business-features
business-features

Number 1: Moral Hazard

Controversy erupted over tragedy and substandard working conditions, as labor once again became a major focus.

business-features/news
Bangladesh

The factory fire in Bangladesh spotlighted industry problems.

Photo By STRINGER/AFP/Getty Images

Appeared In
Special Issue
WWD Year In Fashion issue 12/10/2012

The most basic element of the fashion industry — where clothes are made — became one of the year’s most controversial issues, giving urgency to a moral question: What is a low price really worth if the hidden cost is in dangerous, often abusive and sometimes fatal labor conditions?

The industry’s century-old stigma of unsafe factory conditions reemerged as tragic fires struck several Asian plants, killing hundreds of workers.

Factory conditions were thought to have been on a steady rate of improvement with the advent of corporate social responsibility and monitoring programs throughout the industry. But in September, 101-year-old ghosts of New York’s Triangle Shirtwaist Fire emerged in Pakistan when 264 workers perished in an inferno at Ali Enterprises, a garment manufacturer in Karachi. The owners of the factory were charged with murder, attempted murder and criminal negligence for using illegal electrical connections. While the factory was burning in Karachi, 25 people died in Lahore in a blaze at a shoe factory.


RELATED STORY: Number 2: I'ts the Economy, Still >>

 

The tragedies brought to the forefront the poor working conditions that prevail in many apparel factories throughout the developing world, from Pakistan and Bangladesh to China and Cambodia, despite concerted efforts by apparel brands and organizations to improve conditions. They also fanned public outrage at the callousness of the factory owners and lax enforcement of safety standards by the Pakistani government.

Officials blamed the large number of casualties on the factory having no emergency doors or stairways, with most of the people suffocating in a locked, smoke-filled basement. Fire trucks and cranes could not easily gain access to the building. Because of thefts, the owners had all exits locked and there were bars on the windows, trapping 600 men and women inside. To escape the fire that raged for 15 hours, workers threw sewing machines at the windows, tried to squeeze between the bars and leapt from second and third floors, causing broken bones and other injuries.

The International Labor Organization called for Pakistan to take concrete steps to improve safety standards in the country, noting that the fires highlight the lack of workplace-safety measures. Seiji Machida, head of ILO’s SafeWork Program, said, “Protection of workers’ safety and health is a fundamental human right. We need to reinforce measures to protect workers’ lives from hazards in the workplace.”

Clean Clothes Campaign international coordinator Ineke Zeldenrust said at the time, “These deaths could and should have been avoided. Emergency exits were absent or locked, and workers were trapped. This is the usual pattern. It is well known that many workplaces are unsafe, and that workers in key producing countries risk their lives on a daily basis producing clothes for Europe and the USA.”

CCC said what’s most important is that governments and companies ensure that workers can freely organize and speak out when safety regulations are ignored.

Then came the news in neighboring Bangladesh last month that 111 workers died in a fire at a garment factory in Dhaka. Three officials from Tazreen Fashions Ltd. were arrested after an investigation found they had padlocked all the collapsible gates and provided wrong information to the workers when the fire broke out.

Again, there was an outcry from international watchdog groups and protests in the streets for Western companies and the government to improve factory conditions. Wal-Mart Stores Inc. immediately terminated the relationship with a supplier that subcontracted work to Tazreen because it was a direct violation of the retailer’s policies. The retail giant also pledged to help improve fire safety education and training in Bangladesh. Li & Fung Ltd. and German mass retailer C&A acknowledged having orders pending with the factory when the fire occurred. Li & Fung said it will compensate victims’ families and set up an education fund for their children.

U.S. and international labor and human rights groups sent a letter to U.S. Labor Secretary Hilda Solis and European government labor officials calling on them to press companies to sign onto a “memorandum of understanding” with a group of nongovernmental organizations and international and Bangladeshi trade unions, known as the “Bangladesh Fire and Building Safety Agreement.” The pact is focused on bringing together the government and brand owners and retailers to create a safe and sustainable work environment. PVH Corp. and German retailer Tchibo have signed onto the agreement, but it will not take effect until a certain number of companies have signed it.

Kevin Burke, chief executive officer of the American Apparel & Footwear Association, said the AAFA had a seminar on workplace safety last week in Dhaka that was attended by more than 400 people from the Bangladesh industry. Burke said the operators in Bangladesh were accepting responsibility for the tragedy and were committed to improving conditions to ensure nothing similar happens again.

“There is no excuse for such a tragedy to occur,” he said. “Worker safety is a priority of the AAFA and we feel workers should be treated with respect. If this isn’t a wake-up call for the industry, I don’t know what is. There are a lot of great places and factories in the world to make goods, and if the owners in Bangladesh or Pakistan or elsewhere want to be players, they have to make sure they run safe facilities. There is just no room for incidents like this in our industry.”

In recent years, Chinese officials said the country’s workplace fatalities have declined. But only last week, a Chinese man set fire to the Shantou garment factory in Guangdong where he once worked, killing 14. Liu Shuangyun apparently was angry he hadn’t been paid $500 in wages from over a year ago.

Workplace fatalities in China remain higher than anywhere else, with nearly 90,000 people killed on the job, across various industries, and almost 400,000 injured at work in 2010, according to the government’s official labor statistics. Annual figures have not been published for 2011, but there have been no significant reforms or advances in workplace safety.

“There are not enough personnel or resources for local government to make sure all the factories are up to code,” said Geoffrey Crothall, communications director for China Labour Bulletin, a Hong Kong-based labor rights organization. “There are simply far too many factories and far too few government staff to get the job done.”

load comments

ADD A COMMENT

Sign in using your Facebook or Twitter account, or simply type your comment below as a guest by entering your email and name. Your email address will not be shared. Please note that WWD reserves the right to remove profane, distasteful or otherwise inappropriate language.
News from WWD
Newsletters

Sign upSign up for WWD and FN newsletters to receive daily headlines, breaking news alerts and weekly industry wrap-ups.

LatestPublications
getIsArchiveOnly= hasAccess=false hasArchiveAccess=false