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Safety First?

Competing worker safety programs in the United States and Europe show employers are finally getting serious about changing unsafe workplaces.

Wednesday, July 31, 2013
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When a group of 17 large North American retailers, including Wal-Mart, The Gap, Target and Macy’s, unveiled a joint plan to boost Bangladesh factory safety on July 10, it drew a mixed global response.

But according to some in the HR world, it at least signals the start of trying to get working conditions much safer in that specific country and beyond. The retail group, known as the Alliance for Bangladesh Worker Safety, began to coalesce soon after 1,129 workers were killed this past April when a Bangladeshi garment plant collapsed. In November 2012, 112 people died in a Bangladeshi factory fire.

The five-year plan, the Bangladesh Worker Safety Initiative, which expects to raise $42 million total for Bangladeshi worker safety though member donations (depending on the size of the organization), includes inspections of 500 Bangladeshi factories within the year and a hot line for workers to anonymously report any doubts about workplace safety. Also, the plan promises at least $100 million in loans and other financing to help Bangladeshi factory owners address safety issues.

According to the plan details, retailers expect to create a uniform safety standard for the Bangladesh factories by October, as well as build a clearinghouse to share data among members listing factories that have been approved for production as well as those that require further safety improvements.

A competing plan launched in Europe, which has input from labor organizations (the North American plan does not) and has 70 members – including some U.S. companies -- takes direct responsibility for safety violations by ensuring that there is money to remedy serious fire and building safety problems in Bangladeshi factories. Under the North American plan, however, owners are responsible for their own workplace safety improvements using the loans, but get no direct financial support from the American companies. As part of the ABWS plan, Bangladesh factories that do not comply eventually will lose their business with the ABWS members.

Controversies on plan design and strategies aside, the Washington-based HR Policy Association, which represents the chief human resource officers of 350 major U.S. employers, praised the launch of the Bangladesh Worker Safety Initiative.

“The Bangladesh Worker Safety Initiative demonstrates the serious commitment to worker safety of the U.S. employers in Bangladesh,” says HRPA President and General Counsel Daniel Yager. “We are impressed that they were able to unite so quickly to take decisive action as an industry.”

Yager mentions the fact that the initiative was developed with guidance from former U.S. senators George Mitchell and Olympia Snowe of the Bipartisan Policy Center. He explains that the provisions of the initiative include: developing common safety standards within the next three months, creating a common training program curriculum, ensuring on-going mandatory training and education for factory managers and workers, and inspecting 100 percent of member factories within the first year.

“I believe the North American plan reflects most recent example of the vulnerability global companies face in regions where local protections are not as strong for their workforces as everyone would like to see,” Yager adds. “The challenge is there is only so much the companies can do. They are willing to address the situation, but at the end of the day if the country itself can’t provide protection, it will raise serious questions about the ability to do business there."

Yager says that both the North American and European efforts are important not just in Bangladesh, but in other countries where worker safety continues to be a serious issue.

“Labor safety laws are a work in progress in many countries and regions,” he says. “But worker safety can’t be ignored and companies are stepping up their game. With these initiatives, progress is being made.”

Frank White, director of Mercer’s Health & Safety Networks in Washington, says it was just a matter of time before these types of alliances became reality.

“The North American plan or something like it was inevitable, and not just in Bangladesh but in other coutries as well,” he says. “The loss of lives and poor working conditions demand some real action and response, a collective enterprise to address these real issues through a variety of mechanisms.”

While Mercer does not work directly with many clients in this sector, White, who has worked with OSHA in the past, says that for any plan to succeed, some basic elements must be considered. One is whether or not a plan is enforceable. Another is a clear protocol or process for plant inspections.

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“It’s important how inspections will be done,” he says. “Do you give them 10 days' notice or is there some opportunity for surprise inspections?”

Most of all, he says, all parties involved must understand the guidelines and expectations.

“Once you identify safety issues and point them out, then you have to follow up and make sure they are fixed,” he says. “It must be clear that both participating companies in the alliance and the factory owners are held accountable.”

In the end, he says, it’s really up to the company using the overseas factories to ensure a supplier is protecting its workers, which, he adds, is not always easy to do. White adds the involvement of former senators Mitchell and Snowe does add a dose of credibility to the North America alliance effort.

“That makes it more high profile than it might otherwise be,” he says. “I am sure those two folks will make sure there is some follow up because if this ends up not working, they put their names on it.”

Phillip Wilson, president of the Oklahoma-based Labor Relations Institute, a labor-relations consulting firm, says it’s critical for HR leaders to make sure that labor practices are front and center in discussions about their company’s supply chain, especially when it involves potential international sourcing.

“American companies need to be concerned about the safety of what's happening in their supply chain,” he says. “In today's interconnected world, events that happen across the globe can have far-reaching consequences at home.”

“There are two strong plans created to improve working conditions in factories – the Bangladesh Worker Safety Initiative that we are announcing today, and the plan created by stakeholders in the EU,” Jay Jorgensen, senior vice president and global chief compliance officer at WalMart, said in a statement about the initiatives.

“The next step is for all of us to work together," he said, "in collaboration with government, factory owners and NGOs, to increase safety and improve the quality of life of the women and men in our supply chains whom we depend on to make our products. Our progress against these plans is essential, and we look forward to making progress together.”

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