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Introduction
 Compliance in the Ready Made Garments (RMG) sector is broadly
defined by standard building-structure of factories, working
condition, various rights of workers, workers' health and safety
measures, and environmental safety measures etc. Maintaining
compliance standard has gradually been considered as one of the
important factors for competitiveness in the global apparel
market. It is found that buyers are putting more emphasis on
compliance standard as consumers of developed countries are
becoming increasingly concerned about work and social
environment in the sourcing factories.
Bangladesh's apparel sector has emerged in early 1980s. The
sector has developed overtime under various incentives and
supports provided by the government and market access provided
by different developed countries. It is also true that
government maintained a 'soft look' policy as regards compliance
standard during the early stage of development of apparel
sector; besides, buyers put less emphasis on high level of
compliance standard of RMG units. Factory level compliance
standard has got much attention since the mid-1990s as buyers
have started to put emphasis on different issues related with
compliance. Subsequently, enterprises have initiated to improve
the compliance standard of the factories. However, factory level
compliance standard has not developed to that extent as it
should be during the last twenty five years. It is now important
to appreciate status of the compliance standard of RMG units,
especially after the MFA phase out in a competitive world
market.
One of the major limitations as regards compliance standard of
RMG units of Bangladesh is lack of available information which
hinders any sort of assessment of compliance standard in the
country. Consequently, it is rather difficult to suggest various
policies for the development of compliances in the RMG units.
Recently, BGMEA and BKMEA have initiated to develop a database
on the compliance standard of RMG units, which is a welcome
initiative. However, by and large there is dearth of information
as regards the compliance standard of RMG units. This paper
attempts to highlight on current state of compliance in the RMG
units based on the data of collected through firm level survey
in 2006. A total of 190 factories were surveyed comprising of 63
woven, 63 knit and 26 sweater units. Besides, 470 workers of
these enterprises were also surveyed. Present paper draws
heavily on CPD's recent study on “Bangladesh's Apparel Sector in
Post-MFA Period: A Study on the Ongoing Restructuring Process”.
Following sections will present findings of the survey and
finally it will briefly focus on various policy measures for the
improvement of compliance standard of RMG units.
Factory Level Compliance Standard: Ergonomic Balance
 Factory level ergonomics indicate appropriate balance between
factory space, installed machines and workers. This refers to
size of floor space available for doing work, ratio between
floor space and number of workers, workers and machines used,
workers and production lines, adequacy of air and light inside
the factory, etc.
Floor space available for working in the surveyed factories was,
on average, about 50,000 sq ft, while spaces for setting up a
production line was about 6128 sq ft. Available space for each
worker on average was 52 sq. ft. It appears that large and
medium enterprises provided relatively more space for setting up
production lines and for workers working in the factory. Average
worker-machine ratio was 1.74, indicating that every operator of
a machine took support of 0.74 additional workers (usually these
workers are called 'helpers'). Enterprises, directly dealt with
buyers, (which also tended to be large and medium enterprises)
were operated by higher number of workers in production lines
and also provided higher space to the workers. In other words,
ergonomic standard was better in enterprises which worked
directly with buyers.
A majority of large enterprises were purpose-built, while the
proportion of such enterprises in the case of medium and small
units was relatively low. Factories established in earlier
periods were behind in terms of complying with factory level
compliance standards, perhaps because of government's “soft
look” towards apparel sector in the earlier stage of its
development when these standards requirements were either mildly
dealt or overlooked by concerned offices. In general, factories
established in more recent periods were relatively better
compliant in terms of factory standards.
Worker's Job-related Compliance Standard
 Factory management, in most of the cases, checked the minimum
age of workers that they were recruiting. It appeared from the
survey that entrepreneurs are very strict on this issue, a
considerable change compared to the 1990s. With the introduction
of Harkin's Bill in the US Senate in the early 1990s, both the
government and the entrepreneurs had taken steps to eliminate
child labour in the export-oriented RMG sector of the country.
Buyers are at present very strict in terms of ensuring that they
do not place orders to factories that have any child labour.
Majority of sample enterprises did not provide appointment
letters to the workers, according to the data collected through
survey in 2006. A high proportion of large enterprises provided
appointment letters to their workers; about 53 per cent of knit,
51 per cent of woven and 40 per cent of sweater enterprises did
so. The proportion of sample EPZ enterprises that provided
appointment letters to workers was about 69 per cent, while the
proportion of non-EPZ enterprises providing appointment letters
to workers was 22 per cent. A formal appointment letter, where
all important aspects of employment, were mentioned, would give
confidence to the workers regarding job security which could
lead to higher levels of retention in the factory.
According to entrepreneurs, most of the enterprises paid
workers' wages within first and second week of the month; more
than 90 per cent of the enterprises did so. The practice of
payment of workers' wages in the third week of the month was
evident not only in small enterprises, but also in medium and
large enterprises. Getting income in the first week of the month
was felt to be critically important by the workers since they
had to pay their monthly dues including room rent, utility
charges, etc. in the first week of the month. Irregular payment
was a major inducement for switching jobs and a high turnover.
In most of the sample enterprises, normal working hour
(excluding overtime working hours) was 8.28 hours, which was
more than the stipulated working hours set by the law. In
general, normal working hour in 2005 was marginally lower (-0.2
per cent) compared to that in 2004. From workers' point of view,
reduction of normal working hour was less important compared to
effective working hour which included overtime working hour
along with normal working hour. Length of overtime working hour
was considerable - it averaged about 13.9 hours per week or more
than two hours a day. In general, overtime working hour has
increased by about 3 per cent after the MFA phase out. It was
argued by entrepreneurs that managing bulk volume of production
orders was often difficult within a predetermined schedule of
work as production was often hampered due to electricity outage,
strikes, etc. Thus factories had to operate for longer hours to
compensate for these disruptions. However, in most instances
longer working hours in factories was dictated by the pattern of
orders placed by buyers which necessitated production of certain
volume within a strictly stipulated time-line.
 As maintained by workers, longer working hours and high load of
work in the factory, especially in sweater and knit factories,
have reduced workers' leisure hours. Besides, pressure from the
production managers to fulfill high production targets also made
their lives very stressful. This often led to deterioration in
relationship between workers and the management people directly
involved in production. Workers maintained that in many
instances workers' unrest was caused by deterioration of
relation between workers and management. Most of the
enterprises, according to their owners, maintained a weekly
holiday. Workers maintained that in view of long working hours a
weekly holiday was essential for them.
Most of the sample enterprises provided maternity leave to their
female employees. More than 80 per cent enterprises provided
maternity leave; the ratio was higher in the case of sample
sweater units. Most of the factories did not have day-care and
canteen facilities. Workers had to take their meal sitting in
the stairs or in the corridors or by going back home. Day-care
or canteen facility was available in 53 per cent woven
factories; the share was very low in the case of sweater and
knit factories. In general, the trend is for all types of
enterprises to provide such facilities in increasingly greater
numbers in recent years. Because of having no day care facility
in most of the factories, female workers had to leave their
children at home or in many cases in their vill-ages. Monthly
wage of a female worker was 28 per cent less than that of a male
worker with iden-tical characteristics. However, the field
survey indicated that situation has improved in recent years and
large enterprises tended to provide relatively better facilities
compared to medium and small enterprises.
Analysis indicates that compliance standard of large enterprises
was about six points higher than medium enterprises, while the
standard of small enterprises was three points lower than medium
enterprises and both are significant at a high level. It was
also found that initial investment was very important for the
level of compliance standard that was maintained by enterprises.
Workers' Health and Safety Related Compliance Standard
There were, on average, more than two emergency exits in a
sample factory. More than 600 workers could use one exit in
large factories, while the number for medium and small factories
was 353 and 170 workers respectively. Number of emergency exits
was relatively higher in EPZ-factory compared to non-EPZ
factory. However, availability of emergency exits did not
necessarily ensure worker's safety in full measure. The width of
the exit, landing space available etc. was also important
factors from the perspective of safety.
 There were, on average, 0.8 doctors available in every factory,
which indicates a good number of factories have no in-house
doctors. In other words, one doctor was available for 1,088
workers. According to sample workers, most common diseases from
which they suffered were headache, cold fever, etc. Most
factories did not have adequate ventilation and exhaust fans and
few workers use masks. As a result, there was strong possibility
to be affected by serious diseases, such as tuberculosis.
Incidence of accidents while working in the factory was not
found to be very high. Other than accidents, in-house doctors
usually diagnosed the patients and prescribed medicines free of
cost, but workers had to bear all costs of medicine.
Trade union activities were almost non-existent in the garment
sector. There were very few factories where workers were allowed
to have trade unions at the factory premise. As is known,
following long debates over the issue of allowing trade union
activities in EPZ factories, the government agreed to allow
formation of Workers Welfare Committee (WWC) in the RMG
factories located in EPZs. The WWC is usually comprised of
representatives of workers and factory management, which
regularly met and discussed worker related issues. About 52
factories were found where WWC activities prevailed. Fifty five
per cent of EPZ factories were found to have WWC, while only 20
per cent of non-EPZ factories had WWC. Prevalence of WWC
activity has marginally increased in 2005 compared to that in
2004. Entrepreneurs were more or less divided as regards the
issue; one group supported such a negotiating body while the
other group was against it.
A regression analysis was carried out to understand the impact
of different factors on workers' health and safety related
compliance standards maintained by the sample enterprises. It is
found that large enterprises were better compliant as the value
of index of these enterprises was 9.6 points higher compared to
medium enterprises, while small enterprises were less compliant
compared to medium enterprises: score of the former was 5.5
points lower than the latter. Highly compliant enterprises were
57 per cent more productive compared to less compliant
enterprises and 65 per cent more productive compared to
moderately compliant enterprises. Thus, maintaining compliance
with the required standards was found to have a positive impact
on productivity, indicating the need to enforce compliance at
the factory level for the good of the RMG sector itself.
Sample entrepreneurs were of the opinion that for enhancing
labour productivity a number of measures should be taken:
organise training for workers, improve compliant situation,
diversify production, provide entertainment facility, increase
workers' wage and provide other incentives, and ensure good
behavior with workers, etc.
Code of Conduct Followed by Major Buyers and Bangladesh's RMG
Industry
 Codes of conduct have been an important part of efforts to
improve labour standards in global supply chains. Over the past
ten years, these codes and systems put in place to ensure their
implementation have seen a large scale proliferation. Brands and
retailers are faced with multiple industry standards and
suppliers are confused by the numerous codes and initiatives.
There is lack of harmony in the Code of Conducts of the
different brands, particularly in the cases of minimum age
requirements, wages and benefits and overtime payment. However,
there are some common concerns and standards and Bangladesh will
need to be very careful in addressing the norms established by
the brands. Both legislation of appropriate laws and their
enforcement are important. Lack of uniformity in the brands'
requirements often gives rise to confusion among suppliers. A
large number of suppliers do business with several brands.
Moreover, although all buyers talk about following the code of
conduct which refers to maintaining and adherence to local
legislation as a minimum requirement, when monitors appointed by
buyers or an independent monitor conducted audit of firms, they
tended to follow detailed checklists provided by respective
brands which were usually local legislation plus; suppliers were
often not aware about the additional requirements.
Better coordination and cooperation is essential to address this
confusion and agents of the brand, government regulators and RMG
industry should work towards a tripartite understanding. In this
context, a local clearing house of standards and compliance
could be thought of to streamline the situation. It is also
important to develop a shared understanding about the important
contribution that voluntary codes of conduct could make towards
better working conditions in the factories and also towards
higher productivity of labour.
Policy Recommendations
Since a number of large and medium enterprises are approaching
to enter high-end segment of apparel market, maintenance of a
high level of compliance standard at the factory level is being
considered as the basic requirement to get those orders. These
enterprises thus need to focus on labour-management and labour-relation
with highest priority, followed by environmental safety measures
in case of disposal of industrial wastes and effluents.
It is quite educative for Bangladesh to take the experience of
Cambodia in ensuring compliance which has successfully
 developed
an image as 'compliant' source in the US. BGMEA/BKMEA has set up
compliance monitoring cells to oversee maintenance of compliance
standard by the factories. However, this needed to be
strengthened and made more effective. In order to monitor and
enforce compliance standard at factory level, an independent
compliance monitoring agency (ILO in Cambodia) could be
considered. This agency could be responsible to a joint
committee of government and BGMEA/BKMEA.
Besides, a common compliance standard need to be established
which would take care of domestic legislation as well as buyers'
requirement (code of conduct) which would be enforced through
the monitoring agency. The government of Bangladesh could set up
a 'Compliance Upgradation Fund' in support of developing
compliance standard where buyers also could contribute.
Enforcement of standards of their own by individual (major)
retailers creates a problem in absence of any 'clearing house'.
In view of this RMG associations could work with major buyers to
ensure that there is a common set of standards which is agreed
upon by all buyers. There are strong dividends to be had if
Bangladesh could be marketed in the global market as a
'compliant source'. ¨
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