On April 24, 2013, the Rana Plaza factory collapse claimed the lives of 1,137 garment workers in Bangladesh and injured thousands more. The tragedy, which was the deadliest disaster in a manufacturing facility in human history, put a spotlight on the grossly unsafe labor conditions plaguing Bangladesh’s garment sector and catalyzed fundamental reform.
The international attention and public outrage following the catastrophe forced brands to agree to sign the historic Accord on Building and Fire Safety in Bangladesh, a legally-binding agreement between unions and global apparel brands that obligates the corporations at the top of supply chains to prioritize safe labor conditions for the garment workers producing their clothes. Since its inception in 2013, the Accord’s program of independent inspections and mandatory safety renovations has resulted in sweeping improvements in safety conditions and saved countless lives in the Bangladesh garment industry.
On the seventh anniversary of the Rana Plaza tragedy, the well-being of millions of garment worker is again at grave risk. With demand for apparel plummeting as a result of the public health response to the coronavirus pandemic, brands and retailers have abruptly halted production and canceled orders across their supply chains. Many brands are refusing to pay for apparel that suppliers have already produced for them: in a survey of Bangladesh garment factories conducted by the WRC and Penn State’s Center for Global Workers’ Rights, 52 percent reported having most or all of their completed orders cancelled, leaving them unable to recoup their costs and pay workers.
Brands and retailers’ responses to the pandemic have had a devastating impact on the global garment workforce. Millions of workers have been suspended or terminated with little or no compensation. In the absence of robust social security protections, millions of workers risk economic destitution and will inevitably lack access to food supplies, water and sanitation, and healthcare. Informal, home-based, and migrant workers are especially vulnerable to the economic ravages of the pandemic.
The building safety crisis in Bangladesh and the economic catastrophe wrought by the Covid-19 pandemic were both made worse by a flawed supply chain model that both reflects and amplifies drastic inequities of wealth and power between global apparel brands on the one hand and supplier factories and workers on the other. Brands and retailers’ market power allows them to dictate how profits are made and distributed along their supply chains and the result has been an ever-smaller share for suppliers. This squeeze on suppliers has meant unsafe practices, poverty wages, and non-payment of benefits, including compensation due to workers when they lose their jobs.
A glaring example of the inequities in apparel supply chains and the way they are worsening the present crisis are the terms of payment between buyers and suppliers. It is suppliers that must cover all the up-front cost of apparel production, from buying the fabric to paying workers to sew the garments. Brands don’t pay a penny until weeks or months after they receive the finished goods. In effect, suppliers with a tiny fraction of the financial resources their customers possess are required to subsidize their customers’ cash flow.
Brands and retailers are now taking advantage of these skewed payment terms to protect their own bottom line at suppliers’ expense, by refusing to pay for goods that are in production or are already completed and ready ship, or by demanding large retroactive discounts as a condition of paying anything at all. Suppliers are, predictably, responding by firing workers, often without compensation.
In response to garment union protests in Bangladesh, Cambodia, and elsewhere, and in the face of growing media scrutiny, a number of brands and retailers have recently reversed course and committed to pay in full for all apparel orders already in production or completed, greatly reducing harm to suppliers and workers. Many have yet to follow suit, but the pressure is mounting.
In the near term, it is imperative that buyers honor their obligations to suppliers and workers and pay for the products they asked those suppliers and workers to make. Beyond the immediate crisis, fundamental reform to address the deep inequities of the existing supply chain model are a prerequisite for the living wages, safe conditions, and basic economic security every worker deserves.
Photo: A relative holds a picture of a missing garment worker, who was working in the Rana Plaza building when it collapsed. Weronika (CC BY 2.0)