Workplace Safety and Health: What Companies Doing Business in Bangladesh, China, and India Need to Know. Tuesday, July 22, 2014

Transcription

1 Workplace Safety and Health: What Companies Doing Business in Bangladesh, China, and India Need to Know Tuesday, July 22, 2014

2 Moderator Erin Kuzz, Partner Sherrard Kuzz, Toronto, Canada 2

3 Speakers Ajay Raghavan Partner, Trilegal, Bangalore, India Sameer Sattar Sattar&Co., Dhaka, Bangladesh 3

4 Speakers Jeffrey Wilson Jun He Law Office, Shanghai, China 4

5 Bangladesh Sameer Sattar Sattar&Co. 5

6 Referred Statutes The Bangladesh Labour Code 2006 referred to as BLC. The Labour (Amendment) Act 2013 referred to as the Amended BLC. Bangladesh Workers Welfare Foundation Act 2006 referred to as BWWFA. Judicial Decisions 6

7 Definition of Worker The importance to define a person as worker in terms of application. Section 2(65) of the BLC provides the specific definition as: any person including an apprentice employed in any establishment or industry, either directly or through a contractor, to do any skilled, unskilled, manual, technical, trade promotional or clerical work for hire or reward, whether the terms of employment be expressed or implied, but does not include a person employed mainly in a managerial or administrative capacity. 7

8 Explanation by Court The primary determinant of an employee s status as a worker is whether the employee is performing managerial or administrative functions. The BLC specifically excludes from the definition of worker persons employed in a supervisory capacity performing managerial and administrative functions. Md. Mehedi Hassan & Another v The Government of Bangladesh & Others [2012] 1 LCLR 380 (Referred to as the Mehedi Hasan case) 8

9 Explanation by Court In the Mehedi Hasan case, it has been accepted by the Bangladesh Supreme Court that, while considering whether a person is a worker under the BLC, one has to consider whether he/she has the authority to appoint any employee or take any disciplinary action on his/her own initiative and, therefore, determine whether he/she performs managerial or administrative functions. Also, one has to see whether he/she can remotely discharge any policy making responsibilities on behalf of the company; Omar Sons Ltd. v Chairman [1976] 28 DLR

10 Economic Welfare and Security of Workers The Constitution of Bangladesh protects the interests of the workers. For example, Article 14 of the Constitution makes it a fundamental responsibility of the State to protect workers from all forms of exploitation, including economic exploitation. Chapter 15 of the BLC deals with the workers participation in the companies profits. There is a positive obligation on the companies to establish a fund for the benefit of the workers. Under the Amended BLC, this obligation shall now be applicable for any company: (i) which has a paid up capital of at least Tk. 1 Crore (as of the last date of its accounting year), or (ii) which has fixed assets worth at least Tk. 2 Crore (as of the last date of its accounting year). 10

11 Economic Welfare and Security of Workers Under Section s 234 of the BLC, the company is required to deposit 5% of its net profit in the worker s participation, welfare fund and worker s welfare foundation fund in 80:20 ratio respectively. Under Section 235 of the BLC, the Board of Trustees (BOT) is entrusted with the statutory duties of managing the said fund under direct control of the Government. The BOT shall comprise of 2 representatives from the workers, 2 representatives from the management of the company (one of whom should be related to accounts) and 1 (one) Chairman shall be selected from them annually. 11

12 Economic Welfare and Security of Workers Under Section 233 of the BLC, it is important to note that, for the purpose of Chapter 15 of the BLC, the term worker has been replaced by the term beneficiary by the Amended BLC. The term beneficiary includes any person (whatever his/her status) apart from the owner, partner or a member of the Board of Directors of the Company and who is in employment for a minimum of 9 (nine) months. Under Section 242 of the BLC, two-thirds of the deposited money of the participation fund shall be equally distributed among the beneficiaries in cash and the remaining amount may be invested in state-owned investable sector whose profit shall also be distributed among them. 12

13 Trade Union The right to form a trade union is recognized by Section 176 of the BLC and is further bolstered by the Amended BLC. Under Section 177 of the BLC, a trade union may apply for registration to the Registrar of Trade Unions, which means the Labour Directorate or any official authorized in this respect. Under the Amended BLC, it is now obligatory to include a minimum of 10% female members in the executive committee of a trade union where the female workforce of the company is at least 20%. 13

14 Minimum Wages Under Section 138 of the BLC, the Government shall establish a Minimum Wage Board. The Government is entitled to make recommendation to the Minimum Wage Board if it deems necessary under Section 139 of the BLC. Upon receiving recommendation from the Wage Board, the Government may, by notification in the official Gazette, declare that the minimum rates of wages recommended by the Wages Board for the various workers shall, subject to such exception as may be specified in the notification, be the minimum rates of wages for such workers. 14

15 Minimum Wages At present, after the Rana Plaza collapse, the Government has finalised a minimum wage of Tk 5,300 for garment workers, a raise of 77 percent to be implemented from 01 December

16 Provisions Concerning Child Labour Section 34 of the BLC creates a bar on the appointment of any children in any establishment. Important related issues include: No child shall be required or allowed to work in any factory; An adolescent who is 14 years of age or older shall not be required or allowed to work in a factory unless: o A certificate of fitness granted to her/him is in the custody of the owner of the factory; o Such adolescent carries a token giving a reference to such certificate while he is at work. 16

17 Provisions Concerning Child Labour Under Sections 2(8) and (63), an Adolescent means a person who has completed her/his 14 years but is under 18 years of age and a Child means a person who has not completed his/her 14 years of age. An Adolescent should refrain from risky work under Section 39 of the BLC. 17

18 Exceptions to Restrictions in Working Under Section 44 of the Amended BLC, a child who has completed 12 years of age and/or a disabled worker may be employed in light work that does not endanger his/her health and development or interfere with his/her education (in case of child), provided that the hours of work of such child, where he/she is school going, shall be so arranged that they do not interfere with his/her school attendance. 18

19 Safety Issues for Workers Since the Tazreen Fashion fire incident and, more recently, Rana Plaza collapse, worker safety has been the concern of all manufacturers, multinational buyers, and workers generally. The BLC has detailed provisions relating to the safety of the worker. By complying with these provisions, an employer can improve the working environment and standards in line with the demands of the present situation. 19

20 Safety of Building and Machinery Section 61 of the BLC: Deals with the safety measures relating to buildings and machineries. The Inspector is empowered to issue a written order to the employer, if he/she feels that the building or any machinery of any establishment or any part of it, including internal electric system, is dangerous to human life or safety, specifying his/her opinion as to how these can be rectified within a specified time. 20

21 Safety of Building and Machinery Section 61 of the BLC (cont d): If the Inspector is of the opinion that the building or any machine is dangerous for the life of the worker, he/she can issue an order to repair the defect, failing which, he/she can issue an order prohibiting its use unless and until it is so repaired or replaced. 21

22 Precaution in Case of Fire Section 62 of the BLC: precautionary measures in relation to fire: At least one alternative exit with staircases connecting all the floors of the factory building as described in the rules for each and every factory; All the exits shall be kept lock-free & without any blockage at the time of working hours; No doors affording exit can be locked or fastened during the working hours so that they can be easily or immediately opened from inside; 22

23 Precautionary measures, cont d. Precaution in Case of Fire The doors affording exit must open outwards, unless it is sliding in nature, if the door is between two rooms it must open in the direction of the nearest exit; Marking in red letter in proper size, in the language understood by the majority of the workers, on such doors, windows or any alternative exit affording means of escape incase of fire; There shall be an effective and clearly audible means of fire-warning system to every worker; 23

24 Precautionary measures, cont d. Precaution in Case of Fire There shall be a free passage-way giving access to each means to escape Where more than ten workers are employed other than in the ground floor, there shall be a training for all the workers about the means of escape in case of fire There shall be at least one fire-extinction parade and escape-drill at least once a year in a factory where more than fifty workers are employed. 24

25 Personal Protective Provisions Under Section 74 of the BLC: No person shall be employed in any factory to lift, carry or move any load which is likely to cause him injury Under Section 78(a) of the Amended BLC: Employer shall not appoint any worker without providing personal protective equipment In order to ensure professional health and safety, every worker must be made aware of the risk of work by adequate training 25

26 Powers of Inspectors on Certain Matters The BLC has given some wide powers on the Inspector appointed under the BLC; for example: Under Section 61 of the BLC, an Inspector has the power to order any measures necessary to ensure the safety of the building or part of it and/or machineries; Under Section 62 of the BLC, an Inspector has the power to order measures to be taken when adequate fire extinguishing equipment is not installed as per the license issued by Fire Service Department. 26

27 Some Amendments Brought in 2013 Under Sections 89(6) and (8) of the Amended BLC: The employer shall establish a permanent health centre where 5000 or more workers are employed and appoint a welfare officer where 500 or more workers are employed Under Section 90A of the Amended BLC: A Safety Committee shall be formed by the employer in factories which employ more than 49 workers. Under Section 99 of the BLC: Introducing compulsory group insurance policies for worker by the employer where not less than 100 workers are employed 27

28 China Jeffrey Wilson Jun He 28

29 Employer Obligations Provide safe working conditions Comply with specific regulatory requirements Inform employees about hazardous conditions Provide training and require qualifications Provide health exams, safety equipment Participate in occupational insurance system Engage in collective/union consultations 29

30 Employee Rights Participate in occupational insurance Refuse working in unsafe conditions Report violations to labor bureau Sue employers for damages 30

31 Employee Obligations Follow employer and regulatory safety rules Effect of insurance claims Effect on tort claims 31

32 Environmental Issues High temperature allowance Qualified employees Compensation amounts Air pollution 32

33 Commuting injuries Off-site activities Effect of releases Special Situations Home-based work Work by interns/retirees Dispatch workers/independent contractors 33

34 Injury / Illness Procedures Immediate employer actions Seek medical care for employee Cover medical expenses Arrange workplace tests, take control measures Report accident 34

35 Injury / Illness Procedures Confirmation of occupational illness/injury Conducted by authorized medical facilities Expenses borne by employer Employee may not be terminated during confirmation procedure Appeals Jurisdiction issues 35

36 Injury / Illness Procedures Certification of occupational injury Employer obligation Filed with local labor bureau Assessment of work capability 10 grades Appeals Employee compensation and benefits Employer failure to enroll employee in insurance 36

37 Labor Contract Issues Pre-termination health exams Employee right to terminate employment Certified occupational injuries/illnesses Extension of term Pay/benefits Adjustment of position Unilateral termination by employer Termination/settlement agreements 37

38 Administrative Enforcement Inspections Sanctions Warnings Fines Shut down of operations Detention for certain managers Criminal proceedings 38

39 Employee claims Tort claims Mass litigation Extra-legal proceedings Mediation Commercial obligations Investigations Penalties Enforcement Non-governmental pressure 39

40 India Ajay Raghavan Trilegal 40

41 New Sexual Harassment Law and Impact on Business 41

42 Legislative Background THE ACT IS NOW IN FORCE 42

43 Constitution of Complaints Committee PRESIDING OFFICER (SENIOR WOMAN EMPLOYEE) EMPLOYEE (COMMITTED TO CAUSE OF WOMEN) EXTERNAL MEMBER (NGO OR ASSOCIATION COMMITTED TO CAUSE OF WOMEN) EMPLOYEE (COMMITTED TO CAUSE OF WOMEN) At least one half of total members should be women No member should hold office for more than 3 years 43

44 Dealing with the Complaint Within 90 days of incident Within 7 days* Within 10 days* Conciliation Within 90 days of start of inquiry Within 10 days Within 60 days Aggrieved woman to file written complaint to the Committee Committee to send copy of complaint and related documents to the accused/ respondent Respondent to file his reply along with supporting documents and names/ addresses of victims and witnesses Committee to initiate conciliation at request of aggrieved woman. Terms of settlement arrived at by way of a conciliation process shall be recorded, signed by both parties, and a copy sent to employer. Committee to complete inquiry in accordance with principles of natural justice. Committee to provide report of its findings to employer. A copy should also be given to the parties. Employer to act upon recommendati ons of the Committee *This is not mandatory if the organization s service rules prescribe alternate processes or timelines 44

45 Key Obligations of the Employer Formulate a policy Include sexual harassment as a misconduct under service rules Set up an internal complaints committee and display the order constituting the committee Display the penal consequences of sexual harassment Conduct training programmes for committee members Organise workshops and awareness programmes for employees Set up processes to ensure annual reports have mandatory disclosures and that they are submitted on time 45

46 Overview of Contract of Labour Law 46

47 Applicable law Contract Labour Contract labour in India is governed by the Contract Labour (Regulation and Abolition Act), 1970 (CLRA). The CLRA is applicable to: o every establishment employing 20 or more workmen as contract labour; and o every contractor employing 20 or more workmen. The CLRA is not applicable to establishments in which the work is of an intermittent or casual nature. 47

48 Contract Labour Registration Registration The principal employer is to obtain registration. Licence The contractor, on supplying 20 or more contract labourers to a principal employer, is to obtain a licence under the CLRA. 48

49 Contract Labour Health and Welfare Obligations Contractor's obligation For the welfare and health of contract labour, the contractor must provide: o Canteens; o Rest-rooms; o Drinking water; o First Aid facilities; etc. Payment of Wages 49

50 Contract Labour Health and Welfare Obligations Principal employer s obligation In case the contractor fails, the principal employer is to provide the above. In the first instance, the principle employer has the obligation to make security contributions such as provident fund and state insurance. The principal employer can recover the above amounts from the contractor. 50

51 Women Working at Night 51

52 Applicable law The provisions of some locally applicable shops and establishments laws prohibit employment of women at night. Some states like Maharashtra, Karnataka, Andhra Pradesh etc. have given IT/ITES establishments exemptions from such provisions provided some conditions are met. Approval Night Shift IT/ITES establishments need to apply for permission in order to obtain approval for employing women in the night shift. 52

53 Some Night Shift Conditions Adequate security to be provided during night shift Free transport facilities to be provided from residence to workplace Bio-data to be obtained from driver and pre-employment screening to be conducted Vehicle movements to be monitored Pick-up and drop schedule should be decided beforehand 53

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