abandon Bangladesh's workers
altogether. A voluntary system that brands can walk away from as soon
as the buzz about Rana Plaza dies down is not the answer. The AFL-CIO
urges North American brands to join the existing and enforceable Accord
on Fire and Building Safety in Bangladesh rather than create a new
proposal that has the potential to confuse and undermine progress the
Accord has the potential to achieve.
iv. the afl-cio encourages the u.s. government to withdraw benefits
from bangladesh pursuant to section 19 u.s.c. Sec. 2462(d) of the
generalized system of preferences (gsp)
The AFL-CIO's work to secure labor rights for Bangladeshi workers
through the GSP process has a long history. Since 1990, the AFL-CIO has
filed five separate GSP petitions related to systemic and widespread
violations of internationally recognized worker rights, in law and in
practice, in Bangladesh (with filings raising new issues beginning in
1990, 1999, 2004, 2005, and 2007). Each time, the AFL-CIO believes that
the Government of Bangladesh failed to make meaningful progress on the
adoption and enforcement of internationally recognized worker rights.
Instead, following each new petition, the Government would make
promises and adopt measures to give the appearance of sincerity about
worker rights. But implementation was delayed and enforcement was weak
to nonexistent.
The most recent petition was filed in 2007, and included evidence
that workers had been threatened, arbitrarily arrested, and even
tortured for trade union activity. The United States Trade
Representative (USTR) accepted the petition for review on September 6,
2007, and subsequently placed Bangladesh under ``continuing review'' to
monitor the progress of the Government of Bangladesh toward a set of
worker rights benchmarks elaborated in a 2008 demarche. The decision to
place Bangladesh under review, combined with the subsequent engagement
of the U.S. Government, succeeded in pushing the Government of
Bangladesh and employers to take some initial efforts on behalf of
workers. Unfortunately, the Government of Bangladesh's efforts have
been neither sustained nor effective. It has been, in effect, a case of
one step forward, two steps back.
For example, in the shrimp sector, the Government of Bangladesh,
around 2010, allowed some independent unions to register. However,
employers reportedly then subjected the new unions to a union-busting
campaign, including a press conference organized by employers at which
they reportedly denounced the labor organizations that had helped the
workers to form the unions, as well as local labor authorities. The
Government failed to defend worker rights, and all progress on
organizing independent unions in the sector ceased. To our knowledge,
only one independent union in the sector is still in operation.
Similarly, a prior GSP case, the Government agreed to a new law
allowing some freedom of association in the country's Export Processing
Zones (EPZs). A new law established the right of workers to form worker
associations in the EPZs. The associations were supposed to be a step
on the road toward granting full freedom of association, organization,
and collective bargaining rights for all EPZ workers. Unfortunately,
that commitment, like so many others, stalled.
These associations continue to be denied the right to effectively
collectively bargain (there are no existing collective bargaining
agreements in the EPZs, nor any reports of bargaining), to form
federations, or link with unions or other organizations outside the
zones from whom they can draw technical expertise and other support.
Workers in some zone factories, including in the largest EPZ employer,
report that they continue to be denied the right to hold an election to
create an association. The Government has failed to fulfill its
commitment to provide access to labor conciliators in the EPZs as
promised. Workers have even reported the use of a zone ``blacklist,''
which violates the right of freedom of association by discriminating
against workers for union preference or activity. When workers have
reported instances of antiunion discrimination in the EPZs, the BEPZA--
which has full authority over labor relations in EPZs, rather than the
Ministry of Labor--has usually failed to act on their behalf.
Either the BEPZA or the Government of Bangladesh can address most
of these failures by simply changing current practice or by issuing a
new rule or regulation, but neither entity has done so.\14\ This choice
to leave Bangladeshi workers without the ability to exercise their
internationally recognized worker rights indicates that the current
Government lacks sufficient political will to act.
Given the issues documented in its 2007 GSP petition and numerous
subsequent filings, it is the view of the AFL-CIO that the Government
of Bangladesh is not ``taking steps to afford to workers in
[Bangladesh] (including any designated zone in that country)
internationally recognized worker rights'' (as required by 19 U.S.C.
Sec. 2462(c)(7)), and that GSP benefits should be withdrawn. It is our
sincere belief that the Government of Bangladesh has exhausted any
``benefit of the doubt'' and that at this point, the only recourse left
is to spur the Government of Bangladesh to protect Bangladesh's workers
by limiting, suspending, or withdrawing GSP benefits pursuant to U.S.
law.
The GSP facility provides a critical mechanism to pressure
recalcitrant governments to take clear and concrete actions to afford
workers their internationally recognized worker rights. The labor
eligibility criteria for the GSP program exist for very important
reasons, including the desire to promote fundamental labor rights,
which are positively linked with a country's development\15\ and the
desire to prevent a beneficiary country from unfairly undercutting
workers in every other country in the world (including the U.S.) by
abusing, or permitting the abuse of, its workers. If such behavior were
allowed to proliferate, it would only exacerbate the ``race to the
bottom,'' in which countries compete for investment by weakening their
labor rights regimes. Such a race may indeed lower costs--but it also
suppresses consumer demand, interferes with the formation and growth of
the middle class, and undermines the fundamental human rights as laid
out by the International Labor Organization and in the Universal
Declaration of Human Rights.
Some opponents of Presidential action on the GSP have argued that
it will only further harm workers by throwing them out of work. Such
arguments are speculative.\16\ More importantly, they present a false
choice, as if the only options for Bangladesh's millions of workers are
to work in deathtraps, with meager wages and no rights, or to have
rights, but no jobs. Clearly, other alternatives are possible,
including a Bangladesh in which workers are secure enough in their
rights to advocate for their own welfare, health, and safety on the
job.
Other opponents to GSP limitation, suspension, or withdrawal argue
that any change to Bangladesh's current benefits will result in lost
leverage in the effort to improve labor rights for Bangladesh's
workers. Nothing could be further from the truth.
Leverage under current conditions is almost certainly already gone.
The Bangladesh brand is already tarnished. A recent Harris Interactive
Poll revealed that almost 70 percent of Americans had heard of the Rana
Plaza collapse and almost 40 percent said they will be less likely to
buy clothes made in Bangladesh.\17\ A number of well-known brands,
quite aware of the ongoing labor abuses, have not sourced from
Bangladesh for some time, and some, Disney being the most public, have
made recent announcements to ensure their customers know they do not
source there.
Decisions not to produce in Bangladesh do not help improve
conditions for Bangladesh's impoverished workers. Demonstrated steps to
afford internationally recognized worker rights--as the Government of
Bangladesh would have to show to gain back full GSP benefits--would
demonstrate to the world's brands and consumers that things have
changed for the better. Regaining GSP status (with a U.S. seal of
approval) could help Bangladesh's factories lure back brands and
attract new customers--while continuation of the status quo is likely
to see additional publicity sensitive brands abandon the country
entirely (an outcome the AFL-CIO strongly opposes).
Moreover, it is the failure of the U.S. Government to act on the
GSP petition that seems most likely to result in lost leverage.
When the U.S. fails to enforce its own laws, particularly when
sufficient time--in this case about 6 years--has been granted, it only
creates an atmosphere of impunity, not only for Bangladesh, but also
for every other country receiving GSP benefits. The USTR is currently
reviewing the labor rights practices of a number of countries,
including Iraq, Georgia, Fiji, Uzbekistan, and the Philippines. What
message will continued failure to act send to these Governments? If
they believe that mere promises to change (rather than concrete,
measurable improvements) are all that is necessary to continue to
receive GSP benefits while pursuing a low-road strategy that hurts
workers worldwide, it seems almost certain they will reduce their
efforts to comply with the law. An atmosphere of impunity regarding
labor rights may pad the profit margins of a few of the world's largest
brands, but it certainly does nothing to increase shared prosperity.
On the other hand, action to suspend, limit, or withdraw GSP
benefits for Bangladesh would send a different message--one that says
that workers deserve more than lip-service; that progress is critical;
and that the U.S. will indeed enforce its own laws. The GSP statute
does not create a right to duty-free exports to the United States. It
establishes a privilege, one that must be earned through fair labor and
trade practices. A reduction or loss of GSP benefits would provide an
incentive to the Government of Bangladesh to make substantial changes
to recover those benefits and restore a favorable image for brands and
investment.
Accomplishing such change in Bangladesh is possible. The AFL-CIO's
sister organization the Solidarity Center has an office in Bangladesh,
which has already been supporting worker-led unions in the garment
sector and is poised to accomplish more if the Government of Bangladesh
would become a partner in improving worker rights and acceptable
conditions of work. We are also hopeful that the U.S. Government will
increase its commitment to development programs in Bangladesh,
including those that will help strengthen the labor rights regime and
educate Bangladesh's workers and employers about democratic labor
unions, worker rights, and acceptable conditions of work.
Moreover, there are several steps that the Government of Bangladesh
can take right away to demonstrate that it is ``taking steps to afford
to workers in [Bangladesh] (including any designated zone in that
country) internationally recognized worker rights'' (as required by 19
U.S.C. Sec. 2462(c)(7)). For instance, it can:
Drop all remaining charges against worker rights advocates
Kalpona Akter and Babul Akhter (unless the cases move forward
immediately);
Remove threats against the registration of the advocacy
organizations BCWS & SAFE;
End police surveillance of union activists and labor NGOs;
Provide to the U.S. Government--and make public--quarterly
reports on the progress of the investigation into Aminul
Islam's murder;
Consistent with fundamental labor rights, eliminate any
existing or proposed government approval for unions (including
worker associations inside the EPZs) to affiliate with each
other and allow all unions to link with outside organizations
such as NGOs;
Via rule or regulation, allow its Department of Labor to
monitor union registrations and unfair labor practice
complaints within the EPZs;
Accept ILO and International Trade Union Confederation
criticism and recommendations on the draft labor law
amendments, including the recommendation to increase worker
participation in the process\18\;
Transfer, as quickly as possible, resources from the
industrial police who act largely as agents of employers to
inspection functions to investigate building and fire safety
and investigate unfair labor practices.
While not a complete list of the actions needed to secure
internationally recognized worker rights in Bangladesh, this list
illustrates that there are indeed many measurable changes the
Government of Bangladesh could make right away to demonstrate that it
is taking the required steps under the GSP statute.
The AFL-CIO wants a vibrant, productive garment industry in
Bangladesh, in which workers have good jobs and owners make good
returns on their investments. Both the Government of Bangladesh and
international brands have obligations to ensure that they create an
environment in which that can take place.
v. selected rana plaza survivor stories
Anna Khatun, 16
Anna Khatun, 16, joined one of the factories in the Rana Plaza
building 4 months ago as a helper. She does not even know the factory
name--just that she was working on the fifth floor.
``Because of poverty, I have sent my younger daughter to work and
now she lost her right hand,'' said her mother. A wall collapsed on
Anna--and rescuers had to amputate her hand to free her from the
rubble. Anna could not even respond when asked about what the future
might hold.
``What will be her future? We don't know. We only know she is
disabled now,'' said her mother.
Arati Bala Das, 18, New Wave Style, Ltd.
Arati Bala Das, 18, was pulled from the Rana Plaza wreckage after
being pinned under a concrete block for 3 days. She and her mother,
Titon Bala, worked at New Wave Style Ltd. Arati's mother died in the
disaster. Arati's right leg had to be amputated to save her life.
Arati remembers a power outage hit immediately before the building
collapsed. ``When the building collapsed, I felt that I was going down.
When it stopped, I found myself in the dark. It was difficult to
breathe. I could not see anything. I could not move a bit. I realized
that two dead bodies fell on my legs and a pillar had fallen on those
dead bodies. I was very much afraid and I thought I would not be able
to return alive. After few moments, I heard screaming workers, crying
for help and I assumed that seven or eight more workers were there.''
Rescuers, who found her after 3 hours, provided saline water to her
through a tube until they could rescue her 3 days later.
Arati's youngest sister, Akhi, 2, missed her mother. She would not
stop crying and would not eat. The family brought her to the hospital
so Arati could feed her. Arati has two more sisters--Lucky, 7, and
Lovely, 12. Their father, Adhir Chandra Das, a poor day-laborer, lives
with his family in a rented hut in Savar. Adhir is now left without the
income of his wife and eldest daughter, which the family needs to
survive.
Arati is afraid and sad. ``I will never return to work at garment
factory. I want the government to do something for us. I will not be
able to work in future, at least the government can arrange artificial
leg for me.''
Md. Pintu, 18, and Shilpi, 21, New Wave Bottom Ltd.
Md. Pintu, age 18, and his sister-in-law, Shilpi, 21, worked for 3
years as sewing machine operators in New Wave Bottom Ltd., on the
second floor of the Rana Plaza building. They live in a small tin shed
in Mazidpur Choto Goli, home to the majority of Rana Plaza workers.
Pintu and other workers noticed a big crack in the beam of the
floor on April 23, 2013. Management discontinued production at 10 a.m.
and instructed the workers to leave the building immediately. The next
morning, Pintu and Shilpi discussed the crack with their family. They
thought the factory would be closed for a few days for repairs, and
they would have a safe place to restart their machines. Unexpectedly,
they heard a loudspeaker announcement: ``All the workers of Rana Plaza,
go to work. The factory has already been repaired.''
After hearing the announcement by a representative of the
building's owner, Pintu, Shilpi, and other workers unwillingly went to
work, deeply concerned and afraid. Before leaving the house, Shilpi
looked at her 2-year-old son and sighed.
A few minutes after the workers arrived on the job, the electricity
went out, the backup generators turned on and the building collapsed.
Shilpi was rescued after a few hours and was sent to the nearest
hospital, Prime Hospital. Then she was sent to Dhaka Medical Hospital
for further treatment. She continued to lose blood and remained in
serious condition. After 8 days, she was transferred to the Apollo
Hospital Ltd. for special care, but she died just after arriving at the
hospital emergency room.
Pintu is still missing. His sister has waited outside the building
with his picture, crying.
----------------
End Notes
\1\ Department of State, ``Country Reports on Human Rights
Practices for 2012: Bangladesh,'' available at: http://www.state.gov/j/
drl/rls/hrrpt/humanrightsreport/index.htm#wrapper.
\2\ Jason Burke, ``Majority of Bangladesh Garment Factories
`Vulnerable to Collapse,' '' in The Guardian, June 3, 2013, available
at: http://www.guardian.co.uk/world/2013/jun/03/bangladesh-garment-
factories-vulnerable-collapse.
\3\ See, e.g., Esther Bintliff, ``On Bangladesh, and Some of the
Worst Factory Disasters in History,'' The Financial Times, Apr. 25,
2013, available at: http://blogs.ft.com/the-world/2013/04/on-
bangladesh-and-some-of-the-worst-factory-disasters-in-history/.
\4\ See Section IV of this document for a history of labor law and
practice complaints against the Government of Bangladesh.
\5\ As explained in detail in Section III, existing corporate
social responsibility programs, which include corporate codes of
conduct, workplace monitoring, audits, factory certifications, and
related initiatives simply do not work. These types of programs have
had a chance to work in Bangladesh for years--with no appreciable
impact.
\6\ See, e.g., Matthew Mosk, ``Walmart, Gap Propose Alternate
Bangladesh Safety Program,'' ABC News, May 31, 2013, available at:
http://news.yahoo.com/wal-mart-gap-propose-alternate-bangladesh-safety-
program-195604087--abc-news-
topstories.html;_ylt=AwrNUbDmEKlRYEEAs3z_wgt.
\7\ ``Leading North American Retailers and Brands to Address
Systemic Safety Issues for Workers in Bangladesh Garment Factories,''
Press Release, Bipartisan Policy Center, May 30, 2013, available at:
http://bipartisanpolicy.org/news/press-releases/2013/05/leading-north-
american-retailers-and-brands-address-systemic-safety-issu.
\8\ Available here: http://www.aflcio.org/content/download/77061/
1902391/CSReport.pdf.
\9\ Id., at 28.
\10\ Id., at 37.
\11\ As detailed in the AFL-CIO report, SAI does not ``directly
audit many factories or directly certify brands.'' Instead, it mainly
designs and markets a system meant to provide consumers and retailers
with the confidence that a product has been produced in a social
responsible manner. See id., p. 31.
\12\ Id., at 1 (Sharan Burrow, Foreward).
\13\ Id., at 6.
\14\ EPZ Workers Welfare Association/Society and Industrial
Relations Act (EWWAIRA) in 2010 Section 90. (``Powers to make rules and
regulations.--(1) The Government may, by notification in the Official
Gazette, make rules for carrying out the purposes of this Act. (2) The
Authority may, with previous approval of the Government, by
notification in the Official Gazette, make regulations for carrying out
the purposes of this Act.'').
\15\ See, e.g., Thomas I. Palley, ``The Economic Case for
International Labour Standards,'' Cambridge Journal of Economics, Vol.
28, No. 1, 2004.
\16\ For example, the ready-made garment sector, by far
Bangladesh's leading export sector, does not receive GSP benefits and
seems unlikely to experience job loss as a result of changes in
Bangladesh's GSP benefits.
\17\ ``Among Americans Who Know of Bangladesh Clothing Worker
Deaths, Two in Five Less Likely To Purchase Clothes From There,''
Sacramento Bee, June 3, 2013, available at: http://www.sacbee.com/2013/
06/03/5465917/among-americans-who-know-of-
bangladesh.html#storylink=cpy.
\18\ For more information on the shortcomings of the proposed labor
law reform, see, e.g., Munima Sultana, ``Labour Law Amendment Goes
against Int'l Labour Standards,'' The Financial Express, May 30, 2013,
available at: http://www.thefinancialexpress-bd.com/index.php?ref=
MjBfMDVfMzBfMTNfMV85MF8xNzEwNDc=.
\19\ As told to Solidarity Center staff in Bangladesh as of May 15,
2013.
Senator Kaine. Thank you, Ms. Drake.
Mr. Lubbe.
STATEMENT OF JOHAN LUBBE, INTERNATIONAL LABOR AND EMPLOYMENT
PARTNER, LITTLER MENDELSON, P.C., NEW YORK, NY
Mr. Lubbe. Thank you, Senator Kaine and Senator McCain.
Thank you for the opportunity to testify here before you today.
I am here in my capacity as a practicing international
employment and labor lawyer who has been advising the industry.
My testimony today will focus on some of the key issues facing
companies who conduct business in Bangladesh, as well as
solutions that have been offered to address the issue of worker
safety.
The North American retail and apparel community has been
stunned and saddened at the heart-breaking loss of life from
the recent tragedies at ready-made garment factories in
Bangladesh. The problems within Bangladesh are extremely
complex and systemic. There is no simple one-size-fits-all
solution that will resolve the current systemic issues. All
stakeholders must work together to develop a path forward that
will not only provide a long-term and sustainable solution to
ensure worker safety, but will also maintain the viability of
the country as a key manufacturer and supplier to markets
around the world. The North American retail and apparel
industry is prepared to play a meaningful role and make a
substantial contribution.
Bangladesh is a difficult place to conduct international
business. First, a deficiency in infrastructure, including the
structural integrity of buildings, as well as issues with
electricity grid and water availability.
Second is the challenge of the enforcement of building
codes. The country has a set of codes and certificate
requirements which have not been enforced as they should be.
The Rana Plaza building collapse only reinforces the need for
the enforcement of current codes and an examination of whether
the codes need to be updated.
Third is the Bangladeshi Government itself. There are many
reports about rampant corruption within the government which
need to be addressed. Protection of workers' rights has been
lacking. The government has signaled a move forward in this
regard, and that is supported by the industry.
There is a strong need for shared responsibility to address
the current issues and challenges in Bangladesh. This includes
all stakeholders, from the government, private sector, civil
society, unions, workers, factory owners. Each stakeholder has
a specific area of responsibility and should not be required to
usurp the role of the other stakeholders. You have heard
earlier this morning in testimony mapping out the various roles
that each stakeholder has to play. I am not going to repeat
that.
The tragedies in Bangladesh have prompted a number of
different responses to address worker and factory safety. These
efforts have become even more urgent within the industry as
companies collaborate for continual improvement.
There were also separate initiatives by the German
International Development Agency, GIZ, called the Fire Safety
Alliance in Bangladesh, and IndustriALL global union called the
Fire and Building Safety Memo of Understanding. A good-faith
effort was made in late April of this year to merge the GIZ
action plan with the IndustriALL principles. That failed. In
that effort, American industry participated.
IndustriALL then unilaterally announced the Accord and
provided companies 2 days to sign onto the Accord before they
released it on May the 15th. While the U.S. retail and apparel
industry share IndustriALL's goal to improve worker safety to
make more tangible progress on the ground, U.S. companies
raised several concerns regarding the Accord, including its
vague and ambiguous terms which potentially holds unlimited
legal liability for them.
The IndustriALL Accord should not be viewed as the sole
response and solution to the situation in Bangladesh. The
United States and Canadian companies have come together in an
alliance to develop a single, unified action plan as they
believe it will achieve immediate, sustainable, effective and
long-lasting change for the garment industry and its workers in
Bangladesh.
The action plan will build upon the extensive work many of
these United States and Canadian companies have done in the
past and continue to do on the ground to address and improve
health and safety. We have outlined in our written submission
the legal challenges that we faced, and these range from vague
terms, the utilization of arbitration, to really rewrite and
bring clarity to a contract which is not a good drafting
principle.
Improving worker safety in Bangladesh is a high priority
and will require a collaborative effort by all the
stakeholders. A systemwide solution must address eradicating
corruption, improving the quality of building construction,
revisiting the location of factories, the issuing of building
permits, and the enforcement of codes.
The U.S. retail and apparel industry is prepared and
working swiftly toward making a substantial contribution to
achieving results on the short term and the long term to
prevent future workplace injuries and deaths of Bangladeshi
garment workers.
Thank you for the opportunity.
[The prepared statement of Mr. Lubbe follows:]
Prepared Statement of Johan Lubbe
Chairman Menendez, Ranking Member Corker and members of the
committee, thank you for inviting me to testify at today's hearing to
discuss ``Labor Issues in Bangladesh.'' My name is Johan Lubbe and I am
a shareholder with the law firm of Littler Mendelson, P.C. Littler is
the world's largest labor and employment law firm exclusively devoted
to representing management. I am here today in my capacity as a lawyer
who practices international labor and employment law and my experience
advising the U.S. retail and apparel industry specifically the
associations representing the industry. These associations include the
American Apparel and Footwear Association, the National Retail
Federation, the Retail Industry Leaders Association, the U.S.
Association of Importers of Textiles and Apparel. My testimony today
will focus on some of the key issues facing companies, who are doing
business in Bangladesh, as well as solutions that have been offered to
address the issue of worker safety.
The North American retail and apparel community has been stunned
and saddened at the heartbreaking loss of life from the recent
tragedies at ready-made garment factories in Bangladesh. These tragic
incidents only underscore the need for the international community to
come together to build upon the ongoing work in Bangladesh by
individual companies and other stakeholders to find practical,
immediate and long-term solutions to ensure the safety of the workers
in the garment production facilities in Bangladesh.
It must be noted that the problems within Bangladesh are extremely
complex. As such, there is no simple ``one-size-fits-all'' solution
that will resolve the current systemic issues. Any solution requires
that all stakeholders work together to develop a systemwide solution
that will not only provide a long-term and sustainable solution to
ensure worker safety in the Bangladesh garment industry, but will also
maintain the viability of the country as a key manufacturer and
supplier to markets around the world. As solutions are developed, it is
important to allow for flexibility that will enable brands, retailers,
manufacturers, and other stakeholders to respond swiftly and
effectively to an ever-changing environment within Bangladesh. This
flexibility will allow companies who operate different supply chains
with different factories to make sure they are responding in an
appropriate manner to the issues before them.
Many efforts have been announced by multiple parties including
governments, industry, and others to address the key issues within
Bangladesh. It is important that everyone recognize the shared
responsibility that is required for addressing the worker and factory
safety issues. This responsibility lies with all stakeholders including
the Bangladesh Government, the United States and other foreign
governments, factory owners, employer's organizations, workers, the
buyers in North America and Europe, members of civil society, and
organized labor. The efforts should all build off of each other to
achieve the ultimate goal of protecting those who work in the
Bangladesh garment factories.
bangladesh role in the global marketplace
As committee members are aware, Bangladesh has very quickly become
a major player in the ready-made garment industry. As has been proven
through the years, apparel and garment production are critical first
steps for lesser developed countries to raise their standard of living.
The garment industry accounts for 80 percent of Bangladesh's exports.
In 2011, exports from Bangladesh totaled $23 billion. Garment exports
comprised nearly $20 billion of this total. The industry directly
employs 4.5 million workers, by far the largest employment sector in
Bangladesh. It is significant to note that women make up close to 90
percent of the ready-made garment workforce, allowing for many to
become the primary breadwinners for their families.
The bulk of Bangladeshi manufactured garments are sold in the
European and North American markets. The European market accounts for
60 percent of Bangladeshi exports, about 30 percent of the exports come
to the United States, and the remaining 10 percent is split between
Canada and a few other countries. Part of the reason why the European
market share is so large is that apparel products qualify for duty-free
status under Europe's General Scheme of Preferences (GSP) program.
Unlike the European GSP program, the United States does not provide for
duty preferences under its own Generalized System of Preferences
program. Both Europe and the United States are now considering removing
benefits for Bangladesh under their respective programs. The potential
impact of revisiting the GSP programs is not yet clear. It could lead
to companies deciding to stop sourcing in Bangladesh.
In Bangladesh the majority of the ready-garment industry is located
in Dhaka and the surrounding areas. The second-largest concentration
centers around Chittagong, which is the country's major port while the
rest of the industry are part of export processing zones. Bangladesh
itself is a very unique country for the building of factories. Since
the country is mostly swamp land, there is not a lot of available
stable land which can be used for industrial development purposes.
While there is some more usable land further outside of Dhaka and
Chittagong, the access to key infrastructure such as electricity and
water is very sporadic and unreliable. Companies who decide to build
outside Dhaka and Chittagong face significantly higher operating costs,
as they need to typically build their own power and water facilities.
This is a key reason as to why most manufacturing facilities are built
in Dhaka and Chittagong.
Unfortunately the lack of usable land results in many buildings
being constructed as multipurpose facilities. In addition, a number of
these buildings are built upon fill. If the fill is not done correctly
or up to code, it makes the building inherently unstable. One of the
biggest issues facing the industry is the enforcement of current
building codes in Bangladesh. The country has a set of codes and
certificate requirements which have not been enforced as they should
be. The Rana Plaza building collapse only reinforces the need for the
enforcement of current codes and an examination of whether the codes
need to be updated. As has been reported, Rana Plaza was only
authorized to be a five-story building, yet an additional three floors
were added to the building. In addition, the building was only zoned as
a residential/commercial building. It was not meant to be used as an
industrial complex and certainly not one to house large machines. These
noncompliance issues all contributed to the horrific collapse of a
building that was improperly constructed and used for the wrong
purposes.
The industry has grown exponentially over the years. While this is
positive for the overall Bangladesh economy, it also highlighted the
unfortunate fact that the country was not equipped for this quick
expansion, especially with the inability of the government to build
industrial parks and export processing zones to keep up with the
growing demand.
concerns in bangladesh
The recent tragic events in Bangladesh have highlighted the
continuing concerns about worker safety at ready-made garment factories
in the region. In addition to these issues, there are other concerns
for companies who continue to do business in the country. First and
foremost is the Bangladeshi Government itself. There are many reports
about rampant corruption within the government which need to be
addressed. There are some who are concerned about the number of
Bangladeshi politicians who are actually factory owners and whether
that will slow down or prevent the necessary reforms to address worker
and factory safety. The government has signaled a move to make the
necessary changes with the recent announcements to convene a panel to
consider an increase to the country's minimum wage and allowing unions
to form in factories without the approval of factory owners. In
addition, the government has promised to submit to the Bangladeshi
Parliament a legislative reform package in June 2013 that will include
amendments to Bangladesh's 2006 labor law allowing union representation
and the right for collective bargaining for all workers in the country
as well as other changes. Any solution would require the Bangladeshi
Government to act quickly and swiftly to allow these important changes
to occur.
Second, the deficient infrastructure in Bangladesh is another
concern. Not only with the structural integrity of current buildings,
but issues with the electricity grid and water availability. Key to
this is the need to quickly ensure through factory inspections and
assessments that not only are buildings structurally sound and meet the
appropriate codes, but that the electrical wiring and systems are also
up to the appropriate codes and standards.
In addition to these issues, there are also issues of reliability
of the overall industry as we see incidences of labor unrest increase
and other issues with factory owners shutting down factories for
periods of time. This uncertainty can have a significant negative
impact on a company's supply chain. All of these factors are elements
that retailers, brands, and manufacturers are taking into consideration
as they evaluate their current business relationships in Bangladesh.
need for shared responsibility
As noted earlier, there is a strong need for shared responsibility
to address the current issues and challenges in Bangladesh. This
includes the Bangladeshi Government; other governments including those
of the U.S. and EU; the retailers, brands, and manufacturers who
contract in Bangladesh; the factory owners including the Bangladesh
Garment Manufacturers & Exporters Association (BGMEA) and the
Bangladesh Knitwear Manufacturers & Exporters Association (BKMEA); the
factory workers; civil society; labor unions; and other international
institutions.
The responsibility is shared and not that of the retailers only.
Further, each stakeholder should have an area of responsibility and
should not be required to usurp the role of other stakeholders. This
demarcation of responsibilities in socially responsible supply chain
management is recognized and highlighted in a March 2011 United Nations
(U.N.) report titled ``Guiding Principles on Business and Human Rights:
Implementing the United Nations `Protect, Respect and Remedy'
Framework.'' The U.N. Human Rights Council endorsed this report by U.N.
Special Representative John Ruggie in June 2011. In the report,
Professor Ruggie states: ``The Framework rests on three pillars. The
first is the State duty to protect against human rights abuses by third
parties, including business enterprises, through appropriate policies,
regulation, and adjudication. The second is the corporate
responsibility to respect human rights, which means that business
enterprises should act with due diligence to avoid infringing on the
rights of others and to address adverse impacts with which they are
involved. The third is the need for greater access by victims to
effective remedy, both judicial and nonjudicial. Each pillar is an
essential component in an interrelated and dynamic system of
preventative and remedial measures: the State duty to protect because
it lies at the very core of the international human rights regime; the
corporate responsibility to respect because it is the basic expectation
society has of business in relation to human rights; and access to
remedy because even the most concerted efforts cannot prevent all
abuse.''\1\
Professor Ruggie further elaborates in the report on one of the
Foundational Principles ``States must protect against human rights
abuse within their territory and/or jurisdiction by third parties,
including business enterprises. This requires taking appropriate steps
to prevent, investigate, punish and redress such abuse through
effective policies, legislation, regulations and adjudication.''\2\ It,
therefore, is the primary function of the Bangladeshi Government to
promulgate building and fire safety regulations that comply with
international standards and also enforce such regulations through
regular and effective government inspections and assessments.
In addition, the United States and other governments have the
ability to provide assistance, through training, grants, and other
avenues to improve the infrastructure as well as worker and building
safety. The Department of Labor is currently working on a grant to
provide funds in Bangladesh for training and fire safety. Other
international institutions could also provide funding to help with the
training and infrastructure development and corrections to help improve
the situation in Bangladesh. This could include grants or funds from
USAID, the World Bank, and others.
International organizations, such as the International Labor
Organization (ILO), are also a critical stakeholder that needs to be
engaged in the process. Specifically programs such as Better Work,
which is a joint initiative through the ILO and the World Bank's
International Finance Corporation, are essential to help improve worker
safety in Bangladesh. The ILO has provided Bangladesh with a set of
requirements which must be met before Better Work can begin in the
country. It is imperative these conditions be met as soon as possible
so that Better Work can begin. According to a representative with
Better Work, several amendments included in the labor reform package
which soon will be submitted to Parliament include amendments which
specifically address some of the Better Work requirements. In addition,
Better Work has reported that Bangladesh allowed for the registration
of 23 garment factory unions to date in 2013. In both 2012 and 2011,
only one union was allowed to register each year.
Retailers, brands, and manufacturers all realize they have a role
to play in worker and building safety within Bangladesh as well as
other countries where they source from. This starts with the
assessments and inspections to ensure that factories can not only
manufacture the orders that they are given to the specifics in the
contract, but that they also meet all of the local health, labor, and
safety regulations. These companies have instituted corporate social
responsibility programs which include strict codes of conduct that
vendors must adhere to. Failure to adhere to the code of conduct or
specific contract requirements could lead to the termination of a
contract with the vendor losing business.
Civil society also plays an important role in helping to develop a
long-term sustainable solution. These organizations are typically on
the ground in the country and can provide valuable expertise when
working in a coordinate effort.
current initiatives to address worker and factory safety
A number of different initiatives have been announced to address
worker and factory safety in Bangladesh. Efforts in the U.S. retail
industry began well before the Tazreen Design Ltd. factory fire in
November 2012 to address fire safety issues. Those efforts have become
even more intense as retailers, brands, and manufacturers continue to
work in conjunction with their industry associations to finalize a plan
to address fire and worker safety at factories in Bangladesh. In
addition, two other competing initiatives were launched. One by the
German international development agency Deutsche Gesellschaft fur
Internationale Zusammenarbeit (GIZ), called the ``Fire Safety Alliance
on Bangladesh,'' and the other by IndustriALL Global Union (which
represents apparel union affiliates worldwide), Bangladeshi unions and
some NGOs called the ``Fire and Building Safety MOU'' (the MOU had
actually been developed in 2010).
With the objective of combining efforts, the U.S. industry began to
work with GIZ on their effort. There were also several retailers and
brands who continued to work with IndustriALL on their MOU. At the end
of April 2013, after the Rana Plaza building collapse, GIZ hosted a
meeting with retailers and brands--U.S. and European, IndustriALL and
other campaigning NGOs to finalize an Action Plan for fire and building
safety in Bangladesh. At this meeting, IndustriALL and the campaigning
NGOs proposed their own set of Principles. A good faith effort was made
to attempt to merge the GIZ Action Plan with the IndustriALL Principles
by a deadline of May 15, but this did not succeed. IndustriALL
unilaterally announced May 12 that it would rename its MOU the ``Accord
on Fire and Building Safety in Bangladesh'' and provided companies 2
days to sign onto the ``Accord'' before they released it. The Accord
requires a 5-year commitment from participating retailers to conduct
independent safety inspections of factories, and pay up to $500,000 per
year toward operational costs. As noted, many European retailers and
brands signed onto the Accord before it was released, while only three
U.S. retailers have signed on.
As an industry, U.S. retailers work with their vendors throughout
their supply chains seeking to establish safe working conditions. While
U.S. retailers share IndustriALL's goal to improve worker safety in
Bangladesh and to make tangible progress on the ground, U.S. retailers
cannot in good conscience sign the Accord because the current language
presents potentially unlimited legal liability given its vague and
ambiguous terms. There are also concerns that the Accord removes the
responsibility of the Bangladeshi Government for inherent government
functions, such as building inspections.
Many companies believe that the IndustriALL Accord should not be
viewed as the sole response and solution to the situation in
Bangladesh. In the meantime, these retailers, brands, and manufacturers
have come together in an alliance to develop a single, unified action
plan that will achieve immediate, sustainable, effective and long-
lasting change for the garment industry and its workers in Bangladesh.
The alliance also includes representatives from the Retail Council of
Canada, the Canadian Apparel Federation and their members. The action
plan builds upon the extensive work already being conducted by many of
these retailers on the ground today. These actions include a focus on
(1) worker training and empowerment; (2) standards for fire and
building safety assessments; (3) sharing of factory inspection and
training information; (4) governance; and (5) funding. This work is now
occurring with the help of the Bipartisan Policy Center (BPC), under
the guidance of former U.S. Senate Majority Leader George Mitchell and
former U.S. Senator Olympia Snowe.\3\ They have announced a plan will
be finalized and released by July 2013.
In addition, some companies have announced their own efforts in
Bangladesh which will be wrapped into this unified effort. For example,
since last October, Gap Inc. has been on the ground in Bangladesh with
the Gap Inc. Fire and Building Safety Plan. The Gap Inc. plan includes
the appointment of a Chief Fire Safety Inspector and dedicated fire
safety team, access up to $20 million in accelerated capital for
vendors to make fire safety improvements and $2 million in financial
assistance for Bangladeshi workers displaced due to fire safety
remediation improvements. Gap Inc. hired Randy Tucker, P.E, a fire
safety professional with more than four decades of experience in the
developing world. Mr. Tucker and his team have been on the ground every
month since the launch of the program to conduct inspections across the
company's 73 approved third-party garment manufacturing factories in
Bangladesh. As a result, 20 percent of the factories have been
inspected, and many of them have already begun to make the recommended
improvements.
It has also been reported that Walmart would begin conducting
detailed safety inspections at every one of the 279 factories it uses
in Bangladesh. The company said it would complete all reviews within 6
months and will publicly release the names and inspection information
on all of the factories. It also started posting on its Web site the
list of failed factories in Bangladesh that are no longer allowed to
produce for Walmart. The company is also increasing the pace and
frequency of follow up inspections in all Bangladesh factories, with
visits taking place every 2 months to ensure both compliance and
progress. Finally, Walmart announced that it would hire Bureau Veritas
to provide fire safety training to every worker in all 279 Bangladeshi
factories, and contribute $600,000 to Labor Voices to communicate with
workers about concerns inside the factories. Labor Voices provides a
channel for garment workers to raise their concerns through real-time,
anonymized worker feedback.
Some of these action steps by the retail industry actually go
beyond what has been proposed in the Accord to date.
legal issues for consideration
Again, while retailers, brands, and manufacturers share the goals
of improving industrial health and safety of Bangladeshi factory
workers, the legal issues raised by these companies regarding the
Accord are significant and need full consideration. Finding a workable
and sustainable program to improve the health and safety of Bangladeshi
garment workers is complex, requires careful consideration and a
systemwide solution. An attempt at a ``quick fix'' may satisfy the
immediate desire to be seen to be doing something, but might not render
the long-term sustainable solutions needed to permanently fix the
problems/challenges to ensure worker safety.
There are numerous concerns about the Accord. Overall, the Accord
creates legal enforceable obligations, but what is enforceable is vague
and uncertain. The obligations are described in broad vague terms and
it is left to arbitration to resolve disputes. In principle,
arbitration as a dispute resolution mechanism is acceptable, but not
basically to rewrite or define terms of the Accord that have not been
agreed upon.
Second, the Accord shifts some of the basic government regulatory
functions, such as inspections, onto the retailers. While the U.S.
retailers are prepared to contribute in a variety of ways to improving
worker and building safety standards in Bangladesh, the primary
regulatory and enforcement function of such standards remains under the
auspices of the Bangladeshi Government. The Accord creates a free-
standing Safety Inspector with broad powers to gain access to factories
and order remedial action. At the same time, after the high-level
mission by the ILO of early May 2013, the Bangladeshi Government
committed to recruit and train by the end of October 2013 an additional
200 inspectors for its Department of the Chief Inspectorate of
Factories. Creating a parallel free-standing safety inspectorate means
establishing a duplicate enforcement bureaucracy and the Bangladeshi
Government potentially abdicating its primary function of enforcing
building regulations and workplace health and safety codes. Privatizing
an inherently government function, such as building inspections, as the
Accord envisages, is therefore not the right approach to building the
capacity, know-how and trained inspectors required by the Bangladeshi
Government to fulfill its role in ensuring safe workplaces for
Bangladeshi workers. While industry and other stakeholders are part of
this solution, the focus should be placed on providing the government
the ability to carry out its core responsibility to protect its
citizens, not supplanting that government function.
Third, there are also concerns that the Accord unduly shifts the
responsibility on signatory retailers to essentially establish an
independent employment relationship with the employees of their
suppliers. In the section dealing with ``Remediation,'' signatory
retailers will not only be responsible for factory owners maintaining
the employment relationship and paying wages during a factory closing
for structural improvements/renovations, but also finding the employees
alternative jobs if they are terminated. These broad obligations
imposed on the signatory retailers have potential expanded legal and
financial obligations for the signatory retailers. Since the demise of
the Alien Torts Act to impute liability on U.S. corporations for the
ills of foreign actors, various attempts have been made to impose
liability on U.S corporations under a variety of contracts. These
potential and unforeseen legal and financial obligations that a vaguely
drafted Accord might hold for signatory retailers are of real concern.
Last, the Accord effectively allows for a third-party arbitrator to
determine the price of garments produced in a facility, if the factory
claims the price paid by retailers should be higher to fund the health
and safety upgrades that factories make to comply with corrective
actions by the Safety Inspector. The Accord requires signatory
retailers to ``negotiate commercial terms'' with the factories ``which
[would] ensure that it is financially feasible for the factories to
maintain safe workplaces and comply with upgrade and remediation
requirements instituted by the Safety Inspector.'' A dispute about the
adequacy of the commercial terms, including the purchase price of the
garments, would be subject to arbitration under the Accord.
conclusion
Collaboration is an essential component of efforts to improve
worker and factory safety in Bangladesh. The joint efforts of all
stakeholders are essential to identify viable solutions and implement a
successful and sustainable plan of corrective action that addresses the
systemwide challenges in Bangladesh. A solution must address
eradicating corruption, improving the quality of building construction,
the location of factories, the issuing of building use permits, the
enforcement of building and safety codes, the ability of garment
workers to raise concerns free of retaliation, etc. While many would
prefer a single coordinated effort, there should be flexibility to
allow companies the ability to quickly deal with issues within their
own supply chains.
The U.S. retail industry shares the common objective of preventing
future workplace injuries and deaths of Bangladeshi garment workers.
The industry is prepared and working swiftly toward making a
substantial contribution to achieving results on the short term and the
long term.
Thank you for the opportunity to testify at this important hearing
today.
----------------
End Notes
\1\ Report of the Special Representative of the Secretary General
on the issue of human rights and transnational corporations and other
business enterprises, John Ruggie Guiding Principles on Business and
Human Rights: Implementing the United Nations ``Protect, Respect and
Remedy'' Framework , page 4, March 2011.
\2\ Report pages 6-9.
\3\ ``U.S. Retailers Announce New Factory Safety Plan,'' The New
York Times, May 30, 2013.
Senator Kaine. Thank you, Mr. Lubbe.
Questions. This is an issue that we have to wrestle with in
terms of leverage, what is our leverage over a situation. We do
not have command and control of Bangladeshi regulations,
culture of corruption, building codes, but we do have leverage.
Ms. Drake, your organization filed a--one of the bits of
leverage we have is this GSP status, and your organization
filed with the USTR a request to either withdraw or limit GSP
in 2007. If you would just describe the basis for that original
complaint that was filed 6 years ago. Was it all about
restrictions of workers' rights, or did it also make the
connection to unsafe working conditions?
Ms. Drake. It definitely made the connection to unsafe
working conditions. In the GSP statute, it outlines
internationally recognized worker rights as including freedom
of association, collective bargaining, freedom from forced
labor and child labor, and acceptable conditions of work, which
were then defined to include worker health and safety, minimum
wages, and maximum hours of work.
So there have always been problems regarding freedom of
association and the right to collective bargaining. Likewise,
there have always been problems on health and safety. So that
petition included all those things, and also complaints about
violence against workers and other forms of threats and
repression where workers have been physically assaulted. And,
as was discussed earlier in the hearing, in the 6 years that
that petition has been open, it has continued with the murder
of labor organizer, Aminul Islam.
Senator Kaine. You and your colleagues must have had a sick
feeling when the building collapsed and the news came across
the wire, given the fact that you have raised this issue as a
potential concern that many years ago.
Ms. Drake. Absolutely. I mean, this is our challenge here.
Earlier it was said that somebody had received assurances from
the Government of Bangladesh. Well, for the workers of
Bangladesh, receiving assurances from their own government is
not very reassuring. I mean, even before the Tazreen fire,
there was another incident at Garib & Garib a couple of years
before that, and that was supposed to be the turning point. And
before that there were safety incidents, fires, building
collapses, a flurry of them in 2005 and 2006, and those were
supposed to be turning points where things would change.
As somebody mentioned before, what is the body count that
you need to really make changes? In our opinion, one is too
many. We are well beyond whatever anyone would need to see as
evidence that the current system of the government's very
feeble efforts and the voluntary compliance programs of the
corporations simply are not working and it really is time to
act and make this the final turning point.
Senator Kaine. Let me ask this question, and I will address
it first to you, Ms. Drake. But then, Mr. Lubbe, I would like
to segue and have you answer the same question. I have a couple
of others.
Senator McCain asked a question which is a good one and we
would wrestle with it, whether the withdrawal of GSP status
would help or would hurt. Now, we talked about that you could
lay down conditions and say meet these conditions or we will
withdraw. We heard testimony that nations that have had GSP
status withdrawn have worked hard to get it back because they
wanted that status.
But I would like you first, Ms. Drake, and then Mr. Lubbe,
to address this question about whether if there is a
recommendation to the President to withdraw GSP status, would
that do more good or more harm?
Ms. Drake. It is a tough question to wrestle with, but the
AFL-CIO falls squarely on the side that acting on the GSP
petition to limit or withdraw benefits will do far more good
than it will harm.
The concern about mass unemployment is simply unfounded.
Given that the GSP products comprise about 1 percent of
Bangladesh's exports to the United States--this was discussed
in the earlier panel--we are talking about a much smaller
segment of the economy. The ready-made garment sector, which is
what we have been talking about primarily today, does not get
GSP benefits. So it would not be affected by tariff changes.
I do have a list of what those products are that get GSP
benefits, and the top three are tobacco, for instance. So it
really is a product-by-product issue. You would have to look
at, well, what is the demand elasticity for tobacco, and are
Bangladesh's tobacco exports really going to be prohibited by
putting a tariff, that kind of question.
But more importantly, that sort of frames the question, as
I said earlier, as the wrong question. Is it really a choice of
no jobs or these really terrible jobs with awful conditions and
no rights? There is something in between, and it requires
government action. The government can actually fulfill the
promises that it has been making, and we think there is every
reason to expect that they would. Even though the GSP benefits
are small in monetary value, they have reputational concerns,
and they are also tied to future investments under the OPIC,
the Overseas Private Investment Corporation. There are several
of those programs right now in Bangladesh. Those would not be
threatened at all by a change in the GSP status, but future
OPIC investments could not occur until the GSP status would
come back.
So there are reasons to believe that Bangladesh will act
like other countries that have had limitations on their GSP and
really make changes and fight hard to improve their brand and
get the benefits back.
Senator Kaine. Great. Thanks, Ms. Drake.
Mr. Lubbe, the same question. What effect, thinking about
the GSP, would withdrawal of the status do more harm or be more
helpful?
Mr. Lubbe. Senator Kaine, that is a good question, and I
think it is a complex one, as Ms. Drake has pointed out. The
industry wants to support the Bangladeshi garment industry. But
on the same hand, it also wants to ensure that there is an
incentive to the Bangladeshi Government as a very important
stakeholder to fulfill its promises. Whether the withdrawal of
the GSP status will achieve that has to be evaluated within the
context of all those factors.
You heard earlier this morning, and Ms. Drake also referred
to how complex the system is, its impact. Withdrawal of the GSP
status might send the reputational signal that the U.S.
Government is serious. But, I think, that needs to be evaluated
in the context of all those factors.
The industry will support what the U.S. Government does
here. The industry is concerned about potential unemployment
among Bangladeshi garment factory workers. We do not know what
the true impact will be on unemployment and whether Bangladeshi
factory owners will use that as an excuse to shed employees. So
it needs to be very carefully considered.
Senator Kaine. Mr. Lubbe, you talked in your testimony
about the reason that Canadian and American apparel
manufacturers and companies have chosen not to sign the Accord
but are pursuing a combined effort. Beginning with the Accord,
what was the subject of some of the provisions? You indicated
there could be potential liability or there was vague language.
But what was the subject of some of the provisions that the
American and Canadian firms found problematic? I am assuming
there were some that were fine, but then some were somewhat
controversial. If you could just describe those?
Mr. Lubbe. Sure. Senator, the first point is the
utilization of arbitration. What the Accord does is it uses
arbitration really to fill in and write the agreement for the
parties, ultimately. It provides for a wide array of disputes,
as it is worded, not only between the parties but, I think from
a legal analysis, leaves the room for nonparties to the Accord
to utilize the Accord to declare disputes that go to
arbitration.
Arbitration under the Accord takes on in many instances an
interest arbitration nature, meaning you get a third party to
really write the agreement for the parties on terms that they
could not agree upon. So that is the first point.
The second issue is, as a binding contract, it becomes a
basis for litigation in the United States, and we have examples
where, with the demise of the Alien Tort Act, a variety of
contracts and agreements have been used to sue companies in the
United States for the bad acts of actors outside the United
States, and that is a real concern. The Accord does not exclude
that. That possibility of similar litigation exists.
The third issue, just in terms of broad scope, is also
again through the avenue of interest arbitration. If you review
the provisions that deal with remediation, they require the
signatories must engage in commercial viable agreements, and if
the supplier or the factory owner says, ``well, the price that
we are negotiating is insufficient because I need more money to
improve health and safety at the factory'' and, let us say, for
example, the U.S. retailer says, ``I do not think at the price
that you are asking, that is too high,'' it potentially goes to
interest arbitration again.
So you have price determination through interest
arbitration. Those are some of the critical issues I think that
were raised. If I may, in the April meeting in Germany, these
issues were indeed raised, I am told. I was not at that
meeting, but that is the feedback that I have.
So there was a serious attempt at that stage to iron out
these concerns. As frequently happens in negotiations and
collective bargaining, a line was drawn, and the IndustriALL
took the position that they were not going to make these
changes. The Accord was then published, and the retail
industry, the garment and apparel industry still maintained
those concerns because they have not been addressed.
Senator Kaine. And just since this is an industry
internationally that I have no expertise in, even with the
concerns that you laid out, a sizable number of the European
manufacturers signed on to the Accord. Describe why that is the
case. Why would European manufacturers find it to be acceptable
but North American manufacturers or companies find it to be
less acceptable?
Mr. Lubbe. Senator, you would appreciate that I cannot
speculate exactly how they view their risk. My opinion is that
they are not in the same litigious environment that we are. We
have a history under statutes that have created the fora to sue
in the United States for foreign bad acts. As far as I know,
the Europeans do not have that same system.
A second explanation could be the Europeans have a much
more institutionalized partnership relationship with trade
unions, where our model here is different. Through the use of
works councils, European works councils, this type of
agreements with unions is not uncommon in general that will
cover Europeanwide issues.
So those are two of the explanations that I can offer to
you. I think the first one in terms of litigation risk and
liability is a significant one that is absent from that market.
Senator Kaine. Mr. Lubbe, one question I have is, Are North
American and specifically American companies--and this picks up
on your last point--even just based upon other activities in
this building, the deadlock over things like NLRB appointments,
do they balk at the notion of signing on to accords that
encourage organization and association rights of workers in
Bangladesh?
Mr. Lubbe. Senator, as far as I know, that was not a
stumbling block.
Senator Kaine. Let me ask you finally, and then Senator
Menendez is back and will resume the chair, but you talked
about the effort underway in Canadian and American companies to
find a workable framework going forward. Talk to me a little
bit about the timing of that effort and when we might be
expected to know something about it.
Mr. Lubbe. Senator, this is a work in progress that is
receiving high priority in the industry. As has been reported,
the stated goal is to come with a comprehensive plan that will
have immediate action plans that will provide for long-term
solutions and have that plan ready by, I understand, early
July.
I also understand that, in terms of the actions that have
been taken, there is already a structure set up through working
groups to look at various aspects. Everybody is struggling in
terms of how to prioritize. This is a huge issue, so sometimes
how do you prioritize what is also an issue. That is all being
discussed, and there are very regular meetings scheduled
throughout this month for all the parties to coalesce around
this and come up with a plan that will work for the industry at
large, and also get the individual major players involved in
this effort.
Senator Kaine. So just in terms of the testimony, Mr.
Chair, to summarize some testimony that occurred, I think when
you were out of the room, there is a coincidence of timing
here, the potential of a recommendation from USTR to the White
House at the end of June. Now, that is not the same as when the
President would make a decision, but also a potential decision
by the North American companies about how they would want to
proceed to address this problem from the private-sector side in
early July. So it sounds like in both the governmental and
private-sector side, it is a little bit of a work in progress,
and it would be my hope that we would be able to come back
after those steps are known to consider them and hear pros and
cons about whether they are sufficient.
Mr. Chair, with that, I would return the chair to you.
The Chairman [presiding]. Well, thank you very much. Thank
you, Senator Kaine, for chairing this important part of the
hearing.
Thank you both for your testimony. I have read through it.
Please help me pronounce your last name. I want to make
sure to get it right.
Mr. Lubbe. Senator, it is Lubbe.
The Chairman. Lubbe.
Mr. Lubbe. That is correct.
The Chairman. OK, Mr. Lubbe. I know that you are an
attorney and you are representing these different industries,
so I get your role here. But since they sent you as the person,
let me ask you a couple of questions.
Number one is, what do the companies that you represent
believe is their core responsibility in regard to the topic
that we are talking about?
Mr. Lubbe. Senator, I think I can best summarize it as
follows. The issue of corporate social responsibility has taken
a focus on health and safety of the workers in Bangladesh, and
that has been catapulted to the top of the list of priorities.
If you look at companies' corporate social responsibility, it
has always been over the years, since it has become important
for companies to recognize and play their role, it has been a
work in progress. It is a continuing effort of improving.
What has happened now with these very tragic events in
Bangladesh is that health and safety, including structural
soundness of buildings in which their suppliers are operating,
has come to the forefront. And in that respect, the industry
understands and wants to play an important role to contribute
as one of the stakeholders to make certain that that issue is
addressed. The industry sees itself as one of the stakeholders
and one of the role players, and it is ready and willing to
play that role.
Specifically, the issue of inspections, a number of the
industry individual companies have stepped up their health and
safety inspections to make certain that within their scope of
influence, the providers and suppliers within their global
supply chain, that they make certain that they accelerate and
increase those inspections. There has been an increased focus
on training of workers so that they can help identify the
shortcomings in health and safety and building structure.
There is an awareness that there needs to be support to
employees, workers in Bangladesh, that have been adversely
impacted by these recent events, be it by loss of a job or
injury.
There is a recognition of a contribution to assist the
factory owners to remedy the health and safety shortcomings in
their factories.
And so the role is one of support, providing funding,
providing training, making certain that competent folks,
inspectors, are available now while the Bangladeshi Government
is ramping up its own inspectorate to make certain that
somebody on the ground immediately does something to review
health and safety.
The Chairman. I ask you that question because in reading
your testimony in which you put a great emphasis on the U.N.
report entitled ``Guiding Principles on Business and Human
Rights,'' you referred to the responsibilities there that the
second is the corporate responsibility to respect human rights,
which means that business enterprises should act with due
diligence to avoid infringing on the rights of others and to
address adverse impacts with which they are involved.
Now, of course, one can ultimately respect human rights but
do nothing about it. So, at the end of the day, I get concerned
when I hear about the industry's unwillingness to join a more
global standard so that, regardless of whether it is Bangladesh
today or some other place tomorrow, we have a global standard,
that we do not have a race to the bottom. I think Rana Plaza
shows the limits of individual corporate responsibility
campaigns because multiple brands very often source from the
same factory.
So you have a serious free rider problem if different
retailers are approaching standards differently, and that leads
some to say, well, unless it is everybody else, I am not going
to live to a higher standard unless they have a corporate ethos
that says I want to live to a higher standard, even though it
may make me somewhat less competitive than the others.
So I read your comments about liability, and I hope that
the industry understands that, while I understand their need to
protect themselves legally, there can be no success at the end
of the day, no one will want to wear a piece of clothing made
in Bangladesh if it is on the blood of workers. Those brands
will go down the tube. It is only a question of time; only a
question of time.
So I hope the industry gets their act together, and sooner
rather than later, because it has been willing--these are not
all of a sudden. Rana Plaza is only a dramatization,
unfortunately, of a great tragedy, but it is not because this
has not existed. The fact that there have been, pending USTR,
and I just finished with the USTR nominee upstairs--the fact
that that has been languishing for 6 years gives us an example
of how everybody turns a blind eye until something happens.
I can assure you, something is going to happen here. And as
I have told industries before in good faith, either get your
act together and establish standards or find yourself with
standards you may not care for. I hope that is the message that
you will take back to the industry today.
Mr. Lubbe. Senator, thank you for those comments. I think
that you are spot on. It has become an extremely important
issue for all stakeholders, including the industry, and they
will take those comments of yours to heart.
The Chairman. Ms. Drake, I do not have any questions for
you simply because I largely agree with your testimony. But if
in the last few seconds here you have heard anything that you
want to have a view for the record espoused, I am happy to give
you this opportunity.
Ms. Drake. Thank you so much, Mr. Chairman. I appreciate
that.
I found it interesting--if we take the industry at its word
that its corporate social responsibility focus right now on
health and safety is a priority, these firms, or many of them,
Walmart in particular, has been operating in Bangladesh since
the 1990s. Mr. Lubbe mentioned the many systemic problems that
the firms are aware of in Bangladesh, whether it is factories
being built on unstable ground, whether it is an inconsistent
electricity supply or water supply. And these problems, as I
testified to earlier, and the history of building collapses,
fire collapses, it did not start with Tazreen. It goes back
many, many years.
So if they have known about this, and if they care about
this, there is a true disconnect. Is it one of these situations
where doing the same thing over and over again and expecting a
different result is not a prime example of corporate
management?
We have a report from the AFL-CIO. I cited it in my
testimony, and there is a link, but I can leave copies here
today for Mr. Kaine and Mr. Menendez, if you would like to have
these. It explains that these voluntary programs that can be
eliminated at any moment, as soon as the brands think that the
spotlight is off of them or that they have already contributed
enough money to factory safety or whatever it is, they simply
do not work. If a social auditor comes in to a factory like
Rana Plaza and finds that it is, in fact, unstable, the workers
in the voluntary programs are never notified. They are not part
of the system.
If you want to talk about unilateral, the Accord, we
disagree strongly with the statement that IndustriALL set it
out unilaterally. The Accord was being negotiated for more than
a year, and various brands had taken a look, American brands.
Walmart and Gap were there at the beginning and chose not to
deal with it in 2012, and they chose not to deal with it again.
But it was, in our view, a true negotiation and very different
than these plans, and that is what we are really afraid of, is
that this new alternative plan with the Bipartisan Policy
Center, it sounds good, but if it ends up with more of these
corporate-directed socially responsible but not giving workers
the power to speak up for themselves and be monitors of their
own health and safety, it is simply not going to work.
And if, in fact, it somehow does create a standard that is
binding and enforceable, that is terrific. But then you have
workers who in the morning are working for Walmart and in the
afternoon are working for HNM, and they have to remember which
is the standard and what applies and what they can speak up
about and what they are not allowed to speak up about. That is
not really a helpful situation when you are talking about 4
million workers who are impoverished, many of whom are
illiterate, and they have to keep track of what their rights
are.
And I also wanted to point out the irony that firms are
concerned about arbitration under the Accord, and this might be
the only time where you get a witness from the business side
that does not want arbitration and a witness from the labor
side that says, no, we would like to have arbitration here.
So we think that the Accord--we have read it. It does not
create a cause of action in U.S. courts. The Civil Rights Act,
the Americans With Disabilities Act, the Age Discrimination in
Employment Act, these create causes of action in American
courts. It does not. It is not vague. There are things that are
going to be worked out during this implementation period. But
with the recent decision on the Alien Tort Claims Act, we just
do not view it as really being a threat to these brands, and
neither, in fact, do Abercrombie & Fitch and Sean John and PVH,
and HNM, which is the European company that operates in the
United States, or these other companies that have signed it.
We would really appreciate your support for it and just
continue to ask you to help us in our efforts to push these
brands to sign because, as you have said, they will be the
reputational losers if they do not. Thank you so much.
The Chairman. Well, thank you. You have made ample use of
the opportunity I gave you.
So with that, let me turn to Senator Kaine. And I am going
to ask, Senator Kaine, if you would close out the hearing
because I have a meeting. We will keep the record open until
Friday for questions, and my thanks to both of you. I look
forward to working with both of you as we move forward.
Thank you.
Senator Kaine [presiding]. Thank you, Mr. Chair.
Just one last question, Ms. Drake. I asked Mr. Lubbe
whether the decision by North American companies to not sign on
with the Accord, what were some of the reasons, and he said he
was speculating to some degree, but one of the things he
mentioned as a sort of speculative comment was the differing
comfort levels of European companies in their relationship with
labor compared to the cultural norm here. And I am just struck
by that as an issue, and I wanted to ask you your opinion about
it.
We are in the midst of a major debate here where there is
an effort to block appointments to the National Labor Relations
Board, or to try to find an accord that would allow four out of
five NLRB members to be appointed so there could be a permanent
stalemate against the NLRB doing their job. That effort is
supported by major spokespeople and organizations for broad
American corporations, like the U.S. Chamber of Commerce.
Is it your perception in the reaction of North American
companies to the Accord that arbitration is a point of dispute,
but that there is a reticence to sign on to an accord that
encourages labor organizations to form and flourish because
they are actually, on our own turf, very reticent about labor
organizations and the right to organize and flourish?
Ms. Drake. I would say that is the conclusion that one
would draw from the evidence, and it really is unfortunate that
the President put up a slate of nominees that represent all
sides of the issue on labor and that it is being blocked. If
the United States does not have a functioning National Labor
Relations Board, that goes all the way down to the site, the
small-factory level, and will prevent probably most organizing
efforts from succeeding in the United States because the
employer side will stop the election, put in a complaint, the
complaint cannot be decisively resolved, and things will not
move ahead.
So it is a very aggressive antiworker stance to not want to
have a National Labor Relations Board at all.
Senator Kaine. And with respect to the Accord in
particular, since I am not familiar with the substance of the
Accord, does the Accord only address sort of building code
safety conditions, or does the Accord also address the ability
of workers to associate and organize in a protected status?
Ms. Drake. It does, and it particularly gives workers the
right to refuse to enter and work in a workplace that they feel
is an immediate threat to their health and safety. Having to
respect worker rights and having to recognize that workers can
stand up for themselves and say I am not going to go into that
death trap today I think is, for some in the industry, they do
not want workers to have that ability to stand up and speak up
for themselves to improve their own working conditions and
their livelihoods.
Senator Kaine. And so this is a speculative question, but
take it for what it is worth. If the Accord had just had
conditions within it about building code and fire safety and
things like that, but had not had any conditions dealing with
the protection of workers' rights, is it your opinion that it
would have been more acceptable to the North American garment
companies?
Ms. Drake. I cannot say whether they would have signed. I
would say I think it would be much more acceptable.
Senator Kaine. All right. Well, this has been fascinating
testimony on a very, very challenging topic, and I think both
of you acknowledge that there is a significant complexity. I do
think we are maybe on the verge, with the USTR recommendation
to the White House and the industry effort to come together
behind some set of principles that they could agree with, both
of those happening in relatively short order, that we are on
the verge of being able to come back and say, OK, now that we
have some more facts on the table about what the response is
likely to be from the private sector and the U.S. Government,
it would probably be helpful for us to analyze that again soon.
I am the junior member on a 19-member committee, but I will
certainly recommend to the chair that we come back and follow
up on both of those matters in short order.
And with that, the committee hearing is adjourned. Thank
you for your participation.
[Whereupon, at 12:56 p.m., the hearing was adjourned.]
----------
Additional Material Submitted for the Record
Response of Lewis Karesh to Question Submitted by
Senator Robert P. Casey, Jr.
Question. As you stated in your written testimony, the United
States is a key market for Bangladeshi goods, importing $5 billion in
2012.
What signal would suspension or termination of Generalized
System of Preferences (GSP) benefits send to the government and
factory owners in Bangladesh as well as U.S. brands and
consumers? Is this an effective tool?
Why has it taken the U.S. Government 6 years to review
Bangladesh's GSP eligibility, following acceptance of the AFL-
CIO's petition in 2007?
Answer. On June 27, 2013, President Obama decided to suspend GSP
trade benefits for Bangladesh based on a determination that Bangladesh
``has not taken or is not taking steps to afford internationally
recognized worker rights to workers in the country.'' The
administration hopes that the GSP action will give further impetus to
the Government of Bangladesh's efforts to address longstanding issues
related to worker rights and worker safety.
The experience of the last 30 years suggests that GSP can be an
effective mechanism for advancing worker rights. Over the years, the
U.S. Government has used GSP reviews of worker rights with many
beneficiary countries to bolster our dialogue with these countries on
worker rights and effect meaningful change.
One of the objectives of a GSP worker rights review is to encourage
the relevant country to undertake measures to address the key concerns
that led to the review. Over the last several years, the U.S.
Government worked with the Government of Bangladesh to identify such
measures and to urge that these measures be implemented. In late 2012,
the administration came to the conclusion that the worker rights
situation in Bangladesh had deteriorated and that suspension of
benefits might be warranted absent significant near-term progress in
improving worker rights and worker safety. While the Government of
Bangladesh has taken some actions to address the situation, the
progress was insufficient to meet the statutory criterion to continue
its GSP benefits.
______
Responses of Assistant Secretary Robert Blake to Questions
Submitted by Senator Robert P. Casey, Jr.
Question. Do you assess that the Government of Bangladesh has the
capacity and will to enforce its labor standards and building codes?
What is the U.S. Government doing to assist the Government of
Bangladesh to fight corruption and improve enforcement capacity in this
sector?
Answer. The recent tragedies in Bangladesh underscore the urgent
need for the Government of Bangladesh, factory owners, international
buyers, and workers to come together to strengthen respect for workers'
rights and ensure safe and healthy working conditions. We are
encouraged by recent initial efforts on the part of the Government the
Bangladesh and the Bangladeshi exporters' associations to improve labor
standards and inspect and enforce the fire and building codes. We are
encouraging the Bangladeshi Government to take additional steps to
improve worker rights, including the right to freely associate and
engage in collective bargaining, so workers can effectively negotiate
improved working conditions and wages.
We actively engage with the highest levels of the Government of
Bangladesh, factory owners, international buyers, and civil society on
these issues. We are already supporting capacity-building for trade
unions in Bangladesh and help fund International Labor Organization
(ILO) programs targeting the garment and shrimp sectors. The Department
of Labor is currently seeking project proposals to improve fire and
building safety in the garment industry in Bangladesh. The United
States strongly supports Bangladesh's tripartite national action plan
on fire safety, and the joint statement by tripartite partners issued
at the end of the ILO's high-level mission on May 4. The U.S.
Government is also discussing a joint effort with the European Union,
the Government of Bangladesh, and the International Labor Organization
to assist Bangladesh in bringing working conditions and respect for
workers' rights in the garment sector in Bangladesh in line with
international labor standards.
Question. I am concerned that proceedings before the International
Crimes Tribunal in Dhaka, Bangladesh, have provoked violent protests
and created a volatile political situation in the country. While the
U.S. Government should fully support the prosecution of the most
serious crimes of international concern and the ending of impunity, we
should also ensure that criminal justice is carried out in a manner
that is consistent with international human rights obligations,
including procedure, fairness, and transparency.
Do you assess that the ICT trials meet international
standards of procedure, fairness, and transparency?
What are the U.S. Government and the international community
doing to ensure that witnesses are protected from retaliation?
What is the status of Shukho Ranjan Bali, a prosecution
witness who was allegedly abducted before he could testify?
What is your assessment of how the confirmation of death
sentences and the expected issuance of additional verdicts will
affect the political situation in the country?
Answer. The United States supports bringing to justice those who
committed atrocities during Bangladesh's Liberation War. We believe
that any such trials must be free, fair, and transparent, and in
accordance with international obligations. Bangladesh has agreed to
uphold these requirements through its ratification of international
agreements, including the International Covenant on Civil and Political
Rights. As Bangladesh addresses the legacy of atrocities committed
during the Liberation War, and as we await further verdicts by the
Bangladesh International Crimes Tribunal (ICT), the United States
continues to urge the Government of Bangladesh to adhere to its treaty
obligations, including through a fair and public hearing by a
competent, independent, and impartial tribunal, and by fully respecting
the rule of law. Although we have seen some progress, there remain
significant concerns regarding the law, rules, and procedures used by
the tribunals and we believe that further improvements to the ICT
process are needed to ensure these proceedings meet international
standards. The Shukho Ranjan Bali situation directly relates to our
concerns about adequate protection for witnesses in Tribunal
proceedings. Although the Government of Bangladesh has denied any role
in his alleged abduction, we continue to encourage the government to
ensure the safety of all its citizens, including trial witnesses. Human
Rights Watch has called for the Government of Bangladesh to conduct a
credible investigation into the alleged abduction.
Question. On May 5-6, 2013, protests led by Hefazat-e-Islam
resulted in numerous deaths. Both Amnesty International and Human
Rights Watch have called for independent investigations into the
deaths.
Will the State Department also call for an investigation?
Answer. The Government of Bangladesh gave permission to Hefazat to
demonstrate peacefully. However, upon close review of the evidence, it
appears that Hefazat violated these terms through clashes with police,
violence, and looting. To prevent further violence, the Government
dispersed the protestors. Independent sources estimate the number of
dead closer to 12, far fewer than the hundreds alleged. Nonetheless, we
have consistently counseled the Government to use nonlethal methods of
crowd control and have expressed our concern about the recent rise in
violence in Bangladesh in the wake of a series of general strikes
(hartals) that have significantly disrupted and endangered the daily
lives of Bangladeshis throughout the country. These disruptions incur
direct costs on Bangladeshis, including by preventing ordinary citizens
from doing their jobs, and end up hurting the Bangladeshi economy. The
Embassy continues to closely engage with all parties to urge calm,
encourage dialogue, and ensure that protests are peaceful. Freedom of
expression is one of the hallmarks of a democracy, and we encourage all
Bangladeshis to peacefully express their views.
Question. Some Bangladeshi Islamist groups, including Hefazat-e-
Islam, have demanded the imposition of antiblasphemy laws, similar to
those in place in Pakistan.
What is your assessment of how such laws could affect
religious freedom in Bangladesh?
What is the State Department doing to support legal and
constitutional reforms that increase protections for religious
minorities and women in Bangladesh?
Answer. We are encouraged by the Bangladeshi Government's strong
support for the country's tradition of tolerance, secularism, and
women's empowerment in response to recent demands for the imposition of
antiblasphemy laws by some Bangladeshi Islamist groups, including
Hefazat-e-Islam. In addition, the Government of Bangladesh has rejected
the call for new antiblasphemy laws as unnecessary. We support the
right of freedom of expression, set forth in the International Covenant
on Civil and Political Rights, to which Bangladesh is party, and
continue to press the government to improve protections for women,
girls, and members of religious minorities. We continue to work with
the Government of Bangladesh to advance the rights of women and
marginalized populations. We also continue to support the NGO community
and civil societies' efforts to do the same.
______
Responses of Lewis Karesh to Questions Submitted by
Senator Jeanne Shaheen
Question. Mr. Karesh, it is my understanding that the Office of the
U.S. Trade Representative is leading the administration's review of
Bangladesh's Generalized System of Preferences (GSP) trade benefits. In
your testimony, you mentioned that through the GSP program, Bangladesh
has made some progress, but that USTR has become increasingly concerned
by serious backsliding on worker rights and conditions in the last year
alone.
During the second panel of the Senate Foreign Relations Hearing on
labor issues in Bangladesh, it was mentioned that suspending GSP trade
benefits for Bangladesh would inhibit future U.S. Overseas Private
Investment Corporation (OPIC) projects.
Can you speak to the impact on OPIC projects in Bangladesh
if the President were to decide to remove GSP trade benefits?
Answer. On June 27, 2013, President Obama suspended GSP trade
benefits for Bangladesh based on a determination that Bangladesh ``has
not taken or is not taking steps to afford internationally recognized
worker rights to workers in the country.'' The suspension will take
effect 60 days after the President's proclamation taking this action is
published in the Federal Register. Since OPIC must also take into
account worker rights criteria in assessing its country-level program
eligibility, the President's action will also affect OPIC programs. It
is USTR's understanding that, once the suspension of Bangladesh's GSP
trade benefits takes effect, OPIC will be prohibited from supporting
future investments in Bangladesh. However, suspension of GSP benefits
will not affect existing projects to which OPIC has already made a
legally binding commitment.
OPIC's existing portfolio in Bangladesh, which will not be affected
by the suspension, amounts to $13.3 million and is focused on
telecommunications and humanitarian and development services.
Question. In your assessment, what would be the other possible
outcomes of removing GSP benefits?
Answer. USTR is not aware of other impacts on U.S. programs of the
suspension of GSP benefits.
Question. We are hearing the right words from the Government of
Bangladesh, but are we really seeing the necessary actions to address
the serious shortcomings in worker rights and labor conditions in the
country?
Answer. The President's decision to suspend GSP trade benefits for
Bangladesh was based on a determination that the Government of
Bangladesh is not taking the necessary steps with respect to worker
rights.
In a statement released shortly after the President's action was
announced, Ambassador Froman said, ``Our GSP statute requires certain
basic standards for worker rights and worker safety as a condition of
eligibility. Over the past few years, the U.S. Government has worked
closely with the Government of Bangladesh to encourage the reforms
needed to meet those basic standards. Despite our close engagement and
our clear, repeated expressions of concern, the U.S. Government has not
seen sufficient progress toward those reforms. The recent tragedies
that needlessly took the lives of over 1,200 Bangladeshi garment
factory workers have served to highlight some of the serious
shortcomings in worker rights and workplace safety standards in
Bangladesh. While taking this action today, the administration is also
initiating new discussions with the Government of Bangladesh regarding
steps to improve the worker rights environment in Bangladesh so that
GSP benefits can be restored and tragedies like the Rana Plaza building
collapse and Tazreen Fashion factory fire can be prevented. The Obama
administration is committed to reflecting American values in our trade
policy, including with regard to the rights of workers worldwide.''
______
Responses of Assistant Secretary Robert Blake to Questions
Submitted by Senator Jeanne Shaheen
Question. Assistant Secretary Blake, in response to the deadly
collapse of Rana Plaza, we've seen some American companies express a
willingness to work to improve labor conditions in Bangladesh and
others have decided that it is simply too risky and too damaging to
their brand and reputation to continue to source from apparel
Bangladesh.
It is my understanding that roughly 80 percent of the garment
workers in Bangladesh are women.
How real is the possibility of a mass exodus from Bangladesh
by some of the other big name brands and how would such a move
impact these women who have gained new independence and
improved the lives of their families as a result of this work?
Answer. The growth of Bangladesh's ready-made garment industry has
contributed to impressive gains in employment, particularly for women,
and development successes over the past few decades. Of the over 4
million garment workers in Bangladesh, approximately 80 percent (3.2
million) are women. The State Department continues to actively engage
with U.S. companies on worker rights and safety in Bangladesh,
especially in light of the Rana Plaza and Tazreen Fashions' tragedies.
We understand that some U.S. companies are taking individual actions to
remedy the immediate situation, but we also continue to encourage U.S.
brands to take collective action that leverages these efforts and
involves all the key stakeholders in Bangladesh, including the
government, factory owners, and civil society. While a few brands have
made the choice to source products from other countries, there are many
others committed to working with Bangladesh to resolve challenges to
fire and building safety and worker rights.
Question. In your assessment, would a decision to suspend the
Generalized System of Preferences (GSP) trade benefits for Bangladesh
change the calculus of some retailers and apparel companies who are
currently undecided on how best to proceed?
Answer. The United States has been considering for some time
options regarding GSP benefits for Bangladesh. The current review of
the GSP program signals the United States' strong interest in
Bangladesh's ability to meet international labor standards,
particularly in the area of worker rights. Our decision is imminent.
Regardless of the decision, we are preparing a roadmap of the types of
changes we see as needed to improve worker rights and fire and building
safety in Bangladesh. It should be noted that U.S. imports from
Bangladesh under GSP are modest. In 2012, Bangladesh's exports under
the GSP program totaled only $34.7 million--
or less than 1 percent of Bangladesh's $4.92 billion in exports to the
United States for that year. The GSP program does not include apparel
or other ready-made garments.
Question. From the testimony received by the Senate Foreign
Relations Committee, it would appear that there are differing opinions
on how best to address the serious issue of worker rights in
Bangladesh.
What is the State Department doing to build consensus with
all stakeholders and especially the private sector retailers
and apparel companies?
Answer. Improving labor rights and working conditions--as well as
all human rights--is one of our key foreign policy objectives
worldwide. The recent tragedies at factories in Bangladesh underscore
the urgent need for the Government of Bangladesh, factory owners,
international buyers, and workers to come together to strengthen
respect for workers' rights, including ensuring safe and healthy
working conditions. The United States actively engages with the highest
levels of the Government of Bangladesh, Bangladeshi exporters, and
international buyers on these issues, as well as with the International
Labor Organization. We regularly cite our concerns about labor rights
in Bangladesh, including factory conditions, in our annual Human Rights
Report and in our bilateral consultations, including during the recent
U.S.-Bangladesh Partnership Dialogue in Dhaka. Additionally,
discussions of worker rights and safe working conditions are part of
the current review of Bangladesh's trade benefits under the GSP
program. We also have an ongoing high-level dialogue with U.S. buyers
that source from Bangladesh about workplace safety and the role that
buyers can play in strengthening respect for the rights of workers,
including ensuring safe and healthy working conditions. In March, and
again in May, we reviewed our expectations of U.S. companies'
engagement in Bangladesh and shared a ``Best Practices for Companies
Operating in Bangladesh'' document (please see attached). The U.S.
Government is currently discussing a joint effort with the European
Union, the Government of Bangladesh, and the International Labor
Organization to bring working conditions and respect for workers rights
in the garment sector in Bangladesh in line with international labor
standards.
ATTACHMENT
United States Government Recommendations on Best Practices for
Companies with Operations in Bangladesh--U.S. Department of State (Mar.
11, 2013)
On Tuesday, March 5, 2013, Assistant Secretary of State for
Democracy, Human Rights, and Labor Michael Posner and Assistant
Secretary of State for South and Central Asia Robert Blake hosted a
conference call with over 70 U.S. brands and civil society groups to
discuss fire safety issues in manufacturing facilities in Bangladesh.
On the call, Assistant Secretary Posner and Assistant Secretary Blake
summarized important labor rights issues, including the status of the
Aminul Islam case, union registrations, and legal reforms. They also
outlined what the U.S. government views as best practices for companies
with operations in Bangladesh. Eric Biel, Acting Associate Deputy
Undersecretary for International Affairs at the Department of Labor,
discussed his recent trip to Bangladesh, including numerous meetings on
fire safety and labor law reform, and possible areas for bilateral
technical assistance.
Unsafe working conditions in Bangladesh were brought into the
international spotlight by the Tazreen factory fire of November 2012,
the worst of many deadly manufacturing fires in the country in recent
years. The ILO has been engaged with the Government of Bangladesh on a
Tripartite National Action Plan on Fire Safety to address this issue,
and as of today the Plan is being finalized by the Ministry of Labor
and Employment. They also have worked with the Government to identify
necessary steps, including reforms to labor law and an improved and
more transparent union registration process, to create an ``enabling
environment'' for the establishment of a Better Work program.
The National Action Plan and Better Work program both offer
opportunities to sustainably improve labor standards in Bangladesh and
could both benefit from the support and cooperation of international
buyers, including in coordination with buyers' own initiatives. The
practices outlined below are recommendations from the U.S. government
to U.S. brands as they promote respect for human rights and
international labor standards, as well as encourage engagement with the
Government of Bangladesh and other stakeholders on these issues.
1. Act Collectively: Companies should work together to figure out
how they can make a difference collectively. And it's important that
responses meet three criteria: they're credible; they're relevant; and
they're effective. There are several ongoing collaborative initiatives
in various stages of development. We encourage companies to link
efforts on labor and human rights with collaborative work being done
through multi-stakeholder initiatives, third-party auditors, industry
associations, and cooperative agreements. The Tripartite National
Action Plan on fire safety may offer entry points for buyers and civil
society to support and enhance a Bangladesh-owned process to improve
fire safety.
2. Develop Broad Principles and Policies and Procedures for
Implementation: Companies should have clearly defined labor and human
rights principles, policies and procedures that guide their behavior
and that of their suppliers and subcontractors. Such policies should be
based on internationally recognized human rights and international
labor standards and there should be effective and transparent means of
monitoring compliance. Senior leadership of the companies should
visibly support such efforts and encourage implementation throughout
the entire supply chain.
3. Develop Credible Internal Benchmarks: In order to assess
progress and effectiveness, companies should have internal metrics to
manage and measure performance on labor and human rights.
4. Conduct Independent Third-Party Verification: Third-party
verifiers should assess performance of company policies and procedures.
Inspections by verifiers should be thorough, timely, unannounced,
independent, and include confidential interviews and consultations with
workers about workplace conditions. Inspections should look at serious
and common hazards, implementation of the local law and respect for
internationally recognized human rights and international labor
standards, and mechanisms for tracking noncompliance with company
policies and procedures.
5. Corrective Actions and Penalties: Corrective action may be
necessary to address non-compliance with company policies and
procedures at any point in the supply chain. When suppliers are found
to be in non-compliance, there should be timely identification and
financial or technical assistance to help address hazards in factories.
There should be contractual penalties for non-compliance that are clear
and meaningful. Also, when non-compliance is discovered, corrective
actions should be shared with stakeholders to the extent possible and
appropriate to disseminate lessons learned and best practices for
avoiding or mitigating future incidents.
6. Cultivate Worker Voice and Education: In manufacturing
facilities within a company's supply chain, buyers should seek to
engage with workers to (a) promote education; (b) prevent retaliation
against those reporting hazards; and (c) compensate workers, including
those put out of work during corrective actions. Companies should
communicate with workers through legitimate representatives selected by
the workers themselves, and should avoid factories where no such
representative mechanism exists.
7. Share Information: Companies should share information with each
other, stakeholders, and relevant host government officials about
factories that fail to comply with policies and procedures or
corrective measures, so as to bring the greatest leverage to bear with
the greatest effect, and to avoid undercutting each other's efforts.
Information-sharing will ensure maximum coordination and knowledge.
8. Work with Stakeholders: Draw on the expertise and experiences of
other companies, NGOs, unions, the ILO, the Government of Bangladesh,
and others to develop sophisticated responses to the current human
rights challenges.
______
Responses of Acting Associate Deputy Undersecretary Eric Biel to
Questions Submitted by Senator Jeanne Shaheen
Mr. Biel, while we have heard that positive steps are being taken
in Bangladesh in response to the tragic Rana Plaza collapse that
resulted in the deaths of over 1,100 garment workers, I am concerned
about the enforcement and oversight side of this issue, especially
given the shocking statistic stating that at least 60 percent of the
garment factories in Bangladesh are currently at risk of collapse.
In your testimony, you mentioned that, given the size of the
garment industry in Bangladesh, the government's inspection capacity is
grossly inadequate, despite recent plans to increase the number of
inspectors. The Government of Bangladesh needs to do more.
Question. In your view, can we rely on the Bangladeshi Government
to ensure the adequate enforcement of oversight at this point for its
garment industry? Is this truly an issue of capacity for the
government?
Answer. The Government of Bangladesh has the primary responsibility
for the enforcement of national labor law with respect to worker rights
and workplace safety in the ready-made garment sector. At the same
time, and as noted in my testimony before the committee on June 6, the
U.S. Government recognizes that, at present, Bangladesh's Ministry of
Labour and Employment does not have a sufficient number of labor
inspectors to satisfy this substantial responsibility, and many of the
current labor inspectors also lack adequate training and resources.
Addressing these significant shortcomings so that the Government
can fulfill its responsibility is a great challenge for the Government
and other stakeholders. We are encouraged that, as part of the joint
statement issued on May 4 following the high-level visit of the
International Labor Organization led by Deputy Director General
Houngbo, the Government of Bangladesh committed to hire an additional
200 labor inspectors within 6 months, and to provide budgetary
authority for a minimum of 800 new inspectors.
Donor countries, including the United States, can play a role
through technical assistance and other funding programs. To that end,
on June 13 the U.S. Department of Labor's Bureau of International Labor
Affairs, where I serve, announced a $2.5 million competitive grant
solicitation to fund improvements in the enforcement and monitoring of
fire and building safety standards in the ready-made garment sector in
Bangladesh. This technical assistance, one part of the broader strategy
to address labor enforcement issues, will fund one or more recipients
to: (1) strengthen the Bangladesh Government's ability to improve its
enforcement of fire and building safety standards, and (2) build the
capacity of worker organizations to effectively monitor violations of
fire and building safety standards and abate related hazards in the
ready-made garment sector.
The two-part program design recognizes the lead responsibility of
the Government of Bangladesh, while at the same time acknowledging the
central role that workers and their representatives must play in
improving conditions in the workplace, especially given existing
capacity issues of the Government.
In addition, as noted in my testimony before the committee, the
powerful Bangladeshi garment industry, as well as the international
buyers and retailers that source products from Bangladesh, must do more
to address worker rights and workplace safety issues in the sector.
While the responsibility of the Government remains paramount, the
private sector also has a clear role to play, such as through financing
safety improvements or training management in appropriate fire safety
responses--and by ensuring that workers' rights to advocate on behalf
of their interests in the workplace are respected.
Question. During your testimony, you mentioned that ``legal gaps''
exist in the export processing zones of Bangladesh. Can you elaborate
on this important point? Can the U.S. Government play a more
constructive role in this regard?
Answer. Industrial relations in the export processing zones (EPZs)
of Bangladesh are governed by a different labor law than the law that
generally governs industrial relations in Bangladeash. While most labor
issues in the private sector are subject to the Bangladesh Labour Act
2006, administered by the Ministry of Labour and Employment, the
administration of the EPZs (where approximately 250,000 workers are
employed) and enforcement of EPZ-specific labor law is the
responsibility of the Bangladesh EPZ Authority (BEPZA). When the
Government of Bangladesh adopted the EPZ Workers Association and
Industrial Relations Act (EWAIRA) in 2004, it was intended as a phased
approach and an interim measure. EWAIRA expired in 2008, but instead of
completing the transition to full coverage of the national labor law,
the separate EPZ law was reauthorized in 2010 as the EPZ Workers'
Welfare Society and Industrial Relations Act (EWWSIRA)--with additional
restrictions rather than expanded rights for workers. The U.S.
Government has noted these concerns publicly, including specific cases,
in the 2012 Human Rights Report on Bangladesh.
As reflected in the detailed comments of the International Labor
Organization's Committee of Experts on the Application of Conventions
and Recommendations, the EPZ law falls short of international standards
in a number of fundamental ways. For example, since 2004, the EPZ labor
law has provided for a blanket prohibition against strikes in any EPZ.
That provision of the law is scheduled to sunset at the end of 2013; if
that sunset does take effect, it would provide for a legal right to
strike beginning in 2014. However, given continuing restrictions on the
right to strike, such as a 15-day limit, a ``public interest''
exception, and a 75-percent voting threshold requirement, the U.S.
Government believes it unlikely that strikes will be permitted in
practice within EPZs, even with the expiration of the full prohibition.
Other areas of concern identified with respect to EPZ law and
governance include:
The law constrains the establishment of ``Workers' Welfare
Societies'' (the term used for the strictly limited form of
worker organizations within EPZs) through burdensome membership
and referendum requirements.
It prohibits the affiliation of such associations between
zones or with any political or nongovernmental entity.
It provides for unfettered BEPZA discretion (exercised by
the BEPZA Executive Chair, a position that has been filled by
the Office of the Prime Minister with senior military
officials) in the cancellation of a Society's registration.
It prohibits Societies from obtaining or receiving any funds
from any outside source without the BEPZA Executive Chair's
prior approval.
It permits elected leaders of the Societies to be terminated
by employers with the concurrence of the BEPZA Executive Chair.
In addition to such gaps in the law, worker organizations
have reported that BEPZA fails to enforce even the limited
protections of the law, and has actively created additional
obstacles to the registration of societies and to the limited
associational rights of workers.
The U.S. Government continues to engage with the Government of
Bangladesh regarding these and other concerns about lack of freedom of
association in the EPZs. The issue has been and remains an important
part of the continuing review of Bangladesh's eligibility for benefits
under the Generalized System of Preferences (GSP) trade program. We
also encourage the Government of Bangladesh to take the measures
recommended by the ILO's Committee of Experts to bring its law and
practice into full conformity with international labor standards.
______
Written Testimony Submitted by Peter J. Kaufman
It is a great honor to be asked to make a statement regarding labor
in Bangladesh. I would like to acknowledge the critical importance of
this committee and this hearing. Two catastrophic events in Bangladesh
over the last several months have focused worldwide attention on
egregious labor, safety, and human rights violations that exist in
Bangladesh today. First, the terrible fire in November that killed
almost 200 people and then the recent building collapse that killed
upwards of 1,200 people and both disasters occurred in garment
factories. Since then, there has been intense media scrutiny of
Bangladeshi labor as well as uproar and protests from numerous human
rights groups and the public at large. Therefore, the committee's focus
on ``Labor in Bangladesh'' could not be more urgent and timely.
As an observer of labor and the industrialization of Bangladesh in
the fashion industry for some 30 years, I have witnessed notable
progress in terms of growth and development. Yet Bangladesh is unique
and can be frustrating. Despite progress in some sectors, Bangladesh
remains an underdeveloped country. Per capita wages make it one of the
poorest countries on earth.
bangladesh
The fashion industry is usually the first industry to invest in
developing countries because it is an industry that requires minimal
labor skills. I use the term ``fashion industry'' rather than
exclusively the ``garment industry'' because the range of product is
more inclusive: garments, home products such as bedding, decorative
pillows, handbags, jewelry, shoes, hosiery and other accessories.
Especially in the case of accessories, hand work is often required.
Post-World-War-II Japan was considered a developing country. U.S.
consumers in the 1950s and 1960s were flooded with imports with a
``Made in Japan'' label. Hard goods gradually replaced soft goods as
Japan became a more sophisticated manufacturing country. As countries
progress in this manner, labor becomes prohibitively expensive and the
cost of fashion items is no longer competitive. In addition, since hard
goods have a higher price tag so their manufacturing is encouraged.
This helped Japan's trade deficits and increased their GDP. Therefore,
the fashion industry moved in to countries such as South Korea, Taiwan,
Hong Kong, the Philippines, etc. These countries were ripe for
development. Today, ``Made in China'' is on almost every type of
product. This is largely due to two factors: our ``free market''
environment and China's remarkable success story of industrialization.
Observing these trends over many years, Bangladesh has not accelerated
at the same rate as the other countries mentioned here. Indeed, it has
unusual burdens that keep it back from more rapid growth. Unemployment
is already rampant. Only by virtue of trade legislation does a very
poor country like Bangladesh have the ability to compete with China.
Without this tariff relief, the entire Bangladeshi economy would be in
chaos.
In order for a developing country to attract investment it must
have: (a) political stability; (b) a reliable infrastructure that
includes roads, reliable shipping via sea and air; and (c) a motivated
and reliable labor force. When I first visited the country in the early
1980s, Bangladesh had only (c) a reliable labor force. Doing business
there was out of the question. The factories that did exist had
appalling working conditions. Excluded were the most basic amenities
such as proper lighting, sanitation, and safe housing. The Port of
Chittagong, nearest to the capital city of Dhaka, was primitive. In
fact, it was famously unreliable due to the fairly regular sinking of
cargo ships as a result of typhoons and other natural disasters. Not
only was the quality of the merchandise unreliable, there was also a
lack of on-time delivery. Additionally, the lead times for
manufacturing were excessively long--often more than 6 months--because
basic materials such as fabrics, findings, and thread, had to be
imported from South Korea or Taiwan. It is a tribute to the great
spirit and work ethic of the Bangladeshi people that some progress has
been achieved.
Today, 30 years later, Bangladesh remains basically an agricultural
country. Men still work primarily in the fields. Women often work in
the factories. Thus women are most vulnerable to the vicissitudes of
working in factories with substandard conditions. Yet significant
progress has been made in some areas.
After 30 years, Bangladesh still lags behind in heavy and medium-
level industries while other countries in central and east Asia are key
players in the automobile industry. Although infrastructure has
improved significantly in some areas, other areas of the country still
lack reliable power, telecommunication, transportation, water and gas.
Continuing governmental instability coupled with an entrenched
bureaucracy puts additional burden on the existing manufacturers and
inhibits investment. Due to its long colonial rule, economic
discrimination and government nationalization of this industry, growth
has been slow. While we can place much of the blame on these economic
and geopolitical factors, the fact remains that too many factories have
existed in the same conditions for the last 30 years. Indeed a very
large percentage the employees working in fashion products still have
no expectation of safety, hygiene, fair pay, and human rights.
On the positive side new, state-of-the-art factories have been
built including some in heavy industries. These private enterprises
area making a remarkable contribution to the national economy. In the
garment business, for instance, I visited vertical sweater and knitwear
facilities. Yet historically Bangladesh had only specialized in woven
fabrics. These factories met every international standard of safety,
fair wages, and human rights. Today, the combined tally of the so-
called ``ready-made garments'' along with the entire textile sector not
only make an enormous contribution to this country's GDP, it is also,
by far, its largest export.
beyond bangladesh
In September, just prior to the November fire in Bangladesh, there
was another catastrophic incident. The New York Times reported that
``Fire ravaged a textile factory complex in the commercial hub of
Karachi early Wednesday, killing almost 300 workers trapped behind
locked doors and raising questions about the woeful lack of regulation
in a vital sector of Pakistan's faltering economy. It was Pakistan's
worst industrial accident, officials said, and it came just hours after
another fire, at a shoe factory . . . had killed at least 25.'' The
Times goes on to report: ``every exit but one had been locked . . . and
the windows were mostly barred. In desperation, some flung themselves
from the top floors of the four-story building, sustaining serious
injuries or worse, witnesses said. But many others failed to make it
that far, trapped by an inferno that advanced mercilessly through a
building that officials later described as a death trap.'' Indeed, the
Pakistan Institute of Labor Education and Research, a labor rights
group, said that ``151 workers died in similar accidents in 2011.''
According to the Institute: ``The state was partly responsible for the
deaths . . . because its civil servants silently and criminally allow
violation of laws and regulations established to ensure health and
safety provisions at work.'' There are striking parallels to
Bangladesh. While I applaud the committee's focus on Bangladesh in
these hearings, I respectively point out that sweatshops such as these,
often equally dangerous, exist all over the world. I have personally
been witness to horrific examples in Africa, in China, Guam, Central
America, and Indonesia to name a few. Even in the United States there
have existed clandestine factories in Queens, Brooklyn, and Long
Island, not to mention in border towns from Texas through southern
California.
Labor Behind the Label, a human rights organization, reported about
the incident in Pakistan: ``the fire follows a pattern of negligence
occurring not just in Pakistan but throughout the garment industry.
Brand and retailers must therefore take more action to address the root
causes of such disasters.''
a culture of cheap leads to greed
The culture of ``cheap'' in the United States (and elsewhere) takes
a terrible toll on human beings at the other end. As consumers, we are
offered the ``$17'' dress--at full price--in trendy stores. As
retailers, brands, and importers squeeze for higher profits, their
``sourcing executives'' that place the orders on the ground must
squeeze at the other end. A result of this is subcontracting, which
occurs despite official contracts and ``Letters of Credit''
specifically prohibiting it. At the local factory level, owners and
management also press for profitability. When the retail price becomes
impossibly cheap while the cost of labor and materials remain the same,
someone must pay the price. Those at the lowest end of the food chain
are the ones who pay. The factory laborers are forced to endure
horrendous conditions. Since there is already rampant unemployment in
many of these countries, workers have no choice but to work in
horrendous conditions for $50 a month. While it is true that some
retailers and brands did have direct knowledge of factory conditions,
the reality is that ``subcontracting'' or ``outsourcing'' can and does
occur everywhere in the world.
As we examine the supply chain, from consumer to laborer, there is
yet another human factor beyond mere profitability: greed. Surely this
is a motivating factor when factory managers and supervisors block fire
escapes due to overcrowded conditions. Surely this must be a motivation
when fire extinguishers are intentionally removed or misplaced. Loading
far too many sewing machines into electrical outlets incapable of
handling them is yet another example. Imposing long working hours in
order to maintain profits is another example. It is also well
documented that factory supervisors will beat their employees into
working ``harder'' and 'better.'' Surely there exists a ``culture'' in
Bangladesh that allows such horrific violations to perpetuate. It is
not only appalling and inhumane but illegal.
summation
Internationally, garment production on behalf of U.S. companies in
factories with exploitative policies and hazardous working conditions
has fueled anti-Western sentiment. Recent Islamist riots in Bangladesh
have added to the country's striking death toll and increased pressure
on its endangered fashion industry. Given that a large percentage of
fashion industry manufacturing wordwide is located in the Muslim world,
Islamist radicals use these catastrophic incidents as propaganda tools
undermining public opinion of the West, but also potentially
undermining the stability of already faltering regimes. By demanding
ethical, humane garment production we can better the U.S. fashion
industry's reputation and prevent some of the violence and instability
that hinders workers from making a proper livelihood.
I know that this committee will be considering powerful and well-
intentioned efforts to improve factory conditions for laborers in
Bangladesh. One approach could be along the lines of threatening with
removing tariff relief if conditions are not improved ``soon enough.''
But this is not the correct approach. If such legislation is imposed,
Bangladesh will no longer be competitive in the fashion-related
products that make up the bulk of their GDP and their exportation. If
this should pass, I do entirely agree that the industrialists, factory
owners, management and supervisors will be punished. These terrible
factories will finally close. However, along with them, the many good
factories that already observe human rights and international guide
lines will close as well. The ``good'' factories make up a large
percentage of the total volume. Most significantly, the ripple effect
of such legislation is that it will most profoundly affect the tens of
thousands of innocent laborers who are already victimized. Surely, it
is preferable that workers can have a choice whether or not to work
under current conditions and in improving conditions rather than
joining the millions who are already unemployed. I believe that there
is an alternative strategy: Allowing retailers, brands, and
manufacturers to take responsibility for business on the ground.
Without orders, there is no business and therefore there can be no
factories. Collectively, they should take responsibility for improving
conditions, enforcing international labor standards and as well as
working in tandem with local representatives to address safety issues
in every country they source from.
I see that significant progress is already in work. There are too
many to list. For instance, Phillips-Van Heusen recently announced that
they had signed an important agreement: ``the Clean Clothes Campaign
(CCC) together with Bangladeshi and international human rights
organizations worked with PVH (owner of Tommy Hilfiger and Calvin
Klein) concerning Bangladesh, whose industry has suffered from a spate
of . . . fires involving brands such as H&M, Zara, and GAP. The
agreement provides for independent inspections, training, and worker's
committees on health and safety issues.'' Indeed there are all kinds of
announcements by a variety of retailers and brands who are investing to
improve the infrastructure in Bangladesh. Both Walmart Stores and Gap
Inc. are meeting with ``industry associations and the Bipartisan Policy
Center to develop a plan to improve fire and safety regulation in
Bangladesh factories.''
However, no one yet has ever brought all these important retailers,
brands, and manufactures to the table to collectively use their
enormous buying power to change conditions on the ground. Inspired by
recent experiences I had at the United Nations including such
initiatives as Fashion4Development, Every Woman Every Child and the
Millennium Development Goals (MDGs), I founded a nonprofit called Fair
FashionTM. The primary directive of Fair
FashionTM is to bring industry to the table--for the first
time--to collectively use their buying power to improve conditions on
the ground. If orders en masse are withheld, conditions will change. We
suggest a symposium in the very near future to address this very issue.
Eventually a consortium or coalition would be formed consisting of the
most important retailers, brands, and manufacturers to address such
issues as working conditions on the ground in addition to strategizing
how to help developing countries create sustainable factories for the
future. This process would be ongoing.
I truly believe that harnessing the collective buying power of the
most important retailers, brands and manufacturers will not only make
the necessary changes but will also enable the people of Bangladesh to
stay employed during this period of transition. An agreement has been
signed in the EU spearheaded by H&M that includes all their major
retailer and brands. Thus far most U.S. companies have refused to sign
on fearing liability. The symposium will enable their U.S. counterparts
to draft something analogous, but in language that is more practical.
Using the EU agreement as a pro forma, their American counterparts will
put their enormous collective buying power behind this agreement. The
effect will have not only immediate change, but the right kind of
change in the future.
Finally, once again, I would respectfully like to point out to the
committee that Bangladesh is not alone. The September fire in Pakistan
that occurred just preceding the two disasters in Bangladesh is only
one of many such incidents that occur far too frequently. Perhaps the
only difference is that these occur ``under the radar.'' This problem
is not just about Bangladesh. Indeed, sweatshops exist in many
countries throughout the world. This is a global problem and should be
addressed as such and as soon as possible.
I would like to thank the committee again for allowing me to submit
this statement and my point of view as part of the official record.
______
Written Testimony Submitted by Kalpona Akter, Executive Director,
Bangladesh Center for Worker Solidarity (BCWS)
i. introduction
Chairman Menendez and Ranking Member Corker, thank you for the
opportunity to submit written testimony on the struggle of garment
workers to secure basic labor rights in my home country of Bangladesh.
Given the thousands of workers who have recently lost their lives or
been severely injured working in Bangladesh's apparel export sector,
this hearing could not be more timely.
My name is Kalpona Akter. I went to work in a garment factory in
Bangladesh when I was 12 years old. I went to work because my father
had a stroke and the family needed money to cover basic living
expenses. My mother and I started working in the factory together, but
my mother had a 2-month-old infant and so had to quit, so my 10-year-
old brother and I were the ones who had to sustain the family. I was
paid $6 a month back then for working up to 450 hours per month in
sweatshop conditions. I worked for 8 years at that factory, but I was
fired because I began organizing my coworkers to form a union so we
could have better wages and conditions. I went to work for another
union and then in 2000 I cofounded the Bangladesh Center for Worker
Solidarity, a labor rights advocacy organization that conducts
research, offers worker training, and works closely with trade unions,
such as the Bangladesh Garment Industry Worker Federation, to help
workers know how to claim their rights.
ii. background
The garment export industry is a major employer in Bangladesh, with
over 4 million workers, more than 80 percent of whom are women, mostly
from poor, rural backgrounds. They make clothing for export, mostly to
the U.S. and European brands and retailers who have flocked to the
country to take advantage of rock-bottom wages. Bangladesh's garment
workers are the lowest-paid in the world, with an industry minimum wage
of about $38 a month--due to inflation; this cannot buy any more than
the $6 that I used to earn.
Dangerous Factories
Aside from long hours and low wages, apparel sector workers often
work in factories with chronic safety problems. Since 2005, over 1,800
workers have died and thousands more were severely injured in garment
factory fires and building collapses. These deaths and injuries could
have been prevented had basic safety measures been in place and had
workers' right to refuse dangerous work been respected.
While the recent tragedies at Tazreen Fashions and Rana Plaza, in
which at least 1,239 workers died making clothing for export, have
understandably attracted international attention and condemnation, the
fact is that most of the 5,000 garment factories in Bangladesh are not
up to fire and building safety code--they are death traps. Any day more
workers could be burned alive or crushed when a building collapses. In
fact, since Tazreen, and not counting Rana, there have been at least 44
incidents in the Bangladesh garment industry in which a total of 16
workers were killed and at least 691 workers were injured.\1\
Widespread union and worker repression
On paper, Bangladeshi workers do have the legal right to form
unions and collectively bargain with factory owners. In reality,
attempts to unionize the country's garment workers are ruthlessly
suppressed, with activist workers harassed, blacklisted, or worse, with
tacit government approval.
Last year, my friend and colleague Aminul Islam, a garment worker-
turned-labor-organizer who worked for the Bangladesh Garment &
Industrial Workers Federation and the Bangladesh Center for Worker
Solidarity, was killed, his body--bearing marks of torture--dumped on a
highway. The government has failed to find or prosecute his killers,
but we believe his murder was intended to create a climate of fear
among other labor activists. He had been detained, tortured and jailed
on previous occasions by security forces in the 2 years prior to his
disappearance.
iii. beyond the numbers: stories from survivors
While the statistics of death and injury in recent months are
astounding and have broken records, the numbers alone may not capture
the pain and suffering of families who lost their loved ones and of all
the severely injured workers who lost arms and legs, many amputated on
site at Rana Plaza in rescue missions to pull workers from the rubble.
Let me share just a few stories from workers who survived:
Tazreen Fashions--Fire on November 24, 2012 \2\
Rehana jumped from the 4th floor window of Tazreen Fashions
and was knocked unconscious. She broke her leg. Doctors told
her she will need to be on crutches for the rest of her life.
Reba was the breadwinner in her home. She jumped from the
3rd floor of Tazreen Fashions. She cannot work because of the
pain. Her husband is sick. She has two sons, one of whom just
qualified to get into the military college. She doesn't know
how she can afford it.
Rowshanara jumped from the 3rd floor and still has severe
pain in her back and legs. She was visibly in pain after
sitting too long with us. She is single and gets by on loans.
She has two teenage children in school she doesn't want to
force to go to work, but she worries how she'll get by.
Deepa worked on the 3rd floor. She saw the fire and tried to
escape to the 2nd floor. The factory manager padlocked the door
and told everyone to keep working. Workers were crying and
searching for a way out. A mechanic yelled to come to the east
side of the building where he had created an exit. She jumped
from the 3rd floor and fell unconscious, breaking her leg.
Deepa was 4 months pregnant and lost her baby.
Sumi decided to jump from the 3rd floor rather than perish
in the factory because she wanted her family to be able to
identify her body. She broke her leg and arm and could not
move. Her family borrowed money to pay for medical bills before
the Association funds arrived. Two weeks before Rana Plaza, she
came to the U.S. to urge retailers and brands to join the
enforceable and binding Accord on Fire and Building Safety.
Nazma said she would have died had she waited 10 minutes
more to jump. She saw the manager locking the gate to the
second set of stairs and grabbed him by the collar to stop him,
but he ignored her. She cut her arms trying to get through a
window to reach a bamboo scaffolding. She broke her backbone.
Now, she can't carry anything or do household work. She has
three children. Her stipend was spent on medical care and her
children's education. Her 14-year-old son had to leave school
to go to work.
Rana Plaza--Building Collapse on April 24, 2013 \3\
Rabeya was working at New Wave Style Ltd. in Rana Plaza the
day it collapsed. She has two sons and two daughters--and works
because her husband's income is not sufficient to support the
family. ``I did not want to go to work. But we were threatened
by the owner that we would not get our salary if we didn't show
up,'' she said.
Describing what happened when the building collapsed, she said:
``Upstairs, suddenly I saw some workers running. I also tried
to save myself. But I could not and fell down. A part of
ceiling had fallen on me and my legs were stuck between metal
rods. Meanwhile a big wall had fallen on my chest, breaking my
sternum. It took 2 hours to free myself from the trapped
condition. After that I could move a little bit. I fell down
and screamed, `` `Father . . . save me!' People rescued me when
they heard my scream.''
Still in the hospital, Rabeya is facing a long recovery and an
insecure future. Her face and nose have been crushed, her two
legs broken, and her chest bones broken. ``Now, this is the
outcome of my decision to support my family. I have become a
burden on my husband and my children,'' she said.
Moriom, 28 years old, lost her right hand in the Rana Plaza
building collapse and today fumes in anger and concern about
her bleak future: ``None of us wanted to go to the factory that
day. They forced us to go there. It was end of the month; we
would not get paid for that day if we were absent. We are very
poor, and we cannot bear that loss,'' she said. Moriom has a
daughter and a son living with her mother in a village. Her
husband left her long time ago. They were going to school. She
is now uncertain about their future: ``I am the only earning
family member. How I will work now?'' she said very sadly.
iv. the bangladesh safety accord
The Accord on Fire and Building Safety in Bangladesh is a legally
binding, enforceable agreement between companies and unions, created to
improve safety in the Bangladesh garment industry.\4\ Negotiations for
the Accord began in the months following a fire on December 14, 2010,
which killed 29 workers who were trapped inside a factory supplying
several U.S. companies: Abercrombie & Fitch, Carters, Gap Inc, Kohl's,
PVH, Target, and VF Corporation. Since then, Abercrombie & Fitch and
PVH have signed onto the Accord. All told, the Accord now has 41
companies as signatories including brands and retailers from a dozen
countries,\5\ two global unions--UNI and IndustriALL, and Bangladeshi
unions.
The Accord includes independent safety inspections with public
reports; mandatory repairs and renovations to address all identified
hazards; and a central role for workers and unions, including worker-
led safety committees in all factories and access to factories for
unions to educate workers on how they can protect their rights and
their safety, including their right to refuse unsafe work. The heart of
the Accord is the commitment by companies to work with their suppliers
to secure financing, maintain orders, and ensure renovations and
repairs are completed to make factory buildings in Bangladesh safe.
How the Accord will save lives
I am confident that had the Accord been operational in the
factories before the disasters, workers' lives would have been spared
at Tazreen and Rana Plaza.
Mandatory renovations, with brands ensuring financing
First of all, if the Tazreen and Rana factories had been covered by
the Accord, the inspections would have revealed major safety problems
and resulted in the U.S. and European brands and retailers being
required to ensure financing for mandatory renovations. Tazreen would
have undergone renovations to make the staircases fireproof, add
additional exit doors, and upgrade electrical wiring. Rana Plaza would
probably have been closed down due to the illegal construction of the
building on top of unstable swampy ground, which was then worsened by
the illegal additions of several floors beyond the five permitted
floors. The warning signs of a safety hazard had been evident for a
long time: workers told me that the building would shake on a regular
basis as a result of the three heavy industrial generators in the
building. While Rana Plaza would have been closed, under the Accord,
the brands would have been required to ensure that the factories
continued to pay workers their regular wage or helped them to find
employment at neighboring factories, while the factories were either
renovated or relocated to safer buildings.
Right to refuse illegal work
Garment workers in my country live in such poverty that they cannot
afford to lose even a day of work. So when workers at Rana Plaza were
told they would not receive their salary if they didn't show up--some
were even told they would lose a month's salary for not returning the
day after the cracks appeared--they returned to work. Perhaps some of
the workers believed what they heard on the loudspeaker on the morning
of April 24, ``All the workers of Rana Plaza, go to work. The factory
has already been repaired.'' \6\ Others, while likely skeptical about
the safety of the building, perhaps felt at a loss of other options for
putting food on the table for their children, and so decided to
prioritize their family's survival over concern for their own safety
that tragic day. The behavior of management in this case is a blatant
denial of workers' right to refuse dangerous work. Under the Accord,
workers would not have to choose between such stark options: starve or
risk your life. Instead, there is a third way, a path of reason, where
workers' are not discriminated against for refusing dangerous work and
they receive their regular pay while safety measures are put into place
at their worksite, whether that means major building renovations or
moving the factory to a new site.
At Tazreen, when the fire started, for workers on some floors their
usual sweatshop job became a circumstance of forced labor. Sumi Abedin,
a garment worker who worked on the fourth floor, said that when the
first person on her floor smelled smoke, and she and her coworkers
started to move for the stairs, her supervisor said it was a false
alarm and ordered them back to work, locking the collapsible metal gate
between the floor and the main staircase. The supervisor said to ignore
the fire alarm--that it was just a false alarm--and told them to keep
working. The factories in my country are under such high production
quotas and tight turnaround deadlines from U.S. and European brands
that supervisors will sometimes ignore a fire alarm in order to not
lose precious production time. This circumstance would have been
avoided under the Accord, which requires respect for workers' right to
refuse dangerous work and prohibits brands from cutting orders from a
supplier that makes repairs or upgrades necessary to protect workers'
lives.
Workers in my country are afraid to organize; their legal right to
freedom of association and collective bargaining is not guaranteed.
Under the Accord, companies are required to allow union access. If
workers' at Rana had bargaining rights, perhaps they could have
exercised collective action and refused to return to work the day after
cracks appeared in the walls.
Public reporting of audit results
After the September 11, 2012, fire at Ali Enterprises factory in
Karachi, Pakistan, killed 259 workers who were trapped inside, Social
Accountability International (SAI)--a New York-based group--came under
intense scrutiny by labor rights advocates and the media.\7\ The root
of the concern was twofold: first, auditors accredited under SAI's
system had given the factory a clean bill of health only weeks before
the fire, and second, SAI refused to disclose any reporting from the
audit, citing confidentiality agreements. I ask: how is it that SAI can
justify keeping their knowledge of the factory confidential when the
case involves the largest factory fire in known history in the global
garment industry?
Another auditing firm, the Business Social Compliance Initiative
(BSCI), had certified two factories in Rana Plaza, New Wave Style and
Phantom Apparel. The Web site of another factory in the building, Ether
Tex Ltd, advertised a BSCI audit as well, and that it had also passed
inspection for the Service Organization for Compliance Audit Management
(SOCAM). Clearly, we can't count on these auditing firms to ensure
safety for our workers, particularly when BSCI (despite having health
and safety requirements in its code) disclaims any responsibility for
worker deaths in the premises it had certified by saying: ``The reasons
for the collapse of the factories seem to be related to the poor
infrastructure of the Rana Plaza building. BSCI focuses on monitoring
and improving labour issues within factories and relies on local
authorities to ensure the construction and infrastructure is secure.''
\8\
In my country, where the majority of garment factories are not in
compliance with fire and building safety code, it is unacceptable for
an auditor to ignore construction and infrastructure issues. Under the
Accord, independent inspections will be conducted by experts in fire
and building safety, and compiled audit results will be made publicly
accessible as well as available to the union signatories, which can in
turn inform workers on any hazards identified. At the same time, as
signatories to a legally binding agreement, the companies that are part
of the Accord must ensure that the factory buildings are brought up to
code.
Why industry alternatives won't help
Facing mounting international criticism for refusing to join the
Bangladesh Safety Accord, a group of North American brands, led by Gap
and Walmart, have indicated they will launch their own scheme
purporting to address fire and building safety issues in the Bangladesh
garment industry.
While the full details have yet to be released, the companies
haven't given us any reason to believe that their program will include
the core elements of the Accord which are so essential to preventing
more tragic deaths: transparency of audit results, union involvement,
and real respect for workers' right to refuse dangerous work--all in a
legally binding and enforceable agreement in which brands ensure that
factories have the financial wherewithal to carry out needed fire and
building safety repairs. And it's telling that Gap and Walmart didn't
even bother to meet with workers' representatives while developing this
new public relations stunt.
There is no credible reason why retailers like Gap and Walmart
should not join the 41 companies that have already signed the Accord on
Fire and Building Safety in Bangladesh and make a real commitment to
worker safety. Instead, they continue to barrage the public with new
programs and initiatives that simply repackage the failed programs of
the past that led to the deaths and injuries of workers in hundreds of
incidents in Bangladesh's garment industry in recent years.
Under the Gap/Walmart scheme, even if companies agree to remediate
and finance repairs, we have no guarantee that they will actually do so
and we cannot hold them accountable because they refuse to make
contractual commitments to worker safety.
Walmart routinely violates their voluntary, nonbinding code of
conduct and breaks their promises to workers for safe and decent
working conditions. Why should workers trust any new voluntary,
nonbinding commitment by Walmart?
v. recommendations to the u.s. government
In order to improve safety conditions in factories in my country
supplying the U.S. market, and to protect workers lives, with this
testimony I urge the U.S. Government to:
(1) Urge all U.S. brands and retailers whose clothing was made at
Tazreen and Rana Plaza to pay the full and fair compensation they owe
to the injured workers and to the families of the workers who were
killed.
(2) Call on all U.S. brands and retailers that source clothing from
Bangladesh to sign onto the Bangladesh Safety Accord, joining with 41
other companies, including three U.S. companies: Abercrombie & Fitch,
PVH, and Sean John Apparel.
(3) Mandate the U.S. Joint Military Exchanges to join the
Bangladesh Safety Accord, and to mandate all other apparel brands sold
in the Exchanges to do the same.
(4) Require all U.S. brands and retailers to publicly disclose the
locations of their supplier factories as well as make available a copy
of all current and future audit reports.
(5) Call on U.S. companies to provide fair commercial terms,
including adequate prices and delivery schedules, to make possible
factory investment in safe conditions and higher wages, and urge the
Bangladesh Government to respect workers' right to freedom of
association so it is possible for garment workers to negotiate for
higher wages.
(6) Help provide support for mental health services for garment
workers dealing with long-term trauma as a result of factory fires and
building collapses.
(7) Join with the United Kingdom in taking a new approach to
export-led development programs by not only providing significant
financing to ensure the Bangladeshi apparel industry is made safe and
decent for workers, but also publicly acknowledging, as Minister Duncan
did this week, the responsibility U.S. brands and retailers have to
workers making the products they sell.\9\
----------------
End Notes
\1\ As catalogued by the Solidarity Center, during November 24,
2012, to May 31, 2013; on file with the International Labor Rights
Forum.
\2\ As incorporated in U.S. House of Representatives floor
statement submitted for the record of June 5, 2013, by U.S.
Representative George Miller, Ranking Member of House Committee on
Education and the Workforce.
\3\ These worker stories were collected by an outreach committee
that the Solidarity Center office in Dhaka organized with its partners,
including BCWS.
\4\ A copy of the Accord is available at http://laborrights.org/
safetymou.
\5\ As of June 4, 2013, the companies in the Accord include
Abercrombie & Fitch, Aldi, Benetton, Bonmarche, C&A, Carrefour, Charles
Vogele, Comtex, El Corte Ingles, Esprit, Fat Cat, G-Star, H&M, Helly
Hansen, HEMA, Hess Natur, Inditex (Zara), JBC, John Lewis, KIK, LIDL,
Loblaw, Mango, Marks & Spencer, Mothercare, N. Brown group (SimplyBe,
High&Mighty, etc.), New Look, Next, Otto Group, Primark, PVH, Rewe,
Sainsbury's, Sean John Apparel, s.Oliver, Stockmann, Switcher, Tchibo,
Tesco, V&D, and WE Group.
\6\ As reported by Pintu, 18, and Shilpi, 21, workers at New Wave
Bottom Ltd, one of the factories in the Rana Plaza building, recalling
the loudspeaker announcement they heard the morning of November 24,
2013. This testimony was collected by an outreach committee that the
Solidarity Center office in Dhaka organized with its partners,
including BCWS.
\7\ See for example, this December 7, 2012, New York Times article:
http://www.nytimes.com/2012/12/08/world/asia/pakistan-factory-fire-
shows-flaws-in-monitoring.html.
\8\ As printed on BSCI Web site; retrieved on June 5, 2013: http://
www.bsci-intl.org/news-events/news.
\9\ As reported on June 4, 2013, by the BBC: http://www.bbc.co.uk/
news/uk-22777071.
______
Written Testimony Submitted by Akramul Qader, Ambassador of Bangladesh
to the United States
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