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(c) 2014 Jon L Gelman, All Rights Reserved.

Monday, May 20, 2013

The International Call for Fashion Safety - Accord on Fire and Building Safety in Bangladesh


MAY 13, 2013 
Accord on Fire and Building Safety in Bangladesh

The undersigned parties are committed to the goal of a safe and sustainable Bangladeshi ReadyMade Garment ("RMG") industry in which no worker needs to fear fires, building collapses, or 
other accidents that could be prevented with reasonable health and safety measures. 
The signatories to this Agreement agree to establish a fire and building safety program in 
Bangladesh for a period of five years. 

The programme will build on the National Action Plan on Fire Safety (NAP), which expressly 
welcomes the development and implementation by any stakeholder of any other activities that 
would constitute a meaningful contribution to improving fire safety in Bangladesh. The 
signatories commit to align this programme and its activities with the NAP and to ensure a close 
collaboration, including for example by establishing common programme, liaison and advisory 
structures.

The signatories also welcome a strong role for the International Labour Organization (ILO), 
through the Bangladesh office as well as through international programmes, to ensure that both 
the National Action Plan, and the programme foreseen by the signatories of this Agreement, get 
implemented. 

The signatories shall develop and agree an Implementation Plan within 45 days of signing this 
Agreement. The nongovernmental organisations which are signatories to the Joint Memorandum 
of Understanding on Fire and Building Safety (dated March 15, 2012), having stated their 
intention to support the implementation of this programme, shall, at their own election, be signed 
witnesses to this Agreement. 

This Agreement commits the signatories to finance and implement a programme that will take 
cognizance of the Practical Activities described in the NAP involving, at minimum, the following 
elements:

SCOPE: The agreement covers all suppliers producing products for the signatory companies. 
The signatories shall designate these suppliers as falling into the following categories, according 
to which they shall require these supplier to accept inspections and implement remediation 
measures in their factories according to the following breakdown: 

1. Safety inspections, remediation and fire safety training at facilities representing, in the 
aggregate, not less than 30%, approximately, of each signatory company’s annual 
production in Bangladesh by volume (“Tier 1 factories”).

2. Inspection and remediation at any remaining major or long-term suppliers to each 
company (“Tier 2 factories”). Together, Tier 1 and Tier 2 factories shall represent not less 
than 65%, approximately, of each signatory company’s production in Bangladesh by 
volume. 

3. Limited initial inspections to identify high risks at facilities with occasional orders, onetime orders or those for which a company’s orders represent less than 10% of the MAY 13, 2013 
factory’s production in Bangladesh by volume (“Tier 3 factories”). Nothing in this 
paragraph shall be deemed to alleviate the obligation of each signatory company to 
ensure that those factories it designates as Tier 3 represent, in the aggregate, no more than 
35%, approximately, of its production in Bangladesh by volume. Facilities determined, as 
a result of initial inspection, to be high risk shall be subject to the same treatment as if 
they were Tier 2 factories. 

GOVERNANCE:

4. The signatories shall appoint a Steering Committee (SC) with equal representation 
chosen by the trade union signatories and company signatories (maximum 3 seats each) 
and a representative from and chosen by the International Labour Organization (ILO) as a 
neutral chair. The SC shall have responsibility for the selection, contracting, 
compensation and review of the performance of a Safety Inspector and a Training 
Coordinator; oversight and approval of the programme budget; oversight of financial 
reporting and hiring of auditors; and such other management duties as may be required. 
The SC will strive to reach decision by consensus, but, in the absence of consensus, 
decisions will be made by majority vote. In order to develop the activity of the SC, a 
Governance regulation will be developed. 

5. Dispute resolution. Any dispute between the parties to, and arising under, the terms of 
this Agreement shall first be presented to and decided by the SC, which shall decide the 
dispute by majority vote of the SC within a maximum of 21 days of a petition being filed by 
one of the parties. Upon request of either party, the decision of the SC may be appealed to 
a final and binding arbitration process. Any arbitration award shall be enforceable in a 
court of law of the domicile of the signatory against whom enforcement is sought and 
shall be subject to The Convention on the Recognition and Enforcement of Foreign 
Arbitral Awards (The New York Convention), where applicable. The process for binding 
arbitration, including, but not limited to, the allocation of costs relating to any arbitration 
and the process for selection of the Arbitrator, shall be governed by the UNCITRAL 
Model Law on International Commercial Arbitration 1985 (with amendments as adopted 
in 2006). 

6. The signatories shall appoint an Advisory Board involving brands and retailers, suppliers, 
government institutions, trade unions, and NGOs. . The advisory board will ensure all 
stakeholders, local and international, can engage in constructive dialogue with each other 
and provide feedback and input to the SC, thereby enhancing quality, efficiency, 
credibility and synergy. The SC will consult the parties to the NAP to determine the 
feasibility of a shared advisory structure. 

7. Administration and management of the programme will be developed by the SC in 
consultation with the 'High-Level Tripartite Committee' established to implement and 
oversee the National Action Plan on Fire Safety, as well as with the Ministry of Labour 
and Employment of Bangladesh (MoLE), the ILO and the Deutsche Gesellschaft für 
Internationale Zusammenarbeit GmbH (GIZ), to maximize synergy at operational level; 
and the SC may make use of the offices of GIZ for administrative coordination and 
support.

CREDIBLE INSPECTIONS:

8. A qualified Safety Inspector, with fire and building safety expertise and impeccable 
credentials, and who is independent of and not concurrently employed by companies, 
trade unions or factories, shall be appointed by the SC. Providing the Chief Inspector acts 
in a manner consistent with his or her mandate under the provisions of this Agreement, 
and unless there is clear evidence of malfeasance or incompetence on his or her part, the 
SC shall not restrict or otherwise interfere with the Chief Inspector’s performance of the 
duties set forth in the Agreement as he or she sees fit, including the scheduling of 
inspections and the publishing of reports.

9. Thorough and credible safety inspections of Tier 1, 2 and 3 factories shall be carried out 
by skilled personnel selected by and acting under the direction of the Safety Inspector, 
based on internationally recognized workplace safety standards and/or national standards 
(once the review foreseen under the NAP is completed in June 2013). The Safety 
Inspector shall make all reasonable efforts to ensure that an initial inspection of each 
factory covered by this Agreement shall be carried out within the first two years of the 
term of this Agreement. The Safety Inspector will be available to provide input into the 
NAP legislative review and to support capacity building work regarding inspections by 
the MoLE foreseen under the NAP. 

10. Where a signatory company’s inspection programme, in the opinion of the Safety 
Inspector, meets or exceeds the standards of thorough and credible inspections, as defined 
by the Safety Inspector, it will be considered an integral part of the programme activities 
set forth in this Agreement. Signatory companies wishing to have their inspection 
programme so considered shall provide the Safety Inspector full access to the findings of 
their inspections and he or she will integrate these into reporting and remediation 
activities. Notwithstanding this provision, all factories within the scope of this Agreement 
shall still be subject to all the provisions of this Agreement, including but not limited to a 
least one safety inspection carried out by personnel acting under the direction of the 
Safety Inspector. 

11. Written Inspection Reports of all factories inspected under the programme shall be 
prepared by the Safety Inspector within two (2) weeks of the date of inspection and 
shared upon completion with factory management, the factory’s health and safety 
committee, worker representatives (where one or more unions are present), signatory 
companies and the SC. Where, in the opinion of the Safety Inspector, there is not a 
functioning health and safety committee at the factory, the report will be shared with the 
unions which are the signatories to this Agreement. Within a timeline agreed by the SC, 
but no greater than six weeks, the Safety Inspector shall disclose the Inspection Report to 
the public, accompanied by the factory’s remediation plan, if any. In the event that, in 
the opinion of the Safety Inspector, the inspection identifies a severe and imminent 
danger to worker safety, he or she shall immediately inform factory management, the 
factory’s health and safety committee, worker representatives (where one or more unions 
are present), the Steering Committee and unions which are signatories to this Agreement, 
and direct a remediation plan.

REMEDIATION:
12. 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 1, 2, or 3 supplier, shall 
require that factory to implement these corrective actions, according to a schedule that is 
mandatory and time-bound, with sufficient time allotted for all major renovations.
13. Signatory companies shall require their supplier factories that are inspected under the 
Program to maintain workers’ employment relationship and regular income during any 
period that a factory (or portion of a factory) is closed for renovations necessary to 
complete such Corrective Actions for a period of no longer than six months. . Failure to 
do so may trigger a notice, warning and ultimately termination of the business 
relationship as described in paragraph 21. 

14. Signatory companies shall make reasonable efforts to ensure that any workers whose 
employment is terminated as a result of any loss of orders at a factory are offered 
employment with safe suppliers, if necessary by actively working with other suppliers to 
provide hiring preferences to these workers.

15. Signatory companies shall require their supplier factories to respect the right of a worker 
to refuse work that he or she has reasonable justification to believe is unsafe, without 
suffering discrimination or loss of pay, including the right to refuse to enter or to remain 
inside a building that he or she has reasonable justification to believe is unsafe for 
occupation. 

TRAINING:
16. The Training Coordinator appointed by the SC shall establish an extensive fire and building 
safety training program. The training program shall be delivered by a selected skilled 
personnel by the Training Coordinator at Tier 1 facilities for workers, managers and 
security staff to be delivered with involvement of trade unions and specialized local 
experts. These training programmes shall cover basic safety procedures and precautions, 
as well as enable workers to voice concerns and actively participate in activities to ensure 
their own safety. Signatory companies shall require their suppliers to provide access to 
their factories to training teams designated by the Training Coordinator that include 
safety training experts as well as qualified union representatives to provide safety training 
to workers and management on a regular basis. 

17. Health and Safety Committees shall be required by the signatory companies in all 
Bangladesh factories that supply them, which shall function in accordance with 
Bangladeshi law, and be comprised of workers and managers from the applicable factory. 
Worker members shall comprise no less than 50% of the committee and shall be chosen 
by the factory’s trade union, if present, and by democratic election among the workers 
where there is no trade union present.

COMPLAINTS PROCESS:
18. The Safety Inspector shall establish a worker complaint process and mechanism that 
ensures that workers from factories supplying signatory companies can raise in a timely 
fashion concerns about health and safety risks, safely and confidentially, with the Safety 
Inspector. This should be aligned with the Hotline to be established under the NAP. 

TRANSPARENCY AND REPORTING:
19. The SC shall make publicly available and regularly update information on key aspects of 
the programme, including:

a. a single aggregated list of all suppliers in Bangladesh (including sub-contractors) 
used by the signatory companies, based on data which shall be provided to the SC 
and regularly updated by each of the signatory companies, and which shall 
indicate which factories on this list have been designated by that company as Tier 
1 factories and which have been designated by that company as Tier 2 factories, 
however volume data and information linking specific companies to specific 
factories will be kept confidential, 

b. Written Inspection Reports, which shall be developed by the Safety Inspector for 
all factories inspected under this programme, shall be disclosed to interested 
parties and the public as set forth in paragraph 11 of this Agreement. 
Public statements by the Safety Inspector identifying any factory that is not acting 
expeditiously to implement remedial recommendations. 

c. Quarterly Aggregate Reports that summarize both aggregated industry 
compliance data as well as a detailed review of findings, remedial 
recommendations, and progress on remediation to date for all factories at which 
inspections have been completed.

20. The signatories to this Agreement shall work together with other organizations such as ILO 
and the High-Level Tripartite Committee and the Bangladeshi Government to encourage 
the establishment of a protocol seeking to ensure that suppliers which participate fully in 
the inspection and remediation activities of this Agreement shall not be penalised as a 
result of the transparency provisions of this Agreement. The objectives of the protocol 
are to (i) support and motivate the employer to take remediation efforts in the interest of 
the workforce and the sector and (ii) expedite prompt legal action where the supplier 
refuses to undertake the remedial action required to become compliant with national law. 

SUPPLIER INCENTIVES: 
21. Each signatory company shall require that its suppliers in Bangladesh participate fully in 
the inspection, remediation, health and safety and, where applicable, training activities, as 
described in the Agreement. If a supplier fails to do so, the signatory will promptly
implement a notice and warning process leading to termination of the business 
relationship if these efforts do not succeed. 

22. In order to induce Tier 1 and Tier 2 factories to comply with upgrade and remediation 
requirements of the program, 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. 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. 

23. Signatory companies to this agreement are committed to maintaining long-term sourcing 
relationships with Bangladesh, as is demonstrated by their commitment to this five-year 
programme. Signatory companies shall continue business at order volumes comparable to or 
greater than those that existed in the year preceding the inception of this Agreement with Tier 1 
and Tier 2 factories at least through the first two years of the term of this Agreement, provided 
that (a) such business is commercially viable for each company and (b) the factory continues to 
substantially meet the company’s terms and comply with the company’s requirements of its 
supplier factories under this agreement. 

FINANCIAL SUPPORT:
24. In addition to their obligations pursuant to this Agreement, signatory companies shall 
also assume responsibility for funding the activities of the SC, Safety Inspector and 
Training Coordinator as set forth in this Agreement, with each company contributing its 
equitable share of the funding in accordance with a formula to be established in the 
Implementation Plan. The SC shall be empowered to seek contributions from 
governmental and other donors to contribute to costs. Each signatory company shall 
contribute funding for these activities in proportion to the annual volume of each 
company’s garment production in Bangladesh relative to the respective annual volumes 
of garment production of the other signatory companies, subject to a maximum 
contribution of $500,000 per year for each year of the term of this Agreement. A sliding 
scale of minimum contributions based on factors such as revenues and annual volume in 
Bangladesh will be defined in the Implementation Plan with annual revisions, while 
ensuring sufficient funding for the adequate implementation of the Accord and the Plan. 

25. The SC shall ensure that there are credible, robust, and transparent procedures for the 
accounting and oversight of all contributed funds.

See also: 

Public Outrage Over Factory Conditions Spurs Labor Deal (NY Times) 

......................................

UNI Global Press Release

Politicians on both sides of the Atlantic are waking up to the fact they must take an initiative on Bangladesh garment factory safety.
Global commerce union leaders are urging all governments to commit to the Accord on Fire and Building Safety and push for its speedy implementation. 

The Netherlands Government has called on Dutch retailers to sign the Accord and discussed financial support to improve conditions for the Bangladeshi garment industry. Other European governments, notably France, Denmark and Norway have also shown support. In the U.S. a group of leading Senators has written to retail CEOs who have not signed up, including Walmart and Gap, urging them to reconsider.

The legally binding Accord, driven by IndustriALL and UNI Global Union and the NGOs, the Clean Clothes Campaign and the Worker Rights Consortium, has a critical mass of support from leading retailers around the world with more than 35 brands confirmed:

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, John Lewis, Charles Vögele, V&D, Otto Group, s.Oliver, Bonmarche, HEMA, Comtex.

UNI Global Union General Secretary, Philip Jennings said, “There can be no excuses from the retail sector for not signing up to the Accord, when Walmart alone spends $2.5 billion per year on advertising and Gap $653 million.” 

The trade unions committed to take the message back to their home governments to insist the retail sector backs the deal and that grass root members of parliament mobilise to support it.

Union leaders said it was time for governments to step up.

Per Tønnesen, President of the Danish union HK HANDEL said, “We welcome the fact that the Danish Trade Minister has raised the Bangladesh Factory Safety deal and shown support. This is an important step to convince Danish brands to sign the Accord. All Danish retail companies must be urged to support the Accord. HK HANDEL is looking forward to playing its part in rolling out the implementation plan and the governments should be on-board.” 

John Hannett, General Secretary of USDAW in the UK and President of UNI Europa Commerce said, “The British Government must get behind the Bangladeshi Safety deal but so must politicians of every political persuasion. The big UK retailers have shown their support for the Accord and now it’s up to the politicians to help convince those who have not yet signed. The French Commerce Minister has called on companies, unions and NGOs to come together to discuss concrete steps to improve factory safety in Bangladesh and the Dutch have made their position clear and are considering financial support – the UK must not drag its heels.” 

Michael Bride, of the United Food and Commercial Workers Union of North America said, "We applaud the group of eight U.S. Senators, led by Sherrod Brown, Tom Harkin and Dick Durbin, for calling on those brands yet to sign the Accord to reconsider. U.S. corporations should understand that their efforts to excuse themselves from human rights obligations which companies elsewhere have signed up to will be neither easily forgotten nor forgiven. The U.S. Government has a responsibility to ensure that companies located in its jurisdiction are not permitted to adhere to a lesser standard on human rights and safety than companies in the rest of the world."

The shoe factory collapse in Cambodia earlier this week has underlined that factory safety is not an issue confined to Bangladesh and that such an agreement is vital for the whole retail industry.