Ship recycling is an essential part of the global maritime lifecycle. It supports the circular economy, reduces greenhouse gas emissions by returning valuable steel to the supply chain, and helps ensure that the commercial fleet can renew sustainably. But while the environmental benefits are well known, the human cost has for too long been overlooked.
Across major recycling countries, ship recycling workers face hazardous conditions every day. Ship recycling is a high-risk industry. Even with improving standards and growing adoption of the Hong Kong Convention, injuries remain a reality, leaving workers and their families vulnerable. So equally important as the continuous improvement of safety standards and measures, is the provision of a reliable safety net when accidents occur.
The success of the ILO Employment Injury Scheme (EIS) in Bangladesh’s ready-made garment (RMG) industry provided the impetus for piloting a similar scheme in the ship recycling sector.
The RMG project demonstrated that structured, industry-backed insurance can deliver real improvements in safety practices at factory level and worker welfare and ensure reliable compensation for injured workers and their families.
Why is the injury scheme needed?
The EIS introduced by the ILO and BIMCO is a pilot project that is designed to close the safety net gap. The pilot will transition into a mandatory national EIS by July 2027. At that time, Bangladesh is expected to have the data, experience, and institutional capacity needed to establish a sustainable, permanent national EIS for all sectors, including ship recycling. The aim of the pilot is to help creating the practical, fair and transparent mechanism needed to ensure that injured workers – or the families of those who lose their lives – receive meaningful compensation.
This initiative is needed because:
- In Bangladesh, workers currently lack consistent protection, Compensation frameworks are weak and a single injury can push families into financial hardship
- The industry must match social responsibility with environmental ambition. As ship recycling becomes safer and more regulated, it is essential that the well-being of workers progresses in step with regulatory improvements
- Global collaboration is the only way to raise standards. Individual efforts help, but a collective, industry‑supported scheme creates predictable funding, consistent processes, and incentives for better practice at yard level
- It supports Bangladesh in moving from the current employer-liability system to a national, wage-based EIS anchored in law and administered by the national institution.
