[Senate Hearing 113-597]
[From the U.S. Government Publishing Office]





                                                        S. Hrg. 113-597

     PROSPECTS FOR DEMOCRATIC RECONCILIATION AND WORKERS RIGHTS IN 
                               BANGLADESH

=======================================================================

                                HEARING

                               BEFORE THE



                     COMMITTEE ON FOREIGN RELATIONS
                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                           FEBURARY 11, 2014

                               __________

       Printed for the use of the Committee on Foreign Relations



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                COMMITTEE ON FOREIGN RELATIONS         

             ROBERT MENENDEZ, New Jersey, Chairman        
BARBARA BOXER, California            BOB CORKER, Tennessee
BENJAMIN L. CARDIN, Maryland         JAMES E. RISCH, Idaho
JEANNE SHAHEEN, New Hampshire        MARCO RUBIO, Florida
CHRISTOPHER A. COONS, Delaware       RON JOHNSON, Wisconsin
RICHARD J. DURBIN, Illinois          JEFF FLAKE, Arizona
TOM UDALL, New Mexico                JOHN McCAIN, Arizona
CHRISTOPHER MURPHY, Connecticut      JOHN BARRASSO, Wyoming
TIM KAINE, Virginia                  RAND PAUL, Kentucky
EDWARD J. MARKEY, Massachusetts
               Daniel E. O'Brien, Staff Director        
        Lester E. Munson III, Republican Staff Director        

                              (ii)        

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
                            C O N T E N T S

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                                                                   Page

Akter, Kalpona, executive director, Bangladesh Center for Worker 
  Solidarity, Dhaka, Bangladesh..................................    46
    Prepared statement...........................................    48
Biel, Eric, Acting Associate Deputy Under Secretary for 
  International Affairs, U.S. Department of Labor, Washington, DC     7
    Prepared statement...........................................     9
Biswal, Hon. Nisha Desai, Assistant Secretary of State for South 
  and Central Asian Affairs, U.S. Department of State, 
  Washington, DC.................................................     3
    Prepared statement...........................................     4
    Response of Assistant Secretary Nisha Biswal to Question 
      Submitted by Senator Robert Menendez.......................    60
    Responses of Assistant Secretary Nisha Biswal to Questions 
      Submitted by Senator Edward J. Markey......................    61
Karesh, Lewis, Assistant U.S. Trade Representative for Labor, 
  Office of the U.S. Trade Representative, Washington, DC........    11
    Prepared statement...........................................    13
Menendez, Hon. Robert, U.S. Senator from New Jersey..............     1
Nova, Scott, executive director, Worker Rights Consortium, 
  witness signatory to the Accord on Fire and Building Safety in 
  Bangladesh, Washington, DC.....................................    37
    Prepared statement...........................................    39
Tauscher, Hon. Ellen, chairman of the board of directors, 
  Alliance for Bangladesh Worker Safety, Washington, DC..........    31
    Prepared statement...........................................    33
    Response of Hon. Ellen Tauscher to Question Submitted by 
      Senator Edward J. Markey...................................    62
    Responses of Hon. Ellen Tauscher to Questions Submitted by 
      Senator James E. Risch.....................................    62

                   Additional Material for the Record

The following individuals and organizations submitted material 
  for this hearing:


Reba Sikder, former garment worker at Ether Tex factory at Rana 
  Plaza, Dhaka, Bangladesh.......................................    63
The Bangladesh Garment Manufacturers & Exporters Association 
  (BGMEA)........................................................    64
The AFL-CIO......................................................    66
The International Labor Rights Forum.............................    68
The Center for Business and Human Rights, New York University 
  Stern School of Business.......................................    73
The Government of Bangladesh.....................................    81

                                 (iii)

  

 
                        PROSPECTS FOR DEMOCRATIC
                      RECONCILIATION AND WORKERS'
                          RIGHTS IN BANGLADESH

                              ----------                              


                       TUESDAY, FEBRUARY 11, 2014

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:02 a.m., in 
room SD-419, Dirksen Senate Office Building, Hon. Robert 
Menendez (chairman of the committee) presiding.
    Present: Senators Menendez, Cardin, Durbin, and Risch.

          OPENING STATEMENT OF HON. ROBERT MENENDEZ, 
                  U.S. SENATOR FROM NEW JERSEY

    The Chairman. Good morning. This hearing of the Senate 
Foreign Relations Committee will come to order. I would like to 
welcome our panelists and guests.
    We meet, this morning, to discuss United States policy in 
Bangladesh, following the controversial January election that 
ensured a political stalemate. We also meet for a status update 
on the rights of Bangladesh's garment workers, following the 
fire at Tazreen Fashions in November 2012 and the collapse of 
Rana Plaza in April 2013, which, together, killed more than 
1,200 workers.
    This committee met last June to highlight the challenges 
faced by workers in Bangladesh, and by meeting here again 
today, I hope that all those involved--the retailers, the 
factory owners, the Bangladeshi Government and workers--
understand that this committee remains sharply focused on this 
issue and will continue to do so until we see real and 
measurable progress.
    We have joining us today the first survivor of the Rana 
Plaza tragedy to visit the United States. She is 19-year-old 
Reba Sikdar, who was trapped for 2 days in a tiny space with 30 
others. Only 6 of the 30 survived, and we are pleased that she 
is here today for this hearing. The tragic details of her 
story, which, without objection, I would like to enter into the 
record, are exactly why we will continue to pursue workers' 
rights with the Bangladeshi Government.
    In my view, if the workers of Tazreen Fashions and Rana 
Plaza had been able to organize and represent their interests, 
they would still be alive today. Simply put, workers are the 
best guarantors of their own safety, when given the right and 
the ability to organize.
    In June of last year, this committee met to discuss efforts 
to improve labor conditions in Bangladesh. In November, to mark 
the 1-year anniversary of the Tazreen Fashions fire, the 
committee produced a report recommending that the U.S. 
Government expand programs in Bangladesh that improve workers' 
ability to organize and engage in collective bargaining; that 
United States brands and retailers would ensure their suppliers 
in Bangladesh comply with laws allowing workers to organize 
unions and educate workers in their factories in Bangladesh on 
their rights of association, organization, and collective 
bargaining; and that the Government of Bangladesh should crack 
down on factory owners who engage in anti-union activity, and 
reform all labor laws to meet international standards.
    And parenthetically, I would add that, while we are focused 
on Bangladesh, particularly because of the history and the 
challenges, I do not want those who think that going to another 
country is going to solve their problems--the thinking that 
going, for example, to Vietnam is going to allow them to avoid 
the standards that we are trying to raise in Bangladesh. Our 
goal is to create a universal set of standards for workers' 
rights and safety and health beyond Bangladesh. And so, those 
who think that leaving Bangladesh and going to someplace else 
is going to have them avoid all of that are sadly mistaken. We 
are going to follow this issue wherever it takes us.
    So, I look forward to hearing from our witnesses on whether 
there has been progress on any of these recommendations.
    We are also well aware that any progress we make on labor 
issues is taking place in a very tenuous political environment. 
Bangladesh's main opposition group, led by the Bangladesh 
Nationalist Party, boycotted January's election, and, as a 
result, the Parliament does not include one of Bangladesh's 
largest political parties.
    In December, this committee passed a resolution that 
emphasized the critical need for political dialogue in 
Bangladesh. Led by Senator Durbin, the resolution sent the 
right message at the right time. Unfortunately, the leaders of 
the two main parties have still not agreed on a path forward 
towards democratic reconciliation.
    Last month, I sent letters to Bangladesh's political 
leaders, telling them that the political deadlock will further 
weaken the confidence of international investors, and strongly 
urged that they begin negotiations on new elections that are 
free, fair, peaceful, and inclusive. The people of Bangladesh 
deserve no less.
    I look forward to hearing what political progress, if any, 
is being made.
    I know that Senator Corker was called back to Tennessee, 
and Senator Risch will be sitting in as the ranking member for 
today's hearing when he gets here. I know he is delayed in 
business, but when he gets here, we will certainly recognize 
him for any comments he may have.
    With that, let me begin to introduce our first panel. Our 
first panel is Nisha Desai Biswal, the Assistant Secretary of 
State for South and Central Asian Affairs; Eric Biel, the 
Acting Associate Deputy Under Secretary for International 
Affairs for the Bureau of International Affairs at the 
Department of Labor; and Mr. Lewis Karesh, the Assistant U.S. 
Trade Representative for the Labor Office of the U.S. Trade 
Representative.
    Thank you all for being here. Your full statements will be 
included in the record, without objection. I would ask you to 
try to synthesize or summarize those statements at about 5 
minutes so we can get into Q&A.
    And, with that, Madam Secretary, you are recognized.

 STATEMENT OF HON. NISHA DESAI BISWAL, ASSISTANT SECRETARY OF 
 STATE FOR SOUTH AND CENTRAL ASIAN AFFAIRS, U.S. DEPARTMENT OF 
                     STATE, WASHINGTON, DC

    Ms. Biswal. Mr. Chairman, thank you very much for convening 
this important hearing today. And I will make just brief 
comments in the opening so that we can save more time for the 
questions.
    I want to again reiterate the importance of this hearing 
and the important role that this committee has played in 
continuing to shine the light on the political, economic, and 
labor situation in Bangladesh, and particularly your leadership 
and Ranking Member Corker's leadership with the committee's 
November 2013 report. And the hearing that you chaired last 
summer has helped to focus national and global attention on the 
importance of worker safety worldwide, and particularly on 
Bangladesh.
    Mr. Chairman, Bangladesh is clearly a country of strategic 
importance to the United States. It is the seventh-largest 
country by population and the third-largest Muslim majority 
nation. It is a moderate, secular democracy, one that we value 
and that we support.
    With an annual growth rate of about 6 percent per year, 
Bangladesh is an economic and development success story. And 
important help from USAID and other development partners has 
helped Bangladesh to be on target to reach many of its 
millennium development goals. The United States and Bangladesh 
cooperate closely on security issues, including 
counterterrorism, combating trafficking in persons, narcotics, 
arms, as well as ensuring maritime security and mitigating 
natural disasters.
    Yet, in spite of these gains, Bangladesh faces a worrisome 
political situation, as you noted. On January 5, the government 
held a deeply flawed election in which one of two major 
political parties did not participate and the election did not 
credibly express the will of the Bangladeshi people.
    For months leading up to and following the elections, the 
United States and many others have voiced our strong concerns. 
During my first trip to the region as Assistant Secretary, I 
urged Prime Minister Sheikh Hasina and the opposition leader, 
Begam Khaleda Zia, to find a way forward to hold inclusive 
elections. We also supported the efforts of the United Nations 
to facilitate dialogue between the political parties. 
Immediately after the election, we called for a resumption of 
dialogue to agree upon new elections as soon as possible.
    Mr. Chairman, I want to state very clearly that our 
interest in holding new elections is to ensure a free and fair 
and inclusive process. The United States has not taken sides or 
played favorites in who should lead the country. That decision 
should be left to the Bangladeshi people, whose voices were not 
fairly heard on January 5.
    We have consistently delivered one other message, as well, 
and that is that violence is unacceptable and has no part in a 
democratic process. We are disturbed by opposition parties' use 
of violence and violence against minority communities. But, the 
stifling of dissent also undermines Bangladesh's vibrant civil 
society and long-term stability. We have, thus, called upon the 
country's leadership to provide space that enables peaceful 
expression of political views. And we are concerned by recent 
reports of extrajudicial killings and disappearances allegedly 
committed by security forces.
    But, we remain steadfast in working with the Bangladeshi 
people and the Bangladesh Government in strengthening their 
respect for labor rights, for improving workplace safety in 
Bangladesh. Indeed, that is one of my top priorities with 
respect to engaging in Bangladesh, and my November trip 
included extensive conversations and meetings with labor 
unions, with industry representatives, and with the government, 
and with our international partners.
    We have been working closely with USAID, the Department of 
Labor, and USTR to ensure that we have the right strategy and 
adequate resources to improve worker rights and safety in 
Bangladesh. Our assistance promotes internationally recognized 
worker rights and strengthens the capacity of independent 
worker organizations to recruit members and form legally 
registered unions, engage in collective bargaining and advocacy 
for members. And there has been some incremental progress. 
Nearly 100 unions, 95 of which we see as credible, legitimate 
unions, have been registered in 2013. And the number of 
inspections has increased of factories in Bangladesh.
    But, clearly there is a long way to go, Mr. Chairman. Of 
the 3 million workers in Bangladesh, we estimate that less than 
40,000 currently are represented by unions. And of the--sorry--
of the 3 million workers--and of the 3,000 export-oriented 
factories, just a fraction, right now, have been inspected. So, 
there is a long ways to go, Mr. Chairman, and lots of work to 
be done ahead.
    Thank you.
    [The prepared statement of Ms. Biswal follows:]

               Prepared Statement of Hon. Nisha D. Biswal

    Chairman Menendez, Ranking Member Corker, and members of the 
committee, thank you for holding this important hearing today to 
discuss the current political and economic situation in Bangladesh. The 
country is at a critical juncture, so today's hearing is particularly 
timely and sends a powerful message that the U.S. Congress is concerned 
about where Bangladesh is headed. Before I begin, Mr. Chairman, let me 
particularly thank you and Ranking Member Corker for this committee's 
ongoing leadership on Bangladesh. The Senate Foreign Relations 
Committee's November 2013 report, which was released on the 1-year 
anniversary of the tragic Tazreen Fashions fire, and the hearing you 
chaired last summer, helped focus national and global attention on the 
importance of worker safety worldwide. So your leadership has had a 
tremendous positive impact.
    Mr. Chairman, Bangladesh is a country of strategic importance to 
the United States. As the seventh-largest country by population and 
third-largest Muslim-majority nation, its moderate, secular, democracy 
is one that we value and support. With nearly 8,000 forces in U.N. 
peacekeeping operations, Bangladesh is one of the largest contributors 
to such missions, including the one in South Sudan, where Bangladesh is 
contributing aircraft and police units.
    With an annual growth rate of about 6 percent each year, Bangladesh 
is an economic success story and an increasingly important trading 
partner and destination for U.S. investment. The United States is the 
biggest investor in Bangladesh and the largest single country 
destination for Bangladeshi apparel, the country's largest export. 
Through November 2013, U.S. exports to Bangladesh were up over 44 
percent from the same period last year, to $665 million, while our 
total bilateral trade increased by 12 percent to $5.7 billion.
    Bangladesh is also a development success story. It is a focus 
country for all three of the President's key development efforts: 
Global Health, Global Climate Change, and Feed the Future. With 
important help from USAID and other development partners, Bangladesh is 
on target to reach many of its Millennium Development Goals. Since 
1990, USAID has helped Bangladesh reduce maternal and child mortality 
by more than 60 percent; in that same time, female literacy has 
doubled. In addition, for the first time in decades, Bangladesh now 
produces enough of its daily staple, rice, to feed the entire 
population, an impressive achievement in one of the world's most 
densely populated countries.
    The United States and Bangladesh also cooperate closely on security 
issues, including counterterrorism; combating trafficking in persons, 
drugs, and arms; maritime security; and the mitigation of natural 
disasters. We discuss these issues in our annual Security Dialogue as 
well as our annual military-to-military dialogue. In addition, last 
year we held our second annual Partnership Dialogue, which provides an 
excellent platform to deepen our bilateral ties.
    In spite of these gains in economic growth, development, and 
regional stability, Bangladesh faces a worrisome political situation. 
On January 5, the government held a deeply flawed election in which one 
of the two major political parties did not participate. As a result, 
over half of the 300 members of parliament were elected unopposed, and 
most of the rest faced only token opposition. The election did not 
credibly express the will of the Bangladeshi people. This could have 
serious ramifications for stability in Bangladesh and the region.
    For months leading up to and following the elections, the United 
States and many others have voiced our strong concerns, through public 
statements and private conversations with government officials and 
opposition leaders. In November, during my first trip to the region as 
Assistant Secretary, I urged Prime Minister Sheikh Hasina and 
opposition leader Khaleda Zia to find a credible way forward toward 
participatory elections. We also supported the efforts of the United 
Nations to facilitate dialogue between the parties, which regrettably 
did not succeed. Immediately after the election, we issued a strong 
statement noting that the election was not a credible reflection of the 
will of the people and called for immediate dialogue to agree on new 
elections as soon as possible.
    Mr. Chairman, I want to state very clearly that our interest in 
holding new elections is to ensure a free and fair process. The United 
States has not taken sides or played favorites in who should lead the 
country. That decision should be left to the Bangladeshi people, whose 
voices were not fairly heard on January 5.
    Bangladesh still has an opportunity to demonstrate its commitment 
to democracy. We welcome the efforts by many in the international 
community, including the United Nations, who have sent the same 
message, and who are prepared to help the parties engage in 
constructive dialogue so they can find a way forward.
    We have consistently delivered one other message as well: violence 
is unacceptable and not part of the democratic process. We are 
disturbed by political parties' use of violence, inflammatory rhetoric, 
and intimidation, and by violence against minority communities. In the 
days leading up to the election and on election day itself, over 100 
people were killed in election-related violence and scores more 
injured. We are also concerned by recent reports of continuing 
extrajudicial killings and disappearances allegedly committed by 
security forces. These abuses must stop immediately. We condemn 
violence from all quarters in the strongest terms. These tactics have 
no place in a democracy.
    We have also worked to ensure the safety of our staff. Our Embassy 
in Dhaka has worked closely with law-enforcement and security 
counterparts to ensure protection of personnel and facilities. Embassy 
security staff closely monitor events as they unfold and limit staff 
movements when necessary. They maintain active and frequent contact 
with American citizens throughout the country, warning of potential 
threats as they occur. We have repeatedly and forcefully conveyed to 
all political leaders the importance of the safety of our citizens and 
staff. I am glad to say that the government and other leaders have been 
responsive to our security needs and have taken action when warranted. 
I want to emphasize as well that the violence to date has not targeted 
Americans or American interests. We are nevertheless continuing to 
monitor the situation very closely.
    The political violence poses the greatest threat to the Bangladeshi 
people themselves. It not only puts ordinary people at daily risk of 
harm, but it also paralyzes the economy, threatening to undo the 
country's achievements in development. Bangladesh's turmoil has created 
uncertainty with foreign investors and impacted economic growth. While 
estimates vary, one source estimates the economic cost of the general 
strikes called by the opposition at approximately $200 million per day. 
Stifling of dissent also undermines Bangladesh's vibrant civil society 
and long-term stability. We thus call upon the country's leadership to 
provide space that enables peaceful expression of political views. At 
the same time, we call upon the opposition to use such space 
responsibly.
    We will continue to engage with the Bangladeshi Government and 
opposition to encourage policies and actions that protect and advance 
democratic values, including respect for human rights, space for civil 
society to flourish, rule of law and an independent judiciary, mutual 
respect for Bangladeshis of all religions and of all ethnicities, and 
space for the free and peaceful discussion of political differences 
unmarred by violence.
    Mr. Chairman, I also want to assure members of the committee we 
remain steadfast in our commitment to strengthening respect for labor 
rights and improving workplace safety in Bangladesh. Indeed, this is 
one of my top priorities. Tragedies like the Tazreen fire or Rana Plaza 
building collapse should never happen again.
    After these tragedies, President Obama made the decision in June 
2013 to suspend Generalized System of Preferences (GSP) benefits to 
Bangladesh. Following this suspension, we presented an action plan to 
improve labor, fire, and building structural soundness standards; 
remove obstacles to workers' freedom of association and collective 
bargaining; and reform labor laws, including in the Export Processing 
Zones, to address the underlying concerns that led to suspension of 
GSP. In addition, we worked with Bangladesh, the European Union, and 
the International Labor Organization (ILO) to develop a 
``Sustainability Compact,'' which commits Bangladesh to improving 
worker rights and safety along the lines laid out in the GSP Action 
Plan.
    We are also working with American, European, and other apparel 
brands and retailers, especially those with significant operations in 
Bangladesh, to make sure they are aware of our significant labor 
concerns and the strict conditions in the action plan. Our teams in 
Dhaka and Washington meet regularly with American companies to 
coordinate efforts to advance workplace safety standards and worker 
rights.
    Across the U.S. Government, we are working closely with USAID, the 
Department of Labor, and USTR to make sure we have the right strategy 
and resources to improve workers' rights and safety in Bangladesh. Our 
assistance promotes internationally recognized workers' rights; 
strengthens the capacity of independent worker organizations to recruit 
members, form legally registered unions, and engage in collective 
bargaining; assists women to be active organizers and leaders of the 
workers' organizations; and teaches worker representatives and leaders 
how to advocate for their members. In particular, we have expanded our 
support (over $4 million since 2011) for the Solidarity Center to work 
with Bangladeshi labor to strengthen workers' ability to organize and 
address workplace safety issues.
    There has been some incremental progress in the ready-made garment 
sector in the past year. Nearly 100 unions were registered in 2013, 
compared to one in each of the 2 years preceding. The courts have 
dropped all but one criminal case against labor activists, permitted 
the registration of labor rights NGOs, and started the trial for a 
suspect in the 2012 murder of labor activist Aminul Islam in abstentia. 
The government has completed over 200 structural soundness and 120 fire 
safety inspections, filled 42 vacant inspector positions, and is 
recruiting new inspectors.
    However, there is still much to be done and Bangladesh still has 
not fulfilled the many commitments it made to improve working 
conditions. Plans to hire more inspectors and carry out more labor, 
fire, and building inspections are lagging. The majority of inspections 
and remediation efforts are occurring under the direction of private 
sector initiatives. Gaps remain between national law and international 
standards, no action has been taken to bring Export Processing Zones 
into conformity with international standards, and concerns remain over 
harassment of labor activists and the investigation of the murder of 
Aminul Islam.
    Mr. Chairman, we will continue to push for urgent reforms to 
improve worker rights and worker safety in Bangladesh. We very much 
appreciated the committee's excellent report and are closely following 
many of its recommendations. Thank you for your leadership on these 
important issues.
    In closing, I want to publicly thank Ambassador Mozena and his team 
for their relentless efforts to promote democracy and improve labor 
conditions in Bangladesh. We hope that Bangladesh's political and 
economic leaders will take the right steps to support democratic 
values, foreign direct investment, and a growing economy. Bangladesh 
has come too far and has too much to lose.

    The Chairman. Thank you.
    Mr. Biel.

STATEMENT OF ERIC BIEL, ACTING ASSOCIATE DEPUTY UNDER SECRETARY 
     FOR INTERNATIONAL AFFAIRS, U.S. DEPARTMENT OF LABOR, 
                         WASHINGTON, DC

    Mr. Biel. Good morning, Mr. Chairman. Thanks very much for 
the invitation to the Department of Labor to participate in 
this important hearing concerning workers' rights in 
Bangladesh. We appreciate the interest of this committee and 
the staff, and your continued oversight concerning the issues 
we are discussing this morning.
    I am pleased to join Assistant Secretary of State Biswal 
and Assistant U.S. Trade Representative Karesh, and, again, 
look forward to discussing just a few of the elements of worker 
rights in my remarks and then having an opportunity to answer 
any questions you may have.
    As Assistant USTR Karesh will also discuss, on June 27, 
2013, just 3 weeks after this committee's earlier hearing on 
Bangladesh, President Obama suspended Bangladesh's trade 
benefits under the Generalized System of Preferences, or GSP, 
based on Bangladesh's failure to meet the GSP statute's labor-
related eligibility criteria. That decision was accompanied by 
transmittal of an action plan that laid out both the 
shortcomings on worker rights that had led to that suspension 
and on worker safety--workplace safety, but, in addition, the 
steps needed to provide a basis for, hopefully, at some point 
reinstating benefits.
    Last month, the U.S. Government, through an interagency 
process led by the Office of the U.S. Trade Representative, 
informed the Government of Bangladesh that it had not yet made 
sufficient progress under the action plan to warrant 
reinstatement of those trade benefits.
    Now, to be sure, there has been some progress in some areas 
of the action plan, including, as Assistant Secretary Biswal 
noted, the registration of new trade unions, most of which, 
based on an assessment of the Solidarity Center and others, do 
appear to be credible and independent; the dropping of charges 
against leaders of the Bangladesh Center for Worker Solidarity, 
Kalpona Akter, one of those leaders who will be testifying on 
the second panel; support for programs in the shrimp sector, 
including on involving the Solidarity Center, the other 
involving the International Labor Organization; and a 
commitment to increase resources on fire and building safety. 
But, clearly, as Assistant Secretary Biswal noted, much more is 
needed on some of the most important elements of the action 
plan.
    The progress, to date, in hiring and training inspectors 
has been slow. Labor law amendments enacted last July, roughly 
a month after this committee's previous hearing, do not address 
some of the most fundamental concerns, including severe 
restrictions on the right to strike. Action on the 2012 murder 
of labor organizer Aminul Islam remains inadequate, to date. 
And export processing zones, or EPZs, are still governed by an 
entirely separate labor law and labor law regime. Unions are 
still prohibited in the EPZs, and the EPZ governing authority 
retains nearly complete discretion with respect to critical 
labor management relations.
    In addition, updated reports that we have received just in 
the last few days, and I believe the committee staff has also 
seen, of union organizers being harassed and factories 
registering some employer-organized unions, do remind us that 
higher union registration numbers alone are not sufficient to 
show progress on freedom of association and ultimately to 
address the core issue, that you noted in your opening 
statement, Mr. Chairman, of whether or not workers are being 
adequately empowered in Bangladesh.
    Let me quickly, in the remaining time, just highlight a few 
other areas of our engagement over the last few months.
    Department of Labor has awarded $1.5 million to the 
International Labor Organization and $1 million to the 
Solidarity Center. We did so at the end of September, and the 
program is moving forward--the programs are moving forward.
    The ILO Project is focused in improving government 
enforcement of fire and building safety standards, while the 
Solidarity Center Project is designed to increase worker 
organizations' ability to monitor for violations and to seek 
abatement of hazards.
    We are in regular contact with the ILO, the International 
Labor Organization, as it works with the Government of 
Bangladesh and with international donors and coordinates global 
support on fire and building safety in the ready-made garment 
sector and as it and its partner, the International Finance 
Corporation, move forward with the new Better Work Program that 
is tied to continued progress on labor administration and 
industrial relations issues. And we can talk more about that if 
you or other members are interested, in the question-and-answer 
period.
    And, while our focus has been, and must be, on the 
Government of Bangladesh, we also do see a critical role for 
the private sector. We welcome the approach and the historic 
significance of the Accord on Fire and Building Safety in 
Bangladesh, which has brought businesses and global unions 
together. And we also welcome the recent 6-month report of the 
Alliance for Bangladesh Worker Safety. We know you will be 
hearing more on both of those initiatives from representatives 
on the second panel, as well as from Kalpona Akter.
    Finally, we, at the Department of Labor, want to thank you, 
Mr. Chairman, for your leadership in advocating for a full-time 
labor attachee in our Embassy in Dhaka, including through your 
communications with the Secretary of State. We are working 
actively with Ambassador Dan Mozena and his excellent staff in 
Dhaka to make good on that as quickly as possible.
    Thank you again for convening this hearing. We look forward 
to working closely with the committee to strengthen worker 
rights and workplace safety in Bangladesh as the best path 
forward, not just for the workers of Bangladesh, but also for 
the businesses who are dependent on the United States export 
market.
    And, after Mr. Karesh's testimony, I look forward to being 
part of the questions you may have.
    Thank you very much.
    [The prepared statement of Mr. Biel follows:]

                   Prepared Statement of Eric R. Biel

    Good morning. Chairman Menendez, Ranking Member Corker, and members 
of the committee, thank you for inviting the Department of Labor to 
participate in this important hearing concerning labor issues in 
Bangladesh.
    I am honored to join my colleagues from the Department of State, 
Assistant Secretary Nisha Biswal, and from the Office of the U.S. Trade 
Representative (USTR), Assistant USTR for Labor Lewis Karesh, in 
appearing before you this morning. I know that Assistant Secretary 
Biswal will also be prepared to address broader issues in the U.S.-
Bangladesh bilateral relationship, including in the wake of last 
month's elections. The focus of both this written testimony and my 
remarks at the hearing will be on the critical workers' rights and 
workplace safety issues in Bangladesh.
    My colleagues and I look forward to this opportunity to update you 
on our work on Bangladesh, building on the regular meetings we have had 
with your staffs over the past several months. Since I last appeared 
before this committee 8 months ago, the Department of Labor, through 
our Bureau of International Labor Affairs (ILAB), along with the 
Department of State and USTR, has been actively engaged with the 
Government of Bangladesh, workers' and other civil society 
organizations in Bangladesh, U.S. buyers and retailers, and other 
stakeholders in the United States and Bangladesh in efforts to address 
legal and policy issues concerning workers' rights and workplace 
safety. Our efforts have focused on the ready-made garment sector, as 
well as the shrimp processing sector, and broader concerns relating to 
Bangladesh's labor law regime, including the separate laws and 
governance structure for Bangladesh's Export Processing Zones (EPZs).
    Much of this work has come under the framework of the ``action 
plan'' developed in the context of the Generalized System of 
Preferences (GSP) trade preference program. As you are aware, on June 
27, 2013, 3 weeks after this committee's previous hearing, President 
Obama suspended Bangladesh's trade benefits under GSP based on 
Bangladesh's failure to meet the GSP statute's labor-related 
eligibility criteria. That decision, which followed a multiyear review 
that received increased attention in the wake of the Tazreen fire in 
November 2012 and Rana Plaza building collapse in April 2013, was 
accompanied by the transmittal to the Government of Bangladesh of an 
laying out both the shortcomings on workers' rights and workplace 
safety that formed the foundation for withdrawal of GSP benefits and 
the specific steps needed to provide a basis for reinstatement of those 
benefits.
    Shortly after that, the U.S. Government associated itself with a 
just-concluded ``Sustainability Compact'' negotiated among the European 
Union, Government of Bangladesh, and International Labor Organization 
(ILO) that closely tracks the key elements of the action plan and 
establishes a broader consultative framework for addressing the 
fundamental labor problems highlighted in that Plan. In recent months, 
there has been a regular process for consultations between senior 
diplomats based in Dhaka and officials from the Government of 
Bangladesh in which our Ambassador, Dan Mozena, has played a leading 
part.
    The action plan includes elements centered on improving labor, 
fire, and building safety inspections; increasing fines for 
noncompliance with labor, fire, and building safety standards; 
expeditiously registering unions and protecting unions from 
discrimination and reprisal; resolving longstanding concerns about 
harassment and legal actions against labor activists and 
nongovernmental labor organizations; reforming labor laws to address 
key concerns articulated for many years by ILO expert bodies, including 
reforming the EPZ law to effectively protect EPZ workers' right to 
organize and bargain collectively; and strengthening freedom of 
association in the shrimp processing sector.
    Since the action plan was issued, ILAB has been a key participant 
in a regular interagency process, headed by USTR, for monitoring and 
evaluating the status of Bangladesh's efforts to address the specific 
elements of the action plan. That process has included extensive 
engagement with the Government of Bangladesh both here and in Dhaka, 
including a lengthy meeting with senior Bangladeshi officials in 
November in Washington following the signing of the Trade and 
Investment Cooperation Forum Agreement (TICFA).
    The process has also included careful review of written submissions 
from the Government of Bangladesh as well as the AFL-CIO, which 
submitted the petition that initiated the GSP review. ILAB and others 
involved in this review have also benefited from the report issued by 
the majority staff of this committee on November 22 concerning workers' 
rights and workplace safety in Bangladesh's ready-made garment sector, 
including the recommendations with respect to implementation of the GSP 
Action Plan.
    Late last month, the U.S. Government conveyed to the Government of 
Bangladesh its conclusion that Bangladesh had not made sufficient 
progress to date under the action plan to warrant reinstatement of GSP 
benefits. There have been indications of progress in some areas of the 
action plan, including the registration of new trade unions, the 
dropping of dubious criminal charges against leaders of the Bangladesh 
Center for Workers Solidarity (BCWS), the registration of the BCWS, and 
the Government of Bangladesh's commitment to fund programs through the 
ILO and the American Center for International Labor Solidarity 
(Solidarity Center) in the shrimp processing sector. There have also 
been steps taken with the ILO and other stakeholders to develop a plan 
for many more, and better trained, labor and fire and building safety 
inspectors.
    However, as has been conveyed with specificity to the Government of 
Bangladesh, a great deal remains to be done to implement some of the 
most important elements of the action plan. The plans for a larger, 
well-trained force of labor and fire and building safety inspectors are 
still in their initial stages, and the number of inspectors hired to 
date is relatively small. Labor law amendments enacted in July 2013 do 
not address the concerns raised in the action plan, including severe 
restrictions on collective bargaining, in particular at the industry 
and sector levels, nor inadequate protections against employer 
interference in union activity. There also has not been enough progress 
in achieving justice for the 2012 murder of labor organizer, Aminul 
Islam.
    In addition, EPZs remain governed by a separate labor law providing 
inferior protections for workers in those zones about which both we and 
the ILO have long expressed deep concerns. Today, factories in EPZs 
remain outside the reach of labor and safety inspectors who cover the 
rest of the country; unions are still barred; and the EPZ governing 
authority retains nearly complete discretion with respect to labor-
management relations.
    Concerns also persist with respect to other elements of the action 
plan focused on improving procedures for responding to complaints 
alleging violations of fire and building safety standards and unfair 
labor practices. Recent reports of union organizers being harassed and 
factories registering employer-organized unions are reminders that 
increased union registration numbers alone are not an adequate 
measurement of progress on freedom of association.
    While fulfilling the GSP Action Plan conditions will require 
political will and a seriousness of purpose by the Government of 
Bangladesh, the action plan lays out a clear path for the Government of 
Bangladesh to follow that is practical and relevant to address the most 
serious and longstanding labor concerns.
    Furthermore, we see this as every bit as much an opportunity as a 
challenge for Bangladesh. Our goal, and that of the European Union 
under the framework of the Sustainability Compact, is not to undermine 
Bangladesh's growth and development, including in the ready-made 
garment sector. It is, instead, to work with the Government, industry, 
workers' and other civil society groups, and other stakeholders to 
ensure that economic growth and the gains from trade go hand in hand 
with greater respect for workers' rights and improved workplace safety.
    Put another way, the action plan reflects our Government's view 
that greater adherence to internationally recognized labor standards is 
an essential part of the trade and investment relationship between 
Bangladesh and the United States. That is the best path not only for 
the workers of Bangladesh but also for the businesses that are 
dependent on the U.S. export market.
    Beyond the parameters of the action plan and the Sustainability 
Compact, we also continue to work closely with the ILO independently on 
a number of fronts in Bangladesh. The ILO has assumed the leading role 
in implementation of Bangladesh's March 2013 National Tripartite Plan 
of Action on fire and building safety in the RMG sector, as well as in 
coordinating the activities of different international donors.
    In addition, last September the ILO and the International Finance 
Corporation (IFC) launched a Better Work Program in Bangladesh after 
concluding that the Government had addressed certain labor-related 
preconditions transmitted in fall 2012--including a condition to more 
expeditiously register unions. The Better Work management team has 
provided the Government with a ``roadmap'' laying out a strategy ``to 
secure structural, sustainable change in labor administration, 
industrial relations and social dialogue systems.'' Better Work has 
explicitly conditioned the continuation of its program in Bangladesh on 
the Government making progress in implementing specific activities in 
each of these areas, and has set out a detailed process for monitoring 
that implementation.
    We at the Department of Labor remain committed to playing a 
meaningful role in helping build greater capacity for both the 
Government of Bangladesh and workers' organizations to address the 
shortcomings that culminated in the Tazreen fire and Rana Plaza 
collapse. In late September, we completed a process of soliciting and 
evaluating technical assistance proposals and awarded $2.5 million in 
project assistance--$1.5 million to the ILO and $1 million to the 
Solidarity Center--to work with partners on the ground in Bangladesh. 
The project being implemented by the ILO will focus on improving 
government enforcement of fire and general building safety standards, 
while the Solidarity Center project is designed to increase worker 
organizations' ability to effectively monitor for violations of fire 
and general building safety standards and seek abatement of such 
hazards. ILAB staff traveled to Dhaka in December to work with the 
grantees in moving forward with project implementation.
    While the bulk of our focus has been, and must be, on the roles and 
responsibilities of the Government of Bangladesh to address the labor-
related shortcomings that triggered the suspension of GSP benefits, 
there is also a critical role for the private sector to play in 
improving workers' rights and workplace safety on the ground in 
Bangladesh.
    As you are aware, leading brands and retailers from the United 
States and Europe are actively engaged in initiatives toward this end 
in the ready-made garment sector. While the challenges are substantial, 
we are encouraged by reports of progress in recent months.
    What is particularly notable in this regard is the fact that one of 
these initiatives, the Accord on Fire and Building Safety in 
Bangladesh, represents a historic break from past approaches because it 
brings together major buyers and global labor unions in an agreement 
that includes clear financial obligations and a sustained commitment to 
continued apparel sourcing from Bangladesh. This is an exciting step 
forward for responsible sourcing and supply chain management that we 
see as holding great promise.
    The second private sector initiative, the Alliance for Bangladesh 
Worker Safety, has also made progress, as detailed in its recently 
issued first semiannual report. I understand that the committee will be 
receiving more detailed updates on these efforts from the second panel 
at this hearing.
    Finally, the Department of Labor is committed to even greater 
engagement on workers' rights and workplace safety in Bangladesh in the 
coming months and years. As a part of that effort, we are working 
actively to establish a full-time labor attache in our Embassy in 
Dhaka. Mr. Chairman, your letter of November 7 to Secretary of State 
Kerry provided the critical impetus for this effort. We at the 
Department of Labor have been in regular contact in the past 3 months 
with Ambassador Mozena and his team, and others at the State 
Department, on the steps needed to establish this permanent labor 
attache position. Later this month, ILAB staff will be in Dhaka for 
detailed discussions on the process and logisticsinvolved.
    We are committed to making this happen as quickly as possible and 
of course will keep you and your staff fully apprised as we move 
forward with this important effort. We see this as an essential element 
in any long-term strategy to improve respect for workers' rights and 
workplace safety in Bangladesh; indeed, it is part of a broader ILAB 
effort to put ``boots on the ground'' in a few priority countries where 
being based in country will help us develop the close relationships 
with critical stakeholders and the in-depth knowledge and understanding 
of labor-related laws, regulations, policies, programs, and practices 
that are needed to most effectively advance workers' rights and 
workplace safety.
    Thank you again for convening this hearing and for the ongoing 
interest and focus of the committee on workers' rights and workplace 
safety issues in Bangladesh. We intend to continue to make this a 
priority of the Department of Labor and look forward to a continued 
close working relationship with our colleagues at the State Department 
and USTR as well as members and staff of this committee.
    I appreciate having this opportunity to testify and would be 
pleased to take your questions.

    The Chairman. Mr. Karesh.

STATEMENT OF LEWIS KARESH, ASSISTANT U.S. TRADE REPRESENTATIVE 
FOR LABOR, OFFICE OF THE U.S. TRADE REPRESENTATIVE, WASHINGTON, 
                               DC

    Mr. Karesh. Good morning, Chairman Menendez. Thank you very 
much for the opportunity to testify, before this committee, on 
labor issues in Bangladesh.
    This committee's interest in holding another hearing on 
Bangladesh sends a strong signal to the Government of 
Bangladesh and the international community about the importance 
of continuing to focus on worker rights and safe workplaces in 
Bangladesh.
    On June 27, 2013, President Obama took the extraordinary 
step of suspending Bangladesh's GSP trade benefits. The 
decision was based on Bangladesh's failure to meet the GSP 
criterion of taking steps to afford internationally recognized 
worker rights.
    Just a few weeks prior to that decision, we discussed 
before this committee the administration's ongoing GSP review 
and our growing concern that Bangladesh was moving backward in 
respect for worker rights. The unfortunate tragedies that you 
mentioned in your remarks with regard to the Tazreen fire and 
the Rana Plaza building collapse emphasize the extent of the 
problem in Bangladesh and further focused international 
attention on worker rights and workplace safety issues, 
particularly in the ready-made garment sector.
    The purpose in suspending trade benefits was not to 
penalize Bangladesh, but rather to ensure that beneficiary 
countries are meeting the worker-rights standard of GSP, and 
improving respect for worker rights and improving workplace 
conditions. Thus, at the time of the President's decision, we 
also provided the Government of Bangladesh with an action plan 
containing specific actions that the government should take to 
provide a basis for reinstatement of GSP benefits. These 
included improving labor, fire, and building standards, 
removing obstacles to freedom of association and collective 
bargaining, and undertaking additional labor reform. This 
action plan has proved to be an extremely useful tool around 
which to focus engagement with Bangladesh. And in order to 
encourage Bangladesh to take quick and immediate action, we 
told the Bangladeshi officials, at the time we delivered the 
action plan, that we would review progress again late in 2013.
    This past December, after reviewing information from the 
Government of Bangladesh, from the AFL, which had been the 
original filer of the GSP petition, as well as other 
information that we gathered, we informed the Government of 
Bangladesh that, although it had made some progress on 
implementing the action plan, further action was needed to 
justify reinstatement.
    The Government of Bangladesh has taken some action. It has 
facilitated registration of new trade unions--that was already 
mentioned--and has dropped questionable criminal charges 
against two labor activists, and it has removed obstacles to 
two labor-focused NGOs reinstating their registrations. In 
addition, the Government has been working with the ILO to 
develop a plan for increasing labor, fire, and building 
inspections. This is important progress.
    However, significant work remains, as you heard from my 
colleagues. For example, the safety inspection plans need to be 
implemented, and we need to see that they are actually 
effective. Additional labor reform is needed to address 
shortcomings related to the right to strike and requirements 
regarding union formation. And action must be taken to bring 
the export processing-zone law into conformity with 
international standards.
    We recognize that these are significant undertakings, but 
ones which are essential to addressing the serious and, in some 
cases, life-threatening challenges that remain in Bangladesh. 
We have communicated our conclusions to the Government of 
Bangladesh, and we will further review GSP in May 2014.
    In addition to the GSP Action Plan, I would like to 
highlight another important mechanism that we recently put in 
place with Bangladesh that will help provide an ongoing forum 
to address labor concerns. The United States-Bangladesh Trade 
and Investment Cooperation Forum Agreement, or as we refer to 
as TICFA, was signed in November 2013 and entered into force on 
January 30, 2014. Under the TICFA, one of the things we have 
agreed to do is to form a permanent committee on labor issues. 
We expect this committee to begin meeting at the first TICFA 
meeting, in April of this year. The administration is focused 
on ensuring that our trade partners meet their obligations, 
including their labor obligations, under our trade agreements 
and our preference programs. We believe this TICFA labor 
committee is one additional tool that we can use to ensure 
that.
    So, allow me to conclude with a few points.
    There has been tremendous effort, among all stakeholders, 
to develop concrete and sustainable solutions. Particularly on 
the ground in Dhaka, there has been immense coordination among 
the various entities and initiatives that are underway. I would 
like to recognize, in particular, the exceptional work of 
Ambassador Dan Mozena and his team, at our Embassy in Dhaka, 
who have worked very hard on these issues.
    The United States, along with the EU, the ILO, private 
brands and retailers, local and international unions, NGOs, 
and, of course, the Government of Bangladesh, have worked 
together in unprecedented ways to tackle the many challenges. 
But, ultimately, it will be up to the Government of Bangladesh 
to directly address and solve the remaining challenges. We are 
committed to work with Bangladesh to see that it undertakes the 
worker rights and safety reforms that are set out in the action 
plan. And we will work with all stakeholders to help ensure 
that the benefits of trade and development can be widely shared 
in Bangladesh.
    Lastly, Mr. Chairman, I should also note that legal 
authorization for the GSP program expired in July 2013. As long 
as the program is without authorization, we will not be in a 
position to recommend to the President any changes to country 
eligibility, including for Bangladesh. The administration, of 
course, supports renewal of the program and wants to work with 
Congress to accomplish this.
    Thank you again for the opportunity to testify, and I look 
forward to your questions.
    [The prepared statement of Mr. Karesh follows:]

                   Prepared Statement of Lewis Karesh

    Good morning. Chairman Menendez, Ranking Member Corker, and members 
of the committee, thank you for another opportunity to testify before 
this committee concerning labor issues in Bangladesh. Since your last 
hearing on Bangladesh in June 2013, President Obama, the Government of 
Bangladesh, and various stakeholders have taken several important 
actions related to worker rights and safety in Bangladesh. I would like 
to discuss these developments with you this morning.
    As we discussed last June, the November 2012 Tazreen Fashions 
garment factory fire and the April 2013 Rana Plaza building collapse 
resulted in nearly 1,300 deaths. These tragedies focused international 
attention on worker rights and safety in Bangladesh's ready-made 
garment sector--concerns that the United States Government had already 
been raising with Bangladesh in the context of a country practice 
review of worker rights in Bangladesh under the Generalized System of 
Preferences (GSP) program.
    GSP is a U.S. trade preference program under which beneficiary 
developing countries are afforded duty-free access to the U.S. market 
for thousands of products. The statute governing the GSP program lists 
several criteria, including some related to worker rights,\1\ which 
beneficiary countries must meet in order to maintain eligibility for 
benefits.
---------------------------------------------------------------------------
    \1\ Section 502(b)(2)(G) of the Trade Act of 1974, as amended, 
(``the Trade Act'') provides that the President ``shall not designate 
any country a beneficiary developing country'' under GSP if ``such 
country has not taken or is not taking steps to afford internationally 
recognized worker rights in the country (including any designated zone 
in that country).'' Section 507(4) of the Trade Act provides a 
definition of ``internationally recognized worker rights,'' which 
includes ``the right of association,'' ``the right to organize and 
bargain collectively,'' and ``acceptable conditions of work with 
respect to minimum wages, hours of work, and occupational safety and 
health.''
---------------------------------------------------------------------------
    The GSP review of Bangladesh was initiated based on a petition that 
the AFL-CIO submitted alleging serious shortcomings in the Government 
of Bangladesh's recognition of worker rights. The AFL-CIO petition 
described a wide array of worker rights issues in Bangladesh, including 
serious obstacles to freedom of association and collective bargaining, 
especially in Export Processing Zones (EPZs), the ready-made garment 
and the shrimp processing sectors. The petition and subsequent updates 
also alleged a pattern of harassment and violence against trade 
unionists and nongovernmental organizations (NGOs) working on labor 
rights issues, and a neglect of worker protections in the areas of fire 
safety and health.
    The administration engaged intensively with the Government of 
Bangladesh, the AFL-CIO as the petitioner, and other stakeholders to 
examine the range of worker rights issues addressed in the petition. 
Beginning in late 2012, USTR, in consultation with the other agencies 
in the GSP Subcommittee, including the Departments of State and Labor, 
grew increasingly concerned that the overall worker rights situation in 
Bangladesh was deteriorating. The GSP Subcommittee concluded that the 
situation warranted consideration of possible withdrawal, suspension, 
or limitation of Bangladesh's trade benefits under GSP. To inform the 
public and stakeholders of the GSP Subcommittee's assessment, USTR 
issued a Federal Register notice requesting comments from the public 
and held a public hearing in March 2013 in which both the Government of 
Bangladesh and the AFL-CIO participated. The Rana Plaza building 
collapse just 1 month later, in April 2013, demonstrated the deadly 
implications of the failure to address the underlying issues of worker 
safety and worker rights, especially in the garment sector.
    On June 27, 2013, President Obama issued a proclamation suspending 
Bangladesh's GSP trade benefits based on the Bangladesh Government's 
failure to meet the GSP statutory eligibility criterion of ``taking 
steps to afford internationally recognized worker rights to workers in 
the country.'' At the time of the President's decision, the United 
States provided the Government of Bangladesh with a GSP ``action plan 
'' listing specific actions that Bangladesh should take to provide a 
basis for reinstatement of GSP benefits. The action plan specifically 
calls for improving labor, fire, and building standards, removing 
obstacles to freedom of association and collective bargaining, and 
reforming labor laws.
    As my colleagues on the panel note in their testimony, following 
the President's decision on GSP and the release of the action plan, the 
administration worked closely with the European Union (EU), other key 
stakeholders, including the International Labor Organization (ILO), 
major international garment brands and retailers, unions, NGOs and the 
international donor community to ensure a coordinated and comprehensive 
effort to press for and support reforms by the Government of 
Bangladesh. For example, we worked closely with the EU, the ILO, and 
the Government of Bangladesh on a ``Sustainability Compact,'' that 
complements the GSP action plan in many key areas. The Sustainability 
Compact is an important public commitment by the Government of 
Bangladesh to undertake specific reforms and actions--with support from 
the U.S., EU, and ILO--to improve worker rights and safety.
    We told Bangladeshi officials that we would review their progress 
in addressing the action plan in late 2013. Since then, USTR, the 
Department of State, including the U.S. Embassy in Dhaka, and the 
Department of Labor, and have engaged intensively with the Government 
of Bangladesh and other stakeholders to press for progress on the 
action plan. In November 2013, the Government of Bangladesh submitted a 
paper summarizing its actions to date. The AFL-CIO also submitted a 
paper with its assessment of progress on the action plan. Both 
documents are available for public viewing via the ww.regulations.gov 
Web site.
    The administration concluded its review of these submissions in 
late 2013 and recently conveyed its conclusions to the Government of 
Bangladesh. In sum, we found that while Bangladesh has made some 
progress on implementing the action plan, further action is needed.
    On the positive side, we noted the following progress:

   The Government of Bangladesh has worked closely with the ILO 
        and others to develop a plan for substantially increasing the 
        number and quality of labor, fire, and building inspections, 
        especially in the ready-made garment sector;
   The Government of Bangladesh has facilitated registration of 
        new trade unions, dropped questionable criminal charges against 
        two labor activists, removed obstacles to the operation of two 
        prominent labor-focused nongovernmental organizations, and is 
        working with the ILO to improve transparency regarding 
        inspections, union registrations, and the handling of unfair 
        labor practice cases;
   The Government of Bangladesh also has committed to fund two 
        programs to improve industrial relations and raise awareness of 
        workers' rights in the shrimp processing sector.

    Areas where additional work is needed:

   Implementation of the plans to improve labor, fire, and 
        building inspections which have only just begun. It remains to 
        be seen how effective those inspections will be in identifying 
        and addressing problems such as those that caused the April 
        2013 Rana Plaza factory collapse and the November 2012 Tazreen 
        factory fire.
   Making significant changes to the labor law to address 
        shortcomings related to the right to strike and requirements 
        for union formation. In addition, no action has been taken to 
        date to bring the EPZ law into conformity with international 
        standards, which has been an issue of concern in GSP reviews 
        dating back to the early 1990s.
   Additional actions to establish that harassment and 
        intimidation of labor activists has ended, to implement a 
        system to respond effectively to complaints of unfair labor 
        practices, to implement fines and penalties, and to establish 
        and maintain a public database and hotline.

    My colleague, Eric Biel, from the Department of Labor will address 
some of the substance of the GSP Subcommittee's assessment in more 
detail in his testimony.
    In late January, we communicated to the Government of Bangladesh 
our conclusion that Bangladesh has not made sufficient progress on the 
GSP Action Plan to warrant reinstatement of GSP benefits at that time 
and that we intend to conduct the next such review in May 2014.
    Mr. Chairman, I should also note at this point that legal 
authorization for the GSP program expired on July 31, 2013. As long as 
the program is without authorization we will not be in a position to 
recommend to the President any changes to country eligibility for the 
program. The GSP program is an important tool in the U.S. Government's 
efforts to help developing countries to use trade to overcome poverty 
and advance economic development. GSP also supports U.S. jobs by 
lowering costs for U.S. businesses that use GSP imports as inputs in 
manufacturing. The administration supports renewal of the program and 
wants to work with Congress to accomplish this.
    In terms of our broader economic engagement with Bangladesh, in 
late January, the United States-Bangladesh Trade and Investment 
Cooperation Forum Agreement (TICFA) entered into force. We envision the 
TICFA as the key coordinating mechanism for bilateral, government-to-
government efforts on the GSP Action Plan. As agreed by the Government 
of Bangladesh in the meeting following the TICFA signing in late 
November 2013, we plan to create a TICFA Working Group on GSP/Labor 
Affairs to provide an ongoing, formal mechanism for our two countries 
to address labor concerns. We plan to hold the first TICFA Council 
meeting in Dhaka later this spring.
    In conclusion, we are committed to encouraging Bangladesh to make 
the reforms on worker rights and safety that are set out in the GSP 
Action Plan to provide a basis for reinstatement of GSP benefits. We 
will continue to work closely with the Government of Bangladesh, the 
EU, the ILO, the private sector, workers, NGOs, and others to ensure 
that the benefits of trade and development are widely shared in 
Bangladesh. Many of the issues Bangladesh faces will require sustained 
and focused support from a variety of actors. However, if Bangladesh 
succeeds in addressing these issues and creates a more sustainable 
industry that affords basic worker rights and protects workers' safety, 
it will greatly enhance its economic development and can stand as a 
model for other countries facing similar challenges.

    The Chairman. Thank you all for your testimony.
    Madam Secretary, let me just start off with the political 
environment in Bangladesh. I listened to your statement. I know 
what we are saying to the Bangladeshi Government, but what is 
their response? Where are we headed, here, from your 
perspective?
    Ms. Biswal. Well, it is unclear, Mr. Chairman, where we are 
headed. We continue to work very closely with our colleagues in 
the international community and with the U.N. to continue to 
press upon the government that there needs to be dialogue and a 
new process that is credible. Thus far, I would not say that we 
have had tremendous positive traction on those statements. We 
are continuing to press them, not only on the democratic 
governance issues, but also continuing to press on human rights 
and space for civil society. At the same time, we are 
continuing to work aggressively with the people of Bangladesh 
across the front of issues on the economic/development arena, 
where we have seen some tremendous progress with working with 
civil society in Bangladesh.
    The Chairman. Well, is it time to intensify international 
efforts toward a resolution? I understand that the Secretary 
General's Office of the United Nations has already sent a 
Deputy Secretary General. Is it time for the U.N. to appoint a 
special set of envoys? Is it time for concerned countries to 
send their own high-level envoys to press upon the Bangladeshi 
Government the need to find a political solution to the 
conflict that exists?
    Ms. Biswal. I think, certainly international pressure is 
warranted. Ultimately, this is going to be an issue that gets 
resolved from within, and the political will of the Bangladeshi 
people is going to be the largest and most forceful determinant 
of the course forward for that country. And so, we are trying 
to ensure that the focus here does not go outside of 
Bangladesh, and stays within Bangladesh, and calibrating our 
pressure to maintain that.
    The Chairman. Well, it is very difficult to be able--with 
all the shortcomings that still exist in the whole labor 
standards--to get a government who is in the midst of its own 
crisis and to focus on what they need to do. And so, this has 
multiple consequences to it.
    Let me just say that 40,000 individuals unionized, out of 3 
million, is less than 2 percent. So, I keep hearing about 
progress, but I guess progress is relative. To listen to 
``3,000 factories,'' but knowing that only a small fraction of 
them inspected.
    So, Mr. Biel, I strongly believe that workers are best 
placed to ensure their own safety. How would you assess the 
worker empowerment mechanisms of the two different private-
sector safety initiatives--the Alliance and the Accord--in 
their ability to help workers ensure their own safety?
    Mr. Biel. Thank you, Mr. Chairman.
    On the issue of the numbers, by the way, I think, from all 
we have heard, including in conversations with the 
International Labor Organization, the Solidarity Center 
representatives, both there and here, we are at a very early 
stage on that front. The numbers, as we have noted, of new 
unions registered is a positive development. But, in terms of 
what is actually happening on the ground, and their ability to 
get traction, it is still at a very early stage. The next 
months and the next year will be critical.
    On the issue of the two initiatives, you will hear more 
details on what the two initiatives have done, thus far, on the 
second panel. I would say that we are always encouraged when 
there is the ability of different stakeholders, including 
business and unions, to work together. We have seen progress in 
that front in other places. You noted, in your opening 
statement, that we have to look beyond just Bangladesh, in 
terms of many of these international worker-rights issues. And, 
for instance, when business and labor have spoken with a 
unified voice, for example, on the issue of forced--on child 
labor in the cotton sector in Uzbekistan, it has made a real 
difference. When business and unions have jointly written 
concerning the current troublesome situation in Cambodia, 
working from a common set of understandings, it makes a 
difference. So, certainly, in terms of structure, we see a lot 
of promise in the Accord. You will be hearing more on that from 
Mr. Nova.
    We do want to recognize, at the same time, the Alliance has 
issued a 6-month report laying out accomplishments to date, and 
there is certainly hope on the ground that the two initiatives 
can coordinate with respect to common safety standards, with 
respect to not having duplicative and overlapping inspections 
in factories that--from which both Alliance and Accord members 
source----
    The Chairman. Let me interrupt you for a moment, because 
you----
    Mr. Biel. Sure.
    The Chairman [continuing]. You have perfected the ability 
of members of the Senate to filibuster. So, let me----
    Mr. Biel. Sure.
    The Chairman. I know that is not your intention, but----
    Mr. Biel. Oh, no, no. No, I was----
    The Chairman. The----
    Mr. Bie [continuing]. I am happy to stop with that.
    The Chairman. The core question is--it seems to me that the 
Accord's agreements are more forward-leaning, in terms of 
worker empowerment, than the Alliance is. Is that a fair 
statement?
    Mr. Biel. The Accord structure does create some clearer 
financial obligations of the participating brands. It does 
create a greater degree of certainty, in terms of sustainable 
sourcing from that country. There also are a lot of common 
elements between the two, in terms of the commitments to 
develop better inspection procedures and, indeed, go beyond 
some of the requirements of the government. So, I think it is a 
case of--there are some stronger points of the Accord, there 
are some areas of common area.
    The Chairman. Here is the problem. So--in your own 
testimony, you have a very slow, low rate of inspectors being 
trained. So, right now, if I am in Bangladesh, if I am a 
factory garment worker, I look at a series of circumstances as 
I enter that building and say, ``Wow, my life is really at risk 
here.'' And, unless I have the ability to be able to say, 
``There is a problem here,'' and go to the owners and say, 
``There is a problem'' and not feel that there is going to be 
consequences to my job or my safety--personal safety, we have 
trouble.
    And it seems to me that some of the private sector--which I 
applaud for moving forward--wants to deal only with the safety 
elements, in the hope that inspectors would deal with that, but 
they do not understand that a critical element, even with 
inspectors, is to be able to have an individual say, ``This is 
a challenge to me.'' So, I am concerned about that.
    Mr. Karesh, let me ask you. It appears as though the 
Government of Bangladesh has only addressed what I would 
consider the low-hanging fruit in GSP's action plan, and it 
still has a very long way to go in reforming their labor law 
and ending the harassment of labor activists. Do you think that 
the government has the political will and the capacity to 
credibly address these remaining and significant gaps?
    And I am concerned that we not look at reinstating GSP 
unless, in fact, we have the type of significant action, 
because it is not, as I said, only about Bangladesh. If we do 
not send a message that, in fact, you cannot get trade 
preferences when you have the conditions such as exist in 
Bangladesh, then it will just migrate to other places. So, 
sending the right message, here, is not only sending the right 
message to Bangladesh, but to a more global industry.
    Mr. Karesh. Thank you, Mr. Chairman.
    We recognize, as the Assistant Secretary talked about, that 
the current political situation in the elections obviously 
complicate the situation and engagement with the government. 
But, at this time, on these issues, we believe the government 
remains committed to working with us and private business and 
the stakeholders and the ILO, and others, to continue to 
advance the effort on worker rights. I think you are accurate 
in saying that progress has not been as fast as we would have 
liked. We believe there has been some progress. We believe 
there are very significant actions that continue to be needed 
in order for the administration to consider a possibility of 
GSP reinstatement.
    But, at this time, we do remain engaged. We continue to 
work with them, we continue to work with the ILO and others to 
move the issues forward. And so, we still remain optimistic 
that we will continue to make progress in Bangladesh.
    The Chairman. Well, I have other questions for you, but let 
me turn to Senator Risch.
    Senator Risch. Thank you, Mr. Chairman.
    You know, as we go forward here, I think--after the tragedy 
happened and Americans became aware of what was happening in 
Bangladesh, I think everyone was aghast. And the difficulty, 
here in America, is, is we do not really have a comprehension 
on what the rest of the world is like. Bangladesh is not 
America. It is not going to be America. It is never going to 
have the conditions that we have here. And, as a result of 
that, I think it is--everyone is of the frame of mind that any 
way that we can bring pressure to attempt to change conduct is 
a good thing.
    One of the difficulties is, How do you do that? And I think 
the chairman has made remarks about the difficulty in the 
democratic process in Bangladesh. Certainly, they have made 
real progress, in recent years, in the democratic process. But, 
I think the January 5th elections probably were a step 
backward. And again, comparing it to the American system is not 
a good thing, because they are not anywhere even near the same 
ball park.
    Having said that, Mr. Karesh, the question I would have for 
you is--the President's decision to change the Generalized 
System of Preferences--that was obviously put in place to 
attempt to convince people to change conduct. I have trouble 
tying that to bringing public officials in Bangladesh to change 
their minds about conduct. It seems to me--and, as I understand 
it, the schedule--when that was removed, that there would be a 
tariff of about 16 percent on the goods that were brought into 
the United States. Am I right on that? Approximately?
    Mr. Karesh. I am sorry, Senator, I do not know the actual 
tariff number. I can get that for you, but I do not know.
    Senator Risch. When the tariff went up, tell me--being in 
the position you are in, the Trade Representative Officer, what 
effect has that had on Bangladesh workers, American businesses, 
American consumers, and, finally, on elected officials in 
Bangladesh that we are trying to convince they should change 
their conduct? Tell me how this worked.
    Mr. Karesh. Well, I think it is quite clear that the GSP, 
along with, you know, other factors that have been mentioned 
that brought attention on the working conditions in Bangladesh, 
crystalized a number of things. It crystalized, within the 
Government of Bangladesh, the need to address the issue. It 
also crystalized, among the international community, including 
the brands and the retailers and others who do business there, 
that there were serious problems in Bangladesh with regard to 
worker rights and workplace safety. And it brought, not only 
the governments together, but international organizations, 
brands, retailers, NGOs, labor unions, to focus on the issues.
    Admittedly, suspending GSP--apparel and textile, of course, 
do not come in under GSP, so there is no direct effect on 
apparel products, in particular. But, the notion of losing GSP 
and what comes with it, because the failure to protect worker 
rights matters to governments, matters to the Government of 
Bangladesh, and gets attention within the government, and a 
recognition of a need to address the issues. And that is why we 
say we believe there have been some efforts underway to address 
the concerns, but there is still a great deal more that would 
need to be done.
    The standard under GSP is taking steps to afford 
internationally recognized worker rights. And that is what we 
are working to ensure occurs within Bangladesh to a sufficient 
degree.
    Senator Risch. Has the President's action, in that 
suspension, in any way changed the amount of product that has 
been shipped to the United States?
    Mr. Karesh. There have been some changes in the imports 
from Bangladesh. And I do not believe those are necessarily 
attributed to the decision on GSP. There are other economic 
factors that might affect that. The largest amount of imports 
from Bangladesh to the United States is comprised of apparel. 
And, as I expressed, there is not actually a direct effect with 
regard to GSP on that.
    I think the latest numbers we have, from 2013, are about 
$5.3 billion worth of goods imports from Bangladesh to the 
United States; about $4.9 billion of that is apparel.
    Senator Risch. How about on employment in Bangladesh, on 
the people who work in these factories? Has it had an effect on 
them?
    Mr. Karesh. I do not have any numbers particularly on 
employment levels within Bangladesh. Obviously, that is 
affected by the amount of orders and products that are being 
produced. And the orders go up and they go down. But, I do know 
that our interest, obviously, is ensuring that there are good 
working conditions that, over the long-term--a strongly held 
belief that, if you improve working conditions, you improve 
respect for worker rights, which goes along with rule of law 
and good governance, that that creates the atmosphere that, in 
the long run, will increase economic development and will 
increase employment.
    Senator Risch. My time is pretty limited. Thank you for 
those answers.
    Let me ask each of the panel briefly to address, hopefully, 
a brief question, and that is, How do you see this playing out, 
as far as the Accord and the Alliance? How will this--how will 
those two interests eventually come together and finish out, in 
a brief sort of way? Could you answer that for me?
    Mr. Karesh. I do not know if I can give a definitive 
answer. What I would say with regard to that is that our 
interest is in seeing that there be a variety of stakeholders 
working on these issues, and that it is important that the 
Accord and the Alliance, and the companies that are involved in 
those, coordinate their efforts, harmonize the standards that 
they are utilizing, in order to make the most progress. I 
think, at this time, it is very difficult to determine what the 
ultimate outcome would be.
    Senator Risch. And would you agree with me that, 
ultimately, the biggest stick in this whole thing is held by 
those companies that are the purchasers of those products? Am I 
right or am I wrong on that?
    Mr. Karesh. I believe all the stakeholders have a role to 
play here and----
    Senator Risch. I understand that.
    Mr. Karesh [continuing]. Can help assist it, but I do not 
know who has the largest stick. I would say that, ultimately, 
the most important actor is the Government of Bangladesh.
    Mr. Biel. I would echo that. I think, you know, the private 
initiatives, the Accord and the Alliance, have critical roles 
to play. You will hear more, on the second panel, about the 
number of factories combined that they can reach. And it is a 
pretty sizable number. But, it is important this is all 
coordinated. There is already a structure in place: the Better 
Work Bangladesh Programme, over the next 3 years, can reach 
about 300 factories. That is another piece of the puzzle. The 
ILO is committed, in terms of implementing the National 
Tripartite Plan of Action, to ensure that all the factories in 
the sector ultimately are addressed. There are also challenges 
with the informal sector, and some that kind of are under the 
radar screen.
    But, I would say this will only work if all the parties, 
including the brands and retailers that are part of the Accord 
and the Alliance, step up, continue to push upward with regard 
to common standards, and that we continue to hold the 
Government of Bangladesh's feet to the fire, not just through 
the leverage we have with GSP, but also through our work with 
EU and the ILO and the Government of Bangladesh under the 
Sustainability Compact that was entered into just a few weeks 
after this committee's last hearing, last July, that we are now 
part of, as well. Initially, it was the EU and ILO and 
Bangladesh, and then we joined that, subsequently.
    All those different tools and all of the donor programs--
$26.5 million in funding, including from other governments 
around the world--together, needs to be as harmonized as 
possible, in terms of pushing forward on the common goal of 
helping empower the workers of Bangladesh in a way they have 
not been, to date.
    Senator Risch. Ms. Biswal, your thoughts on the issue?
    Ms. Biswal. Yes. Thank you, Senator.
    I would say that there is a natural sequencing here, in 
that, initially, because of lack of capacity, it is going to 
require a very concerted effort by industry to help Bangladesh. 
But, ultimately, it will not be industry and international 
pressure as much as it will be political will within Bangladesh 
to conform to international standards on worker safety. And 
that is going to require a very robust and engaged labor and 
civil society. And therefore, it is important that we continue 
to press on all sides and on all stakeholders, even though, in 
the immediate term, you may see much greater action coming out 
of industry, in terms of addressing the immediate problems. The 
longer term requires labor and civil society to have a robust 
capacity to continue this.
    Senator Risch. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Senator Cardin.
    Senator Cardin. Well, thank you all very much. And I 
certainly agree that Bangladesh is an important strategic 
partner of the United States. We have a longstanding 
friendship.
    But, let me just follow up on Senator Risch's point. Yes, 
political will is needed to make these changes. But, political 
will can be helped by the international community. And I think 
harmonizing all the tools that are available is critically 
important. But, we start with the realities. And the 
realities--Mr. Karesh, according to your testimony, is that 
there is still substantial progress that needs to be made in 
order to comply with our action plan. The implementation of 
plans to improve labor, fire, and building inspections have 
only just begun. Significant changes to the labor law to 
address shortcomings relating to right of strike and 
requirements for union formation still needs to be done. There 
is still harassment and intimidation of labor activists. So, 
there is still a significant progress that we expect to be made 
if, in fact, Bangladesh is going to meet certain basic 
standards for human rights, labor rights, and worker safety.
    So, how do we harmonize, in a way, all these tools that we 
have available? We do provide a great deal of assistance. We 
are--they are major players and major U.S. initiatives. There 
is the international community. Why have we not been more 
successful, particularly with highly visible episodes occurring 
in Bangladesh--why have we not been able to coordinate better--
what do we need to do to coordinate better all the tools that 
are available?
    Mr. Karesh. Thank you, Senator.
    Well, there are a variety of things, and I think many of 
them are underway. We have been working under GSP, obviously 
very closely with the government and a lot of other actors. We 
have----
    Senator Cardin. Does the government take us seriously on 
GSP? As we said, it does not apply to a lot of their imports. 
So, is this an effective tool?
    Mr. Karesh. Our view is that this has been extremely 
helpful, extremely useful in----
    Senator Cardin. But, from Bangladesh's----
    Mr. Karesh [continuing]. Focusing the government----
    Senator Cardin [continuing]. Point of view, Do we have 
their attention on this?
    Mr. Karesh. Yes, I believe that we do, sir. Yes, sir. And 
that is based on the action and the engagement we have had with 
the government, both here, working through the agencies here, 
as well as our Embassy in Bangladesh, as well as working, as 
mentioned by my colleagues, with the EU, with the Netherlands, 
with the U.K., with Canada, and with the ILO and others. We 
have worked with the ILO, who is starting a Better Work Program 
in Bangladesh which required certain reforms to be undertaken 
by the Bangladeshi Government before the ILO would come in and 
run that program. They met those standards. There is more that 
needs to be done, but at least they met some minimal actions 
taken for the ILO to feel as though it was beneficial to go in. 
And you have heard my colleagues talk about other programs and 
actions that are underway, working between the governments, 
working with the international community, international 
organizations, NGOs, and others.
    Senator Cardin. But, is there--Madam Secretary, is there a 
clear message, when we still participate in so many of our 
programs and yet the pace of progress has not been acceptable 
to us? Should we be tougher?
    Ms. Biswal. Well, we are being very tough, Mr. Senator.
    To kind of look at the pace, you have to look at where they 
are coming from and where they are going. In the two prior 
years prior to this engagement, there were approximately 1 or 2 
unions formed per year, to this year we have seen 100 unions 
formed, 95 of which we think are strong and credible, 5 of 
which we think are industry-sponsored.
    It is clearly not enough, but there is positive momentum, 
and transformation is not going to happen immediately and 
overnight. It is going to be a long haul to get Bangladesh to 
where it needs to be to meet international standards. And we 
have got to be with them for that long haul, continuing the 
pressure, but also providing the tools and the assistance. And 
with the leadership of this committee, I would say that we are 
providing tools and assistance. Nine million dollars of U.S. 
Government funding has been committed over the past year, 
specifically on issues of labor and worker safety, between the 
Department of Labor, the Department of State, and USAID, 
working with----
    Senator Cardin. How much of your time is also spent on 
good-governance issues, on dealing with free and fair 
elections, dealing with the basic problems of corruption within 
Bangladesh? Is that part of the equation that is----
    Ms. Biswal. Absolutely.
    Senator Cardin. Yes, we want to make sure workers are safe; 
yes, we want them to have the right to organize. But, without 
good governance, a lot of that is going to be somewhat 
meaningless.
    Ms. Biswal. It is all part and parcel of the same thing. It 
is all interrelated and interconnected. And we want to see a 
strong and vibrant Bangladesh that continues to prosper and 
that requires addressing issues of strengthening democratic 
processes, addressing issues of corruption. And we are working 
with the Anti-Corruption Commission in Bangladesh, working on 
issues of transparency, as well as issues of capacity.
    Senator Cardin. Could you provide for us the expectations 
on progress on those fronts, give us some timeframe as to how 
we think--no, I understand you--it is hard to predict, it does 
depend upon, as you put it, the political will of the 
government and the people, but it--there are so many areas of 
concern that we pointed out. And yes, the international 
community was shocked with the visible signs of failure within 
Bangladesh, but the elections are critically important, 
democratic institutions are critically important, following 
through on the--on their plans to deal with corruption are 
vitally important. And it is not just--not just the trade 
issues that have been mentioned. These other issues must be 
done also if we are going to have a reliable country that we 
can----
    Ms. Biswal. Right.
    Senator Cardin [continuing]. Have confidence that our 
partnerships will result in a better way of life for the 
people. But, without the foundations, there is a question as to 
whether we should be continuing some of these partnerships.
    Ms. Biswal. Well, I would draw upon my prior experience at 
USAID as we look at Bangladesh and we see it is a very mixed 
picture and a complicated picture. Because, on the one hand, we 
have seen tremendous gains on lifting people out of poverty, on 
improving the health conditions, on working with and 
strengthening civil society organizations to be able to provide 
services as a supplement to the government, where government 
fails to meet those needs. And so, you have seen improvements 
in food security, you have seen reductions in poverty level, 
you have seen reductions in maternal deaths and child deaths, 
and Bangladesh is well on its way to meeting many of the 
Millennium Development Goals.
    At the same time, that progress can easily be reversed if 
the democratic processes and institutions are not strengthened. 
And therefore, there is a great deal of focus right now on 
ensuring that the democratic institutions in Bangladesh do not 
slide back. And there is concern. There is real concern. Not 
enough to warrant pulling back or disengaging, but it does 
require us to redouble our efforts and continue to maintain 
pressure on that country and that government so that the 
Bangladeshi people have the best shot at a more stable and 
prosperous future.
    Senator Cardin. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Durbin.
    Senator Durbin. Mr. Chairman, thank you. And thanks for the 
kind remarks in your opening.
    It was over 20 years ago that I made my first trip to 
Bangladesh. And I have been back several times. I was amazed by 
what I found. And one of the most amazing things that happened 
was, I met a man who became a close friend of mine and one of 
the most inspiring people I have ever met. And I am speaking of 
Muhammad Yunus, the founder of Grameen Bank. Microcredit was 
not his original idea, but he took this notion of loaning money 
to the poorest of the poor to a level that no one in the world 
had ever seen. He has received the Nobel Peace Prize for his 
efforts, and I was happy to lead a bipartisan effort in the 
House and Senate to give him the Congressional Medal of 
Freedom. I believe he may have been the first Muslim to receive 
that award. There was a huge hall packed with his supporters 
from all different backgrounds and religious faith. He is and 
was so extraordinary so as to deserve these singular awards.
    And so, it troubles me greatly when I see what has happened 
to Grameen Bank. When I consider the impact of the government's 
decision in removing him from the leadership of that bank and 
then basically subsuming this bank into the Central Bank of 
Bangladesh, it strikes me that it is a crass political move to 
punish him in some way, but, sadly, to punish millions of 
innocent people who depend on that bank to survive.
    I will just tell you that my trips to Bangladesh, meeting 
with those who count on the Grameen Bank, are some of the life 
experiences I will never forget. In the poorest villages of one 
of the poorest nations on Earth, the Grameen Bank has given 
these--primarily women, but not exclusively--given these women 
hope.
    And so, I guess I would like to ask, if I could, first of 
the Assistant Secretary of State, here. We know what this 
government has done to Muhammad Yunus, and what it has done to 
Grameen Bank. What is it we can do to convince the Prime 
Minister that this is wrong--wrong for her nation, unfair to 
this man, and inconsistent with a good relationship between the 
United States and Bangladesh?
    Ms. Biswal. Well, thank you, Senator. And let me just echo 
the sentiments that you so eloquently put forward.
    Professor Yunus, every time that I have had the occasion 
and the opportunity to meet with him, is a deeply inspiring 
figure. His humility is buttressed by his creativity, his 
intellect, and his insight, and his commitment to humanity, 
which extends far beyond the borders of Bangladesh.
    The United States has engaged aggressively on the issue of 
the Grameen Bank, and the viability and the sustainability of 
the Grameen Bank. It is one of Bangladesh's proudest and most 
crowning achievements. And yet, it is under threat within 
Bangladesh.
    The United States and USAID have partnered with Professor 
Yunus to ensure that Grameen's global reach continues to be 
strengthened. And when I was at AID, prior to this position, I 
had the pleasure of being able to work with Dr. Yunus in 
supporting and strengthening Grameen's social businesses and 
their ability to reach millions of women around the world. So, 
I think that the Grameen institution, globally, is one that is 
strong and that we are continuing to work with and partner with 
and support.
    What I think is under threat is Grameen's ability to 
operate and support millions of Bangladeshi women and 
Bangladeshi families. And that is a deep shame and travesty. 
And we continue to press the government--in my recent visit, in 
November, I raised this directly with the Prime Minister. I had 
an opportunity to meet with Professor Yunus while I was in 
Dhaka. And we continue to press, at every opportunity, that 
this is not in the interest of Bangladesh and that this 
undermines the Prime Minister's own economic development 
objectives for her country and for her people.
    Senator Durbin. I want to salute my colleague Senator 
Boxer, who circulated a letter signed by a number of the women 
Senators, because this is--Microcredit and Grameen are 
important issues for women around the world. I hope that we 
will continue to press on this. It is just such a cruel irony 
that the country, the nation that gave birth to this notion of 
expanding Microcredit beyond what was a pretty limited 
application, is now seeing that effort thwarted, subjugated by 
its current government.
    Let me address a second issue which has come up here, and 
that is the issue about the disastrous fire that killed so many 
Bangladeshi garment workers in 2012. Since then, more than 100 
apparel corporations from 19 countries have signed on the 
Accord for Fire and Building Safety. I would like to ask if 
anyone on the panel--Mr. Biel, Mr. Karesh, or the Secretary--
would like to comment on this Accord. And I would like to add 
one postscript to it.
    In what was left of these buildings after the fire, it was 
discovered that there were some products that were being made 
for the United States Marine Corps. And the Marine Corps made 
it clear, from that point forward, that they were not going to 
do business with companies out of Bangladesh that did not sign 
on to the Accords. I want to expand that beyond the Marine 
Corps. And I think it should be expanded across the board to 
all government agencies, that we will continue to work with 
those companies that are providing a safe work environment for 
those workers, but we will not, by our government funds, 
subsidize those that exploit workers or expose them to this 
sort of danger.
    And I would like to ask Mr. Karesh, Mr. Biel, if they could 
comment.
    Mr. Biel. Sure. Thank you for that important comment, both 
with regard to the general situation, in terms of factory 
conditions, and what you mentioned concerning the Marine Corps.
    We had an opportunity, at Department of Labor, 
International Labor Affairs Bureau, to meet, just last week, 
with a group from the U.S. Marine Corps to talk a little bit 
about what they are doing with regard to broader government 
procurement issues, in light of some of the concerns that have 
been raised when some T-shirts with their logos were found in 
the aftermath of the Tazreen fire. They are taking some very 
proactive steps.
    There was a conference convened, about a month ago, by the 
Democracy, Human Rights, and Labor Bureau at the Department of 
State, in which we participated and others participated, to 
talk about, more broadly, the ability to use government 
procurement as a lever for improved working conditions. And I 
am sure my colleagues at State, as well as we at the Labor 
Department, and others, would be pleased to talk further about 
ways we can work together on that, not just in the context of 
Bangladesh, but globally.
    With regard to the specific things you mentioned concerning 
the Accord, you will be hearing more on the second panel, in 
terms of the details of what the Accord is doing. I think one 
thing I neglected to say earlier--when the chairman was asking 
about the Accord and the Alliance--is one thing we should all 
dispel is the notion that one is somehow a European initiative 
and one is a U.S. initiative. In fact, as you will hear more on 
the second panel, the Accord--the cornerstone member of the 
Accord was PVH, which includes well-known brands like Calvin 
Klein and Tommy Hilfiger, and so forth. And there are a number 
of other U.S. retailers that have joined the Accord; most 
recently, Fruit of the Loom, which is also actually a member of 
the Alliance.
    And so, there really is an opportunity to move forward with 
these initiatives as a key part of the overall set of solutions 
for improving workplace safety and worker rights in Bangladesh. 
And we are happy to talk further with you and your staffs about 
how those fit into the work we do on a government-to-government 
basis. But, I know you will be hearing a lot more from the 
second panel on the specifics of the Accord and the Alliance.
    Senator Durbin. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator Durbin.
    I just have a few other questions before we excuse you. And 
I think Senator Risch may have some, as well.
    Madam Secretary, I see, in the Bangladeshi press this 
morning, reports that USAID will refocus its democracy and 
governance programs away from the capacity development of 
members of the Bangladeshi Parliament. What are our future 
plans of democracy and governance programming in the country as 
we move through this uncertain period? And where are we moving 
to, in terms of our USAID program?
    Ms. Biswal. Thank you, Mr. Chairman.
    We are taking a more comprehensive review of our democracy 
and governance programming. I will note that it is a fairly 
limited amount of resources; and therefore, we want to make 
sure that we are making very effective and impactful use of 
those resources, including supporting and strengthening labor 
and worker safety issues, including addressing issues of 
judicial strengthening and judicial capacity. We are taking a 
very hard look at the parliamentary strengthening programs, and 
particularly are curtailing any programs that are providing any 
direct benefit to members of Parliament, are looking at broader 
programs of institutional strengthening to see whether they are 
the best use of resources.
    As we manage in a constrained budget environment, the fact 
that, across the board, more needs to be done to strengthen 
democratic institutions and processes and political parties, et 
cetera, it is going to be a little bit of a struggle to 
determine exactly how to make that scarce dollar stretch as 
much as possible, and have as great an impact as possible. But, 
we are committed to doing that, because, really, none of the 
economic gains or development gains in Bangladesh can be 
sustained if there is not the transparent, accountable 
institutions to form the bedrock to continue forward.
    The Chairman. What I am trying to determine, then--first of 
all, is--are those press reports correct?
    Ms. Biswal. We are curtailing some aspects of the 
parliamentary programs----
    The Chairman. Okay.
    Ms. Biswal [continuing]. Particularly those that are 
focused on individual members of Parliament.
    The Chairman. I see. And we have yet to determine where we 
are moving those resources to?
    Ms. Biswal. That is right.
    The Chairman. All right. Well, the committee would be 
interested in what is USAID's, State Department's, focus on 
where you are going to be using those moneys.
    Mr. Biel, let me ask you, What role can the very powerful 
garment industry association in Bangladesh, the Bangledesh 
Garment Manufacturers and Exporters Association (BGMEA), play 
in promoting the rights of workers, ending anti-union activity 
in member factories, and facilitating the successful 
negotiation of collective bargaining agreements in member 
factories?
    Mr. Biel. There are a number of roles BGMEA and other 
industry associations can and must play. BGMEA is actually--
their chairman is part of the board of the Alliance. And so, 
there is an opportunity, through the Alliance, for them to be 
directly working with their members to deal with the fact that 
there are some factory owners still in Bangladesh who do not 
appear to be receptive to the initiatives that these brands and 
retailers are undertaking to try to move forward with 
inspections and to deal with worker rights and workplace 
safety.
    The other thing is, BGMEA, working closely with the 
government, with the Ministry of Labor and other parts of 
Bangladesh Government, need to be a voice for continued 
progress on the implementation of labor law reforms, not just 
on the ones that were included in the July 2013 package, but 
concerning other areas where our hope is--and this will take 
some time--that brand Bangladesh can be a model, not for what 
we have seen in the past 2 or 3 years and even further back, in 
terms of well-publicized disasters like Tazreen and Rana Plaza, 
but can be a model for improvements. And that will only happen 
if powerful industry associations convince their members to 
move forward, to be more transparent, to have state-of-the-art 
compliance programs. Again, it is a continuum of work from the 
private sector and the government, and BGMEA does have a 
tremendous political presence in Bangladesh, including in terms 
of representation in the Parliament. And so, they are clearly a 
critical actor----
    The Chairman. What is their incentive? Since apparel is 
obviously not part of the GSP, it has no direct effect. What is 
their incentive?
    Mr. Biel. I think the--well, one of their incentives is, we 
certainly, as all of us have said, do not want any of this to 
result in a loss of jobs in Bangladesh, but, ultimately, buyers 
around the world will make a determination, based on their own 
concerns, their own reputation, on where they are going to 
continue to source from. It is a very competitive global 
market. And I think one of their incentives is, Bangladesh has 
grown by leaps and bounds, in terms of--the ready-made garment 
sector is now second in the world, maybe first, based on 
current trends--and their incentive is, they do not want to 
lose the business to other markets, based on a sense that this 
is not a stable environment, and it is one in which the buyers 
cannot count on the kind of practices that will enhance their 
own reputation.
    So, I think, even though GSP is a lever, it has limited 
commercial impact, tied to the sustainability compact and tied 
to what the private sector initiatives can do, factory owners 
and the trade associations, Bangladesh, do have a strong 
incentive to step up their game.
    The Chairman. Well, I hope the factory owners understand 
that it would be very difficult for international brands to 
sell clothing made in Bangladesh if it is on the blood of 
workers. And if they do not understand that, they will come to 
that understanding when it is way too late.
    Mr. Karesh, last question. What is it that we are going to 
need--I see the EU is in the midst of conducting a review of 
Bangladesh's status with their GSP program, which, unlike ours, 
includes apparel products. Do you have any sense of what 
factors the EU is going to be looking for? And what are we 
going to ultimately look for in restoring GSP? Because, while, 
you know, these do not have a direct effect on apparel, 
obviously a country wants GSP, because there is--the very name 
implies there is a preference. And so, if you want that 
preference, you have to live up to a certain standard. So, do 
you have any insight into the EU? And lastly, what do we 
expect--what will we need to see before we consider restoring 
GSP?
    Mr. Karesh. Thank you, Mr. Chairman.
    I am not fully versed in the GSP program in the EU, but, as 
I understand it, they have requirements for their GSP-Plus 
program which are similar to ours with regard to--making sure 
there is respect for ILO fundamental labor rights. And I 
presume that they will be looking at those issues. But, as I 
understand it, it is a much longer, more involved process that 
could take quite a bit of time if they are actually going to 
move forward and consider Bangladesh's eligibility under that 
program. I think it is one of the reasons why they have 
engaged, along with us and others, to try to focus the 
Bangladesh Government on addressing the concerns and improving 
the conditions there.
    As far as our GSP review, we have discussed some of the 
factors that we have looked at. We have laid out a very 
specific action plan. And our view is, those are the minimum 
actions that we need to see in order to come out with a 
positive view on reinstatement of GSP benefits. We believe 
there has been some progress on those issues, we believe these 
are very reasonable, doable things that would show a change in 
political will, would show that there is ability for workers to 
assert their rights and to empower them to a degree to ensure 
that there can be safer workplaces and that they can protect 
those rights and that they have a voice.
    As we have said, there are a lot of factors involved here. 
Our view is, ultimately, it comes down to determination of the 
Government of Bangladesh. But the other stakeholders obviously 
can play a role in improving conditions, but what we will need 
to see is--and we have a----
    The Chairman. So, at a minimum, you are talking about the 
fulfillment of the action plan.
    Mr. Karesh. That is correct, sir. Yes.
    The Chairman. Senator Risch.
    Senator Risch. Thank you, Mr. Chairman.
    First of all, let me say, Ms. Biswal, I really appreciated 
your response to Senator Cardin and Senator Durbin's really 
focused questions about the institutions. Without institutions 
that are stable and that represent the will of the Bangladesh 
people, we are all beating our head against the wall, here. You 
need that before you have anything else. So, I appreciate your 
clear vision in that regard, and also your initiatives in that 
regard.
    Let me close with just this focus for a minute. All three 
of you, I think, have said that what is going on right now is, 
all the stakeholders, the people who own the tools in the 
toolbox, are trying to work together to reach the same 
objective. Now, they may have different strategies of how to 
get there and what have you. But, that--and I tried, and others 
tried, to ask, How long is this going to take? And, appreciate 
that the answers there are not as clear as we would like, nor 
does anyone know.
    Having said that, it appears to me that we have got quite a 
ways to go yet, as far as this negotiation process is 
concerned, as far as the give-and-take is concerned. We have 
had some attempts in Congress to put in some legislation, the--
either it favors the Accord or it favors the Alliance. And it 
is also my impression that, at this point in time, for the 
Congress to get involved in this, as far as taking one side or 
the other, probably is counterproductive. And Congress is not 
very good at many things, and on something with as many moving 
parts as this, and is--as not being very far along the road to 
maturity that the agreement needs, it would seem to me to be 
greatly premature for Congress to wade in, here.
    I would like to get your thoughts, briefly, all three of 
you, in that regard.
    Mr. Karesh, start with you, please.
    Mr. Karesh. Thank you, Senator.
    Well, our view is that we need attention from a variety of 
the stakeholders here. And, ultimately, the Government of 
Bangladesh has to do what it needs to do to ensure there is 
full respect for rights. But, when you talk about, very 
specifically, on the shop floor, in the factories, improving 
safety, the buyers, whether they are in the Accord, in the 
Alliance--I think as long as those efforts are coordinated and 
they are focused, they can do a lot of good in the near future 
to improve working conditions where they are doing business.
    Senator Risch. You think they are making progress in that 
regard?
    Mr. Karesh. I think there is a lot of effort underway by a 
lot of people. And it is hard, sometimes, to measure that 
progress, but there clearly is attention to the issues.
    Senator Risch. Ms. Biswal, I am going to go to you next, in 
case I run out of time.
    Ms. Biswal. Well, thank you, Senator.
    We believe that there is room and space for all actors to 
work together, and it is going to require all actors to work 
together. And so, while we have not preferenced Alliance versus 
Accord, there is an important role for industry, for labor, for 
government, for civil society, and for the international 
community to play. And we are focused on trying to harmonize 
those efforts so that we can have as strong an outcome as 
possible.
    Senator Risch. Perfect. Thank you very much. I appreciate 
that.
    Mr. Biel.
    Mr. Biel. Just to echo what my colleagues have said, and 
specifically on the issue of the role Congress can play, I 
think this hearing, alone, in terms of demonstrating the 
continued focus of this committee and your continued oversight 
of these issues, sends a very strong and powerful message, the 
statements you have made. In terms of specific things dealing 
with preferences and so forth, you know, far be it for us to 
suggest a particular approach, but there are certainly some 
broad guidelines that you can lay down.
    Again, the core takeaway from this, perhaps, will be, What 
are the different tools, and how are they best situated, to 
ensure that workers in Bangladesh are empowered so that we do 
not have, as Assistant Secretary Biswal's predecessor, 
Assistant Secretary Blake, said very powerful at this--before 
this committee last June, a situation where, again, workers die 
because of the fact that they do not have the power to stand up 
for themselves? And you should certainly be assessing whether 
different actions--whether the ones that we are taking, 
government to government, whether--whatever the Alliance is 
doing, whatever the Accord is doing--are focused adequately on 
ensuring that the end game is a stronger role and voice for 
workers.
    The critical thing we will be doing in the coming months--
and it is a slow process--is seeing how the registration of 
these unions leads to actual changes on the ground. We are at 
the very early stages of that. As I mentioned, the Solidarity 
Center has documented some situations where newly formed unions 
are not being allowed to function adequately, but they also 
recognize that it is still early and that situation, hopefully, 
can change.
    So, that is how we are going to measure progress. And 
again, we have the mechanism of being able to look very 
specifically at what we have laid out in the GSP Action Plan, 
to do so in the areas that action plan covers. But, there are 
other things, certainly, that are the prerogative of Congress, 
including in terms of issues like government procurement 
policies. And we can certainly have a further conversation 
about those in the coming weeks and months.
    Senator Risch. Thank you much.
    Thank you, Mr. Chairman.
    The Chairman. Well, my thanks to all of you for your 
testimony. I can assure you that it is the Chair's intention to 
continue to follow this issue into what I hope will be a 
successful conclusion. We thank you for your testimony and your 
service.
    We will excuse this panel.
    Earlier, I had mentioned that we have visiting with us Reba 
Sikdar, and she is now here with us.
    So, Reba, thank you very much for joining us today, and we 
are so glad that you can be with us and that you are here to, I 
hope, embody the very essence of what we are fighting for. So, 
we are glad to have you with us.
    Let me call up our next panel.
    This panel is excused. Thank you very much.
    They are: Ellen Tauscher, chairman of the board of 
directors of the Alliance for Bangladesh Worker Safety--
    We are going to ask those who want to engage our panelists, 
that they can do so outside of the hearing room so that we can 
continue to move to the next panel. All right, if we can have 
our guests please leave quietly if you are going to vacate the 
hearing room.
    Our second panel today: Ellen Tauscher, chairwoman of the 
board of directors of the Alliance for Bangladesh's Worker 
Safety. I am thrilled to--as she works her way through the 
crowd--I had the privilege of serving with Ms. Tauscher in the 
House of Representatives, and we welcome her here today. Scott 
Nova is the executive director of the Worker Rights Consortium. 
Mr. Nova is here to represent the Accord on Fire and Building 
Safety in Bangladesh. And Ms. Kalpona Akter has come from 
Dhaka, where she is the executive director of the Bangladesh 
Center for Worker Solidarity. And we are honored to have you 
join us here today.
    Thank you all for being here. I will remind you that your 
statements will be fully included in the record, without 
objection, in their entirety. I would ask you to summarize your 
statements in about 5 minutes or so, so that we can go ahead 
and engage you in some questions.
    And, with that, Ms. Tauscher, you are recognized.

  STATEMENT OF HON. ELLEN TAUSCHER, CHAIRMAN OF THE BOARD OF 
 DIRECTORS, ALLIANCE FOR BANGLADESH WORKER SAFETY, WASHINGTON, 
                               DC

    Ms. Tauscher. Thank you very much, Chairman Menendez and 
members of the committee.
    It is a great honor to be back at this table again. This is 
the committee I got to know well during my time as Under 
Secretary of State as we collectively worked together on arms 
control and nonproliferation issues.
    And, Mr. Chairman, I very much appreciate your work and 
leadership on Bangladesh, and specifically on worker safety. I 
know how much you care about these issues, as you did when we 
served together for so long in the House of Representatives.
    Mr. Chairman, last summer, the leading North American 
apparel companies, retailers, and brands launched the Alliance 
for Bangladesh Worker Safety. The Alliance was developed under 
the guidance of former Senators George Mitchell and Olympia 
Snowe, with the help of the Bipartisan Policy Center. It 
represents a legally binding, 5-year, $50-million effort to 
improve the fire safety and structural integrity of factory 
buildings in the Bangladesh garment industry through a rigorous 
inspection and training regime, which is already well underway. 
The core mission of the Alliance is to improve the safety of 
the women and men who make their living in Bangladesh's ready-
made garment sector. Our goal is to prevent another factory 
tragedy and to build a long-term culture of safety.
    Mr. Chairman, as you have said, the situation on the ground 
in Bangladesh is complex and challenging. There are roughly 
5,000 factories in Bangladesh's ready-made garment industry. As 
the committee's own report from last fall notes, rapid industry 
growth and urbanization have led to a factories sprouting up in 
apartments and other places that are ill-suited to large-scale 
garment production and make unauthorized subcontracting even 
more dangerous than usual. There are too few government 
inspectors, and labor laws have been too weak for too long.
    But, despite the challenges and failures, the garment 
industry has played a key role in improving workers' lives in 
Bangladesh and advancing the country's economic development. 
More than 4 million people in Bangladesh, most of them women, 
depend on their jobs making clothes to support themselves and 
their families. The Alliance member companies acquire garments 
from close to 700 factories in Bangladesh which employ 
approximately 1.28 million workers. Far too many people depend 
on these jobs for us to turn away. We recognize our shared 
responsibility to address the threats to worker safety head-on, 
and agree workers should never need to risk their lives to make 
a T-shirt or to sew a pair of jeans together.
    As we move forward carrying out our mission, the Alliance 
will continue to work closely with the Government of 
Bangladesh, civil society, workers groups, and with our 
colleagues in the Accord. Despite press reports to the 
contrary, I am pleased to report that we have had excellent 
discussions with the Accord leadership in Europe, as well as in 
Dhaka. It is our commitment to work together with the Accord, 
and we are doing just that today on a number of important 
areas, such as standards, sharing on inspection results, and 
even organizing training events together.
    Let me turn to our progress. We have moved quickly, in just 
a few months, on several fronts. We have helped establish a new 
fire safety and structural safety standard. We opened an office 
in Dhaka with 15 staff. We conducted a baseline survey and 
offsite interviews with more than 3,200 Bangladeshi workers and 
28 representative factories to obtain their input and 
perspective on factory safety issues. We have provided fire 
safety training to workers and managers at 218 Alliance 
factories. And we have completed fire safety, structural, and 
electrical inspections in 222 factories. We are committed to 
inspecting 100 percent of all member-approved factories, and 
provide training in all of these factories, by July 2014.
    The work we are all undertaking requires money as well as 
time and effort. The Alliance's approach emphasizes the 
importance of shared responsibility through mechanisms such as 
access to $100 million in low-cost capital. Alliance members 
have also committed $5 million to assist workers by replacing 
the lost wages of factories needed to temporarily close for 
repairs.
    With regard to the workers, we know that workers must have 
a voice in ensuring their environment is safe. They must not 
only be able to recognize safety concerns, but they must also 
have the means to effectively make those concerns known to 
factory management without the fear of being disciplined or 
fired. We believe democratically elected groups operating 
within the factories, whether they be worker participation 
committees, health and safety committees, or unions, will be an 
effective way to communicate safety concerns to management. We 
intend to work closely with these groups, sharing remediation 
plans, and ensuring that they are immediately alerted to urgent 
safety issues.
    In conclusion, Mr. Chairman, while this situation is 
complex, one thing is clear: Improving the safety of 
Bangladesh's garment industry must be our No. 1 priority. Our 
moral compass and business interests must remain aligned. We 
know that work will not be easy or quick, and solutions will 
take time to adopt and sustain. We must all stay committed to 
the common goal of making a safer workplace in Bangladesh not 
the exception, but the rule.
    Thank you, Mr. Chairman. You can be sure we look forward to 
working with you and this committee in the months ahead.
    [The prepared statement of Ms. Tauscher follows:]

               Prepared Statement of Hon. Ellen Tauscher

                              introduction
    Chairman Menendez, Ranking Member Corker, and members of the 
committee, it is a real honor to be back at this table again today. 
This is a committee I came to know well during my time as Under 
Secretary of State, as we collectively worked together on arms control 
and nonproliferation. And, Mr. Chairman, I appreciate your leadership 
on Bangladesh, and specifically on worker safety. I know how much you 
care about these issues, as you did during our time together in the 
House of Representatives.
    Last summer, the leading North American apparel companies, 
retailers, and brands launched the Alliance for Bangladesh Worker 
Safety. The core mission of the Alliance is to improve the safety of 
the women and men who make their living in Bangladesh's ready-made 
garment sector. The Alliance was developed under the guidance of former 
U.S. Senators, George J. Mitchell and Olympia Snowe, with the help of 
the Bipartisan Policy Center. It represents a 5-year, $50 million 
effort to improve the fire safety and structural integrity of factory 
buildings through a rigorous inspection and training regime, which is 
already well underway.
    Currently, the Alliance is comprised of 26 companies, and I have 
the honor of chairing its board of directors. Our members have visited 
Bangladesh, toured local factories and met with government officials 
and labor leaders to learn about the magnitude of the country's safety 
challenges.
    As we gain a deeper and more nuanced understanding of these 
challenges, we also see the great potential and promise for the workers 
of Bangladesh as we come together to find sustainable solutions. We are 
actively working with the Accord, the Government of Bangladesh, the 
Bangladesh University of Engineering and Technology, workers' groups, 
factory owners and other key stakeholders to prevent another factory 
tragedy and to build a long-term culture of safety. Too many 
Bangladeshis have died--we all have to do better.
                                context
    Despite its failures, the garment industry has played a key role in 
improving workers' lives in Bangladesh and advancing the country's 
economic development. More than 4 million people in Bangladesh, most of 
them women, depend on their jobs making clothes to support themselves 
and their families. The Alliance member companies source garments from 
close to 700 factories in Bangladesh, which employ approximately 1.28 
million workers. Far too many people depend on these jobs for us to 
turn away.
    The situation on the ground in Bangladesh is complex and 
challenging. The 700 factories that make products for the Alliance 
member companies are only a small fraction of the roughly 5,000 
factories in Bangladesh's ready-made garment industry. As the 
committee's own report from last fall notes, rapid industry growth and 
urbanization have led to factories sprouting up in apartments and other 
places that are ill-suited to large-scale garment production and make 
unauthorized subcontracting even more dangerous than usual. There are 
too few government inspectors, labor laws have been too weak for too 
long, and recent political instability has taken attention away from 
focusing on worker and factory safety.
    These circumstances only reinforce the need for a collaborative 
approach to creating a safe and inclusive environment for factory 
workers that contributes to economic growth and stability in 
Bangladesh. We recognize our shared responsibility to address the 
threats to workers' safety head-on and agree workers should never need 
to risk their lives to make a T-shirt or pair of jeans.
    Our business interests are aligned with our moral compass. A strong 
garment industry that protects workers' rights and safety is not only 
good for the people who work in these factories, but makes for better 
business continuity and builds a sound foundation for long-term 
business partnerships.
    Lastly, let me note that there has been considerable misinformation 
about the perceived differences between the Alliance and the Accord and 
too little said about what we have in common and where we can 
collaborate. The member companies and other stakeholders of both 
initiatives share a common purpose: to protect the safety and 
livelihoods of garment workers in Bangladesh. We have had excellent 
discussions with the Accord leadership in Europe, as well as in Dhaka. 
We need to work together, and we are, today, on a number of important 
areas such as standards, sharing of inspection results, and even 
organizing collaborative events to educate the factory community on the 
standards and ways to improve workplace safety.
    Now, I'd like to briefly address some of the progress we've made in 
our first few months.
                   collaboration and common standards
    Last October, technical experts from the International Labor 
Organization, the Alliance, Accord and Bangladesh University of 
Engineering and Technology worked together to develop a common Fire 
Safety and Structural Integrity Standard that is being used for factory 
inspections. I was very proud of the work that many technical experts 
from Alliance member companies put in, sharing their expertise to 
achieve the goal of having one fire and structural safety standard. The 
Standard aligns with the Bangladesh National Building Code and National 
Tripartite Plan of Action.
    We hope we can continue to work in the spirit of collaboration with 
the Accord and other stakeholders focused on worker safety in 
Bangladesh.
                          local participation
    The Alliance recognizes the importance of building local capacity 
and empowering workers to develop an effective, lasting system for 
ensuring the safety and future growth of Bangladesh's garment industry. 
In just over 6 months since its formation, the Alliance has:

   Conducted a baseline survey and offsite interviews with more 
        than 3,200 Bangladeshi workers in 28 representative factories 
        to obtain their input and perspective on factory safety issues. 
        The insights from this research will help us build better and 
        more relevant solutions, and we will share these insights with 
        the public.
   Provided fire safety training to workers and managers at 218 
        Alliance factories.
   Opened an office in Dhaka with 15 local staff, including 
        technical experts.
   Engaged the Bangladeshi Government, factory owners and 
        industry associations, labor groups, NGOs including BRAC and 
        the International Finance Corporation.
   Been in dialogue with the United States Embassy in 
        Bangladesh to clarify our intentions and our progress.
                           empowering workers
    Garment workers play a key role in the Alliance's efforts to 
improve factory safety. They have unique insights from the factory 
floor into potential safety issues and their active participation 
facilitates remediation efforts and effective responses to threatening 
conditions.
    We know that workers must have a voice in ensuring their working 
environment is safe. They must not only be able to recognize safety 
concerns, but must also have the means to effectively take those 
concerns to factory management without fear of being disciplined or 
fired.
    We believe democratically elected groups operating within the 
factories--whether they be Trade Unions, Worker Participation 
Committees, Health and Safety Committees--will be an effective way to 
communicate safety concerns to management. We intend to work closely 
with these groups, sharing remediation plans and ensuring that they are 
immediately alerted to urgent safety issues.
    The Alliance is also working to develop tools to protect workers' 
rights and give voice to their concerns. For example, an anonymous 
worker helpline that uses mobile technology will empower workers to 
call attention to safety issues before they become emergencies. This 
helpline will not only field calls with a live operator 24 hours a day, 
7 days a week, it will also allow for two-way communication with 
workers and a platform for education.
    For all of us, a critical element of worker empowerment calls for 
better understanding what workers need and how our collective efforts 
can drive sustainable impact. To gain better insight into their 
perspectives, we have talked to workers directly and conducted one of 
the largest worker surveys on safety and health in Bangladesh. The 
survey and offsite interviews point to the need for a comprehensive and 
consistent health and safety-training curriculum that can be 
implemented systematically across factories and correct for some of the 
issues that have come to life. For instance:

   Workers are legitimately concerned for their safety.
   65 percent of workers in focus groups indicated they would 
        prefer to work on a low floor for safety reasons.
   In 34 percent of surveyed factories, workers say they had 
        witnessed fire incidents. This is in line with the focus group 
        results, where participants in all but one of the 10 
        discussions reported experiencing fires.
   47 percent of respondents feel they cannot leave their 
        building quickly in case of emergency, and 30 percent think 
        there is a high risk of fire in their building.
   27 percent feel they are not given sufficient training on 
        how to protect themselves.
   When asked offsite during focus groups, however, workers 
        voice more concern about how training is executed.
   Female participants pointed out that their male counterparts 
        are more readily offered training.
   While most participants have taken part in evacuation 
        drills, most were conducted during daytime hours, leaving night 
        shift workers neglected.
   Drills were often conducted inappropriately, such as with a 
        failure to count participants; others were only partly 
        conducted, for example, evacuating workers to lower levels 
        rather than fully outside their buildings.
   Despite comprising 80 percent of the garment factory 
        workforce, female workers tend to have a lower level of 
        knowledge than their male counterparts. They are also less 
        active in health and safety committee activities, contacting 
        worker representatives and voicing their concerns.

    Our training programs will endeavor to directly address these 
findings, and we will continue to identify areas for special 
consideration as the Alliance's programs are rolled out.
                                training
    Worker training is an essential part of the Alliance's commitment 
to local capacity-building. Ongoing training courses are designed to 
result in measurable improvements in the knowledge, skills, and 
awareness that are critical for ensuring worker safety and well-being. 
By July 2014, the Alliance intends to fulfill its commitment to train 
workers, supervisors, managers, and security guards in 100 percent of 
our current factories on safety fundamentals. We will also develop 
additional training modules related to safety in year 2.
    As part of training for management, we believe it is critical to 
help them understand the importance of engaging workers, both 
individually and through any democratically elected workers' groups 
operating within the factory. We also believe it is important that 
management respect workers' right to collectively voice concerns 
without fear of retaliation and to allow for regular and open dialogue 
about safety. We intend to incorporate these messages into management 
safety training, and we will share this training curriculum publicly 
for use by other safety initiatives.
                          factory inspections
    Factory inspections are an essential component of evaluating and 
improving the existing building and electrical infrastructure in 
Bangladesh's garment industry. To date, fire safety, structural and 
electrical inspections have been completed in 222 factories (31 
percent) that make products for Alliance member companies. A number of 
brands have already completed initial assessments of all their approved 
factories in Bangladesh, and many factories have already begun to 
implement substantial remediation. Alliance member companies have 
committed to inspecting 100 percent of all member-approved factories by 
July 2014.
                          technical expertise
    Considering the rapid, often haphazard growth and unique structural 
characteristics of Bangladesh's garment factories, it is especially 
important that inspectors have the right technical training and 
expertise. The Alliance established an independent Committee of Experts 
to help develop and implement consistent factory safety standards 
across all approved Alliance factories and to certify inspectors. The 
committee is made up of independent fire, structural, and facility 
safety experts from Bangladesh and North America who are certified, 
credentialed, and recognized authorities in safety. Training on 
implementation of the safety standards will be mandatory for all 
approved inspectors.
                       resources for remediation
    The work we are all undertaking requires money as well as time and 
effort. The Alliance's approach emphasizes the importance of shared 
responsibility through mechanisms such as access to low-cost capital.
    By recognizing the difficulty to gain access to affordable 
financing in Bangladesh, some Alliance members have pledged a combined 
total of $100 million in low-cost capital to assist vendors in 
financing safety remediation efforts. These resources can be used to 
implement critical safety measures, such as installing fire doors, 
sprinkler systems, handrails in stairways and other structural 
integrity improvements.
    We anticipate that pricing adjustments will likely be made over 
time by factory owners to cover these important investments in safety. 
We are currently working with partners such as the IFC and banks to 
explore innovative financing solutions, and expect the Government of 
Bangladesh and other stakeholders to play an important role in 
supporting these efforts.
    In addition, we are collaborating with other groups, including the 
IFC, Accord, and BGMEA, on the International Trade Expo on Building and 
Fire Safety in Bangladesh that will be held later this month. The Expo 
is focused on providing Bangladesh factory workers with access to 
quality safety equipment. In addition to offering exposure to credible 
resources, this Expo will also provide education by experts as well as 
an announcement about low-cost capital available for factory 
remediation made available by three external funding sources.
    Alliance members have also committed $5 million to assist workers 
by replacing any lost wages if factories need to be temporarily idled 
for repairs.
                              transparency
    Let me now shift to another important priority for the Alliance--
transparency. The Alliance releases a monthly report that publicly 
discloses the names of all approved suppliers in Bangladesh. The list 
also identifies factories that are currently manufacturing goods for 
members of the Accord. These shared suppliers make up approximately 50 
percent of the Alliance factory list, underscoring the importance for 
collaboration between the two initiatives. Supplier information for the 
approved Alliance factories is listed on the Alliance Web site. The 
Alliance also recently released a 6-month progress report detailing the 
strong foundation that has already been laid for our work. Copies of 
the report have been provided to the committee.
                             moving forward
    While the situation is complex, one thing is clear--improving the 
safety of Bangladesh's garment industry cannot be done unilaterally. 
Collaboration among all who share in the responsibility for garment 
factory safety is the only effective way forward. We know the work will 
not be quick or easy, and solutions will take time to adopt and 
sustain. We must all stay committed to the common goal of making a 
safer workplace in Bangladesh not the exception, but the rule.
                               conclusion
    We appreciate the initiative that the committee and U.S. Government 
have taken to address the important safety issues in Bangladesh's 
ready-made garment industry, and we are grateful for the opportunity to 
share our perspective on the Alliance's approach and progress. We look 
forward to working together to improve the safety and well-being of 
Bangladesh's garment workers and advance the sustainable, inclusive 
growth of the country's garment industry.
    Thank you for allowing us to testify today.

    The Chairman. Thank you.
    Mr. Nova.

  STATEMENT OF SCOTT NOVA, EXECUTIVE DIRECTOR, WORKER RIGHTS 
    CONSORTIUM, WITNESS SIGNATORY TO THE ACCORD ON FIRE AND 
         BUILDING SAFETY IN BANGLADESH, WASHINGTON, DC

    Mr. Nova. The Accord on Fire and Building Safety in 
Bangladesh appreciates the opportunity to testify today, and we 
also appreciate the committee's continued attention to this 
vital issue.
    The danger in Bangladesh has long been apparent. The first 
documented mass fatality incident in a garment factory was in 
1990. Between 2004 and 2006 alone, there were nine fatal fires 
and building collapses, killing 200 workers. From 2006 to 2011, 
more than 500 workers died in further disasters. The Tazreen 
Fashions and Rana Plaza catastrophes were shocking because of 
the staggering numbers of dead, but no one could say that 
worker deaths in an apparel plant were, by that point, a 
surprise.
    Major retailers, recognizing the challenges in the country 
and concerned about the weakness of local regulatory efforts, 
have long operated their own inspection programs in Bangladesh. 
Despite the companies' efforts, these programs did not solve 
the problem. In fact, every building where workers died en 
masse in recent years had been inspected by industry auditors. 
For example, Walmart repeatedly inspected Tazreen Fashions, and 
yet the inspectors failed to detect or address the grave 
hazards, including lack of fire exits, that ultimately took the 
lives of more than 100 workers.
    This history provides us with a crucial lesson. It is not 
enough to say you have an inspection program. The question is, 
What kind of inspection program? To their great credit, the 
Accord signatory companies have recognized that stronger 
measures are essential, and they have committed to work with 
labor unions to put these measures in place.
    It is the Accord's unique features that will enable it to 
transcend the shortcomings of prior inspection systems. I want 
to note four elements, in particular, three related to worker 
empowerment.
    One of the most important worker empowerment provisions of 
the Accord is the power of workers, themselves, to enforce the 
agreement. Garment unions are signatories; they share equal 
power with the brands and retailers on the steering committee, 
and they can bring enforcement action if any signatory fails to 
fulfill its obligations. As is true in any context, the people 
who have the power are the ones who are sitting at the table 
when the real decisions get made.
    Another key provision is the leading role for worker 
representatives in the Accord's inspection, remediation, and 
training programs. When safety engineers inspect factories 
under the Accord, worker representatives, as well as managers, 
guide them through the factory. When the inspection reports are 
ready, worker representatives get the reports the same day as 
the factory managers. When Accord training teams go to 
factories to talk to workers, union representatives are on the 
teams. At most Accord factories, this will be the first time 
any labor union has ever set foot on the premises.
    One effect of these provisions will be to strengthen the 
ability of workers in Bangladesh to form unions. Asked last 
May, ``What could be done to improve labor standards in 
Bangladesh?'' Ambassador Mozena answered, ``That is a very easy 
question. That will happen when workers can organize.''
    An issue was raised earlier about the situation at Rana 
Plaza and what might have saved the lives of the workers at 
that location. The morning of the disaster, as I think people 
are aware, many workers were afraid to go into the factory 
because of the evidence that had arisen the prior day that the 
building was in danger of collapse. Yet, managers bullied and 
intimidated workers to go into the factory, successfully, in 
part, by threatening their wages and their jobs. The general 
manager of Tazreen Fashions finally went to jail, this past 
Sunday. One of the charges against him is that he and other 
managers, after the fire alarm went off, told workers to remain 
at their machines, apparently hoping it was a false alarm, and 
not wanting to lose any production time. If workers at Rana 
Plaza, if workers at Tazreen Fashions, had enjoyed the right to 
refuse to enter or stay in a dangerous building without fearing 
the loss of their livelihood or their jobs, many of those 
workers would be alive today. This is why the Accord protects 
the right of every worker in an Accord factory to refuse 
dangerous work without fear of losing jobs or wages.
    Inspections under the Accord are a means to an end: the 
renovation of factory buildings to address the grave safety 
hazards that exist in many of them. Inspections are of no value 
if, for lack of financial capacity, remedies are never 
implemented. This is why the Accord brands and retailers have 
committed to ensure that every factory will have the capacity 
to undertake all needed renovations. The financial capacity. 
This is not a voluntary loan program, it is a fundamental 
requirement of every Accord signatory.
    We are implementing the Accord as swiftly as possible, 
given the massive scope of the enterprise, which covers 1,800 
factories and more than 2 million workers. Senior staff is in 
place in Dhaka and is hiring a local team of up to 100 
individuals. Standards are finalized, and inspections begin in 
large volume this month. Public inspection reports will soon be 
released, and, consistent with the Accord's commitment to 
genuine transparency, these reports will include the specific 
hazards found in each factory, the remedies needed to address 
them, and the deadlines by which they must be addressed. A 
major announcement later this month will provide much more 
detailed information, and we will, of course, share that with 
the committee.
    I want to conclude by noting, as a previous panelist and 
member of the committee did earlier, the breadth of support for 
the Accord, including in the United States, where there are 
corporate signatories like the Berkshire Hathaway subsidiary, 
Fruit of the Loom; like PVH, which was the first company to 
sign an earlier version of the Accord; and a number of others. 
Mr. Durbin, whose leadership on this issue we appreciate, 
mentioned the fact that the Marine Corps now requires its 
licensees to be signatories to the Accord. This year's Defense 
Appropriations Act includes report language that encourages the 
rest of the Armed Forces to make that same decision. And so, we 
see support for the Accord in the United States, not just from 
corporations, but from the Government, also from the public 
sector, where many universities now require their licensees to 
sign.
    So, I will conclude by noting that I would be happy to 
address relations between the Accord and the Alliance, in 
answer to questions, which I did not have an opportunity to do 
here, and welcome questions from the committee.
    Thank you.
    [The prepared statement of Mr. Nova follows:]

                    Prepared Statement of Scott Nova

    The Accord on Fire and Building Safety in Bangladesh appreciates 
the opportunity to offer testimony today on the vital issue of worker 
rights in Bangladesh's garment industry. The Accord is a groundbreaking 
worker safety initiative of which 151 apparel brands and retailers, 
from 21 countries, are now signatories, along with two global union 
federations, eight Bangladeshi garment workers' unions and union 
bodies, and four international labor rights organizations, 
participating as witness signatories. The Accord, whose governing body 
is chaired by the International Labor Organization (ILO), covers an 
estimated 1,800 factories and in excess 2 million workers, which means 
that more than half of the entire Bangladeshi garment workforce will 
come under the protections provided by the agreement.
              support for the accord in the united states
    It is important to note, some misimpressions to the contrary, that 
the Accord enjoys active support and participation from leading 
American brands and retailers. Indeed, the first company to sign an 
earlier version of the Accord was PVH Corp., the U.S. firm, formally 
known as Philips-Van Heusen, which owns Calvin Klein, Tommy Hilfiger, 
and other major brands. Other U.S. corporate signatories include 
Abercrombie & Fitch, American Eagle Outfitters, Knights Apparel (the 
largest producer of university logo clothing and Nike's main competitor 
in that sector), Fruit of the Loom, one of the oldest apparel brands in 
North America, and others. It is also important to note that the 
Accord's signatories include a number of foreign-based corporations 
that have a large presence in the U.S. consumer market, including 
companies like H&M and adidas that are household names in the U.S. and 
that sell more goods here than they do in their home countries.
    There is also strong support for the Accord in the nonprofit and 
public sectors in the U.S. A number of our Nation's leading 
universities, including Duke, Penn State, and Georgetown, now require 
that the apparel brands that make clothing bearing their names in 
Bangladesh sign the Accord, as does the United States Marine Corps.\1\ 
The Defense Appropriations Act for the current fiscal year included 
report language commending the Marine Corps for adopting this 
requirement, urging the rest of the Armed Forces to do the same. We 
appreciate Mr. Durbin's leadership in encouraging the largest agency of 
the U.S. Government to align its procurement practices with the Obama 
administration's policies urging brands to strengthen oversight of 
their supply chain in Bangladesh. Support for the Accord is also 
extremely strong throughout the U.S. labor movement and across the 
community of labor rights advocates.
            why a new approach to worker safety is essential
    The Accord on Fire and Building Safety in Bangladesh exists because 
its signatories recognize that past efforts to address the worker 
safety crisis in Bangladesh were insufficient and that new approaches 
are required to safeguard the lives of the millions who work in that 
nation's garment factories.
    It is important to recognize that the danger to workers in 
Bangladesh has been apparent for many years. The first documented mass-
fatality incident in the country's export garment sector occurred in 
December 1990 and there were at least 12 additional mass-fatality 
disasters during the remainder of the 1990s. Between April 2004 and 
April 2006 there were nine separate fatal fires and building collapses, 
killing a total of at least 200 workers.\2\ In an editorial in March 
2006, in the English-language Daily Star newspaper, a local banker 
warned that the ``deep concern'' of global buyers over these disasters 
would lead to a loss of exports if such incidents continued to occur. 
From 2006 to 2009, more than four hundred workers died in a series of 
further disasters, according to statistics from Bangladesh's Fire 
Service and Civil Defense department. In 2010, there were two more 
fatal factory fires, including one, in December, that killed 29 workers 
at a facility producing for a large number of prominent U.S. brands.
    The Tazreen Fashions fire in 2012 and the Rana Plaza disaster last 
year were shocking because of the staggering loss of life; however, by 
the time of those disasters, it was no longer possible to say that 
worker fatalities in a garment factory were surprising. Indeed, given 
the explosive growth of the industry in Bangladesh in recent years, 
with millions of workers employed in ever-larger factories, it was 
arguably inevitable that larger disasters would occur.
    Major brands and retailers sourcing from Bangladesh, recognizing 
the strong challenges to worker rights and worker safety and concerned 
about the weak regulatory efforts of local authorities, have long been 
operating their own private factory inspections programs--as they do 
throughout their global supply chains. These programs, which encompass 
worker safety issues among various other categories of compliance, 
ensure that most or all factories producing goods for a given brand or 
retailer are subject to regular inspections by factory auditors, who 
measure each factory's practices against the corporation's labor 
standards, report any violations detected and recommend remedial 
measures.
    Despite a great deal of effort by the brands--and by their 
employees, many based locally, whose job it is to coordinate the 
factory inspections--these programs did not succeed in addressing the 
problem. It is important to note that every factory where workers have 
died en masse in recent years, with only one possible exception, was 
inspected multiple times by private auditors representing the factory's 
customers. To cite one important example, Tazreen Fashions was visited 
repeatedly by inspectors representing Walmart, but these inspectors 
never identified nor corrected the grave safety flaws, including the 
lack of viable emergency exits, that ultimately took the lives of 112 
workers.\3\ There is a profoundly important lesson here for all of us--
corporations, labor rights advocates, and public officials alike: it is 
not enough that a garment factory is subject to an inspection program; 
the crucial questions concern the composition of that program.
    To their great credit, the brands and retailers that have signed 
the Accord on Fire and Building Safety in Bangladesh have recognized 
that stronger and more effective worker safety measures are essential 
to bring an end to the disasters in Bangladesh and have committed to 
work with global and Bangladeshi labor unions to put those measures 
into place.
                      the accord: major provisions
    The Accord is designed to address the shortcomings of prior efforts 
and thereby to ensure, once the program is fully implemented, that the 
safety of workers in all factories covered by the agreement is strongly 
and sustainably protected and that mass fatality disasters become a 
thing of the past. The central features of the Accord are the 
following:

   First, the Accord is a binding, enforceable contract between 
        151 apparel brands and retailers and international and 
        Bangladeshi labor unions. This, in itself, is groundbreaking. 
        There is no contemporary precedent for a binding agreement of 
        this scope and detail, covering workers' rights in the global 
        supply chains of major corporations, in which worker 
        representatives themselves have genuine enforcement powers. By 
        signing a binding agreement with labor unions, the Accord's 
        signatory corporations have guaranteed that worker 
        representatives will be at the table when key decisions about 
        worker safety at their contracted factories are made. This does 
        not always make for easy or quick decisions, but it guarantees 
        that the voice of workers is always heard and that the safety 
        of workers remains at the heart of Accord decisionmaking. Given 
        the stakes involved, the importance of this cannot be 
        overstated.
   The Accord provides for inspections of all factories 
        producing for signatory companies, carried out under the 
        direction of an independent Chief Safety Inspector, so that the 
        engineers doing the inspections are accountable to the Accord 
        as a whole, not to any individual brand or factory. This means 
        that when Accord inspectors assess a factory, they do so with 
        the understanding that they have as much accountability to 
        worker representatives as they do to any other party.
   Accord inspections assesses each factory against a robust 
        safety standard, incorporating the essential elements of the 
        Bangladesh National Building Code (BNBC), and improving on that 
        code by clarifying the application of the standards to existing 
        buildings and adding stricter standards in certain areas. The 
        BNBC, which is a reasonably strong code, has been in place in 
        Bangladesh since 1993 and has carried the force of law since 
        2006; however, prior to the Tazreen and Rana catastrophes, 
        private factory auditors, even though charged with protecting 
        worker safety, did not include the most vital building code 
        issues in their inspection protocols. Among the issues excluded 
        were the structural integrity of buildings and the adequacy of 
        emergency exits, including enclosure of stairwells. The 
        consequences of failing to inspect for structural integrity at 
        Rana Plaza are obvious.
   At Tazreen, and in numerous other fatal factory fires, one 
        of the primary causes of fatalities was the lack of enclosed 
        stairwells, protected by fire doors. In multistory buildings, 
        proper enclosure of stairwells, the purpose of which is to 
        prevent deadly smoke from spreading rapidly through the 
        building and making stairs impassable, is fundamental to fire 
        safety and has long been required by all credible building 
        codes (including all North American and European codes and 
        including the BNBC). It is nonetheless the case that, at the 
        time of the Tazreen fire, enclosed stairwells with protective 
        fire doors were absent from almost every one of the more than 
        3,500 apparel factories operating in the country. At Tazreen 
        Fashions, after the fire broke out in the first-floor storage 
        area, the unenclosed stairwells filled rapidly with noxious 
        smoke. All of the exit stairs became impassable within minutes, 
        trapping the workers on the upper floors.\4\ After that point, 
        most workers who made it out alive did so by jumping from third 
        and fourth story windows. That was only way out of the 
        building. By including structural integrity, adequacy of fire 
        exits and a number of other previously excluded issues, the 
        Accord inspections, on that basis alone, represent a massive 
        advance over pre-Tazreen inspection programs. Also, appropriate 
        to the technical nature of the applicable safety standards, 
        Accord inspections are carried out by highly trained 
        structural, electrical, and fire-safety engineers, not 
        generalist social auditors.
   The Accord provides a very high degree of transparency, both 
        to the public and to workers. Under prior private inspection 
        programs, workers rarely saw the results of the inspections of 
        their factories and such reports were usually not available to 
        the public. Under the Accord, all factory reports will be 
        public and will include, along with the name of the factory, 
        detailed information on each specific safety hazard identified; 
        the renovation, repair, or retrofit required to eliminate that 
        hazard; and the date by which it must be completed. The Accord 
        will also issue detailed public reports on the progress of 
        factory renovations and repairs; when a factory fails to 
        implement the improvements deemed necessary by the engineers, 
        this failure will be reported publicly. Similarly, factories 
        which execute the necessary corrective actions will be 
        recognized through the reporting system thus having the 
        opportunity to show their individual-level commitment and 
        collectively improving the image of the industry as a whole. 
        Even more important than this public transparency, will be the 
        access workers and worker representatives will have to the 
        findings of inspectors. Under the Accord, worker 
        representatives will always have access to all inspection 
        reports within 2 weeks of inspection--at the same time as 
        factory managers.
   The Accord's corporate signatories have agreed to ensure 
        that factories will have the financial capacity to address all 
        renovations and repairs that are needed. The purpose of this 
        provision of the Accord is not to subsidize wealthy factory 
        owners, of which Bangladesh has a fair number; they should, and 
        will, pay their own way. However, there are substantial numbers 
        of factory owners who will not be able to afford what is needed 
        and in those cases the Accord signatories will provide 
        support--through direct payment for renovations, price 
        enhancements, joint investments, loans or other means. This is 
        not a voluntary loan program, but an obligation of the 
        signatory brands and retailers to provide assistance where it 
        is genuinely necessary. The Accord staff will play an active 
        role in discussions between brands and factory owners, to 
        ensure that every factory gets any help it legitimately needs 
        and, at the same time, that no factory is asking for more than 
        its financial circumstances justify.
   The Accord's corporate signatories have also committed to 
        use their relationships with their contracted factories to 
        provide powerful incentive for factories to undertake needed 
        safety improvements. Any factory that the Accord's Chief 
        Inspector determines to be unsafe, and unwilling to become 
        safe, will swiftly and permanently lose the business of every 
        customer that is a signatory to the Accord (and will be 
        ineligible for orders in the future). As a practical matter, 
        such factories will soon be out of business. Conversely, the 
        signatory brands have committed to reward safe factories with 
        ongoing business.
      As is clear from the discussion of key Accord provisions above, 
        the Accord is far more than an inspection program. The design 
        of the Accord was informed by the recognition that the great 
        majority of garment factories in Bangladesh need significant 
        safety improvements in one or more areas. Inadequate fire 
        safety systems and substandard electrical wiring (the source of 
        ignition in most fires) were widespread in the industry at the 
        time of the Tazreen Fashions fire and continue to affect most 
        factories. While the grave structural flaws that brought down 
        Rana Plaza are by no means the norm, Bangladesh has more than 
        3,500 export apparel factories, and if even a few percent are 
        in that category, as is likely, this places hundreds of 
        thousands workers at risk. Lesser structural flaws affect a 
        much larger number of factories and must also be addressed. The 
        Accord is best understood as a sweeping program of factory 
        renovation, based on a clear understanding that inspections, 
        however competently executed, are of no value if the remedies 
        they identify cannot--for lack of financial capacity, or of 
        accountability, or of economic incentive--be effectively 
        implemented.
           the accord: the central role of worker empowerment
    The design of the Accord also reflects the understanding that 
protection of worker safety is impossible without meaningful worker 
empowerment. The Accord contains a series of provisions that ensure not 
just that workers can participate in the program, but that workers can 
influence the program, both in terms of what happens on the factory 
floor and at the highest levels of Accord decisionmaking.

   Among the most vital provisions of the Accord is protection 
        for the right of workers to refuse dangerous work. Two days 
        ago, the managing director of Tazreen Fashions, Delwar Hossain, 
        finally went to jail, pending trial, on charges issued in 
        December.\5\ He and other managers are charged, among other 
        offenses, with refusing to let workers leave the factory after 
        the fire alarm sounded, insisting that the alarm was part of a 
        fire drill. Unquestionably, this decision--likely driven by a 
        desire to avoid production delays and informed by the false 
        assumption that the fire would be contained--contributed to the 
        high death toll. At Rana Plaza, on the morning of the collapse, 
        many workers balked at entering the building, terrified by the 
        discovery of large cracks in the structure the prior day. 
        Factory managers, insisting the building was safe, pressured 
        and bullied the workers--in some cases threatening to dock them 
        a month's pay if they refused to go to work.\6\ Most succumbed 
        to these tactics and went to their machines; the building 
        collapsed less than an hour after the workday began. Had 
        workers at these two factories been able to exercise the right 
        to refuse to enter, or stay in, a dangerous building, without 
        having to fear the loss of pay or the loss of their jobs, many 
        of them would be alive today. This is a right recognized in ILO 
        conventions and it is a right that is essential to the safety 
        of Bangladeshi workers. Under the Accord, no worker who refuses 
        work based on a reasonably justified fear of danger can be 
        penalized; if workers are fired or docked pay for refusing to 
        go into an unsafe building, the workers, or their 
        representatives, can contact the Accord and the Accord and its 
        signatory brands will ensure that the factory owner reinstates 
        fired workers and/or reimburses workers who have lost wages. 
        Accord staff will carry out a robust training program to inform 
        workers about this policy, since the right cannot be exercised 
        by workers unless they know it exists and believe it will be 
        protected. If the Accord did nothing else, empowering workers 
        to protect themselves from the recklessness of some 
        irresponsible factory managers would greatly reduce the 
        likelihood of another Rana Plaza.
   The Accord also recognizes the central role of workers in 
        promoting and defending, on a day-to-day basis, safe practices 
        in the workplace. This is why the Accord requires that a 
        credible worker-management health and safety committee be 
        established in every factory, with worker-members chosen by 
        their unions and fellow workers. Making this a reality is a 
        massive undertaking that will require substantial time, but it 
        is essential to sustaining safe workplaces over time. These 
        committees will exist not just on paper, but in practice, and 
        factory managers will be required to support the process and 
        respect the role of the committees. The Accord will train and 
        provide support to both the labor and management 
        representatives on these committees to ensure they are 
        functional at the factory level.
   The Accord also ensures that unions are engaged in all 
        facets of the initiative. This includes equal status with 
        brands and retailers over the governance of the program 
        (through the Accord's Steering Committee, as outlined above) 
        and involvement in all inspection, remediation and training 
        programs. The Accord requires that labor unions be allowed to 
        participate on training teams that will provide worker safety 
        and worker rights education in those factories that are regular 
        suppliers of the signatory brands and retailers. At most of 
        these factories, this will be the first time any representative 
        of a union federation has been able to set foot on factory 
        premises and will allow union leaders to address workers in 
        their workplaces on safety issues and their rights as workers. 
        The Accord also requires that, in every factory where unions 
        have any membership, a union member will participate in the 
        onsite inspections of that factory by the safety engineers--
        walking through the factory with the engineers, asking and 
        answering questions, just as the factory managers are able to 
        do. The Accord is also establishing a program that will combine 
        the engineers' onsite work with offsite interviews with workers 
        from each inspected factory. This is not an easy proposition 
        logistically, but it will be a strong mechanism for ensuring 
        the integrity of the inspection process.
      As noted earlier, unions will receive all inspection reports at 
        the same time as factory managers and will be able to share the 
        results with workers. At every factory where unions have any 
        membership, at least one of the Accord's signatory unions will 
        be able to participate, on behalf of workers, in the 
        development of the remediation plan. The Accord staff will also 
        work closely with unions and the brands to ensure that workers 
        in each factory are able to provide information to the Accord 
        on whether factory managers are fulfilling their safety 
        promises. While the Accord's ongoing followup inspections are 
        designed to enforce a factory's remedial commitments, it is 
        only workers who are in the factory every day and they can be 
        an invaluable source of information--provided a serious effort 
        is made to enable them to play this role.
   The ability to report to the Accord when factories fail to 
        implement required safety measures is one aspect of a broader 
        complaint mechanism the Accord is creating. This goes well 
        beyond the establishment of complaint ``hotlines,'' which can 
        be useful, if handled properly, but which are one small piece 
        of the much broader program that is required. Working closely 
        with the Accord's Bangladeshi labor union signatories, with the 
        community-based worker centers the initiative is establishing, 
        with local nongovernment organizations, with labor rights 
        organizations in Bangladesh, and with the local offices of the 
        signatory brands, the Accord will generate a robust, two-way 
        flow of information that maximizes workers' impact on the 
        initiative.
   In order for workers to participate effectively in the 
        defense of their own health and safety, they have to be able to 
        speak out with candor about safety hazards in their factories 
        and about cases in which factory managers fail to fulfill their 
        obligation to eliminate those hazards. A large impediment to 
        such worker expression is workers' understandable fear that 
        their complaints could lead to a temporary loss of wages, if 
        their factory must be closed for repairs, or loss of their 
        jobs, if the factory must be shuttered permanently. The Accord 
        addresses this problem by requiring that factories continue to 
        pay workers their normal wages during any period when they are 
        idled due to safety repairs and by requiring the signatory 
        brands and retailers to seek alternate employment in their 
        other supplier factories for any worker who loses his or her 
        job due to permanent closure. Both eventualities will occur 
        with some frequency and the cost of replacement wages, in 
        particular, will be substantial. In a factory of a typical size 
        (1,500 workers), a 3-month closure will require continuation 
        pay of more than $300,000.\7\ If even 5 percent of the nation's 
        factories are temporary idled, this could generate upward of 
        $50 million in such costs. This is why the Accord requires that 
        wages be paid in all cases, rather than establishing an 
        arbitrary cap that might be reached well before most factories 
        are repaired. By protecting the jobs and livelihoods of 
        workers, the Accord empowers them to speak out about safety 
        violations to a degree that would otherwise be impossible.
   Finally, while the right to organize and bargain 
        collectively is outside the scope of the Accord, the agreement 
        will have a substantial positive impact in this vital area.
      Although Bangladeshi unions have small numbers of members in many 
        factories, less than 3 percent of garment plants have an actual 
        recognized union that can represent workers and bargain on 
        their behalf. While it cannot be known how many workers would 
        choose to unionize if they could do so freely, it is well 
        understood that this freedom has not existed, in practice, for 
        Bangladeshi garment workers. The State Department, among many 
        other observers, has repeatedly noted the absence of respect 
        for associational rights by factory owners and by the 
        government in Bangladesh. Despite the likelihood that they will 
        be disciplined, fired or worse, workers have tried to organize 
        in many factories, often showing great courage, but they have 
        usually failed. Very recently, however, we have seen glimmers 
        of hope. Due to the incentives generated by the decision of the 
        Obama administration to suspend benefits for Bangladesh under 
        the Generalized System of Preferences, the possibility of 
        similar action by the European Commission, and the urging of 
        buyers, the Government of Bangladesh has improved statutory 
        protections for associational rights and has begun to recognize 
        some factory-level labor unions, as the law requires. And some 
        factory owners are feeling a degree of pressure to refrain from 
        the customary tactics employed to prevent organizing.
      As unions and workers seek to expand this new opening, the 
        Accord's various worker empowerment provisions, like union 
        access to factories and the creation of worker centers, will 
        provide valuable tools they can utilize. The Accord also 
        creates a forum that the signatory corporations and unions can 
        use to address conflicts that arise in the course of union 
        organizing efforts. Many of the Accord's signatory brands and 
        retailers have demonstrated, in their overall supply chain 
        operations, a significant and laudable commitment to promoting 
        respect for associational rights at supplier factories and the 
        Accord will facilitate and accelerate those efforts in 
        Bangladesh. Where Bangladeshi workers are able to organize, 
        they will gain a powerful mechanism to protect their safety in 
        individual workplaces and will be able to increase their 
        contribution to the broader reform of the industry.
              engagement with the government of bangladesh
    The Accord is a private initiative. It is not intended as a 
substitute for public regulation. The signatories recognize, however, 
that effective public regulation in Bangladesh is a work in progress 
and that efforts by the private sector are therefore necessary, in the 
near term, to protect worker safety.
    The Accord will engage extensively with the Government of 
Bangladesh, at several levels: through the Accord's cooperation with 
the Bangladesh's National Tripartite Plan of Action (NTPA); through the 
Accord's Advisory Board, on which the government is represented by 
several senior officials of the Ministry of Labor and Employment, 
including the Director of Labor; through direct engagement between the 
Accord's senior staff and relevant government officials (for example, 
when dealing with urgent threats to worker safety at particular 
factories); and through the Accord's engagement with the Bangladesh 
University of Engineering and Technology, which is advising and 
providing services to the government in the context of the NTPA and the 
government's own factory inspection work. It is the Accord signatories' 
hope that constructive and fruitful cooperation with the government 
will be feasible throughout the life of the Accord.
    We also believe that the Accord will play an important role in 
expanding technical capacity in Bangladesh in the area of fire, 
electrical, and structural safety and in providing a model for 
impartial, skilled, and effective factory inspection--and that the 
government and other local actors will thus be strengthened in their 
future compliance efforts.
                  the accord: status of implementation
    The Accord is a massive undertaking: more than 1,800 factories, 
many needing substantial renovations and retrofitting; more than 5,000 
(1 inspection each for fire, electrical, and structural safety at each 
of the 1,800 factories) initial factory inspections in this year alone; 
and the training of tens of thousands of workers to serve on 
occupational health and safety committees; among many other 
activities--all carried out with an unprecedented level of joint labor-
management decisionmaking in a local environment where just traveling 
from factory to factory can be a daunting challenge. For these reasons, 
it is taking substantial time to make the Accord fully operational. All 
involved with the effort are deeply mindful of the urgency of the task; 
we all wish every factory could have been inspected within a few months 
of the initial signing of the agreement. We understand that in every 
factory that has not been inspected and, where needed, renovated and 
repaired, workers remain in danger. As a labor rights advocate, I 
personally wish the work was moving faster. However, I must tell you 
candidly, and based on a detailed knowledge of the work to date, that 
it is moving as fast as it can.
    Later this month, the Accord will make a number of major 
announcements that will provide a detailed outline of the Accord's 
inspection program--including personnel, inspection methods, the number 
of inspections that will be carried out per day, per week, and per 
month, and other vital information. As that announcement is not ready 
today, I am limited in the specifics I can share.
    I can report the following:

   The Accord has established the safety standard that will be 
        used for all inspections; it is available on the Accord Web 
        site.
   Accord inspections, using this standard, will commence in 
        large volume this month.
   The Accords has published, and regularly expands and 
        updates, a list of every factory to be inspected under the 
        agreement, with an unprecedented level of detail on each 
        building, including the number of stories, whether the 
        structure houses one or multiple businesses, and how many 
        workers the factory employs. This is also available on the 
        Accord Web site.
   The Accord will shortly begin to generate public inspection 
        reports, including a number of initial reports that will be 
        released in conjunction with the near-term announcement noted 
        above, which will include information on the state of each 
        building that has never before been available to the public.
   Comprehensive protocols have been developed to govern 
        implementation of critical worker participation and empowerment 
        elements of the Accord, including the formation and training of 
        health and safety committees, the enforcement of the right to 
        refuse dangerous work, the Accord's worker complaint mechanism, 
        and the rules governing union member participation in onsite 
        inspections. These protocols will be made public.
   The Accord has put in place a senior staff structure 
        comprised of an extraordinary set of individuals. They include 
        Brad Loewen, Chief Safety Inspector, who began his career as a 
        firefighter and has served for decades as a technical expert 
        and a highly effective public regulator on commercial building 
        safety; Rob Wayss, formerly the Chief Technical Advisor to the 
        ILO Promoting Fundamental Principles and Rights at Work Project 
        in Bangladesh, whose knowledge of the intersection of worker 
        empowerment and workplace rights in the Bangladesh context is 
        unparalleled; and Alan Roberts, a pioneer of labor rights 
        initiatives in global supply chains who has led and advised 
        corporate social responsibility programs for more than 30 years 
        and who enjoys respect and trust across the management-labor 
        spectrum.
   This team is in the process of hiring a local staff in Dhaka 
        that will number up to 100 people, supplemented by a modest 
        international staff based in Amsterdam, and will operate a 
        budget (exclusive of the actual cost for building improvements 
        and other elements of remediation) in excess of $10 million per 
        year.
   It is also important to understand that, while they are not 
        independent Accord inspections, a number of the larger Accord 
        signatory companies have commissioned substantial numbers of 
        fire, structural and/or electrical inspections of supplier 
        factories. Many of these inspections have been done by 
        respected engineering firms and they have covered the same 
        critical building code issues that will be the focus of the 
        Accord inspections. The Accord's Chief Inspector is in the 
        process of reviewing the results of this work and he will 
        determine in which cases the work is up to Accord standards and 
        to what extent remedies have been implemented (though followup 
        inspections by independent Accord inspectors will nonetheless 
        occur in all cases). However, it is clear from the quality of 
        the firms used for these inspections, and from the limited 
        results made available earlier to the Accord Steering 
        Committee, that much of this work has been significant and has 
        likely already increased the margin of safety for workers in a 
        substantial number of factories.
   The Accord, which last year established an emergency 
        protocol for handling cases where there is imminent danger to 
        workers, has already been engaged in a number of cases 
        involving urgent corrective action to address structural 
        dangers, including cases involving temporary building closures 
        and the obligation of factories to continue payments to 
        workers. Although it is impossible to know what would have 
        happened had no action been taken, there is a substantial 
        possibility that these limited actions have already saved 
        workers' lives.

    With respect to cooperation between the Accord and the Alliance for 
Bangladesh Worker Safety, the following can be noted:

   The Accord worked with engineers representing the Alliance 
        on the development of the inspection standard, which is now 
        being utilized by both initiatives.
   The Accord stands ready to cooperate with the Alliance in 
        any way that advances the interests of worker safety, including 
        cooperation at the level of shared factories.
   Those Accord factories also used by Alliance brands and 
        retailers represent only 20 percent of all Accord factories; 
        this fact impacts, for obvious reasons, the percentage of its 
        limited time and resources that the Accord devotes to the 
        question of Accord-Alliance cooperation.
   The Accord recognizes that, as a practical matter, factories 
        cannot carry out two separate remediation programs. This is why 
        the Accord supported the creation of a common inspection 
        standard and why the Accord will freely share information with 
        the Alliance concerning inspection schedules and remediation 
        plans and assumes that the Alliance will provide the same.
   The level of active cooperation at shared factories, 
        particularly with respect to remediation, may be limited by the 
        significant differences in the nature, extent, and 
        enforceability of the commitments made by brands and retailers 
        under the respective initiatives. Of particular concern, the 
        Accord wants to ensure, where financial support for renovations 
        is needed at a given factory, that all of the factory's buyers 
        contribute, with an equitable division of costs. To the extent 
        that Alliance brands are willing to accept, at the level of 
        individual factories or more broadly, comparable obligations 
        with respect to independence of inspections, support for 
        remediation, public transparency and worker empowerment, the 
        Accord is open to a strong level of cooperation.
   Everyone involved with the Accord would prefer that there 
        were one initiative. It is worth noting, that every brand and 
        retailer that is now a member of the Alliance was invited, 
        before the Alliance came into being, to join their 
        counterparts, from the U.S. and elsewhere, in signing the 
        Accord.
   Indeed, I would today reiterate on behalf of the Accord 
        signatories an invitation for the 26 Alliance brands to join 
        their 151 counterparts in the Accord. This would allow us to go 
        forward with a single unified agreement and would put a swift 
        end to concerns about duplication and misallocation of 
        resources, while greatly reducing the possibility that there 
        will be major buyers at a given factory that are unwilling to 
        join other brands and retailers in fully supporting crucial 
        remedial measures.

    The Accord leadership will continue to keep the members of this 
committee, and all interested parties, updated on the implementation of 
the initiative.

----------------
End Notes

    \1\ See, ``New Trademark Licensing Policy Aims to Protect Workers 
in Bangladesh,'' http://www.georgetown.edu/news/trademark-licensing-
policy-bangladesh.html. See also, ``Penn State to require retailers to 
sign Bangladesh Safety Accord,'' http://www.collegian.psu.edu/news/
campus/article_df872004-8d52-11e3-9928-0017a43b2370.html. See also, 
``Marines Toughen Rules for Makers of Licensed Clothing,'' http://
www.nytimes.com/2013/11/23/business/marines-toughen-rules-for-makers-
of-licensed-clothing.html.
    \2\ Fair Wear Foundation, ``Background Study Bangladesh,'' January 
2006, available at http://www.fairwear.org/ul/cms/fck-uploaded/archive/
2010-01/bangladesh_fwf_country_study.pdf.
    \3\ Greenhouse, Steven and Jim Yardley, ``As Walmart Makes Safety 
Vows, It's Seen as Obstacle to Change,'' The New York Times, December 
28, 2012, available at http://www.nytimes.com/2012/12/29/world/asia/
despite-vows-for-safety-walmart-seen-as-obstacle-to-change.html?page 
wanted=all.
    \4\ Eidelson, Josh, ``Photos Show Walmart Apparel at Site of Deadly 
Factory Fire in Bangladesh,'' The Nation, November 26, 2012, available 
at http://www.thenation.com/blog/171451/photos-show-walmart-apparel-
site-deadly-factory-fire-bangladesh#.
    \5\ See, ``Tazreen owner, wife sent to jail,'' Dhaka Tribune, 
February 9, 2014, available at http://www.dhakatribune.com/2014/feb/09/
tazreen-owner-wife-sent-jail.
    \6\ Yardley, Jim and Julfikar Ali Manik, ``Building Collapse in 
Bangladesh Leaves Scores Dead,'' The New York Times, April 24, 2013, 
available at http://www.nytimes.com/2013/04/25/world/asia/bangladesh-
building-collapse.html?pagewanted=all&_r=0.Devnath, Arun, ``Bangladesh 
Raises Minimum Wage for Garment Workers After Unrest,'' Bloomberg News, 
November 14, 2013, available at http://www.bloomberg.com/news/2013-11-
13/bangladesh-garment-factories-to-stay-shut-amid-worker-protests.html.

    The Chairman. Thank you.
    Ms. Akter.

  STATEMENT OF KALPONA AKTER, EXECUTIVE DIRECTOR, BANGLADESH 
        CENTER FOR WORKER SOLIDARITY, DHAKA, BANGLADESH

    Ms. Akter. Good morning. Chairman Menendez and members of 
this committee, thank you for this opportunity for me to 
testify for--to improve working conditions and respect for 
worker rights in my home country of Bangladesh.
    I am a former child worker, and I used to sew clothes for 
several well-known American brands and retailers. At age 16, I 
was fired from my job, in retaliation for my effort to organize 
a union in my workplace. I went on to cofound the organization 
called Bangladesh Center for Worker Solidarity, where I 
currently serve as the executive director.
    Much has happened since I submitted written testimony to 
the committee on June 6, 2013. Soon thereafter, the United 
States suspended Bangladesh GSP benefits, sending a clear 
signal to the garment industry that compliance with human 
rights must be improved in the industry if it is to receive 
such a benefit in the future.
    I understand that the United States is scheduled to review 
the suspension of GSP in May, and I would note that, although 
there have been a few advances in recent months, there are a 
number of areas in which little-to-no improvement has been 
made. Several union leaders continue to face unsustainable 
charges. Recently, an organizer with the Bangladesh Independent 
Garment Workers Union Federation was detained by police under 
baseless charges.
    Workers continue to face harsh retaliation for their 
efforts to secure respect for their rights. Although new unions 
have been registered, I have seen no substantive improvement in 
the willingness of factory managers to engage in collective 
bargaining. The new minimum wage of 5,300 taka per month, falls 
far short of a living wage and the workers' demand for 8,000 
taka per month.
    Nearly 2 years later, there still has not been an 
independent, transparent investigation into the brutal murder 
of my colleague, Aminul Islam, and not a single person has been 
prosecuted for this crime. The Government of Bangladesh does 
not have a viable initiative to ensure workplace safety. The 
government announced a National Tripartite Plan of Action, but 
workers report that they have not seen any visible result in 
terms of inspections or any real improvement in the factories.
    Before reinstating GSP, the United States should require 
that these issues are addressed. The U.S. Government also has 
an essential role in urging American brands and retailers to 
pay full and fair compensation to the victims of disaster in 
their supply chains. The Tazreen Fashions factory, where at 
least 112 workers were killed in the fire on November 24, 2012, 
made clothes for Walmart, Sears, Dickies, and Delta Apparel, 
which produced local apparel for the U.S. Marine Corps. More 
than a year later, none of these companies have offered any 
compensation to the injured workers and the families of the 
victims.
    The April 24th collapse of Rana Plaza killed at least 1,135 
workers and injured more than 2,500 workers. The American 
companies that sourced from Rana Plaza, including Children 
Place, Cato Fashions, JCPenney, and Walmart, none of which have 
agreed to pay a single dime of compensation to the victims. I 
urge the U.S. Government to do what you can to compel these 
Americans brands and retailers to immediately join the Rana 
Plaza Agreement on Compensation, which is facilitated by the 
ILO.
    The U.S. Government also has an important role to play in 
protecting the lives of workers who sew the clothes for U.S. 
companies and U.S. Government itself. The best way to do this 
is through the Accord on Fire and Building Safety in 
Bangladesh. The U.S. Government should urge apparel brand and 
retailers to join the Accord, and should ensure that its own 
retailers operated by U.S. military actions join the Accord and 
comply fully with the requirements of the Accord. Following the 
new policy of the Marine Corps, the changes should also require 
that--the changes should also require that licensees and 
vendors that supply apparel made in Bangladesh join the Accord.
    Regarding the Alliance for Bangladesh Worker Safety, I do 
not believe that it will generate any meaningful improvements 
for workers in my country. The Alliance does not offer any role 
for workers' representative in either its governance or 
implementation. Recently, the Bangladesh Garment and Industrial 
Workers Federation, BGIWF, attended in a meeting is with 
Alliance representative, stated that the program had met with 
workers participation committee during the factory inspections, 
but later, when BGIWF spoke with the committee representative, 
they stated that there is no one from Alliance had met with 
them.
    In another inspection, the Alliance said they had 
interviewed workers from the particular factory, but the 
workers from the factory reported that management had hand-
picked the workers for the interview.
    The Alliance has claimed that it will offer low-interest 
loan to the factories to pay for repairs. Yet, the Toronto 
study reported that several factories producing for Walmart, 
one of the founding member of the Alliance, were not even aware 
such financing was available. There is no meaningful difference 
between the Alliance and the industry-controlled corporate 
social responsibility programs that have been left behind 
thousand of dead worker--dead and injured workers. The Accord 
is only one way to prevent future tragedies.
    Thank you again for the opportunity in testifying at this 
hearing, and I appreciate your concern and for the welfare on 
human rights of Bangladesh workers in my country.
    Thank you.
    [The prepared statement of Ms. Akter follows:]

                  Prepared Statement of Kalpona Akter

    Chairman Menendez, Ranking Member Corker, and members of the 
committee: thank you for the opportunity to testify on the struggle of 
garment workers to achieve improved working conditions and respect for 
their labor rights in my home country of Bangladesh.
    I am a former child garment worker. My activism in the garment 
industry is very personal. When I was 12 my father became disabled and 
could no longer work. My mother had to stay home to take care of my 
baby sister, so my 10-year-old brother and I went to work. I sewed 
clothing for multinational corporations and made less than 10 dollars a 
month for 450 hours of work. We were cheated on our overtime wage: it 
was wage theft. We went on strike and we won. But then some strike 
organizers were fired. I learned that there are laws that are supposed 
to protect us and I started organizing my coworkers. Management 
harassed me all the time, and then fired me. I was only 16. I went to 
work for a union and then I cofounded the Bangladesh Center for Worker 
Solidarity, a worker center that educates workers about their rights 
and conducts research. I became an organizer and never stopped. Not 
when workers were beaten and tear-gassed for demanding higher wages. 
Not when the government made it illegal for our organization to 
operate. Not even when factory owners brought falsified charges against 
me and put me in jail. Not even when my friend and union organizer, 
Aminul Islam, was disappeared, tortured, and murdered with all evidence 
pointing to the government's security forces. It is these experiences, 
and the ongoing horrific fires and building collapses, which motivate 
me to seek improvements in the lives of the 4 million garment workers 
in my country--even as I, and at least 15 other labor leaders, continue 
to face government surveillance.\1\
---------------------------------------------------------------------------
    \1\ Islam, Rabiul and Mohammed Jamil Khan. ``Lawmen Identify 
`Instigators'.'' Dhaka Tribune. November 20, 2013. http://
www.dhakatribune.com/labour/2013/nov/20/lawmen-identify-%E2%80 
%98instigators%E2%80%99)
---------------------------------------------------------------------------
    Much has happened since I submitted written testimony to this 
committee on June 6, 2013. Soon thereafter, the U.S. suspended 
Bangladesh's Generalized System of Preferences (GSP) trade benefits. 
While our garment industry had not benefited from GSP, the industry had 
long been seeking GSP benefits. The suspension of GSP for other sectors 
sent a clear signal to the garment industry that compliance with human 
rights, labor rights, and workplace safety must be significantly 
improved if the industry is to ever receive such benefits in the 
future. Now that the U.S. is scheduled to review the suspension of GSP 
in May, I would like to highlight some of the advances in recent 
months, as well as the ongoing challenges.
    The advances include:

   Most of the unsubstantiated criminal charges brought against 
        union leaders and labor rights advocates in the summer of 2010 
        have been dismissed by the courts. As of January 2014, I am no 
        longer facing any of these charges. But our work is not done in 
        this area until the remainder are dismissed.
   As of August 2013--after 3 years of government crackdown 
        against us--the Bangladesh Center for Worker Solidarity has 
        successfully had our official registration status reinstated.
   The Government of Bangladesh has begun to process trade 
        union registrations again, with nearly 100 new garment factory 
        unions registered in the past year.

    The ongoing challenges include:

   Some union leaders from Bangladesh Garments and Industrial 
        Workers Federation (BGIWF) and Bangladesh Independent Garment 
        Workers Union Federation (BIGUF) continue to face 
        unsubstantiated criminal charges. Recently a BIGUF organizer 
        was detained under unsubstantiated charges.
   Workers continue to be fired and beaten in an industry 
        attempt to repress their efforts to organize to secure respect 
        for their labor rights. Although new unions have been 
        registered recently; it remains to be seen whether factory 
        management will respect union rights in collective bargaining 
        negotiations.
   The garment sector minimum wage increase to 5300 taka 
        (approximately US$68) per month, at the end of 2013, falls far 
        short of a living wage and of workers' demands for 8000 taka 
        (US$103).
   There has yet to be a transparent investigation into the 
        April 2012 brutal murder of union organizer Aminul Islam. While 
        plenty of evidence points to a member of Bangladesh's security 
        forces as a culpable party, as of yet no one has been brought 
        to justice for this crime.
   The Government of Bangladesh does not yet have a visible 
        initiative to ensure workplace safety. The Government announced 
        a National Tripartite Plan of Action on Fire Safety but garment 
        workers report that they have not seen any visible results in 
        terms of inspections or real improvements in factories.

    Before reinstating GSP, the U.S. should require and ensure that:

   The remaining unsubstantiated charges against labor leaders 
        are dismissed;
   Workers are free to exercise their collective bargaining 
        rights;
   Bangladesh is upholding its role in workplace safety;
   There is a transparent investigation into the Aminul Islam 
        murder case and that the perpetrators of the crime are brought 
        to justice;
   Bangladesh reform its labor laws so that they meet the 
        International Labour Organization (ILO) standards; and
   Workers in export-processing zones are afforded full rights 
        to form unions and bargain.

    The U.S. Government also has an essential role in communicating 
with American brands and retailers, to urge them to pay full and fair 
compensation to the victims of disasters in their supply chains:

   Tazreen Fashions, the garment factory where at least 112 
        workers were killed in a fire on November 24, 2012, made 
        clothing destined for Walmart, Sears, Delta Apparel, Dickies, 
        and Sean John Apparel. The factory made Marines-logo clothing 
        for Delta Apparel and its largest customer was Walmart. But 
        even more than a year later, none of the American companies 
        whose clothing was made at Tazreen have yet to offer any 
        compensation to the injured workers and families who lost loved 
        ones. In fact, Walmart and Sears have refused to pay 
        compensation on the basis that production was ``unauthorized.'' 
        Whether the production was authorized or unauthorized should 
        not matter: companies must be accountable for safety in their 
        supply chains. These callous companies are failing accept their 
        responsibility to pay compensation, even while many of the 
        survivors are unable to work and are unable to afford the 
        medical treatment they need for the burn injuries and bone 
        fractures that they sustained as a result of these companies' 
        negligence to remediate safety hazards even after their audits 
        found major safety violations in the months prior to the fire.
   The April 24, 2013 collapse of Rana Plaza, which housed five 
        garment factories, killed at least 1,135 workers and injured an 
        estimated 2,500. Similarly to Tazreen, families who lost loved 
        ones are facing immense financial hardship and the survivors 
        are struggling with psychological trauma and physical pain. 
        Many of the survivors are unable to return to work and cannot 
        provide for themselves or their families. Some have had to pull 
        their children out of school and send them to work in an 
        attempt to not starve. The American companies that did business 
        with factories at Rana Plaza included Children's Place, Cato 
        Fashions, JCPenney, and Walmart. All of these companies owe 
        compensation to the victims, but none of them has yet to pay 
        any compensation yet. The testimony of Reba Sikder, who is here 
        with me today, is but one story of thousands of people who were 
        affected by the building collapse and who are owed 
        compensation. I have traveled all the way from Bangladesh to be 
        here today to ask members of the U.S. Government to do what you 
        can to call on these American brands and retailers to 
        immediately join the Rana Plaza Arrangement on Compensation, 
        which is facilitated by the ILO.\2\
---------------------------------------------------------------------------
    \2\ For information on the ``Understanding for a Practical 
Arrangement on Payments to the Victims of the Rana Plaza Accident and 
their Families,'' please visit http://www.ranaplaza-arrangement.org.

    In addition to ensuring compensation for victims, the U.S. 
Government must have an important role in saving the lives of workers 
in my country in the supply chains of U.S. companies and of the U.S. 
Government itself. One hundred fifty-one companies from 20 countries, 
including 10 U.S. companies,\3\ have now joined the Accord on Fire and 
Building Safety in Bangladesh. The Accord is a program of independent 
safety inspections with public reports; mandatory repairs and 
renovations to address all identified hazards; and a central role for 
workers and unions, including worker-led safety committees, in all 
factories and access to factories for unions to educate workers on how 
they can protect their rights and their safety, including their right 
to refuse dangerous work. The companies in the Accord commit to work 
with their suppliers to secure financing, maintain orders, and ensure 
renovations are completed to make factory buildings in Bangladesh safe.
---------------------------------------------------------------------------
    \3\ See the full list of Accord signatories at http://
www.bangladeshaccord.org/signatories/.
---------------------------------------------------------------------------
    The immediate causes of the incidents in Bangladesh are flammable 
materials piled in hallways or in illegal bottom floor storage rooms, 
overloaded electrical systems, or poorly constructed buildings. What 
has resulted in a high number of injured and dead workers in case after 
case has been the absent or completely inadequate fire suppression 
equipment, locked doors and barred windows, and overall poor emergency 
training and planning. But the problem isn't just with the poorly 
constructed buildings with weak foundations or the additional stories 
added illegally after original construction. It's not just with open 
stairwells which act as chimneys rather than as escape routes, or the 
missing fire extinguishers or the lack of emergency lighting. All of 
those structural issues are of course critical and must be urgently 
addressed in hundreds if not in over a thousand factories in 
Bangladesh.
    There's another core part of the problem that must be solved. It's 
this: time and again when workers speak up with concern about safety 
risks, they aren't listened to. And in the moment of crisis, when the 
fire alarm goes off or a building starts to crack, workers' voices not 
only fall on deaf ears, but they are actively disregarded. Their right 
to refuse dangerous work is denied. When I say this, I'm thinking of 
the workers at Tazreen who were ordered to go back to their sewing 
machines when the fire alarm went off and then when it became really 
clear that it was a real fire, the exit doors were locked and the floor 
managers with the keys were nowhere to be found. When I talk about the 
right to refuse dangerous work, I'm thinking about how the Rana Plaza 
workers' rights were denied when they said they didn't want to go to 
work in a building with cracks in the walls but they were told that 
they must or they would lose their precious pay, and then they were 
even lied to and told the building had been repaired. This is why I 
fear that until the largest U.S. companies the buy from Bangladesh--
companies such as Walmart, Gap and VF Corporation--join the Accord, 
garment workers will continue to die on the job in my country.
    From media reports I am aware of the Alliance for Bangladesh Worker 
Safety, founded by a group of North American companies. However, my 
awareness on-the-ground in Bangladesh of this initiative is minimal. 
The Alliance has never invited the Bangladesh Center for Worker 
Solidarity to meet with them. It has no involvement from or 
representation of unions or other meaningful worker-representative 
bodies in its governance or implementation. The Bangladesh Garments and 
Industrial Workers Federation (BGIWF) did attend one meeting with the 
Alliance convened by the Solidarity Center. In that meeting, the 
Alliance said that it had met with a workers' participatory committee 
during a factory inspection. But later, when BGIWF spoke with the 
committee, the committee said no one from the Alliance had met with 
them. In another instance, the Alliance said they had interviewed 
factory workers, but workers from the factory reported that management 
had selected the workers for the interviews. These examples indicate 
that at least as of yet there is no meaningful difference between the 
Alliance and the corporate- controlled ``corporate social 
responsibility'' programs that have failed Bangladeshi garment workers 
in the past, and have left behind thousands of dead and injured 
workers.
    In contrast, the Accord is cosigned with 10 unions and 4 
nongovernmental organizations as witness signatories. The Accord 
involves workers and their unions in inspections, in trainings, and 
unions receive copies of inspection results from the Accord. As one 
example, in the inspection of Fashion Island Ltd, the Accord involved 
leaders from the factory-level union, which is affiliated with BGIWF. 
Following the completion of the inspection, the Accord staff held a 
meeting with leaders of factory union to present the findings from the 
investigation.
    Apart from the sheer difference in the scale and reach of the two 
programs (the Accord has more than five times more members than the 
Alliance does), and the fact that the Alliance is accountable to no one 
other than the companies themselves, there are other significant 
differences. The Alliance has been highlighting its financing in media 
interviews, but that's a program of loans rather than direct financing 
of factory repairs. Factory managers themselves don't even know how to 
access this funding. Even after my country has experienced the 
deadliest garment industry disaster the world has ever seen, the 
Alliance companies have shown no indication that they will increase the 
prices they pay to factories to include the cost of safety or that they 
will guarantee that factories have the funds necessary for repairs 
after hazards are uncovered. There is no contractual commitment to 
worker safety under the Alliance. The only tool workers have access to 
is a hotline, and it is unclear what is done with the information that 
is submitted.
    Thank you again for the opportunity to testify in this hearing. I 
appreciate your concern for the welfare and human rights of garment 
workers in my country.
           summary of recommendations to the u.s. government
    With this testimony I urge the U.S. Government to:

    (1) Urge all U.S. brands and retailers whose clothing was made at 
Tazreen and Rana Plaza to pay the full and fair compensation they owe 
to the survivors and to the families of the workers who were killed.
    (2) Call on all U.S. brands and retailers that source clothing from 
Bangladesh to sign onto the Accord on Fire and Building Safety in 
Bangladesh, and require all apparel companies that do business with the 
U.S. Government and source from Bangladesh to join the Accord.
    (3) Before reinstating GSP, the U.S. should require and ensure that 
the remaining unsubstantiated charges against labor leaders are 
dismissed; that workers are free to exercise their collective 
bargaining rights; that Bangladesh is upholding its role in workplace 
safety; that there is a transparent investigation into the Aminul Islam 
murder case and that the perpetrators of the crime are brought to 
justice; that Bangladesh reform its labor laws so that they meet the 
International Labour Organization (ILO) standards; and that workers in 
export-processing zones are afforded full rights to form unions and 
bargain.
    (4) Help provide support for mental health services for garment 
workers dealing with long-term trauma as a result of factory fires and 
building collapses.

    The Chairman. Well, thank you. And thank you all.
    Ms. Tauscher, our committee report from last November 
recommended that the Alliance include Bangladeshi union 
representatives on safety training teams to educate workers 
about their rights, helping empower them to ensure their own 
safety. Last year, I wrote you a letter with a similar 
suggestion, and you replied that the Alliance would take it 
under consideration when designing their training curriculum.
    The Alliance's recent progress report stated that it will 
take a, ``complete worker representative approach that includes 
worker and management education and freedom of association.''
    Can you tell the committee what that approach will consist 
of? And will the Alliance include union representatives on its 
safety training teams?
    Ms. Tauscher. Mr. Chairman, thank you very much. And thank 
you very much for your letter.
    And, as you saw in my response, and as you saw in our 6-
month report, the Alliance has made tremendous efforts and 
tremendous moves forward. With the Accord, both of our 
technical teams have put together harmonized standards. It is 
very, very important that--as you know, in Bangladesh, with 
such a complex and chaotic circumstance, the only thing worse, 
perhaps, than having no standard is to have two. And so, that 
is why we have worked very closely with the Accord technical 
teams to create one standard for fire and building integrity.
    So, technically, there is nothing different between the 
Alliance and the Accord, when it comes to standards. We have--
as we have said, we believe democratically elected groups, 
especially workers participation teams, occupational worker 
safety teams, and unions, are very important parts of making 
sure that workers are empowered to speak for themselves, that 
they know that they should not enter buildings that are unsafe. 
We are creating a 24-hour hotline that is going to be 
accessible to all workers in our factories----
    The Chairman. Does the Alliance include union 
representatives on its safety training teams?
    Ms. Tauscher. Well, we have not put the safety training 
teams together. We are just getting into the training business. 
I was in Geneva, just 2 weeks ago, meeting with the Accord 
leadership, where we have offered to work with the Accord to 
have one training program.
    We believe it is important to have worker representation on 
the training teams. We fundamentally agree that it is important 
that workers are able to speak, and that there is no reprisals 
to them for the issues that they have about safety.
    So, the answer is, we are developing our training. Neither 
the Accord nor the Alliance have their training systems set up 
yet. We think we are a little bit ahead, because we are about 
to launch our 24-hour hotline next month. But, as I said, we 
are going to have worker participation as part of it.
    The Chairman. Worker participation.
    Ms. Tauscher. Well, Mr. Chairman, there are only three--
there are only five unions in the 220 places that we have done. 
So, it is not as if there are unions in every place. And I 
think, as you saw from Assistant Secretary Biswal's testimony, 
we are moving as fast as we can to build capacity across the 
platform.
    The Chairman. But, you heard Ms. Akter, who is on the 
ground, living it every day. And clearly, she has a different 
view----
    Ms. Tauscher. She does.
    The Chairman [continuing]. Between the Alliance's approach 
and the Accord's approach, I certainly applaud that you both 
have come together, particularly as it relates to a common set 
of inspection standards. As I understand it, there is an 
agreement----
    Ms. Tauscher. That is right.
    The Chairman [continuing]. On initiatives, and there is--
however, there is still no agreement on how financial 
obligations will be shared among the Alliance and the Accord 
brands for shared factories that require significant 
remediation. So----
    Ms. Tauscher. But, we do have $100 million fund of low-cost 
loans, and we actually have two different factories that we are 
negotiating with right now. As far as I know, no factory has 
been given any money for remediation, either from the Alliance 
or the Accord.
    And, you know, I am happy to meet with Ms. Akter. I think 
that she has some mis-impressions about the Alliance. She has 
clearly stated her preference for the Accord. But, the truth of 
the matter is, it takes everyone, together, working together. 
We could decide that we are going to have a rivalry between the 
Alliance and the Accord. I am sure some people have decided 
that. But, frankly, that takes our eye off the people in----
    The Chairman. Whoa, whoa. No, I am not----
    Ms. Tauscher [continuing]. Bangladesh that desperately need 
our help.
    The Chairman. I am not an advocate of rivalries. I am an 
advocate of achieving the goal.
    Mr. Nova----
    Ms. Tauscher. We agree.
    The Chairman. Mr. Nova, what is the Accord's position about 
having union representatives on safety training teams?
    Mr. Nova. All safety training teams will have 
representatives from the signatory union federations.
    The Chairman. Whether or not that particular factory----
    Mr. Nova. Indeed. And one note. It is true that a very 
small number of factories actually have recognized unions. But, 
many factories have some union members. Which is to say, the 
unions in the country, including the unions that are 
signatories to the Accord, have a modest number of members in 
many factories. And where the commitment is there, with the 
help of the signatory unions, in communication with their 
members in those factories, it is possible to have meaningful 
worker participation, not just in the training process, but in 
other phases and aspects of the program.
    The Chairman. So, what are the challenges of just having a 
worker--outside of a union context, as, of course, that is an 
enormous pressure on that individual worker who has no 
representation at----
    Mr. Nova. Indeed.
    The Chairman [continuing]. That factory, and I can see it 
very easily being someone who will just say everything is 
hunky-dory, because their risk is greater than they can 
sustain.
    Ms. Tauscher, on the morning of the Rana Plaza collapse, 
many workers were reportedly afraid to enter the building, but 
were pressured, as we have heard here, to do so by factory 
managers who threatened to withhold their pay. And at Tazreen 
Fashion, when they attempted to leave the building when the 
fire alarms went off, they were also pressured by management to 
return to work. Does the Alliance think that workers should 
have the right to refuse to enter, choose to leave a dangerous 
building without the fear of losing their pay?
    Ms. Tauscher. Of course the Alliance believes that the 
workers have the ultimate right of safety and security in their 
workplace, not only the knowledge of it, but the assurance of 
it. And that is why the Alliance member companies have agreed, 
in a legally binding agreement, that we will not source through 
factories that are not inspected with the Alliance and the 
Accord standards, that if there is any kind of reprisals or any 
kind of management issues, if worker participation committees 
are given any kind of threats, that Alliance companies cannot 
work in those places. So, it is----
    The Chairman. Would the Alliance----
    Ms. Tauscher [continuing]. Very important----
    The Chairman [continuing]. Then consider amending its 
members' agreement to include that important protection?
    Ms. Tauscher. We have that as part of our member agreement, 
Mr. Chairman.
    The Chairman. Okay. Well, we will have to rereview that, 
because we must have missed it. So, I would urge you to point 
it out to us, where it is.
    Let me ask you this. Let me ask you both, actually, both 
Mr. Nova and Ms. Tauscher. Does the industry and the retailers 
understand--fully understand--that the consequences of selling 
garments made in a country like Bangladesh, where, as you so 
aptly said, we have two high-profile tragedies, which, of 
course, riveted our attention. There are a lot of people who 
have lost their lives, maybe not in the maximum of the Rana 
Plaza or the other tragedy--but, do the companies really get 
it, here, that trying to sell clothing made in Bangladesh with 
the blood of workers, if that does not improve, that there is a 
consequence to the retailer, at the end of the day?
    Ms. Tauscher. Mr. Chairman, I think that we are all shocked 
and dismayed at the tragedies that you see in Bangladesh and, 
frankly, in any kind of workplace tragedy where people lose 
their lives. Keep in mind that the millions of people that work 
at these companies of the Alliance, which are basically 
Canadian and American--the millions of people that work there, 
the hundreds of millions of Americans and people around the 
world that shop in these stores and wear these brands, want to 
know that the places where the clothing is being made are safe.
    It is important that we understand the very chaotic 
situation in Bangladesh, that there is tremendous 
responsibility by the Government of Bangladesh, who has failed 
to step up and provide not only the kinds of laws and 
protections, but the inspections and the kind of credibility in 
the anticorruption moves that they should have to create the 
kind of place that would provide better opportunities for their 
own people.
    But, having said that, these companies could have walked 
out of Bangladesh. That would not have improved the lives of 
the people of Bangladesh, especially the 80 percent of these 
workers who are women. And that is why the Alliance and the 
Accord came together to create the opportunity for industry--
you know, as Assistant Secretary Biswal said, this is--these 
are many different pieces that have to move, and the faster 
movement will be on the industry side, but eventually it has to 
be about civil society, people of Bangladesh, and 
democratically elected opportunities for them to move forward.
    So, industry is moving. Fifty-million dollars in a legally 
binding agreement by these 26 member companies of the Alliance 
is a significant effort. There are reputational issues, there 
are risks, of course, but they could have been mitigated by 
just leaving Bangladesh. The decision was to stay and to do 
everything we can----
    The Chairman. Well, of course----
    Ms. Tauscher [continuing]. To help build capacity.
    The Chairman [continuing]. I agree. Our goal is not to have 
them leave Bangladesh. I get that. That is why I said, at the 
beginning of this hearing, that this was not just about 
Bangladesh--that those who think that just leaving Bangladesh 
and going to another place where the same set of circumstances 
exist will have avoided the challenges of having to produce 
product in Bangladesh--no, we are going to follow this.
    So this is the underpinnings of my question. Of course the 
government has a great deal of responsibility. A continuing, 
developing civil society in Bangladesh will have its share of 
responsibility. But, there are clearly--sometimes, in an 
equation of a negotiation and/or of a goal to generate an 
effort or achieve a public policy, that I think in this case is 
also about the bottom line, the enormous leverage that the 
retailers have over the practices of a country like Bangladesh 
are probably disproportionate to what even a government might 
do, vis-a-vis Bangladesh, because the economic bottom line is 
there. So, the garment factory association, if it gets a really 
clear message from the retailers, at the end of the day, is 
going to be very clear for them the consequences of not 
cleaning up their act.
    Mr. Nova, I have not heard from you on this.
    Mr. Nova. I think the Accord signatory brands and retailers 
get it. And I think this is reflected in the extraordinary 
nature of the commitments that they have made in signing the 
Accord and in the enforceability of those commitments by worker 
representatives. These companies are making financial 
commitments that will involve real costs. They are making 
commitments to act, in terms of their relationships with 
individual factories, on the decisions of the Accord's 
independent chief inspector, which means some brands will end 
up having to leave factories that they would otherwise stay in 
solely because the independent chief inspector has said, ``This 
factory is unsafe and it is not committed to becoming safe.'' 
These are commitments that will involve financial costs, 
logistical costs. These brands and retailers have agreed to 
share power with worker representatives at every level of 
decisionmaking within the Accord.
    I think the extraordinary nature of the agreement is 
entirely necessary and appropriate, given the extraordinary 
nature of the challenges in Bangladesh. And I think the 
signatory companies do get that.
    The Chairman. Now, I had mentioned earlier, in my 
conversation with Ms. Tauscher, that your two initiatives have 
agreed on a common set of inspection standards, which is very 
desirable, and I applaud that. But, again, there is no 
agreement on financial obligations, how they will be shared 
between the Alliance and Accord brands for shared factories 
that require significant remediation. How confident are you 
that such an agreement can be reached?
    Mr. Nova. I do not know. And there is a strong commitment, 
on the part of everyone involved with the Accord, to cooperate 
to the greatest extent possible in every instance in which it 
advances the goal of protecting worker safety. And you have 
seen that commitment reflected in the development of the joint 
inspection standard.
    At the same time, we must be mindful of the significant 
differences between the agreements, in terms of the nature and 
enforceability of the commitments that the signatory companies 
have made. And those differences may create significant 
obstacles to cooperation.
    From the perspective of the Accord, the bottom line is that 
the Accord's commitments to independent inspections, to 
ensuring that there is full financial capacity by factories to 
undertake repairs and renovations, to full public transparency 
in the reporting process, to a very high level of worker--not 
just participation, but influence over the operations of the 
Accord--that must remain in place. And so, cooperation can only 
happen to the extent that those principles are not compromised. 
And I am hopeful that more cooperation will be possible, but, 
again, also mindful of those distinctions.
    It would have been better, in my view, had there been a 
single agreement. And, as you may know, every signatory of the 
Alliance, prior to the Alliance coming into being, was invited 
to sign the Accord.
    And it is worth noting that one significant Alliance 
signatory brand, Fruit of the Loom, one of the oldest apparel 
companies in the United States, recently chose to sign the 
Accord agreement, and it may be that other Alliance companies 
will do so. I certainly would reiterate the longstanding 
invitation of the Accord to have companies in the United 
States, both those inside the Alliance and those outside, that 
are not signatories of the Accord, to join. Ideally, we would 
have one program. That would, in a very clear and decisive way, 
eliminate the possibility of duplicative efforts and confusion.
    To the extent that there are now two initiatives, we will 
cooperate in every way that we can.
    The Chairman. Let me ask you both--Human Rights Watch 
reported several instances of intimidation and mistreatment of 
labor leaders, organizers, and members in Bangladeshi garment 
factories over the past year. This is over the past year, the 
year that we have focused all this attention on it, so somebody 
does not get it here. How do both of your associations plan to 
ensure that such illegal activity is not taking place in its 
members' supplier factories? I note that H&M took action to 
stop anti-union activities in its factories in Bangladesh, so 
we applaud them for that. How do both of your efforts come to 
bear upon that issue?
    Ms. Tauscher. Well, Mr. Chairman, all the Alliance 
companies and factories absolutely abhor any kind of 
intimidation, reprisals to workers, anything that is going to 
prevent workers from having active participation, not only in 
the securing of a safe building integrity and fire safety 
environment, but also in the training of workers to make sure 
that they can decide, on a day-to-day basis, whether the 
factory is a safe place to go to work, and to make sure that 
they have no reprisals. So, you know, our activities include 
the worker hotline, the very extensive 3,200-member survey we 
just did, and making sure that everyone understands, through 
the staffing that we have in Bangladesh, that this is not 
allowed.
    The Chairman. Okay. Well, that is different than--so, I am 
a worker, and I call the worker hotline, and I report an active 
intimidation or I report some dangerous problem with the 
factory. What is going to happen then?
    Ms. Tauscher. An inspector will go out and, you know, find 
out what is going on. And it could include having, you know, 
quiet inspections, people watching over a period of time, doing 
everything you can, interviews with management, making sure 
that, you know, the worker participation committee or the 
safety and occupational health committee or the union 
representatives on the ground are asked what is going on, and 
that a decision will be made. No Alliance company will work 
with a factory that is either unsafe or that is intimidating 
its workers.
    The Chairman. Let me ask you--and, you know, of course you 
are here as the representative--what is the fundamental concern 
or problem that Alliance members have, vis-a-vis the question 
of organizing workers and workers having a union ability to be 
part of their safety and security? Even our Ambassador there, 
who has visited with me twice while he was visiting the United 
States, makes it very clear that a critical part of achieving 
the goals we all want--I believe the Alliance wants it, I 
believe the Accord wants it, and, of course, Ms. Akter and 
fellow workers want it--which is the safety and security of 
these individuals--but, why is it that the Alliance seems to 
have a arms-length view as it relates to----
    Ms. Tauscher. I just think that is a bad----
    The Chairman [continuing]. Organizing labor?
    Ms. Tauscher. I think that is a misimpression. Just as I 
think Mr. Nova's----
    The Chairman. Well, you are going to have to work to change 
my impression, because that is my impression.
    Ms. Tauscher. Well, I am happy to do that, Mr. Chairman. 
But, just as Mr. Nova's consistent allusion to some kind of 
uniqueness to the agreement of the Accord is really a fallacy. 
We both have business models that are compatible. Both of us 
have the ability to hold people accountable and responsible. 
The only difference between the two agreements, frankly, Mr. 
Chairman, is that the Accord members agree to be able to sue 
each other and the Alliance members agree to go to binding 
arbitration. That is the only difference in the agreements.
    And I think that the record of the Alliance and the Accord 
working together on technical matters is exceptional. Within 
months, we came to agreement on common building integrity and 
fire standards, harmonized with the Bangladesh University of 
Engineering and Technology, with local governments, with the 
Government of Bangladesh. Now, perhaps we need an nonaggression 
pact between the political ends of the Alliance and the Accord. 
But, the truth is, we work very well together on the technical 
issues.
    And it should not be about two different organizations. It 
should be about the people of Bangladesh that need our 
capacity-building and our investment and our leadership to make 
their workplace safer.
    The Chairman. Well, Mr. Nova, I am going to give you a 
brief chance, since----
    Mr. Nova. Well, I would just note the----
    The Chairman [continuing]. Your association was----
    Mr. Nova [continuing]. The dispute resolution mechanism 
contained within the Accord is binding arbitration. And that--
that has been the case from outset of the agreement. So, I am 
not sure--and I am happy to discuss it with her, with Ms. 
Tauscher, about the impression that there is a program under 
which all disputes will be resolved through lawsuits.
    There are significant differences between the agreements. 
There are elements of the Accord, including the enforceable 
obligation to ensure that each factory has sufficient funds to 
undertake all necessary safety repairs, renovations, and 
retrofitting, including the very fact that the agreement is 
actually enforceable by worker representatives, that are 
unique. And I note its uniqueness, not necessarily in exclusive 
reference to the differences with the Alliance, but, in fact, 
its uniqueness relative to all other prior agreements that have 
been intended to address labor rights issues in challenging 
environments like Bangladesh, and specifically in the 
Bangladesh context, as I noted earlier, have not been very 
successful, especially with respect to worker safety.
    So, it is a new kind of agreement, a binding, enforceable 
agreement with equal power shared between unions and companies, 
with clear financial obligations for companies, with clear, 
unequivocal protection for the right to refuse dangerous work. 
These are substantial innovations, and we think they are at the 
heart of what the Accord will do and why we believe it will 
ultimately make a fundamental, measurable difference in terms 
of the safety of workers.
    The Chairman. Ms. Akter, I do not want you to feel left 
out, here, so what--you have heard both representatives, here, 
talk about how they approach the issue. Do you have any 
perspectives on that, or do you have any insights you want to 
share with the committee?
    Ms. Akter. Yes----
    The Chairman. If you would put your microphone on.
    Ms. Akter. Oh. Thank you.
    Just one thing I wanted to share, that I am on the ground, 
so I see that day-to-day activity, both Accord and Alliance. 
So, in my sense, like there is a--two inspection that I can 
talk about, like one inspection has been done by Accord, when 
they went to the factory and pre---they informed the union, the 
factory-level union and also the federation, that they are 
going to have this inspection. And then, during the inspection, 
whole union team, union member, was with them. This is one. And 
second, when they have done their inspection, they have the 
followup meeting with the union, what was the findings during 
the--you know, an inspection that they found in that particular 
factory. So, this is what workers has involved. And they 
totally understand that it is because of their safety there is 
an inspection being done.
    On the other hand, when Alliance has done their inspection, 
as I stated, that none of the workers has been informed that, 
you know, the Alliance going to have their inspection at the 
factory, and they have been handpicked out by the factory 
management to talk to the Alliance members, and who--and 
Alliance also demanded that they spoke to the workers 
participating committed in that factory, but, in the reality, 
they have not.
    So, for us, definitely Accord is a great piece, or we would 
say that this is one which can make our factories safe for our 
workers. On the other hand, it will also help workers to raise 
their voice and join with union in future.
    The Chairman. Let me ask you--you are part of a union, no? 
Are you part of a union?
    Ms. Akter. My organization is a--NGO, but we closely work 
with the national unions.
    The Chairman. Okay. So, your observation--how do 
Bangladeshi workers--do they have a concept of what a union is? 
Do they understand what a union is? Do they fear joining a 
union?
    Ms. Akter. Of course they understand there is a rights of 
union in the law that they have. Our law provision has been 
ratified by the country, so they know that. I should not demand 
that 4--whole 4 million workers know that, but majority--a good 
percentage of workers, they know they have union rights. And 
they have to face all this retaliation by the factory 
management and by the state when they try to organize in their 
factory-level unions. So, that was even 1-year-back scenario.
    After the GSP suspension by the U.S. Government, the 
government has opened a little window for workers to get their 
unions registered. So, last 8 months, I should say that about 
100 union has been registered, officially, but it is a long way 
to go for their collective bargaining. I think among 100, one, 
two, or three of them were able to submit their charter of 
demand. And among this 100 union, which even been registered, 
but they are facing a lot of retaliation by the factory 
management. And many of union has submitted, but their 
application has been rejected, that has been happened, too. So, 
it is changing a little bit, in compared to last 1 year.
    The Chairman. So, under the new unions, how many of them--
or, do you have a sense of their ability to go--because 
creating a union is one thing, going and representing workers 
is another. Do you have a sense of how that is unfolding?
    Ms. Akter. Among even--among--if we consider these 100 
unions, I would say at least 70 unions, they have their strong 
leadership and they can go for the bargaining if they are free 
to.
    The Chairman. All right. Well, I appreciate your testimony. 
Obviously, it is something the committee is going to continue 
to be engaged in. I said we would not go away with just one 
hearing, and we do not intend to go away. So, we look forward 
to continuing to engage with the Alliance, the Accord, and the 
workers, as well as the Government of Bangladesh.
    I would like to submit, for the record, written statements 
from the Government of Bangladesh, the Bangladesh Garment 
Manufacturers and Exporters Association, the AFL-CIO, the 
International Labor Rights Forum, and the Center for Business 
and Human Rights at the NYU Stern School of Business. Without 
objection, they shall all be included.
    The Chairman. And, with the thanks of the committee, this 
hearing is adjourned.
    [Whereupon, at 12:05 p.m., the hearing was adjourned.]
                              ----------                              


                   Additional Material for the Record


       Response of Assistant Secretary Nisha Biswal to Question 
                   Submitted Senator Robert Menendez

    Question. The Rohingya are possibly the most persecuted people in 
the world, and yet few people are aware of their plight. A Muslim 
minority long resident in Burma, they are essentially stateless, lack 
basic rights, and continually facing restrictions on work, travel, 
marriage, and education. In Burma, they routinely suffer forced labor, 
confiscation of property, arbitrary arrest and detention, and physical 
and sexual violence. Decades of exclusion and myriad humanitarian 
abuses against the Rohingya drove hundreds of thousands of them to flee 
their homeland to Bangladesh and other countries throughout the region. 
In Bangladesh, several hundred thousand reside in both formal camps and 
squalid makeshift camps. Please describe the current challenges facing 
the Rohingya population in Bangladesh, and the details of the 
Government of Bangladesh's recent announcement of a ``Rohingya 
strategy.''
    Unregistered Rohingyas receive very limited aid, and are subject to 
arrest, extortion and detention. Unregistered refugee women and girls 
are particularly vulnerable to sexual and physical attacks. Please 
describe specific actions taken by the USG to urge the Bangladeshi 
Government to register undocumented refugees and improve protection for 
all vulnerable Rohingyas. In addition, detail any efforts made by 
Bangladesh to appeal to international donors to address the issue of 
Rohingya refugees.

   Please detail restrictions the Government of Bangladesh has 
        placed on humanitarian access and provision of assistance, both 
        by U.N. partners and NGOs, to registered and unregistered 
        Rohingya refugees.
   Furthermore, describe USG interbureau and interagency 
        efforts made on the Rohingya issue, any efforts to seek 
        resettlement of Rohingya refugees to third countries, and the 
        Bangladesh Government's response to resettlement efforts by the 
        USG or other governments.
   Please describe USG's multilateral efforts to find a 
        durable solution to the Rohingya issue.
   Please detail any upcoming opportunities for the U.S. 
        Government to engage the Government of Bangladesh on this 
        issue.

    Answer. The State Department remains deeply concerned about 
intercommunal violence and tension in Burma's Rakhine State, which we 
continue to monitor very closely. We have called on the Government of 
Burma to prevent the conditions that lead to outward migration. We have 
urged the authorities to take appropriate actions to maintain calm and 
restore security and stability according to international standards. We 
have also called on the government to hold those responsible for the 
violence fully accountable under just and transparent procedures 
according to the rule of law. President Obama requested of Burmese 
President Thein Sein last May that the Rohingya's ``rights and their 
dignity is recognized over the long term,'' and we continue to advocate 
that the solution, which includes a path to citizenship, lies in Burma.
    As you noted, there are approximately 25,000 Rohingya refugees 
registered with the U.N. High Commissioner for Refugees (UNHCR) in two 
official camps, Kutupalong and Nayapara, in southeastern Bangladesh. 
However, UNHCR estimates there are an additional 5,000 to 7,000 
refugees physically present in the camps and at least 200,000 
unregistered Rohingya living in the surrounding areas outside of the 
camps. The Bangladeshi Government estimates this figure to be closer to 
500,000. Many Rohingya face acute malnutrition and lack of access to 
essential services. The challenge is to provide humanitarian aid that 
matches the size of the population. Bangladesh only allows UNHRC to 
assist the 25,000 registered Rohingya.
    UNHCR and nongovernmental organizations continue to provide life-
saving humanitarian assistance despite limits placed on their 
operations, with some modest success. Bangladesh has granted UNHCR 
permission to provide semipermanent housing, female police officers, a 
biogas plant, and 1 year of secondary education in the camps.
    We have stressed to the Government of Bangladesh that it should 
grant humanitarian status to undocumented Rohingya, allow the provision 
of basic services, and follow accepted UNHCR methods in surveying this 
population. Our Embassy in Dhaka coordinates closely with UNHCR, and 
following its survey will monitor the government's implementation of a 
new five-point Rohingya strategy, which has yet to be announced.
    The United States is the main international donor assisting 
Rohingya refugees. In FY 2013, the State Department provided over $39.2 
million in humanitarian assistance for vulnerable Burmese, including 
Rohingya, in Thailand, Bangladesh, Burma, Malaysia, India, and 
elsewhere in the region. These programs provide life-saving 
humanitarian assistance to Burmese internally displaced persons, 
refugees, and asylum seekers in the areas of health and medical care, 
nutritional services, water, sanitation and hygiene, and access to 
services for people with disabilities. We are in early discussions to 
determine the possibility of providing third-country resettlement, but 
remain focused on repatriating Rohingya safely to their homes in Burma 
as the best possible durable solution.
    The State Department has made the protection of Rohingya refugees a 
priority in our engagement with the Government of Bangladesh. I raised 
it during my visit to Dhaka in November, as did Senior Advisor for 
Burma, Judith Cefkin, in her December visit. I will discuss Rohingya 
during Foreign Secretary Shahidul Haque's February 18-20 visit to 
Washington and in senior officials' future visits to the region. 
Assistant Secretary for East Asian and Pacific Affairs Daniel Russel, 
Assistant Secretary for Population, Refugees, and Migration Anne 
Richard, and I continue to reinforce the importance the administration 
places on the conditions faced by Rohingya--in Burma, Bangladesh, and 
elsewhere in the region.
                                 ______
                                 

      Responses of Assistant Secretary Nisha Biswal to Questions 
                 Submitted by Senator Edward J. Markey

    Question. In your testimony, you mentioned that Bangladeshi courts 
had begun a trial in absentia for a suspect in the murder of labor 
activist Aminul Islam. Can you provide any additional details about the 
trial and investigation--in particular, whether the government has 
fully and independently investigated allegations that Bangladeshi 
security forces were implicated in Islam's murder?

    Answer. While the courts have started the trial for Mustafizur 
Rahman, a suspect in the 2012 murder of labor activist Aminul Islam, in 
absentia, we remain concerned about the investigation. The Government 
of Bangladesh reports that it conducted an investigation into 
allegations that Bangladeshi security forces were involved in Islam's 
murder, but did not find sufficient evidence to bring charges against 
any security force officials. However, there are concerns that the 
investigation was not transparent and that important evidence from 
independent reports has not been addressed. The Government of 
Bangladesh reports that Rahman, who was the last person seen with 
Aminul Islam, fled the country. The government has taken some positive 
steps, such as offering a reward for information on his whereabouts, 
publishing calls for information in leading papers, and designating 
this case as ``sensitive,'' which requires the Ministry of Home Affairs 
to monitor the case regularly. We continue to monitor the situation 
carefully and push the government to carry out justice.

    Question. In January, Bangladeshi human rights defenders Adilur 
Rahman Khan and Nasiruddin Elan of Odhikar were criminally charged with 
publishing false information, for reporting that the government had 
killed 61 protesters in May 2013. As you know, the Department of State 
often cites Odhikar's reporting in its own reports on Bangladesh's 
human rights practices, and denounced Rahman's and Elan's initial 
detention in August. Can you provide any comment on the ongoing 
proceedings against them?

    Answer. The Department of State, both in Washington and through our 
Embassy in Dhaka, continues to raise publicly and privately at the 
highest levels our concern about reports of ongoing harassment of 
Odhikar and other human rights defenders. We are deeply concerned by 
attempts to restrict operating space for Bangladesh's historically 
vibrant civil society, including prosecutions of not only Adilur Rahman 
Khan and Nasiruddin Elan, but of other leading human rights activists 
under the Information and Communication Technology (ICT) Act. The ICT 
Act contains vague provisions that have a chilling effect on freedom of 
expression on Internet and social media platforms. This free expression 
is a fundamental right protected by Bangladesh's Constitution, and the 
new legislation runs contrary to Bangladeshi traditions of vigorous and 
open debate.
    The stifling of expression, including dissent, undermines 
Bangladesh's long-term stability, and we have urged the Government of 
Bangladesh to reconsider the ICT Act. Ambassador Mozena welcomed Mr. 
Khan to the Ambassador's residence on October 20, 2013, upon his 
release from jail, and in November Mr. Khan participated in a meeting 
with A/S Biswal in Dhaka. Throughout the ongoing proceedings, the 
Embassy has been in close personal contact with Mr. Khan, Mr. Elan, and 
other Odhikar officials, and will continue to support their right to 
free expression.
                                 ______
                                 

              Response of Hon. Ellen Tauscher to Question 
                 Submitted by Senator Edward J. Markey

    Question. Has the Alliance for Bangladesh Worker Safety taken any 
position on whether international companies whose clothing was 
manufactured at Rana Plaza and Tazreen should compensate the families 
of workers who were killed in the Rana Plaza collapse and the Tazreen 
fire? Have any members of the Alliance provided such compensation?

    Answer. Alliance members believe we have a shared responsibility to 
support victims. Recent factory tragedies in Bangladesh revealed major 
problems and failures at all levels. The buildings were not safe. 
Workers were not heard. We have to ensure that does not happen again.
    This is what the Alliance is all about. We intend not only to 
inspect all of our factories and train all of our workers and 
management; we also intend to engage with workers to ensure their voice 
is heard.
    We are actively exploring more formal mechanisms for our members 
companies to contribute to both the ILO victims fund, as well as other 
humanitarian funds.
    We are also currently planning several fundraising efforts for 
victims--the first is the International Trade Expo on Building and Fire 
Safety, where all proceeds raised for the exhibition will be donated to 
the ILO victim's fund. We are very proud of our team in Dhaka that has 
been leading this effort.
                                 ______
                                 

             Responses of Hon. Ellen Tauscher to Questions 
                  Submitted by Senator James E. Risch

    Question. You testified about collaboration in Bangladesh between 
the Accord and the Alliance on factory standards and training. If 
legislation were passed favoring the Accord in U.S. Government 
procurement how would this affect collaboration?

    Answer. As noted in the Alliance testimony, we have had very good 
engagement with the Accord leadership in Europe and Dhaka. We have 
hundreds of factories in common, we have worked together and we will 
continue to do so.
    For example, the Alliance and Accord worked together on developing 
a common set of fire and building safety standards, and have had world-
recognized experts prepare them. We are also in discussions with the 
Accord regarding the creation of a common inspection report as well as 
a similar methodology for worker involvement in the inspection and 
remediation process. Technical experts from the Accord and the Alliance 
recently met for an ongoing discussion pertaining to shared factories 
and their assessments. Finally, we are jointly hosting an International 
Trade Expo on Building and Fire Safety later this month in Dhaka.
    Given the common approach to standards, training, and worker 
empowerment, we believe that legislation favoring one approach over the 
other is fundamentally flawed and potentially detrimental to ongoing 
collaboration. We should be dedicating all our resources and energy to 
improving conditions on the ground in Bangladesh instead of creating 
unnecessary and arbitrary schisms in the United States.

    Question. I understand the common inspections standards between the 
Alliance and Accord exceed the standards set by the National Tripartite 
Committee in Bangladesh. Please explain the reasons for doing so and 
what are the key enhancements?

    Answer. The Alliance and Accord worked together on developing a 
common set of fire and building safety standards, and have had world-
recognized experts prepare them. Those experts considered not only what 
is feasible in Bangladesh, but also what is necessary to be considered 
on par with international standards and what is necessary to prevent 
future tragedies in Bangladesh.
    In a few rare instances, the new requirements do exceed standards 
set by the National Tripartite Committee and these exceptions were 
thoroughly discussed with BUET, the BMEA, and others as to why. For 
example, the Alliance/Accord safety standards require sprinkler systems 
in some situations where the National Tripartite Committee in 
Bangladesh does not. We simply feel that given the challenges with the 
existing infrastructure and traffic situations we will not always be 
able to rely on a rapid response from first responders. We believe we 
need the ability to extinguish fires with onsite resources rather than 
waiting on remote resources to arrive. Again, our deviations are 
limited and are based on the findings of hundreds of fire and safety 
audits already completed.
    Some of the changes required by the new standards, like sprinkler 
systems, for example, will take time and money to get fully 
implemented--but we are committed to seeing this through.

    Question. What is the volume of exports from Bangladesh for your 
respective members?

    Answer. We estimate that Alliance members account for about $4 
billion of the nearly $19 billion in exports from Bangladesh.
                                 ______
                                 

 Prepared Statement of Reba Sikder, Former Garment Worker at Ether Tex 
                Factory at Rana Plaza, Dhaka, Bangladesh

(Testimony provided verbally by Reba Sikder in Bangla, then transcribed 
and translated into English.)

    Thank you for the opportunity to share my story.
    I am 18 years old and was born in Gopalganj, a district just south 
of Dhaka. My parents could not afford for me to attend school after 
third grade, so at the age of eight I began working as a domestic 
worker. In 2008, I moved to Dhaka because my cousin said I could earn 
more money there. I started working in a garment factory when I was 14 
years old. In 2012, I began working as a sewing machine operator at 
Ether Tex, a clothing factory on the sixth floor of Rana Plaza. I 
earned 3,800 taka (US$49) as a base salary and with overtime, I earned 
approximately 8,000 taka (US$103) per month. I usually worked 14 hours 
per day, 6 to 7 days per week. My regular shift was from 8 a.m. to 10 
p.m. but sometimes I would work as late as 3 a.m. if the factory was 
rushing to finish an order.
    On April 23, 2013, I reported to work as usual. During the day, my 
colleagues and I heard that a massive crack had appeared in one of the 
columns of the building. Management allowed us to leave but with the 
strict instruction that we must return to work the following morning. 
When I arrived at Rana Plaza on the 24th, I found many workers standing 
outside, refusing to enter the building because they believed it was 
unsafe. However, my line chief insisted that if we did not return to 
work we would not get paid our wages for the month and also would not 
receive our overtime benefits. I saw one of the production managers 
slap a female worker who refused to enter. One of the managers 
announced to us that the building had been inspected and was safe and 
that we needed to get to work because we had to meet our shipment 
deadline. Finally, despite our fears about the cracked column, my 
colleagues and I entered the building and began to work at our 
machines. Within 15 minutes, the electricity went out and the generator 
was switched on. Moments later, I heard a loud noise, like an 
explosion, and the building collapsed.
    In those first seconds, surrounded by the sound of the building 
crumbling, my colleagues and I began to run toward the stairs. 
Suddenly, caught on a sewing machine, I fell to the floor, landing on 
top of two male and three female colleagues. The two men died instantly 
and I passed out. When I awoke, I heard one of my coworkers crying for 
help and asking for water. I said, ``I am sorry, I cannot help you, my 
foot is pinned beneath the machine.'' Then he handed me his cell phone 
and asked me to give it to his mother. He spoke to me for a few minutes 
and then fell silent and I realized that he had died. I started 
screaming for help and asking for water because I was so thirsty. Some 
workers lying near me responded that they did not have any water. I 
said, ``Please, whatever you have, please give it to me. I am so 
thirsty, I am dying.'' Then one of my coworkers gave me her urine to 
drink.
    Finally, I was able to move the machine off of my foot and I 
started crawling toward the sound of other workers' voices. I crawled a 
little further and reached a small opening that was created by the 
columns and walls that had fallen. There were 30 other workers in this 
small area. I did not know how much time had passed since the collapse, 
but one of the workers checked her cell phone and told us that we had 
been trapped for 2 days. I could not believe it.
    We began looking for a way to escape and we found another worker 
who was trapped and asking for help. We told her that we could not help 
her because there was barely enough room to move around and she said, 
``If you cannot help me, at least I can help you escape from this place 
because I saw many workers go this way,'' and she pointed us in the 
direction that the other workers had gone. It was very dark and we had 
to crawl a long way. I began to cry because I thought I would never 
escape and would never see my parents again. Finally, we felt some air 
coming from the outside and crawled toward it. We yelled for help and 
about 30 minutes later some members of the Army rescue team came and 
were able to get us out. Of the 30 workers who were trapped in that 
small space, only 6 of us survived.
    It was not until I was rescued that I realized that my ankle was 
broken and I began to feel tremendous pain. I was rushed to the 
hospital where I was able to contact my family. I had to have surgery 
on my ankle and I still bear the scars from the column that cut my 
neck. I have almost constant pain in my lower back and both of my 
ankles still hurt. I have difficulty sleeping and often experience 
nightmares. But what has been most debilitating is the trauma and panic 
I still feel, which has made it virtually impossible to find new work. 
I feel afraid just looking at tall buildings and I am scared to go 
inside. I worry there will be another collapse.
    Once I was discharged from the hospital, I went to live with my 
parents in their village in Gopalganj. Both of my parents are elderly 
and cannot work. After the accident, I received 30,000 taka (US$390) in 
compensation from Primark. When I was in the hospital, I was given 
10,000 taka (US$129) from the Prime Minister's fund. But my family and 
I had to use all of this money to cover our living expenses and now we 
have nothing. My younger brother, who works at a jute mill in the 
Khulna area, sends home 2,000 taka (US$25) per month to our family. We 
live on a small patch of land where we are able to grow a small amount 
of rice, which we must split with our landlord. It is extremely 
difficult to live off the money that my brother sends home every month.
    My life has been so incredibly hard in the last year and my heart 
breaks even more for all the other workers and families affected by the 
Rana Plaza building collapse. Because of the accident, I no longer have 
any hopes or dreams for the future like I did before.
    I would like to ask the U.S. Government to help ensure that the 
brands--including the American companies Children's Place, JCPenney, 
Cato Fashions, and Walmart--that benefited from the work of my 
colleagues and me pay us full and fair compensation. Please think about 
the workers who have lost their limbs, their feet and their hands, and 
about the families who have lost their sons and daughters, wives, and 
husbands. Please think about their pain and how they are forced to 
live. I would also urge the U.S. Government to tell American brands to 
sign the Accord on Fire and Building Safety in Bangladesh. This is the 
only way to prevent future workers and their families from suffering 
the same tragedy that I have experienced.
                                 ______
                                 

        Prepared Statement of Bangladesh Garment Manufacturers 
                    & Exporters Association (BGMEA)

    The Bangladesh Garment Manufacturers and Exporters Association 
(BGMEA) takes the opportunity to present its views and developments in 
the area of workers' rights and welfare with specific regards to 
apparel industry of the country.
    The ready-made garment (RMG) sector of Bangladesh tells an 
impressive story of the country's successful transition toward a major 
export-oriented economy. However, in order to continue prospering, in 
the face of recent tragic incidents that has caused worldwide concern, 
we must overcome several challenges with regards to the safety and 
social compliance practices in this industry.
    The post-Rana Plaza era has brought a new dimension toward 
reforming the ready-made garment industry in Bangladesh, not only in 
terms of safety, but also to empower the 4.4 million workers. The 
Government of Bangladesh, private sector representatives like BGMEA, 
buyers and international organizations like ILO, IFC are working hand 
in hand with a common objective to rebuild the industry and ensure 
safety. BGMEA is committed to ensuring that our workers have a safe 
place to work in, and enjoy at least the rights assured by our laws and 
codes. This submission covers updates on some of the major initiatives 
and developments achieved so far in this industry in the mentioned 
area.
                            workers' rights
    The Labor Law of Bangladesh was amended in July 2013 making the law 
more favorable toward ensuring workers' rights, including the right to 
freedom of association and collective bargaining. Through this 
amendment the legal requirements for trade union formation have been 
made more flexible. It should be relevant to mention here that the 
number of trade unions at the garment factories has significantly been 
increased in recent times. Currently the total number of trade unions 
registered in the RMG sector is 237 of which 101 trade unions were 
registered from January 2013 to February 2014.
    Despite the fact that the labor law has been made more favorable 
toward workers resulting in a new wave of union formation, we have to 
also admit that we are still in the early stage of industrialization in 
the country and most of the entrepreneurs are first generation 
businessmen. In addition, the lack of education, awareness on the 
principles of trade union, motivation, and cultural backwardness of the 
people are the major drawbacks to internalize the true spirit of trade 
unionism and enforcing proper union in Bangladesh. Against this 
backdrop, the surge in trade union formation may give birth to 
problems. Keeping this in mind BGMEA has taken an initiative to mediate 
and resolve the problems in a proactive manner. In this connection 
BGMEA has formed a new department to deal with issues related to 
workers' rights. A Senior Additional Secretary of BGMEA is currently 
supervising the activities of the department and we are in a process to 
recruit a labor consultant on a permanent post. Besides, BGMEA is 
preparing a plan to aware and educate factory employees and 
entrepreneurs on Bangladesh Labor Act.
    To ensure the better living of the workers the Government of 
Bangladesh has also increased the minimum wages of garment workers by 
77 percent with an effect from December 1, 2013. This may be noted that 
the consolidated increase in minimum wages for garment workers during 
the last 5 years has been around 219 percent. The owners will have 
difficulty in ensuring this, but are committed to delivering what they 
have agreed.
    Better Works Program has been started by the ILO at the garment 
factories of Bangladesh. BGMEA is in close touch with ILO and extending 
cooperation and support for smooth and successful implementation of 
this program.
                            workplace safety
    BGMEA is determined to bring positive changes in the area of 
workplace safety. To ensure that we have taken a number of initiatives 
by ourselves, and also collaborated with the Government, brands/
retailers, and ILO on several other initiatives, particularly--National 
Tripartite Plan of Action, Accord, and Alliance. We are also in close 
cooperation with the Government of Bangladesh in implementing the 
recommendations made by the United States in the Bangladesh action plan 
2013. Yet, it remains a long-drawn and continuous process. However, 
BGMEA itself has taken a number of steps to address the issue of 
workplace safety in its member factories.
    The following instructions were given by BGMEA to member factories 
to comply with on mandatory basis:

   Moving the generators from any level of the building to the 
        ground floor.
   Keep all the stairs free for easy and convenient entry and 
        exit to and from the factory floors at all time. No goods/
        materials are to be kept on the stairs/passage, which might 
        cause obstruction for free movement of personnel.
   Factories must keep all the gates open during working hours.
   Check fire alarm and emergency lights at regular intervals.
   Arrange required number of Fire Extinguisher, ensure 
        sufficient water in hydrant and install hose-reel and other 
        related equipment serviceable for use.
   Factories should hold Fire Drill as per rule and keep 
        records of all such activities.

    BGMEA itself proactively recruited a team of experts comprising 12 
engineers in order to assess structural integrity and electrical safety 
of the garment factories of Bangladesh. Until now the BGMEA experts 
have inspected 920 factories. The inspection is still going on.
    For improving the working condition of the garment factories BGMEA 
launched a crash program. Under the crash program 14,000 mid-level 
factory management and supervisors in around 1,600 factories have so 
far been imparted training by BGMEA on fire safety measures. BGMEA has 
also recruited 35 fire trainers. The trainers who are ex-officials of 
Bangladesh Fire Defense Service, Air Force or Bangladesh Navy have 
undergone high-skill 1-month Training of Trainers (Tot) course on fire 
prevention, fire extinction, safe evacuation, search, rescue and first 
aid in October 2013. The trainers are now conducting safety courses at 
the member factories of BGMEA.
                               conclusion
    Bangladesh is one of the least developed countries with limited 
resources. The growth of RMG industry in the country has significantly 
contributed to women empowerment, poverty alleviation and overall 
socioeconomic progress. It is true that the RMG sector of Bangladesh 
has witnessed a few unfortunate incidents, but we have learnt lessons 
from them and trying our best to adapt to the globally accepted 
standards to avoid further mishaps. However, we cannot do it all at 
once; it requires some more time for the development process to take 
firm roots. We have already acted on many issues and prompted quite a 
few initiatives as mentioned above. We believe that our trade partners 
will not take any steps that instead of establishing a semblance of 
order may impede our progress. We believe our positive attitude to 
correct the incorrect and adopt the best are our strength. We are 
progressing everyday and what we need most to continue our march 
forward is the friendly support.
                                 ______
                                 

                   Prepared Statement of the AFL-CIO

    The AFL-CIO is pleased to submit testimony for the record on the 
status of labor rights in Bangladesh with particular reference to labor 
rights practices in the country's Ready Made Garment Industry and in 
its Export Processing Zones where the production of garments dominates. 
This testimony will also briefly comment on the status of labor rights 
in the Shrimp Processing Sector.
    The AFL-CIO commends the committee and in particular, Chairman 
Senator Menendez, for conducting sustained oversight of the Government 
of Bangladesh's willingness to follow through on its promises to bring 
its labor law in compliance with international standards and to enforce 
current labor and occupational and safety laws related to the garment 
sector. The AFL-CIO wishes to recognize the committee's efforts to 
focus the Obama administration's attention of the wide-range of labor 
rights abuses that surround garment production in Bangladesh. Moreover, 
the AFL-CIO believes that the work of the committee has been helpful in 
expanding the space for workers to exercise their right to associate in 
unions that have the potential to help avoid the appalling workplace 
tragedies that led to the deaths of over 1,200 workers in just the last 
2 years.
    For nearly 30 years, the AFL-CIO has sought to promote worker 
rights in Bangladesh and has worked closely with the Solidarity Center, 
which provides a wide range of technical assistance to garment worker 
unions, labor rights activists, legal aid lawyers and labor support 
organizations. The goal of these efforts has been to ensure that 
Bangladesh complies with International Labor Rights conventions and 
standards.
    Given Bangladesh's poor record of compliance, the AFL-CIO has filed 
a series of labor rights petitions under the statute governing the 
Generalized System of Preferences (GSP) that would remove such 
preferences from a beneficiary country if it fails to take steps to 
enforce core International Labor Rights Conventions.\1\
---------------------------------------------------------------------------
    \1\ See 19 U.S.C. Sec. 2462 for more information on the Generalized 
System of Preferences.
---------------------------------------------------------------------------
    On June 27, 2013, the United States Trade Representative (USTR) 
announced that it was suspending GSP benefits on products imported into 
the United States from Bangladesh (Docket No. USTR-2012-0036). On July 
19, 2013, the USTR publicized its ``Bangladesh Action Plan 
2013,''(Action Plan) outlining ``significant actions'' the Government 
of Bangladesh (GOB) was encouraged to take to provide a basis for 
reinstating GSP benefits.
    This testimony briefly enumerates and expands upon the AFL-CIO's 
observations and comments provided to the Office of the United States 
Trade Representative (USTR) on November 15, 2013, on the actions taken 
by the GOB toward the goals set forth in the action plan.\2\ The AFL-
CIO believes that the GOB has only begun to implement a few of the 
actions spelled out in the action plan.
---------------------------------------------------------------------------
    \2\ The original filing can be found in the online Docket No. USTR-
2012-0036, at http://www.regulations.gov/#!docketDetail;D=USTR-2012-
0036.
---------------------------------------------------------------------------
    Set forth below is the AFL-CIO's list of actions in the action plan 
which, to our knowledge, have not been acted upon at all. To date, the 
AFL-CIO has not observed evidence demonstrating that the GOB has taken 
any action or significant action in the following areas:
    Enforcement of labor laws--

   Passing new labor law amendments that address key concerns 
        related to freedom of association and collective bargaining 
        (while amendments have been passed, the changes were inadequate 
        to resolve the problems and in several areas created new 
        problems).
   Increasing fines for labor law infractions.
   Levying of fines.
   Removing licenses to export from offending companies.
   Establishing a public database to track inspections or 
        enforcement actions.

    Efforts to promote freedom of association (FOA) in the ready-made 
garment (RMG) sector--

   Effectively protect union officers and activists in new 
        unions.
   Publicly report on the number of new unions and collective 
        bargaining agreements.
   Conduct a credible investigation of the death of Aminul 
        Islam.
   On the public database, also report on union discrimination 
        and other unfair labor practice complaints, their status, and 
        fines and sanctions levied.
   Train industrial police on labor law to prevent 
        intimidation.

    Export Processing Zones (EPZs)--

   Issue interim regulations to ensure transparency, prevent 
        anti-union discrimination and blacklisting.
   Begin process of bringing EPZ law into compliance with ILO 
        standards.
   Establish interim regulations that provide an inspection 
        regime similar to the RMG sector.

    Shrimp processing sector--

   Publicly report on status of anti-union discrimination 
        cases, remediation and fines.

    Set forth below is a list of obligations on which some partial 
actions appear to have been taken by the GOB:

   Some labor inspectors are being identified and trained, but 
        nowhere near the number promised by the GOB.
   There is some progress toward addressing building and fire 
        safety, but as yet there is no independent verification of how 
        many factories have been closed, relocated or improved.
   Registration of an increased number of unions has occurred 
        (see Appendix 1) but not all of these are independent, worker-
        led unions, and there has been significant employer retaliation 
        and discrimination, which has not been sanctioned or remediated 
        (see Appendix 2).
   The Bangladesh Center for Worker Solidarity (BCWS) has had 
        its registration restored, but the Social Activities for 
        Environment (SAFE) organization, which works in the Shrimp 
        Processing Sector, still does not have permission from the 
        Government's NGO bureau to receive foreign funding.
   The AFL-CIO is pleased that all but one case has been 
        dropped by the Government against BCWS activists. However, we 
        are concerned about efforts by the GOB to paper over the murder 
        of labor activist Aminul Islam by announcing the trial in 
        absentia of one individual, given that there is evidence 
        indicating a conspiracy that does not appear to have been 
        thoroughly investigated.
   There is some evidence that the GOB is discussing a 
        tripartite agreement on freedom of association in the shrimp 
        industry. Nonetheless, workers in that industry still lack 
        union representation, there are widespread labor standards 
        violations, and the rights of contract workers are abused.\3\
---------------------------------------------------------------------------
    \3\ Additional information regarding labor inspections, union 
registration, anti-union discrimination, and related issues are 
included in appendices to this letter.

    Finally, the AFL-CIO notes the following additional concerns:
Minimum Wage Implementation
    While the AFL-CIO welcomed a long overdue increase in the minimum 
wage for garment workers, we have received reports that employers are 
demoting workers to lower paying classifications so that they do not 
pay the higher wage set for each classification. In addition, in some 
cases, employers are significantly raising production quotas to cut 
labor costs. If workers cannot meet the higher quotas, managers then 
force unpaid overtime work, or suspend a few workers without pay as a 
means to intimidate other workers into achieving the higher rate of 
production.

                       Atmosphere of Intimidation

    Intimidation of workers or those who would assist them remains a 
recurring problem in Bangladesh's Ready Made Garment Industry and 
Export Processing Zones. For example, over the past several months, the 
AFL-CIO has received information that local police, under the direction 
of employers, are intimidating union organizers including by using 
short-term detentions. In the Export Processing Zones, workers have 
recently reported that leaders of Worker Welfare Associations (proto-
unions) are not allowed to openly communicate with each other. Within 
individual factories, workers fear that they will be fired or suspended 
for even the most minor offenses. ``Counselors'' who work for the Zone 
authority and whose job it is to solve workplace disputes are viewed by 
workers as agents of management, and have threatened workers who raise 
issues regarding management abuses. Beyond these problems faced by 
workers, government security personnel have surveiled the Solidarity 
Center and have questioned visitors and staff about the Center's 
activities.
The Role of the Brands
    The AFL-CIO welcomes statements by foreign businesses and the two 
associations that they have formed to improve safety standards in the 
Bangladesh garment industry. There is agreement by the Accord and the 
Alliance that empowered workers are the ultimate guarantors of a safe 
workplace because they have the ability to withdraw from work in a way 
that allows individual workers protection that they would not have 
otherwise. However, only the Accord has integrated unions and NGOs into 
its governance structure. The Alliance says that it wants to cooperate 
with unions, but it is unclear what this means in practice. In the 
meantime, the members of both associations need to support nascent 
unions who are struggling to function following their successful 
registration. Such support, which involves demands that employers 
negotiate with unions and comply with government directives to rehire 
union leaders and activists, will be the true test the Brands' 
commitment to safer workplaces.
Coordination Among Foreign Governments
    The AFL-CIO is pleased to see the U.S. Embassy taking the lead in 
promoting coordination with the European Union, key European donor 
governments, governments in other countries and the International Labor 
Organization. It is vitally important that these governments give a 
consistent and clear message of their commitment to workers' safety and 
to the enforcement of core labor standards. The European Union through 
carefully modulated statements must use the conditionality under its 
Generalized System of Preferences to nudge the Bangladeshi Government 
forward. It is also important that these governments closely consult 
unions and NGOs in their own countries as they develop policy in the 
future.
    At your direction, we would be pleased to provide the committee 
with any followup information.

[Editor's note.--Appendix 1 and Appendix 2 submitted as an attachment 
to AFL-CIO's prepared statement were too voluminous to include in the 
printed hearing. They will be maintained in the permanent record of the 
committee.]
                                 ______
                                 

       Prepared Statement of the International Labor Rights Forum

                            i. introduction
    Chairman Menendez and Ranking Member Corker, thank you for the 
opportunity to submit written testimony on the ``Prospects for 
Democratic Reconciliation and Improving Workers' Rights in 
Bangladesh.''
    The International Labor Rights Forum (ILRF) is a human rights 
advocacy organization dedicated to achieving dignity and justice for 
workers worldwide. Founded in 1986 and based in Washington DC, ILRF 
works with trade unions and community-based labor rights advocates to 
expose violations of workers' rights, including child and forced labor, 
discrimination, and violations of workers' rights to organize and 
bargain collectively. Our field research helps to build and promote 
worker-driven organizations and solutions. We develop, propose, test, 
and assess government and corporate policies to ensure that global 
trade, procurement, and development practices support workers' rights.
    ILRF has worked closely with labor unions and labor rights NGOs in 
Bangladesh for many years to research and report on safety and labor 
rights violations in the garment sector, and to advocate for corporate 
and governmental policies that strengthen workers' own capacity to 
demand safe and decent working conditions.
         ii. background: workers have no voice to demand change
    As is by now commonly recognized, the infrastructure problems in 
Bangladeshi garment factories are daunting. The Bangladesh Institute of 
Architects estimates that as many as 50 percent of Bangladesh's 
factories may be unsafe.\1\ Buildings need to be repaired. Engineers 
and fire safety inspectors are sorely needed. After many years of 
social auditing without addressing fire and building safety, apparel 
retailers, and brands are finally acknowledging this problem. We would 
like to focus on a problem that is just as serious but as yet not fully 
acknowledged by industry and the Bangladeshi Government: the fact that 
workers--who are best placed to monitor workplace hazards--still do not 
have adequate capacity to report on safety and labor violations and to 
demand change.
Workers Without a Voice are Killed in Fires and Building Collapses
    Since 2005, more than 1,800 workers have been killed in dozens of 
factory fires, building collapses, and other deadly garment factory 
incidents in Bangladesh. In case after case, workers interviewed after 
the tragedies reported that they found exits locked or blocked and 
managers refusing to heed their concerns. Workers smelled smoke, but 
were told to continue working only to be killed in fires. They observed 
cracks in the walls but were threatened to report to work or lose their 
meager wages, only to be crushed under collapsing buildings. They 
consistently reported that raising safety concerns with managers or 
joining with other workers to address the problems could be a 
punishable offense that would get them fired.
    A few examples will help to illustrate the connection between 
unsafe workplaces and the suppression of workers' voices.
    In April 2005, workers at the Spectrum factory reported a crack in 
the ceiling to management. They were told to keep quiet lest they would 
worry their coworkers and to return to work. Five days later the 
factory collapsed, killing 64 workers. There was no union or health and 
safety committee that could insist that management listen to the 
workers' concerns.\2\
    On November 24, 2012, workers at the Tazreen Fashions factory 
discovered smoke. A worker yelled, ``There's a fire in the factory!'' 
Workers rushed for the door, but managers, worried about meeting 
production goals, ordered the workers to continue working. ``There is 
no fire! It is a lie!'' they yelled at the workers and locked the door. 
One hundred twelve workers were killed in the fire. These workers could 
not demand safe working conditions, because they had no voice and no 
union representation.\3\
    On April 23, 2013, workers in the factories of the Rana Plaza 
building noticed cracks in the building. Managers in a bank and small 
shops that occupied the first and second floor of the building also 
noticed the cracks, closed shop, and told their employees to stay home 
the following day. But the garment factories ordered their workers to 
return to work on April 24, threatening the loss of 1 month's pay if 
they did not comply. At least 1,135 workers were crushed to death under 
the collapsing building. The vast majority of these workers had no 
union representation and no voice to demand their rights or to refuse 
dangerous work.
    Bangladeshi garment workers have been killed in factory fires and 
other deadly incidents for decades, with few people paying attention. 
The first recorded garment factory fire occurred on December 27, 1990, 
at Saraka Garments in the capital Dhaka. At least 32 workers died and 
more than 100 workers were injured.\4\ Between the Tazreen Fashions 
fire in November 2012 and January 2014, at least 26 workers have been 
killed and nearly 823 workers injured in 57 factory fires.\5\ During 
that period there has been on average one factory fire a week in 
Bangladesh, with an average of two workers injured or killed per day 
due to factory fires. These figures do not take into account the 
Tazreen Fashions and Rana Plaza tragedies, but only the everyday fires 
and ordinary deaths and injuries that do not make mainstream news 
because they appear not to reach catastrophic proportions. Workers 
continue to lose their lives, quietly, with few people paying attention 
because they still have no effective voice to demand change.
Repression of Worker Organizing
    As the examples above indicate, unsafe working conditions are 
integrally linked to the systemic violations of workers' rights to 
organize and bargain collectively for safe conditions--to have a voice 
at work. Although the government has recently registered new unions in 
the garment sector, several problems remain.
    In April 2012 Aminul Islam, a worker organizer with the Bangladesh 
Garment and Industrial Workers' Federation (BGIWF), was tortured and 
murdered.\6\ The circumstances suggest government security forces 
murdered Mr. Islam in retaliation for his labor rights work in the 
garment industry.\7\ To date, nobody has been held responsible for this 
crime; a message not lost on workers.
    The government has allowed unsubstantiated criminal charges against 
worker organizers to linger for years. For example, leaders of the 
Bangladesh Center for Worker Solidarity, Bangladesh Garments & 
Industrial Workers Federation, the Garments Trade Union Center, the 
Bangladesh Textile-Garments Workers Federation, the Sadhin Bangla 
Garments Workers Federation, the Jago Bangla Garments Federation, the 
Garments Workers Forum, and the Bangladesh Garments and Shilpo Sromik 
Federation, as well as dozens of workers were until recently charged 
with a number of unsubstantiated criminal offenses and faced trial in 
several cases connected to garment worker demonstrations for a decent 
wage in July and August 2010.\8\ Some of these worker leaders faced 10 
separate charges and were required to report to court one out of three 
workdays for 3 full years, severely impeding their work to protect 
labor rights. The government only recently dropped most of these 
charges, and only after significant pressure from the U.S. Government 
and international rights organizations. Some union leaders from the 
Bangladesh Garments and Industrial Workers Federation (BGIWF) and 
Bangladesh Independent Garment Workers Union Federation (BIGUF) 
continue to face unsubstantiated criminal charges.
    At the same time, the authorities continued surveillance of a 
lengthy list of labor rights advocates.\9\ In November 2013, the Dhaka 
press reported that two workers were killed during a protest for wage 
increases.\10\
     iii. prospect for improving worker rights: the accord on fire 
                   and building safety in bangladesh
    After decades of garment workers being ignored, silenced, and 
marginalized it is clear that the only meaningful corporate social 
responsibility policy is one that puts workers' interests in the center 
of health and safety reforms, strengthens workers' voices to negotiate 
safe and decent working conditions through legally established unions, 
and, as a last resort, gives workers the right to refuse dangerous 
work. Unions are vital to workers' safety for three core reasons:

          1. Trade unions have historically played a pivotal role in 
        driving the development and enforcement of occupational safety 
        and health regulations in many countries;
          2. Well-informed trade union leaders can provide an important 
        counter balance to outside business pressures to lower cost and 
        compliance levels by ensuring that safety measures are fully 
        incorporated into the costs of doing business; and
          3. Respect shown by government and employer representatives 
        to trade union demands provide an important signal to workers 
        and managers alike that the workers are vital to improving the 
        industry.

    Today in Bangladesh, there is one established worker safety program 
that strengthens workers' voices and strives to balance the relation 
between workers and management by including an equal number of union 
and company representatives in its governance structure and involving 
unions in its implementation. That program is the Accord on Fire and 
Building Safety in Bangladesh, which at the time of writing includes 
151 private-sector brands and retailers.
    The Accord on Fire and Building Safety in Bangladesh involves 
unions both in the governance and implementation of the program. The 
Accord's executive committee includes an equal number of 
representatives of trade unions and companies. The Accord's training 
teams also include trade union representatives to educate workers about 
their rights, including the right to refuse dangerous work. As a 
signatory to the Accord, trade unions can initiate binding arbitration 
against another signatory to compel it to comply with the terms of the 
agreement. By fostering a more equal relationship between companies and 
unions, the Accord helps to address workers' fear about speaking up to 
defend their safety and their rights.\11\ The Accord model of social 
compliance should be strengthened in Bangladesh and replicated 
elsewhere.
              iv. recommendations for the u.s. government
Continue to Use GSP as a Lever for Labor Rights Compliance
    The months leading up to the GSP review for Bangladesh in May 2014 
are critical for the U.S. Government to insist on full respect for 
freedom of association and other labor rights for garment workers in 
Bangladesh. In July 2013, the U.S. Government suspended Bangladesh's 
tariff benefits under the Generalized System of Preferences program 
(GSP) citing its repeated failure to improve worker safety and labor 
rights.\12\ Bangladesh should not receive trade benefits under the GSP 
program without implementing the GSP Action Plan. Among other steps, 
the Bangladeshi Government must:

   Advance a transparent investigation into the murder of 
        Aminul Islam and publicly report on the findings of this 
        investigation.
   Ensure full freedom of association in the Export Processing 
        Zones.
   Continue to register unions expeditiously when they present 
        applications that meet administrative requirements, and ensure 
        the unions can negotiate collective bargaining agreements in 
        which workers are afforded benefits beyond the minimum levels 
        guaranteed by law.
   Publicly report on unfair labor practice complaints received 
        and labor inspections completed.
   Ensure full compliance with the new 5,300 taka per month 
        (US$ 68) minimum wage law of December 2013.
Urge U.S. Apparel Brands and Retailers to Pay Compensation to Workers 
        and Join the Bangladesh Safety Accord
    The U.S. Government has a duty to protect human rights by working 
proactively to ensure that U.S. multinational enterprises identify, 
prevent and mitigate actual and potential human rights violations in 
their operations and supply chains. In this case, this means that the 
U.S. Government should insist U.S. apparel brands and retailers 
mitigate the harms both to the workers who have been injured in factory 
fires and building collapses and to the families of workers who have 
been killed in factory fires and building collapses associated with the 
supply chains of the brands and retailers.
    Unfortunately, as of yet, none of the U.S. brands and retailers 
whose products were made at Rana Plaza, Tazreen, or Aswad have paid the 
compensation that they owe to the survivors and families who lost loved 
ones. The U.S. Government should call on these companies to immediately 
pay the compensation they owe.\13\
    In addition, the U.S. Government should ensure that apparel brands 
and retailers identify and prevent human rights violations in their 
Bangladeshi supply chains. The Bangladesh Safety Accord provides a good 
model for the apparel industry to meet their human rights due diligence 
responsibilities in this regard. The U.S. Government should explicitly 
urge companies to join the Accord.
Set a Positive Example through the Government's Own Procurement
    Marine Corps licensed apparel was found in the rubble of the 
Tazreen Fashions factory, where 112 workers were killed in November 
2012. However, in November 2013 the Marine Corps Trade Mark and 
Licensing Office adopted a licensing policy that requires a licensee 
that provides garments from Bangladesh to certify that: ``it has become 
a signatory of or otherwise complies with applicable requirements set 
forth in the Accord on Fire and Building Safety in Bangladesh.'' \14\ 
In the Defense Appropriations Act of 2014 the U.S. Congress praised the 
Marine Corps Trade Mark and Licensing Office for adopting the Accord 
standard, and urged the rest of the Armed Forces to do the same.\15\
    The U.S. Government has a singular opportunity to promote the 
Accord standard through its own procurement. The government buys more 
than $1.5 billion of clothes from overseas factories,\16\ most of it 
through the U.S. military exchanges. The Department of Defense requires 
the exchanges to assure that private-label merchandise is not produced 
with forced or child labor. The exchanges have adopted supplier codes 
of conduct, addressing child labor, forced labor, working hours, 
compensation and benefits, disciplinary practices, freedom of 
association, the right to collective bargaining, discrimination, and 
health and safety.\17\
    However, a new ILRF report \18\ shows that the military exchanges 
are buying clothing from unsafe and abusive factories in Bangladesh 
without investigating the working conditions. In relying on factories' 
own unverified claims of compliance with labor law or the audits of 
companies such as Walmart and Sears--audits that have persistently 
failed to protect workers from fires and building collapses--the 
exchanges are, in effect, ``flying blind'' the report argues.
    This recklessness toward working conditions in their supply chains 
first came to light when Marine Corps licensed apparel was found in the 
rubble of the Tazreen Fashions factory.
    The military exchanges should no longer outsource social 
responsibility to the private sector, but take responsibility for safe 
and decent working conditions in their supply chains. By working with 
members of the Bangladesh Safety Accord they can maximize their impact, 
and ensure that workers themselves have an effective voice in their 
workplaces.
    With the Marine Corps licensing policy as a model, the military 
exchanges should:

    1. Join the Accord on Fire and Building Safety in Bangladesh or 
fully abide by its requirements.
    2. Require licensees that use Bangladeshi suppliers to join the 
Accord.
    3. Require vendors that supply products from Bangladesh to join the 
Accord.

    The military exchanges should also work collaboratively with other 
federal agencies to extend the Accord model to address compliance 
requirements beyond fire and building safety in Bangladesh and other 
supplier countries. In this respect, the administration and Congress 
can provide support and guidance. In particular, the White House can 
set up a system of interagency coordination and collaboration among the 
military exchanges and other government agencies that purchase apparel 
internationally. A collaborative interagency body that pools 
information and resources can assist the military exchanges and other 
government agencies and entities to conduct their own coordinated 
supply chain investigations and remediation activities in Bangladesh 
and elsewhere. It can also help to develop and promote best practices 
in procurement and human rights, and provide training and other support 
to contracting officers. A standardized approach on safety and labor 
rights compliance across government would benefit contractors, 
licensees, and suppliers, and would provide far greater efficiency than 
separate agency approaches or outsourced social responsibility.
                             v. conclusion
    The continued repression of worker organizing and worker voices in 
Bangladesh is integrally linked to unsafe workplaces in Bangladesh. The 
most promising worker safety program in Bangladesh is the Accord on 
Fire and Building Safety, in part because it involves trade unions in 
both governance and program implementation, helping to balance the 
relation between management and workers. The U.S. Government should 
continue to insist on strict labor-rights compliance criteria for 
Bangladesh to receive GSP benefits, consistent with the GSP Action 
Plan. The government should protect against potential human rights 
abuses by U.S. apparel brands and retailers by urging them to join the 
Bangladesh Safety Accord. In addition, the U.S. Government should set a 
positive example with the procurement of its own retailers, operated by 
the U.S. military exchanges. Following a new Marine Corps licensing 
policy, the exchanges should join the Accord, or fully implement its 
requirements, and require licensee and vendors that supply goods made 
in Bangladesh to do the same.
    Thank you for the opportunity to submit this testimony.

----------------
End Notes

    \1\ Nessman, Ravi, ``More Bangladesh Factories Dangerous,'' AP, 13 
June 2013, http://news.yahoo.com/ap-exclusive-more-bangladesh-
factories-004057310.html (accessed 22 January 2014).
    \2\ Maher, Sam. ``Hazardous Workplaces: Making the Bangladesh 
Garment Industry Safe.'' Clean Clothes Campaign: 2012.
    \3\ ``Survivor of Bangladesh's Tazreen Factory Fire Urges U.S. 
Retailers to Stop Blocking Worker Safety,'' Democracy Now, 25 April 
2013, http://www.democracynow.org/2013/4/25/
survivor_of_bangladeshs_tazreen_factory_fire (accessed 22 January 
2014); Eidelson, Josh, ```I Jumped to Save My Body,''' The Nation, 18 
April 2013, http://www.thenation.com/blog/173921/i-jumped-save-my-body-
walmart-slammed-over-nicaragua-stabbings-and-bangladesh-fire# (accessed 
22 January 2014).
    \4\ See, for example, ``Major RMG Fires Since '90,'' The Daily 
Star, February 27, 2010, available at http://www.thedailystar.net/
newDesign/news-details.php?nid=128066 (accessed December 2, 2012).
    \5\ The American Center for International Labor Solidarity, 
Bangladesh office, uses local media reports and worker interviews to 
maintain the figures on garment factory fire incidents in Bangladesh.
    \6\ See, ``Labour leader, Aminul Islam, was allegedly killed after 
being abducted by the law enforces,'' Odhikar fact-finding report, on 
file with International Labor Rights Forum.
    \7\ This is not just the judgment of former colleagues of Mr. Islam 
and his family. In the letter to Prime Minister Hasina, 11 industry 
associations from Europe and North America express concern that ``the 
apparent circumstances leading up to and surrounding Mr. Islam's death 
could be perceived to be part of a deliberate campaign to repress 
efforts to raise and address issues related to unsatisfactory working 
conditions in the RMG sector.'' See ``A Chronology of the Investigation 
of the Murder of Labor Activist Aminul Islam,'' International Labor 
Rights Forum, 6 August 2012, http://www.laborrights.org/creating-a-
sweatfree-world/sweatshops/partner-spotlight-bangladesh-center-for-
worker-solidarity/reso.
    \8\ ``Enemies of the Nation or Human Rights Defenders, 
``International Labor Rights Forum, http://laborrights.org/creating-a-
sweatfree-world/resources/enemies-of-the-nation-or-human-rights-
defenders-fighting-povert.
    \9\ Islam, Rabiul and Khan, Mohammad Jamil, ``Lawmen Identify 
`Instigators,' '' Dhaka Tribune, 20 November 2013, http://
www.dhakatribune.com/labour/2013/nov/20/lawmen-identify-%E2%80 
%98instigators%E2%80%99 (accessed February 3, 2014).
    \10\ Islam, Rabiul, Ibid.
    \11\ ``Accord on Fire and Building Safety in Bangladesh,'' 13 May 
2013, http://www. 
bangladeshaccord.org/wp-content/uploads/2013/10/the_accord.pdf 
(accessed 5 February 2014).
    \12\ United States Department of Labor, ``Statement by the U.S. 
Government on Labor Rights and Factory Safety in Bangladesh,'' 19 July 
2013, http://www.dol.gov/opa/media/press/ilab/ILAB20131494.htm 
(accessed 22 January 2014).
    \13\ The U.S. companies that owe compensation for Rana Plaza 
(building collapse of April 24, 2013, that killed at least 1,135 
workers and injured an estimated 2,500) are Cato Fashions, Children's 
Place, JCPenney, and Walmart. The U.S. companies that owe compensation 
for Tazreen (factory fire of November 24, 2012, that killed at least 
112 workers and injured 150) are Delta Apparel, Dickies, Disney, Sears, 
Sean John Apparel, and Walmart. The U.S. Companies that owe 
compensation for Aswad (factory fire of October 8, 2013) are Gap Inc 
and Walmart. Information on the Rana Plaza Arrangement on compensation 
is available at http://www.ranaplaza-arrangement.org/
    \14\ Greenhouse, Steven, "Marines Toughen Rules for Makers of 
Licensed Garments," The New York Times, November 22, 2013.
    \15\ United States Defense Appropriations Act, 2014, http://
www.gpo.gov/fdsys/pkg/CREC-2014-01-15/html/CREC-2014-01-15-pt2-PgH475-
2.htm (accessed 6 February 2014).
    \16\ Urbina, Ian, "U.S. Flouts Its Own Advice in Procuring Overseas 
Clothing," The New York Times, 22 December 2013, http://
www.nytimes.com/2013/12/23/world/americas/buying-overseas-clothing-us-
flouts-its-own-advice.html?_r=0 (accessed 22 January 2014).
    \17\ "The Social Responsibility policy of the Army & Air Force 
Exchange Service (The Exchange), Navy Exchange Service Command (NEXCOM) 
and Marine Corps Exchange (MCX)," http://www.shopmyexchange.com/
DoingBusiness/QualityAssurance/ (accessed 22 January 2014).
    \18\ Please contact [email protected] to receive a copy of the report.
                                 ______
                                 

  Prepared Statement of the Center for Business and Human Rights, New 
                York University Stern School of Business

    More than 1,800 people have died in Bangladeshi factories in the 
last 24 months, victims of tragic factory fires and a building collapse 
that ranks as one of the largest industrial accidents in modern 
history. In the context of an acute lack of government oversight, poor 
infrastructure, and loose sourcing relationships, the risk of further 
deadly industrial accidents remains high unless serious reform is 
undertaken to address these chronic problems. We commend the Committee 
on Foreign Relations for convening this timely and important hearing to 
examine the role of the U.S. Government and American and European 
brands in enhancing workplace safety and workers' rights in the supply 
chain.
    American consumers and companies have played an important role in 
the growth of the garment industry in Bangladesh. Employers in the 
garment sector that supply American brands and retailers have created 
millions of jobs that provide a path out of extreme poverty for many 
young Bangladeshis, especially rural women Apparel now represents 80 
percent of the country's export economy.
    But the work environment in the garment industry in Bangladesh is 
dire. Industrial accidents happen at an alarming rate, demonstrating a 
deep breakdown in the way the supply chain operates. Fundamental reform 
is needed in three key areas: the sourcing strategies of global brands 
and retailers, oversight of the garment sector by the government of 
Bangladesh, and investments in development to address infrastructure 
failings that contribute to the cycle of factory disasters.
    The committee's hearing examines efforts to address shortcomings in 
workplace safety and respect for workers' rights in Bangladesh by the 
U.S. Government and two separate private initiatives on the part of 
multinational brands, as well as local unions. Over the last year, the 
Center for Business and Human Rights at New York University Stern 
School of Business has studied these efforts, including through two 
research missions to Bangladesh and a meeting convened at NYU Stern 
that brought together major players in the garment sector. Our 
conclusion is that reforms proposed to improve working conditions in 
the last year are not sufficient to bring about fundamental change in 
the supply chain. There is an urgent need to identify and address 
underlying causes of industrial accidents and to chart a practical and 
achievable way forward for the garment sector in Bangladesh.
                                context
    The premise of globalization and global supply chains is that they 
benefit people in developed and developing countries. Consumers in the 
United States and other developed countries have wide access to 
affordable products, while workers in places like Bangladesh are lifted 
out of extreme poverty and their countries become more prosperous and 
stable partners. The tragedies that have unfolded in Bangladesh in the 
last year are a stark illustration that deep reform is needed to make 
this equation add up.
    Bangladesh is by no means the only country that has capitalized on 
a large labor force and low production costs to build an export economy 
centered on apparel exports. China, Vietnam, Indonesia, Honduras, 
Cambodia, Mexico, and India all have followed similar strategies. But 
Bangladesh is unusual in its production volumes (it follows only China 
and Vietnam in U.S. apparel imports) and the outsized role garments 
play in its export economy, coupled with the country's exceptionally 
weak governance.
    Bangladesh ranks at or near the bottom among the 97 countries 
measured in the World Justice Project's annual Rule of Law Index, 
across all measures of good governance. It ranks 97th in civil justice, 
90th in regulatory enforcement, and 89th in absence of corruption. In 
these areas, it joins Liberia, Cameroon, Cambodia, Sierra Leone, 
Venezuela, Zimbabwe, Ethiopia, and Pakistan. In short, the government 
lacks the political will, technical capacity, and resources necessary 
to protect the basic rights of its own workers.
                   initial steps toward deeper reform
    Some important steps have been taken in the last year which begin 
to lay the groundwork for deeper reform. In June 2013, the Obama 
administration suspended Bangladesh's participation in the Generalized 
System of Preferences (GSP) program, which gives preferential trade 
status to least developed countries. While the GSP program does not 
include apparel exports from Bangladesh, it sent an important signal 
that the United States considers a lack of respect for worker safety 
and workers' rights to be a serious diplomatic issue. As Senator Levin 
and Congressman Miller said at the time, ``this decision sends a strong 
message that Bangladesh must take serious and concrete action to 
improve the situation on the ground.''
    The Government of Bangladesh complained bitterly about the 
decision, despite the fact that it affects only 1 percent of 
Bangladesh's exports to the United States. In their statement, Senator 
Levin and Congressman Miller also expressed an expectation that the 
``decision will be viewed with interest by others considering similar 
action, such as the European Union.'' The European Union's GSP program 
includes garments for Bangladesh; suspension would represent a serious 
economic blow, though it has not indicated whether it will consider 
such a move.
    Second, two important private initiatives have been formed around 
the issue of fire and building safety, each bringing together separate 
groups of global apparel brands and retailers, the Accord on Fire and 
Building Safety (``Accord'') and the Alliance for Bangladesh Worker 
Safety (``Alliance''). Both aim to improve factory safety through 
three-part programs that include factory inspections, worker trainings, 
and the provision of resources to make factory improvements over a 5-
year period.
    Considerable attention and energy has been devoted to parsing 
differences between these two initiatives, including in the context of 
this committee's hearing. One important difference is the participation 
of global and local unions in the Accord. The Accord also imposes 
stricter requirements for global retailers in providing mandatory 
funding for remediation, whereas the Alliance makes contributions for 
remediation voluntary. But our analysis of the Accord and the Alliance 
(Appendix 1) concludes that the similarities outweigh the differences. 
Both bring together large groups of companies operating in the same 
sector to conduct specific activities centered on fire and building 
safety in a coordinated and accountable manner. It is a very positive 
development that more than 150 American and European companies are 
working together on these issues and embracing common standards for 
implementation, but more needs to be done.
    On a parallel track, the Government of Bangladesh has initiated its 
own ``National Tripartite Plan of Action on Fire Safety in the RMG 
Sector.'' The plan identifies many of the issues that are relevant for 
transforming the garment sector, including setting up a transparent and 
accountable system for subcontracting. But the plan includes an overly 
ambitious timeline, and deadlines have passed for the majority of the 
21 actions steps. Especially in Bangladesh's turbulent political and 
electoral climate, it seems unlikely that there will be either 
sufficient political will or government resources to implement the 
plan's complex administrative and programmatic activities.
                   business as usual is not an option
    ``Business as usual is not an option'' was a common refrain in the 
immediate aftermath of Rana Plaza. But since last April, little has 
changed in the way business operates. Professor Richard Locke, now of 
Brown University, has conducted extensive research on systems to 
improve working conditions in the manufacturing sector. His recent 
book, ``The Promise and Limits of Private Power: Promoting Labor 
Standards in a Global Economy'' (Cambridge 2013), concludes that the 
two most important factors for improving working conditions are long-
term, trust-based business relationships between buyers and suppliers, 
and a strong rule of law.
    Locke also concludes that systems based on labor inspections by 
multinational brands that are conducted independently of any sourcing 
incentives or disincentives are largely ineffective in achieving better 
working conditions. Many apparel brands initiated this kind of private 
compliance model in the late 1990s, and Locke's conclusion resonates 
among people who struggled to make improvements under this model.
    Since they both launched last year, it appears that the Accord and 
the Alliance are doubling down on the private compliance model and are 
investing heavily in the same regime of inspections and remediation 
plans that have constituted conventional wisdom in the apparel sector 
for the last 15 years. Both initiatives are in the early stages of 
development and there is room for both to innovate and expand their 
scope. For now, while the Accord and the Alliance should be commended 
for bringing together more than 150 global companies to collectively 
address factory safety and for increasing accountability to outside 
stakeholders, neither agreement goes far enough.
    The collapse of Rana Plaza last April was the most deadly 
industrial accident ever to occur in the global apparel industry. Yet 
it is not at all clear that the deaths of more than 1,200 workers in a 
single accident have changed the underlying structure of the supply 
chain model that helped create the circumstances leading to the 
tragedy.
                  real reform requires further action
    Reforming the supply chain will require significant investments in 
three key areas: supply chain management, government oversight, and 
infrastructure development. Investing in these areas does not mean that 
business--either globally or in Bangladesh--should not be profitable. 
We believe strongly in the power of business to create value for 
business and society, as it has done in Bangladesh and around the 
world. But the current model is not sustainable. A supply chain that is 
literally falling down is bad for workers, business, American 
consumers, and Bangladesh's prospects for growth in its export economy.
1. Supply chain management
    As Locke's research has shown, the best thing global companies can 
do for working conditions is to develop long-term, trust-based business 
relationships directly with suppliers. For most companies, especially 
those that are heavily reliant on intermediaries and sourcing agents to 
procure their products, this means fundamentally reexamining their 
sourcing strategies. Some companies, including Nike, Adidas, H&M, and 
Fast Retailing (Uniqlo) have started to make strides in this area by 
shortening their supply chains, establishing relationships with 
strategic suppliers, and maintaining direct relationships with a 
significant portion of their supplier networks.
    It is concerning to see repeated reports of American and European 
companies expressing surprise that their products were found to have 
been made in an ``unauthorized'' facility, often with acutely 
substandard conditions and even child labor. It is not credible for 
major brands to claim ignorance of where their products are being made. 
The answer to this problem is not yet another supplier code of conduct 
or inspections on top of inspections, but investments in better supply 
chain management.
    There is something wrong with the way the supply chain is managed 
if the only way to meet demands for price, quantity, and delivery time 
is to split up orders among an opaque network of suppliers, some of 
whom operate substandard facilities. This is what many in the garment 
sector describe as an open secret--the dependence on a system of 
authorized and unauthorized subcontracting in which workers ultimately 
pay the price.
    Companies are quick to point out that they have policies against 
unauthorized subcontracting, and many supplier relationships have been 
cut in recent months over allegations of improper subcontracting. 
Addressing this problem will require more than a finger-in-the-dike 
approach. What is needed is better data about the nature of 
subcontracting and an open conversation about how to meet the pressures 
suppliers face in a more sustainable way, for workers and for business.
    The Center for Business and Human Rights at NYU Stern is urging a 
more open conversation about the nature of business relationships in 
the supply chain and their effect on working conditions and respect for 
workers' rights. This spring, we will publish a detailed report on 
situation in Bangladesh and will convene a second meeting in Dhaka that 
will bring together buyers, suppliers, worker organizations, 
governments, and international organizations.
    Reexamining sourcing strategies will not be easy. Doing so is 
likely to have far reaching implications well beyond Bangladesh, and it 
may increase costs for brands and consumers. But failing to look at the 
connection between business practices and working conditions will only 
perpetuate the tragedies of Rana Plaza, Tazreen, and countless other 
factories.
2. Government oversight
    Primary responsibility for protecting the rights of Bangladeshi 
workers rests firmly with the Government of Bangladesh. Since its 
inception in the 1980s, an almost total lack of oversight has 
characterized the ready-made garment sector in Bangladesh. In the 
heyday of the Multifibre Arrangement (MFA), Korean factory owners 
facing limits on export quotas turned to Bangladesh as a place ripe for 
development in apparel exports. With few regulations and no building 
code in place until 1993, apparel factories were allowed to spring up 
almost anywhere in and around Dhaka--in back yards, above auto body 
shops, in shopping centers, and tenement buildings.
    The legacy of this system is well known. With increasing demand for 
high production volumes, floors have been added illegally to existing 
buildings to accommodate yet more factory space. Historically, the few 
factory inspectors employed by the government were paid so little that 
corruption was inevitable. And the government has devolved important 
regulatory functions, including issuance of an import and export permit 
and maintenance of the database of factories, to the leading trade 
association of garment manufacturers, the Bangladesh Garment 
Manufacturers and Exporters Association (BGMEA).
    It is critically important that the government assume much more 
significant oversight duties in the garment sector and devote the 
resources and personnel to make its oversight effective. Unfortunately, 
the government remains incredibly weak, especially in the midst of 
electoral turbulence and ongoing political protests.
    The international community rallied around the launch of Better 
Work Bangladesh last fall, with donor governments in the Netherlands, 
Norway, Switzerland, the United States, and the U.K. providing 
significant funding to underwrite the program. Better Work program, now 
operating in eight countries, was initially developed in Cambodia with 
the aim of preventing exporting countries from exploiting low labor 
standards to attain competitive advantage in the global marketplace. 
The program also is intended to shift the burden of labor inspections 
in exporting countries from private actors--brands, retailers, and 
third-party auditors--to the public sector.
    But Better Work's own assessment of its progress to date indicates 
that it has struggled to sustainably devolve enforcement of labor 
standards to the government or to enhance respect for ILO core labor 
standards in the most challenging areas. The Thirtieth Synthesis Report 
issued by the flagship Better Factories Cambodia program noted that 
child labor, discrimination, and freedom of association violations 
persisted, even after 12 years of auditing under the program.
    Despite these challenges, Better Work Bangladesh is certainly worth 
investment by the international community. But it should not be a 
substitute for government oversight. Foreign governments should keep up 
diplomatic pressure on the Government of Bangladesh, as the United 
States has done around GSP suspension, to continue to press for greater 
attention and investment in oversight functions.
    The BGMEA, too, should work with the government to gradually stop 
serving in its current pseudo-regulatory role. The BGMEA is a powerful 
political and economic entity. This is a moment for it to lead to 
ensure the sustainability of what has been Bangladesh's most profitable 
export industry. This means leading its membership to accept changes 
that will likely impose additional responsibilities on its members--
increased regulations, greater public oversight, and strategies to 
relocate and even close some factories. These are the areas that are 
most critical for long-term sustainability of the garment sector, and 
they cannot be negotiated by outsiders.
    The failure of the government to regulate the labor market is also 
evident in the lack of adequate judicial remedy for victims of 
industrial accidents. Documentation by the Bangladesh Legal Aid and 
Services Trust (BLAST) and the Bangladesh Institute for Labor Studies 
illustrates a pattern of inadequate remedy and compensation for 
victims, which adds to the burden of families who have already suffered 
greatly and further erodes trust in the garment sector.
3. Infrastructure development
    A third critical area for lasting change in workplace safety is 
infrastructure development. Bangladesh lacks important infrastructure 
in industrial production facilities and electricity, among other areas. 
A lack of purpose-built production facilities and insufficient 
electrical production and delivery are major contributing factors to 
fire and building safety risks.
    Bangladesh's infrastructure is one of the most underdeveloped in 
the world. The 2013-2014 Global Competitiveness Report of the World 
Economic Forum (WEF) ranks Bangladesh's infrastructure was 132nd out of 
148 countries under review. The World Bank, IFC, and foreign government 
donors have made attempts over the years to invest in infrastructure. 
Their efforts have been stymied by endemic corruption and an entrenched 
unwillingness on the part of the government to investigate and 
prosecute corruption.
    Here, too, the BGMEA has a leadership role to play in helping to 
develop new industrial parks where garment factories can relocate. It 
is notable that the export processing zones, which were purpose-built 
for large-scale industrial production, have not been plagued by fires 
and building collapses. There are other concerns regarding the zones, 
most importantly around a lack of respect for freedom of association, 
but on the issues of fire and building safety, they provide a lesson 
for the broader garment sector. The government, the BGMEA, and foreign 
donors should redouble efforts to speed the creation of more industrial 
parks.
    A second major issue is the quality of the electrical supply. 
Again, Bangladesh ranks near the bottom among the 148 countries 
included in the WEF survey, at 133rd. The country currently is unable 
to meet the rising demand for electricity from increasing 
industrialization. From 2000 to 2012, electricity consumption increased 
by an annual average of 12 percent, with little increase in electricity 
production.
    Power shortages and power black outs occur frequently in the 
garment sector, causing factory owners to turn to generators. As was 
well-documented in the Rana Plaza collapse, the combination of heavy 
generators resting on unstable foundations can have tragic results. 
Moreover, generators consume more than 300 million liters of diesel and 
furnace oil a year, which adds significantly to production costs. And 
when power outages cause manufacturing delays, factory owners assume 
the high cost of airfreight. Some of the larger and better-resourced 
factory complexes have even built their own private power plants, which 
help those few factories that can afford them, but do little to address 
sector-wide shortcomings.
    At present, most foreign development funding is focused on 
investments in Better Work Bangladesh, worker empowerment and skill 
development programs, food security, labor inspections, and combating 
human trafficking. But in the absence of major infrastructure overhaul 
in a few key areas, development programming in the garment sector will 
have an insufficient effect. Workers empowered to work in crumbling 
buildings still face grave risks. Investing in the kind of major 
infrastructure development Bangladesh needs has proven to be a 
frustrating and often fruitless task because of corruption. It is up to 
the government and local industry to make the case that Bangladesh is a 
sound investment.
                               conclusion
    The Center for Business and Human Rights at NYU Stern is hardly the 
first to assert that the way to increase respect for workers' rights in 
Bangladesh is better government oversight and investments in 
infrastructure development. Many people also acknowledge privately that 
loose business relationships, a lack of incentives for better labor 
practices, and the priority placed on negotiating the absolute lowest 
cost of production are what really drive poor working conditions.
    But it is also common to hear that these issues are too difficult 
to take on or that ``we have to start somewhere,'' with the same kind 
of inspection and remediation programs that have constituted CSR in the 
apparel industry since the mid-1990s. The priorities outlined above are 
ambitious because this is a moment for bold action. Media coverage of 
workplace safety in the global supply chain has not been this high in 
recent memory. Consumers are hungry for information and assurance that 
the products they buy meet basic standards of workers' rights. The 
administration is using its leverage through trade policy to encourage 
reform on labor rights. And Congress is paying attention, as 
demonstrated by this important hearing.
    Enhancing the dignity of work and the sustainability of the garment 
sector in Bangladesh will require more than foreign solutions. The 
Government of Bangladesh and local industry must lead a transition to a 
better managed and better regulated garment sector that remains 
competitive over the long term. The first 20 years of the garment 
industry have helped lift millions out of extreme poverty in 
Bangladesh. We believe strongly that business also can be a force to 
ensure that the next two decades are brighter for Bangladesh's workers. 
We stand ready to work with local and global businesses, policymakers, 
workers' organizations, and other experts to chart a sustainable future 
course.
          * * * * *

                               APPENDIX 1

Analysis of the Accord and the Alliance, Center for Business and Human 
          Rights, New York University Stern School of Business

    The following analysis compares the Accord and the Alliance across 
five dimensions: participation, decisionmaking and governance, 
commitments, program and approach, and fees and funding. It is intended 
as a snapshot of the two initiatives at an early stage of their 
development, not as an exhaustive comparison. The Center's conclusion, 
discussed in its written submission to the February 11, 2014, Senate 
Committee on Foreign Relations hearing on Bangladesh, is that while the 
participation of unions in the Accord represents an important 
distinction, the similarities between the two initiatives outweigh the 
differences.
                             participation
    Both the Accord and the Alliance are comprised primarily of 
multinational corporations from North America and Europe. 
Significantly, the Accord includes 10 unions as signatories, including 
6 unions from Bangladesh. In this respect, it reflects the European 
industrial relations context, which have been characterized by 
political involvement through labor parties, worker participation in 
company decisionmaking, and relatively high levels of union membership.

 
------------------------------------------------------------------------
                                  Accord                 Alliance
------------------------------------------------------------------------
Brands and retailers      139 retailers. The      26 retailers. All are
                           majority of             North American
                           participants are        companies,
                           based in Europe; a      representing 90% of
                           smaller group is from   ready-made garment
                           the Americas. Also      exports to the United
                           includes Asia's         States from
                           largest retailer.       Bangladesh.
------------------------------------------------------------------------
Worker organizations or   10 union signatories,   None.
 unions                    including six unions
                           from Bangladesh.
------------------------------------------------------------------------
Other participants,       Four international      ``Supporting
 observers, or advisors    labor rights NGOs are   associations''
                           ``witness               include several North
                           signatories.''          American trade
                                                   associations and the
                                                   NGO BRAC. Li & Fung
                                                   serves in an advisory
                                                   capacity.
------------------------------------------------------------------------


                     decisionmaking and governance
    Both initiatives are led by small governing boards with a neutral 
chair. Membership in the Accord's steering committee is split between 
retailers and unions. The Alliance's board is split between retailers 
and outside experts. Both have some international staff, as well as 
offices and staff in Dhaka.

 
------------------------------------------------------------------------
                                  Accord                 Alliance
------------------------------------------------------------------------
Decisionmaking body       The steering committee  The board of directors
                           is comprised of 3       includes 4 brand
                           representatives         representatives, 4
                           selected by trade       outside experts, and
                           union participants      an elected chair.
                           and 3 representatives
                           selected by retailer
                           participants. The ILO
                           selects a neutral
                           chair.
------------------------------------------------------------------------
Staff                     Led by an Executive     Led by a President and
                           Director for            CEO in Washington,
                           International           DC, with an office
                           Operations and an       and staff in Dhaka.
                           Executive Director
                           for Bangladesh
                           Operations, with an
                           office and staff in
                           Dhaka.
------------------------------------------------------------------------

                              commitments
    Each initiative is envisioned to last for 5 years, through 2018. 
The Alliance requires that members participate for 2 years; the Accord 
requires 5 years, with some requirements for maintaining order volumes 
for the first 2 years. If a member company leaves the Alliance, the 
member pays a financial penalty. If an Accord member is subject to a 
dispute, the issue is referred to the Steering Committee, whose 
decision either party can appeal to binding arbitration. Advocates of 
the Accord have emphasized that this constitutes a legally binding 
agreement, but it is not clear that the penalties associated with 
dispute resolution are significantly different from the more 
straightforward financial penalties contained in the Alliance.

 
------------------------------------------------------------------------
                                  Accord                 Alliance
------------------------------------------------------------------------
Overall program           5 years (2013 -2018).   5 years (2013 -2018).
 commitment
------------------------------------------------------------------------
Individual participant    5 years of              Minimum commitment of
 commitments               participation in the    2 years participation
                           initiative. Member      in the initiative.
                           companies commit to
                           maintaining order
                           volumes for 2 years
                           with Tier 1 and 2
                           suppliers as long as
                           such business is
                           commercially viable
                           and the factory meets
                           the member company's
                           requirements.
------------------------------------------------------------------------
Penalties for leaving     Disputes between        Financial penalties
 the initiative            parties are referred    assessed if a member
                           to the Steering         leaves the initiative
                           Committee, whose        before the 2-year
                           decisions can be        mark; lesser
                           appealed to a binding   financial penalties
                           arbitration process.    if a member leaves
                                                   after the 2-year
                                                   mark.
------------------------------------------------------------------------


                          program and approach
    In total, the two initiatives encompass approximately 2,400 
factories out of the approximately 5,000 -6,000 factories in 
Bangladesh. The two initiatives offer similar programs, focused on 
factory safety and building inspections, worker training and 
empowerment, and making funds available for factory remediation. All 
program activities in both initiatives focus on building and fire 
safety and do not address broader issues of labor rights, freedom of 
association, or business relationships in the supply chain.

 
------------------------------------------------------------------------
                                  Accord                 Alliance
------------------------------------------------------------------------
Core program elements     Safety inspections,     Safety inspections,
                           remediation, fire and   safety and
                           building safety         empowerment training,
                           training, member-       voluntary loans for
                           sponsored funding for   factory improvements.
                           factory improvements.
------------------------------------------------------------------------
Factories covered         All suppliers           100% of factories in
                           producing products      the members'
                           for signatory           respective supply
                           companies;              chains; approximately
                           approximately 1,700     700 factories.
                           suppliers across
                           three tiers.
------------------------------------------------------------------------


                            fees and funding
    In both initiatives, corporate participants make an annual 
contribution based on dollar volume of exports to cover the inspection 
and training programs and operational expenses. The initiatives differ 
in the degree to which companies are required to cover the costs of 
remediation. In the Accord, it is mandatory for each member company to 
make sufficient funds available to pay for structural repairs and 
renovations, while in the Alliance such funding is made available 
through voluntary loans.

 
------------------------------------------------------------------------
                                  Accord                 Alliance
------------------------------------------------------------------------
Participant fees to       Company signatories     Members contribute up
 support core              make a maximum annual   to $1,000,000 per
 programming and           contribution of         year to a Worker
 operations                $500,000 on a sliding   Safety Fund. Fees are
                           scale basis relative    assessed on a tiered
                           to volume of sourcing   basis, based on
                           from Bangladesh. Fees   dollar volume of
                           cover safety            exports in the
                           inspections,            previous year. Fees
                           trainings, and          underwrite fire and
                           operational expenses.   building safety
                                                   initiatives in
                                                   factories supplying
                                                   member companies and
                                                   operational expenses.
------------------------------------------------------------------------
Additional costs to       Each member company is  Individual members may
 support factory-level     responsible for         make affordable
 remediation               ensuring sufficient     financing available
                           funds are available     to suppliers in their
                           to pay for structural   individual supply
                           repairs or              chains to help
                           renovations in          finance factory
                           factories where         repairs and
                           remediation is          improvements on a
                           required.               voluntary basis.
                                                   Terms are set by the
                                                   individual member
                                                   company.
------------------------------------------------------------------------
Support for displaced     Each company is         10% of fees directed
 workers during            responsible for         to the Worker Safety
 remediation               covering the cost of    Fund are reserved to
                           displaced workers in    support temporarily
                           its supplier            displaced workers.
                           factories.
------------------------------------------------------------------------

                               __________

          Prepared Statement From the Government of Bangladesh



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