Does compliance to standards in the ready‐made garments industry affect employee attitudes? A study in Bangladesh

Abstract

Due to high quality at low costs, Bangladesh has long been of interest to retailers as a location for sourcing garments. In 2012 and 2013 however, two disasters drew the world's attention to the poor working conditions of the garment workers there, which in turn led to demands that these conditions should be improved. However, many factory owners continue to view compliance as a cost and are reluctant to improve standards. Based on data from 444 workers in the ready‐made garments industry, this study focuses on the mediating effect of job satisfaction on compliance with improved standards, and employee engagement. The findings confirm that compliance acts as a distal antecedent to employee engagement and job satisfaction fully mediates the compliance–engagement relationship. The results shed light on the significance of compliance with standards in terms of long‐term profitability, and retaining an engaged workforce. They highlight the value of good management practices when implementing compliance in the garment factories of Bangladesh and provide guidance for policymakers and groups concerned with the working conditions of garment workers in Bangladesh and elsewhere.