ILO and the Government of the People’s Republic of Bangladesh launched the four-year pilot of the Employment Injury Scheme (EIS) on 21 June, which covers all ready-made garment (RMG) workers.
The project, which already has a number of apparel brands committed to providing voluntary financial contributions, is said to be the first to protect Bangladesh workers from loss of income due to workplace-related injuries.
Go deeper with GlobalData
The project marks a milestone in terms of establishing decent work and economic growth within the country and the ultimate aim is for it to be introduced permanently when the pilot ends.
The pilot means injured workers and dependents in case of employment-related accidents that lead to permanent disability or death can receive compensation.
The initial project is being overseen by a tripartite committee convened by the Government of Bangladesh made up of members of the Ministry of Labour and Employment as well as employer and worker representation.
The International Labour Organization (ILO) led the conceptualisation and design of the pilot, in accordance with the requirements of ILO Employment Injury Protection Convention and led efforts to engage brands in the programme.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataThe brands that have already signed pledges as commitments for voluntary financial contributions, as the forerunners for effective protection against work-related accidents in Bangladesh include Bestseller, Fast Retailing, the H&M Group, KiK Textilien und Non-Food GmbH, Primark and Tchibo.
Fast Retailing’s group executive officer and head of sustainability Yukihiro Nitta explains: “Fast Retailing recognises that one of our most important responsibilities is to protect the security and safety of the people who help to make our clothes. Our ongoing partnership with the ILO is built on a commitment to finding solutions to issues faced by all workers in Asia – not just those in our supply chain – through systemic social protection measures and improved working environments across the region. The new EIS pilot provides a pathway to a significant new safety net for workers in Bangladesh – one of our key manufacturing locations. We are delighted to be able to support it.”
How will the injury insurance pilot benefit Bangladesh garment workers?
The pilot project will allow data gathering and capacity-building on occupational accidents, diseases and rehabilitation, based on a sample of representative factories to take place.
Research will be carried out on the average medical costs for a worker in case of injury. This will help identify the resources necessary to ensure that medical care as described in the Bangladesh Labour Act is effectively met.
The research will extend to the process adhered to and the benefits provided in case of temporary incapacity. This will demonstrate the viability, feasibility and cost efficiency of an EIS in Bangladesh, ensuring affordability of employers’ contributions by testing the impact of a sharing of responsibility approach.
It is estimated that 150 factories will be participating in generating the evidence needed for a long-term solution.
The pilot project will also allow for risk-sharing for long-term benefits: payment of compensations in case of permanent disability or death for the entire RMG sector that are in-line with international labour standards.
In this component, the pilot provides income replacements for the permanently disabled and the dependents of deceased workers, covering the entire RMG sector. This takes the form of periodical payments as top-ups for the already existing lump-sum payments of the Central Fund, rendering the level of benefits compatible with the ILO Convention No. 121. These top-up payments will be financed by voluntary contributions of international brands and retailers. In doing so, they are stimulating further the transformation towards a comprehensive employment injury insurance scheme and supporting the primary efforts of government authorities.
This is in line with the ILO MNE Declaration , which encourages enterprises to complement public social security systems and help to stimulate further their development, including through their own employer-sponsored programmes.
