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Legal ‘Peril’ Awaits Bangladesh Accord Hold-Outs, Experts Warn

The pending expiration of the Accord on Fire and Building Safety in Bangladesh won’t just endanger garment workers’ lives, labor campaigners warn, it’ll also expose apparel brands to considerable legal liability.

European companies, in particular, will find themselves increasingly held to account by human-rights due-diligence legislation, both existing and forthcoming, that requires them to actively root out potential abuses in their supply chains. France’s Corporate Duty of Vigilance Law already places the onus on French firms to identify and prevent social risks that could occur as a result of their business activity, while the recently passed German Act on Corporate Due Diligence Obligations will soon levy fines on Germany-based companies that allow labor abuses to take place under their watch. The broader European Union is gearing up to do something similar, meaning that any brand that falls under its jurisdiction will be required to engage in meaningful mitigation strategies or face the consequences of inaction.

“We have analyzed the legal situation and we believe that major apparel companies that would decide to turn their backs on the successful Accord model are putting workers’ lives at risk, and are risking legal liability, especially in France and soon to be in Germany,” Christie Miedema, campaign and outreach coordinator at the Clean Clothes Campaign, the garment industry’s largest consortium of labor unions and nonprofits, told Sourcing Journal.

Worker-rights advocates say that by not committing to a continuation of the Accord, which expires Aug. 31, brands such as Aldi North, Carrefour, H&M and Otto are running afoul of their due-diligence duties under French and, soon, German law, which could result in potential legal proceedings.

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“Under these new laws, a company will be liable if workers in their supply chain are harmed in a factory fire or building collapse and the brand has not fulfilled its due-diligence obligations,” said Miriam Saage-Maaß, vice legal director of the European Center for Constitutional and Human Rights.

The Accord, labor groups say, is the most effective way for EU companies to protect and improve workplace safety in Bangladesh, yet its renewal has been a fraught process. The same, predominantly European brands that eagerly signed the landmark agreement in the aftermath of the 2013 Rana Plaza factory collapse, which killed 1,134 garment workers and harmed myriad more, have been slower on the re-uptake. The Accord marked a watershed moment for safety conditions. Unlike the rival Alliance for Bangladesh Worker Safety, which American companies rallied around the same year, the Accord was legally binding, meaning that commitments by signatories to support factory improvements had contractual heft.

The Accord has been widely credited for turning Bangladesh’s once accident-prone garment industry—the world’s third-largest exporter of clothing after China and Vietnam—into one of the safest. Inspections at more than 1,600 factories, which collectively employed 2-million-plus workers, uncovered nearly 130,000 safety violations, from structural damage to blocked fire escape routes. The bulk of these hazards have been eliminated to date. Now, labor groups worry that the loss of the Accord and a return to self-regulation will turn back that hard-won progress and leave outstanding problems, such as inadequate fire alarms, hanging. Besides an extension of the agreement, they also want to see it expanded to other vulnerable garment-producing nations, such as Egypt, Morocco and Pakistan.

Several Accord holdouts, including H&M and Marks & Spencer, say they remain committed to worker safety in Bangladesh by throwing their support behind the Ready-made Garment Sustainability Council, a tripartite national body with 18 seats divided between trade unions, brand representatives and factory owners. Better known as the RSC, the group has largely taken over the monitoring and inspection duties of the Accord, albeit without legal consequences for brands. In July, labor unions UNI and IndustriALL Global Union quit the RSC, saying that its lack of enforceability, individual brand accountability and independent monitoring makes it ineffective as a worker-safety organization.

“Unless there is a legally binding commitment by brands to continue to support the Accord’s work—including both the requirement on factories to operate safely and making it financially feasible for them to do so—garment workers’ lives in Bangladesh will be at risk,” said Ben Hensler, general counsel and deputy director for policy and research at the Worker Rights Consortium. “Under human-rights due-diligence laws, this is a risk that, if brands refuse to renew the Accord, they would ignore at their own peril as well.”