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ILO to Consult on Insurance for Bangladesh RMG Workers

The International Labour Organization (ILO) is consulting with stakeholders in Bangladesh’s ready-made garment (RMG) sector to introduce an employment injury insurance scheme for workers in its top export-earning sector.

Once established, the employment injury insurance (EII) scheme could protect workers for less than 3 taka ($0.04) per workday per worker at the minimum wage, according to Bangladesh’s Financial Express.

Anne Drouin, chief of the ILO Social Protection department, said, “As a first step it makes sense to develop an EII scheme for the RMG sector. This would send a strong signal to brands and buyers that workers are being taken care of and that labour rights in Bangladesh are being taken seriously,” the Financial Express reported.

In light of the sector’s unfavorable past and present politically-fused blockade hindering exports, the investment could prove necessary as one way to keep existing brands sourcing in Bangladesh at bay and convince new ones to make there.

Drouin told attendees at an ILO-organized workshop in Bangladesh held over the weekend that the move is the most cost-effective and socially responsible way to enhance the country’s reputation and advance the sector.

The scheme will be made up of contributions from employers and managed by an autonomous body under the country’s Ministry of Labor including a government, worker and employer representative.

Acting after the fact as was the case following the Rana Plaza building collapse after which it took all the sector could muster to be able to provide compensation for survivors and families of the deceased, according to Srinivas Reddy, ILO country director for Bangladesh, is not realistic or beneficial.

“Bangladesh needs a national EII scheme to provide reliable, low-cost and no-fault accident- compensation insurance for workers. This will be less costly to employers than private insurance and will deliver better protection to ensure that no worker is left behind,” the Financial Express reported Reddy as saying.

Employers, brands and buyers must work together to see the scheme take shape, but proper implementation is another factor to consider.