Dhaka, Bangladesh (BBN)- A total of 37 apparel brands and retailers -- 35 European, one US and one Chinese -- have signed a deal aiming to make the country’s apparel industry safe and sustainable under a new accord on Fire and Building Safety in Bangladesh.
The brands and retailers are H&M, Inditex, C&A, PVH, Tchibo, Tesco, Marks & Spencer, Primark, El Corte Inglés, jbc, Mango, Carrefour, KiK, Helly Hansen, G-Star, Aldi, New Look, Mothercare, Loblaws, Sainsbury's, Benetton, N Brown Group, Stockmann, WE Europe, Esprit, Rewe, Next, Lidl, Hess Natur, Switcher, Abercrombie & Fitch, Bonmarche, John Lewis, Charles Vögele, V&D, Otto Group and s.Oliver.
Under the deal, the global brands and retailers have agreed to establish a fire and building safety programme in Bangladesh for a period of five years.
The programme will be based on the national action plan on fire safety (NAP), which expressly welcomes the development and implementation by any stakeholder of any other field that would constitute a meaningful contribution to improving fire safety in Bangladesh.
The latest initiative has been taken against the backdrop of the loss of lives in tragic incidents at Rana Plaza, Tazreen Fashions, Tung Hai and other apparel manufacturing facilities in Bangladesh in the recent past.
The signatories will appoint a steering committee with equal representation chosen by the trade union and company and a representative selected by the International Labour Organization (ILO) as a neutral chair to implement the agreement. The committee will appoint a safety inspector and training coordinator.
They will also appoint an advisory board involving brands and retailers, suppliers, government institutions, trade unions, and non-governmental organigations (NGOs) to provide feedback and input of stakeholders to the Committee.
Country's garment factories will be inspected by the safety inspectors. Tier one suppliers, which are identified by their volume of productions, will receive safety inspections, remediation and fire safety training. Tier two factories will receive inspection and remediation, while there will be limited initial inspections at tier three factories in Bangladesh.
There are 5,400 garment factories in Bangladesh, mostly located at Dhaka, Savar, Gazipur, Narayanganj and Chittagong.
Where corrective actions are identified by the safety inspector as necessary to bring a factory into compliance with building, fire and electrical safety standards, the signatory company or companies that have designated that factory as a tier one, two, or three supplier, will be required to implement these corrective actions, according to a schedule that is mandatory and time-bound, with sufficient time allotted for all major renovations.
Signatory companies will require their supplier factories, to be inspected under the programme, to maintain workers' employment relationship and regular income during any period that a factory (or portion of a factory) is closed for renovation necessary to complete such corrective actions for a period of no longer than six months.
"If a supplier fails to do so, the signatory will promptly issue a notice and start warning process leading to termination of the business relationship if these efforts do not succeed," the six-page agreement, initiated by IndustryALL and UNI Global Union, said.
In order to induce tier one and tier two factories to comply with upgrade and remediation requirements of the programme, participating brands and retailers will negotiate commercial terms with their suppliers which 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, according to the agreement.
"Each signatory company may, at its option, use alternative means to ensure factories have the financial capacity to comply with remediation requirements, including but not limited to joint investments, providing loans, accessing donor or government support, through offering business incentives or through paying for renovations directly," it noted.
Signatory companies are committed to maintain long-term sourcing relationships with Bangladesh, as is demonstrated by their commitment to this five-year programme. They will continue business on order volumes comparable to or greater than those that existed in the year preceding the inception of this agreement with tier one and tier two factories at least through the first two years of the term of this deal.
Signatory brands and retailers will have to contribute a maximum US$500,000 per year to pay for the steering committee, safety inspector and training coordinator. Payments will depend on each company's annual garment production in Bangladesh.
BBN/SSR/AD-21May13-12:35 pm (BST)