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U.S., Urging Worker Safety, Outlines Steps for Bangladesh to Regain Its Trade Privileges

July 19, 2013 by Leave a Comment

Three weeks after announcing it would suspend Bangladesh’s trade preferences, the administration released an “action plan,” which calls on Bangladesh to significantly increase the number of labor, fire and building inspectors and to improve their training. The plan urges Bangladesh to impose stiffer penalties, including taking away export licenses, on garment factories that violate labor, fire or building safety standards.

In addition, the administration recommended that Bangladesh create a public database of all garment factories for reporting labor, fire and building inspections, including information on violations found, penalties assessed and violations corrected, with the names of the lead inspectors.

The administration suspended Bangladesh’s trade privileges after a widespread outcry that the country was doing too little to safeguard worker’ rights and safety in light of the Rana Plaza factory building collapse in April that killed 1,129 workers and the Tazreen factory fire in November that killed 112.

The action plan calls for establishing “an effective complaint mechanism, including a hot line” for workers to anonymously report fire, building and workers’ rights violations.

With regard to the garment industry, the Obama administration said Bangladesh should enact and carry out measures to address concerns that factories were suppressing workers’ rights to unionize and bargain collectively. The administration urged Bangladesh to ensure that unions and their supporters do not face reprisals and to “expeditiously” grant recognition to unionization efforts when enough worker signatures have been gathered to meet legal requirements.

Union leaders in Bangladesh say that after they gather the needed 30 percent of worker signatures at a company to qualify for union recognition, the country’s labor department gives those lists of names to factory owners, who then often proceed to fire union supporters or bully them into withdrawing their names from the list — so that there is no longer the 30 percent needed. Labor leaders say that is a major reason so few of the nation’s 5,500 garment factories and four million garment workers are unionized.

On Monday, the Bangladesh government adopted a new labor law that it said would be critical in making it easier for workers to unionize. One provision bars government labor officials from giving that list of union supporters to factory owners. Nonetheless, Bangladeshi labor leaders pointed to several new provisions to assert that the law was in ways a step backward and made it harder to unionize.

The Obama administration called on Bangladesh to publicly report information on the status and outcomes of individual unionization efforts and on whether the government had officially registered them, including the time taken to process unionization applications and the basis for any denials. It said Bangladesh should make sure that its export-processing zones allow full freedom to unionize.

The administration also said Bangladesh should proceed with a “transparent investigation” into last year’s killing of Aminul Islam, a prominent union organizer. Bangladeshi news media have reported that government officials might have been involved.

Article source: http://www.nytimes.com/2013/07/20/business/global/us-urging-worker-safety-outlines-steps-for-bangladesh-to-regain-its-trade-privileges.html?partner=rss&emc=rss

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Bangladesh’s Cabinet Approves Changes to Labor Laws

May 13, 2013 by Leave a Comment

The new initiatives are partly in response to outrage over conditions in the country’s garment sector after the April 24 collapse of a garment-factory building, Rana Plaza, in Savar, an industrial suburb of Dhaka, the nation’s capital. By Monday afternoon, at least 1,127 people were confirmed to have died in the Rana Plaza collapse, a number that could still rise, in what is now considered the deadliest disaster in the history of the garment industry.

A top adviser to Bangladesh’s prime minister, Gowher Rizvi, said the changes approved by the cabinet – which must still be approved by the country’s Parliament – are part of a broader government effort to come into compliance with international labor standards and improve conditions for workers in an industry that is critical to the nation’s economy.

“Worker safety and worker welfare have now been brought into the forefront,” Mr. Rizvi said in a telephone interview. He said that discussions on these changes predated the Rana Plaza collapse even as he agreed that the disaster had intensified the pressure for reforms.

“This is the goose that lays the golden egg,” he said of the garment industry’s importance to Bangladesh. “Don’t kill it. We have to strengthen it. We have to nurture it. Nurturing it means fair treatment of the workers.”

Bangladesh is now the world’s second-leading garment exporter, trailing only China, and has become a popular manufacturer for top global brands by delivering lower costs, largely because of rock-bottom wages. Minimum wage in the garment industry is $37 a month. Labor unions are largely absent in garment factories, partly because of legal restrictions on organizing. In some cases, workers trying to organize unions have faced dismissals from factory bosses, as well as intimidation and harassment from local officials.

Mikail Shipar, the country’s labor secretary, said Monday’s changes included eliminating a central restriction on union organizing and improving benefits for workers. Under the current rules, organizers must present the government with a list of names showing that at least 30 percent of workers in a factory want a union. But that list is then turned over to a factory’s owner to verify the authenticity of the names – a step that some owners have used to engage in union busting by firing or harassing workers on the list.

Now, Mr. Shipar said the list would no longer be turned over to factory owners.

“This is a major barrier in getting registration of a trade union in a factory,” he said. “Through the proposed amendment of the labor law, we removed this barrier.”

Other changes involve benefits. Severance payments will be increased for workers with longer tenures at factories; annual payments under a welfare fund will be equalized so that every garment worker, regardless of the size of their factory, will receive the same amount. Factories will be pushed to modernize management practices and provide workers with banking accounts and direct deposit to protect against abuses by lower-level managers, like withholding or delaying wages.

Government officials on Sunday announced the creation of a new wage board that would begin discussions between labor and management on setting a new minimum wage for garment workers. Mr. Shipar said the process might take up to six months, but officials have said that any wage changes would be retroactive to May 1.

Bangladesh has roughly 5,000 garment factories, employing directly and indirectly more than 4.5 million people. Nearly 80 percent of garment workers are women, many of them poorly educated and from rural villages. In the past, even the low local wages were better than working in the fields. But as inflation has spiked in the past two years, garment workers have staged angry protests, demanding higher wages and better conditions.

Mr. Rizvi, the government adviser, said the move by the cabinet on Monday is part of a broader effort to bring Bangladesh into compliance with minimum labor standards established by the International Labor Organization. This month, a high-level delegation from the organization met in Dhaka with factory owners, government officials and labor leaders and issued a joint statement pledging to introduce a labor law reform package in Parliament; to assess the structural integrity and fire safety of all factories in 2013; and hire an additional 200 government inspectors to regulate the industry.

Julifkar Ali Manik contributed from Dhaka, Bangladesh.

Article source: http://www.nytimes.com/2013/05/14/world/middleeast/bangladeshs-cabinet-approves-changes-to-labor-laws.html?partner=rss&emc=rss

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Factory Owners in Bangladesh Fear Firms Will Exit

May 3, 2013 by Leave a Comment

Mohammad Fazlul Azim, a member of the Bangladesh Parliament and an influential garment factory owner, implored brands not to leave Bangladesh, noting that many factories did comply with safety standards.

“The whole nation should not be made to suffer,” he said. “This industry is very important to us. Fourteen million families depend on this. It is a huge number of people who are dependent on this industry.”

Factory owners in Bangladesh as well as Western apparel retailers have faced intense pressure from governments, consumers and labor groups to improve workplace safety there after a building containing five garment factories collapsed last week outside the nation’s capital, killing more than 430 people.

Several Western retailers indicated on Thursday that they were considering new plans to ensure factory safety, efforts that would require investing in, rather than abandoning, their operations in Bangladesh. But few have made financial commitments to upgrade unsafe factory buildings or to endorse tougher and deeper inspections. So far, pledging money for relief efforts has been the most common response by big retailers.

Galen G. Weston, the chairman of Loblaw, a major Canadian retailer, said his company wanted more rigorous factory inspections that would for the first time examine the structural integrity of buildings housing these garment factories. He also said Loblaw, which makes the Joe Fresh apparel line, was trying to figure out what more it could do to improve workplace conditions there.

Mr. Weston said he was disturbed that factory managers saw fit to send apparel workers back into the building last week after it had been declared dangerous.

“What role does industry play in propagating a manufacturing culture that would take such risks with people’s lives?” he said. “I’m troubled by the deafening silence from other apparel retailers on this issue.”

Mr. Weston said he was upset that only two out of the nearly 30 Western apparel brands whose goods were manufactured in that building had spoken out about the disaster.

Officials from two nongovernment organizations who attended a meeting in Germany on Monday aimed at improving factory safety in Bangladesh said Thursday that they were confident that several major retailers would soon join a broad plan to ensure fire and building safety in Bangladesh factories. But so far, that plan has been embraced by just PVH, the parent company of Tommy Hilfiger and Calvin Klein, and the Tchibo Group, a German retailer.

“I’m quite confident that we will get some of the big retail players to sign on to this,” said Jyrki Raina, general secretary of the IndustriAll Global Union, a federation of 50 million workers from 140 countries. “The world will not forgive us. We will all look ridiculous if there is nothing done.”

If a few more retail giants sign on, labor groups are likely to turn up the pressure on others to join the effort or face protests, several officials said. Already, demonstrators have carried signs outside the stores and offices of major retailers that bought apparel from factories in the collapsed building. Mr. Raina said that at the Monday meeting worker advocacy groups and retailers sought to revise the PVH-Tchibo plan so that it would be acceptable to more retailers while still maintaining strong workplace protections.

Several labor advocates voiced optimism that two companies that have taken the lead in creating a compensation fund for the Bangladesh victims and their families — Loblaw and Primark, an Anglo-Irish retailer — would join that plan, which calls for Western retailers and brands to help pay for safety improvements at garment factories.

Walmart, Gap and numerous other retailers have balked at embracing the plan. Retail and labor officials say that is partly because the retailers are concerned about the plan’s binding legal commitments.

Jim Yardley contributed reporting.

Article source: http://www.nytimes.com/2013/05/03/business/factory-owners-in-bangladesh-fear-firms-will-exit.html?partner=rss&emc=rss

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Textile Makers in Taiwan Create a High-Tech Niche

December 13, 2012 by Leave a Comment

TAIPEI — Jason Chen knows what it feels like for globalization to threaten his family business.

In 1992, he went to mainland China to find inexpensive raw materials for his garment and blanket business in Taiwan, following his competitors in the textile industry as they rushed to the mainland for free land, inexpensive labor and loose environmental regulations.

But when a shipment of cloth he bought proved defective, his client rejected his garments, and he lost about $100,000. It was enough to push him to take matters into his own hands, and he founded Singtex Industrial to focus on developing higher-value, waterproof synthetic cloth.

“When you go cheap, you have no good quality control,” he said. “Many of us went to China for a new, sweet beginning but tasted only bitterness in the end.”

Singtex’s story parallels the transformation of the textile industry in Taiwan over the last two decades. Once the main pillar of Taiwan’s economic development, textiles have given way to high-technology gadgets and components. Fabric mills and garment factories moved offshore during the last 20 years to focus on lower costs and higher volumes.

Yet the industry has re-emerged over the past 15 years, with companies spinning out a plethora of high-technology fabrics that are being snapped up by European and North American brands. Those materials are used in products like ski jackets, sports jerseys, outdoor furniture and firefighters’ protective gear.

“These fabrics have special production, coating and lamination processes, and we want to keep those patents here,” said Robert Jou, a director at the state-funded Taiwan Textile Research Institute.

Data from the Taiwan Stock Exchange for 2010, the most recent year for which figures are available, show the average net margin at textile companies was 12.7 percent, compared with 7.6 percent for companies producing electronic products like semiconductors, computers and communication components.

Singtex owns 34 patents, including one for S.Cafe, a polyester cloth with coffee grounds mixed into it. The coffee grounds, recycled from local 7-Eleven convenience stores and Starbucks cafes, absorb odors, giving the fabric added value for athletic clothing. Singtex counts the Timberland and Hugo Boss brands as its customers, and has even landed a deal to supply fabric for the Liverpool soccer club’s uniforms.

Mr. Chen’s company survived the industry’s exodus to China, but many others did not. Exports dropped by 44 percent in dollar terms from 1997 to 2009, according to data from the Taiwan Ministry of Finance. Mills that did not do research and development, or have the ability to invest in innovation, could not compete and went out of business.

There were 7,752 textile companies in 1997, but by 2010, only 4,299 were left, according to the textile institute’s data.

“The ones that survived focused on innovative products to serve higher-value demand in Europe and United States,” said Chen Lee-in, a senior economist at the state-funded Chung-Hua Institute for Economic Research. “It really turned the notion that textiles was a low-tech industry on its head.”

This new business environment spawned companies like Hyperbola Textile, whose 24 employees work in a chic loft office in Neihu, a high-technology hub in Taipei.

Hyperbola found its niche in designing high-performance outdoor clothing, like ski jackets and raincoats, and supplies brands like Canada Goose, Lululemon and Patagonia. It also produces fade-resistant outdoor cushions.

The company has no factory. Instead, it finds mills in Taiwan to make the fabrics.

Tina Wang, Hyperbola’s founder, said that although her clients made smaller orders in Taiwan than they would in China, they needed fabrics that could withstand harsh weather conditions and demanding environments, which Chinese mills often lack the technology to produce.

In 2011, Ms. Wang’s company and its partner mills produced 350 types of fabrics to satisfy that demand.

Article source: http://www.nytimes.com/2012/12/13/business/global/textile-makers-in-taiwan-create-a-high-tech-niche.html?partner=rss&emc=rss

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