Who is Responsible for Overseas Working Conditions?
Note: This article has been updated to correct the spelling of Johan Lubbe's name.
Two attorneysone representing the National Retail Federation and the other the AFL-CIOnot surprisingly took different stands Thursday on the responsibility of U.S. corporations for overseas working conditions in the aftermath of the Bangladesh garment factory collapse in April that killed 1,100 workers and injured another 1,500.
Labor problems in Bangladesh are complex, and There is no simple one-size-fits-all solution that will resolve the current systemic issues, said attorney Johan Lubbe in testimony [PDF] before a Senate Foreign Relations Committee hearing on labor issues in that country.
Lubbe, a shareholder at labor and employment law firm Littler Mendelson, advises various retail and apparel industry associations, including the National Retail Federation. The U.S. retail industry, he said, shares in the objective of preventing future workplace injuries and death.
But he quickly pointed a finger at the Bangladeshi government. A solution must address eradicating corruption, improving the quality of building construction, the location of factories, the issuing of building use permits, the enforcement of building and safety codes, [and] the ability of garment workers to raise concerns free of retaliation, Lubbe said.
He also urged flexibility for businesses to allow companies the ability to quickly deal with issues within their own supply chains. Specifically he said The Gap Inc. and Wal-Mart Stores Inc., which sell garments made in Bangladesh, have already taken several steps to improve working conditions and to work toward a long-term solution.
Lubbe called for a cooperative effort among all stakeholders, while criticizing a proposed fire- and building-safety accord that many European companies have already signed.
U.S. retailers cannot in good conscience sign the accord because the current language presents potentially unlimited legal liability given its vague and ambiguous terms, he testified.
Taking a different view was Celeste Drake, testifying on behalf of the American Federation of Labor and Congress of Industrial Organizations. A union trade specialist and lawyer, Drake said the government, factory owners, and international brands need to commit to enforceable standards for workplace safety and worker rights.
She stressed that international companies play a key role. The global fashion industry pays rates that, in effect, cause the very problems that plague Bangladeshs factories and their workers, Drake charged. Some factories may wish to do the right thing, but feel they cannot afford to do so and still remain competitive.
International brands are especially critical, she said, because they have the financial leverage to incentivize meaningful change.
Drake said U.S. companies need to sign the binding safety accord. She added that American brands PVH Corp. (parent company of Calvin Klein and Tommy Hilfiger), Sean John Clothing Inc., and Abercrombie & Fitch Co. have already signed.
Several U.S. government officials also testified at the Senate hearing. The transcripts are available here.
The European Union already has announced that it is considering trade action against Bangladesh to pressure the country to improve safety standards.