Change slowly coming to Bangladesh garment industry one year after disaster

As we approach the first anniversary of the the Rana Plaza building collapse, the deadliest industrial accident since the 1984 Bhopal disaster, it's worth asking if anything has changed much in Bangladesh's garment industry.

The apparent answer is 'maybe.'

On April 24, 2013, the eight-storey building housing a number of clothing factories in the Dhaka suburb of Savar crumbled into a pile of concrete and steel rubble, killing more than 1,100 workers and injuring 2,500 more.

The output from Rana Plaza was destined mostly for western clothing stores and the disaster exposed the the appalling conditions that low-paid garment workers endure so we can buy shirts, pants and dresses at rock-bottom prices.

The world subsequently learned employees were ordered to continue working in the building the day after dangerous cracks began appearing in the shoddily constructed building. Shops and a bank on the ground floor closed.

But conditions in Bangladesh's garment and textile industry, its main source of export revenue, were hardly a secret.

A 2012 fire at a Dhaka clothing factory that supplied Walmart killed more than a hundred people. The nine-storey building had no fire exits. The building's owners, as well as managers and security guards who allegedly kept workers at their machines after the fire started, have been charged with homicide.

Another garment-factory fire last October claimed at least 10 lives, CBC News reported.

One of the biggest clients was Canadian retailer Joe Fresh, a division of the Loblaw empire. Other clients included Walmart, Benetton and Bonmarche.

[ Related: Joe Fresh vows to improve conditions amid calls for boycott ]

In the wake of Rana Plaza, outraged Canadians mounted a boycott of Joe Fresh products. Loblaw Co. was among first to offer compensation to workers injured in the collapse and families of the dead. It's apparently the only one so far to sign a binding agreement to ensure factories it uses receive regular fire safety and structural inspections, according to CBC's public affairs program the fifth estate.

But it's also reportedly expanding its production in Bangladesh as it opens more than 100 new Joe Fresh stores around the world, the fifth estate says in a segment to be broadcast Friday evening.

A Bangladeshi official told the program Loblaw told him production had doubled since the Rana Plaza disaster. Loblaw didn't confirm the size of its expansion but said it had no plans to reduce its business there.

“We continue to believe that the economy and manufacturing communities of Bangladesh benefit from our presence, attention and long-term commitment,” a company spokesperson told the fifth estate via email.

Critics of Bangladesh's garment sector say the disaster has spurred changes, prompted by pressure from western countries and some of the retailers concerned about the tarnish of their brands being linked to the Dickensian industry.

PBS Newshour reported recently that Bangladesh's government has increased the minimum wage and passed legislation to allow unions to organize factories and reach collective agreements. The U.N International Labour Organization has also become involved.

But new rules and regulations have not been a panacea, Newshour noted. Workers have been fired for union activity and wages still fall short of providing a decent livelihood.

[ Related: Primark, Loblaw pay out to Bangladesh factory victims ]

The bottom line still rules, owners of the country's more than 5,500 garment factories say. They're expected to pay for improvements but retailers still expect them to produce goods at the same low, low cost.

“The buyer says if you can’t give it (to us) for our price, we’ll go somewhere else,” Shabbir Mahmood, who owns two factories, told Newshour.

Officials have been slow to conduct the inspections promised in the wake of Rana Plaza, CBS News reported last month. The first ten of a planned 1,500 inspections turned up locked fire exits, exposed electrical cables chewed by rats and overloaded ceilings.

One company laid off 3,500 workers after inspectors said they found serious structural problems at the factory, CBS News said.

A labour-rights activist told the fifth estate that while Loblaw's actions have provided short-term fixes, the company's overall business model is still to make clothing as cheaply and quickly as possible.

“I think what they have done is positive, but . . . everybody needs to sign the (safety) accord," said Bob Jeffcott of the Maquila Solidarity Network.

"They were at the table early on for negotiation of this (compensation) trust fund. So they participated from the beginning on that. Whether this is fundamentally changed how they do business or not is yet to be seen.”

The fifth estate said it learned Loblaw recently hired one person to oversee its operations in the country. Previously it had no one to monitor operations and check on the factories it uses.

CBS News said western retailers avoid getting too involved in monitoring factories they contract work to, in case they're labelled "joint employers" and found legally liable for dangerous conditions.

Consumers should perhaps be willing to pay more for that T-shirt or those blue jeans if it means the person who made them can collect a living wage and work in safe conditions. But CBS News notes labour cost makes up only a small fraction of the retail price of a garment.

Maclean's reported a 2011 report by the consulting firm O'Rourke Group Partners found a $14 Polo shirt made in Bangladesh costs the retailer only $5.67. The labour component is just 12 cents or two per cent of the wholesale cost.

The largest component of the wholesale price – 65 per cent – is the cost of fabric and trimmings.

The retailer enjoys a markup of about 60 per cent.

Raising workers' wages 10 times would raise the price of a shirt by one dollar and making all of Bangladesh's factories safe would cost about 30 cents per garment, CBS News said.

Something to think about the next time you go shopping.