Trade unions reach $2.3m settlement on Bangladesh textile factory safety

IndustriALL Global Union and UNI Global Union have reached a US$2.3 million settlement with a multinational apparel brand after it was accused of delays in remedying life-threatening hazards at its factories.

IndustriALL Global Union and UNI Global Union have reached a US$2.3 million settlement with a multinational apparel brand after it was accused of delays in remedying life-threatening hazards at its factories.

The settlement was agreed after a two-year arbitration process under the legally binding Bangladesh Accord for Fire and Building Safety. The accord was set up in the wake of the fatal collapse of the Rana Plaza textile factory complex in 2013.

The brand, which cannot be named under the terms of the settlement, has agreed to pay $2m to fix issues at more than 150 garment factories in Bangladesh. A further $300,000 will be paid to the two unions that brought the case, IndustriALL Global Union and UNI Global Union, to fund their joint “supply chain worker support fund”, an initiative that supports union-backed efforts to improve pay and conditions for workers in global supply chains.

Christy Hoffman, UNI Global Union’s deputy general secretary called the settlement “ground breaking”. “This proves the validity of the arbitration process. It’s a turning point for business and human rights,” she said.

IndustriALL’s general secretary, Valter Sanches, said: “This settlement shows that the Bangladesh Accord works. It is proof that legally binding mechanisms can hold multinational companies to account. We are glad that the brand in question is now taking seriously its responsibility for the safety of its supplier factories in Bangladesh. Their financial commitment serves as an example for other brands to follow.”

The case, heard at the permanent court of arbitration in The Hague, was brought after the unions complained that basic safety features at the factories, such as the presence of locked gates, structural faults and a lack of fire doors and sprinkler systems, had not been addressed despite pledges to the contrary.

 

This is the second arbitration case to be settled under the accord. In December 2017, IndustriALL and UNI reached another agreement with a brand using more than 200 factories in Bangladesh. However, that settlement was reached under an even tighter confidentiality agreement and even the amount of the settlement was kept under wraps.

A second Accord was signed in June 2017 It goes into effect when the original agreement expires in May 2018 and extends the Accord’s protections until 31 May 2021, unless a joint monitoring committee (comprised of Accord brand signatories, Accord trade union signatories, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), the International Labor Organization (ILO), and the Government of Bangladesh) unanimously agrees that a set of rigorous conditions for a handover to a national regulatory body have been met prior to then

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