United States 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 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. 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.

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