U.S. retailers sign Bangladesh plan in wake of workplace disasters

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Some of the nation’s biggest retailers signed on to a new five-year safety pact Wednesday that calls for inspecting every Bangladesh factory within a year, a decision spurred by the collapse of a garment plant in April killed 1,129 workers and a November factory fire that killed 112.

The Alliance for Bangladesh Worker Safety will have basic safety standards set up within three months and promote worker participation, worker training and transparent inspection results. The safety initiative, developed with the help of former Sens. George J. Mitchell and Olympia Snowe, also calls for public semi-annual progress reports and stresses the “shared commitment” of the government of Bangladesh and other international organizations.

The 17 U.S. retailers — including industry leaders Wal-Mart, Gap, Target, J.C. Penney, Kohl’s, Nordstrom and Macy’s — have raised $42 million, 10 percent of which will be earmarked to aid temporarily displaced workers. The group will offer an additional $100 million in loans to assist factory owners with safety improvements. 

“It’s historical that a group of retailers have come together like this,” said Daniel Duty, Target Corp.’s vice president of global affairs. “We’re very excited to be a part of it. We’ve worked hard the past [several] weeks to come up with an industrywide plan that will really make a difference.” 

Bangladesh authorities have vowed to improve worker safety standards in one of Asia’s poorest countries, and U.S. activists said outside pressure from Western manufacturers who have flocked there may help. 

“The Bangladeshi government has over many years repeatedly promised to ensure worker safety and worker’s rights and they have failed. And the question [is] whether they really are committed to make the structural changes that are necessary,” said Brad Adams, executive director of the Human Rights Watch Asia Division. “I think everyone should approach the commitments they’ve made with a great deal of skepticism.”

Mr. Adams said Human Rights Watch has yet to complete an analysis of either the North American safety plan or the plan put forward by a group of mostly European companies, but he said it “would be a revolution” if the Bangladeshi government honored its commitment to worker’s rights. 

The U.S. plan comes days after the European plan that calls for inspections within nine months and guarantees funds for necessary safety upgrades, announced Monday by more than 70 retailers and trade unions.

“In substance, the plans are very much alike [and] address many of the same issues,” Mr. Duty said, citing the legal requirements as the main difference. “It’s not a difference that matters with respect to the ultimate goal, which is worker safety.” 

The North American group reportedly objected to the European plan because it said it could leave them facing unlimited liability in future incidents and provide no accountability for private funds. Only three U.S. retailers signed up for the European plan: Abercrombie & Fitch; PVH, which owns Calvin Klein and Tommy Hilfiger; and Sean John. Other companies that have signed the global pact include Swedish retailer H&M and Italian clothing company Benetton.

Critics of the North American plan say it is not as effective as the European plan because the U.S. companies were unwilling to make a large financial commitment for safety.

The North American alliance covers about 500 factories and a majority of the clothing exports from Bangladesh to North American companies. The global pact covers anywhere from 800 to 1,000 factories. About 25 percent of the garment exports from Bangladesh go to North America. There are about 5,000 garment factories in the country.

Jay Jorgensen, senior vice president of global chief compliance officer at Wal-Mart Stores Inc. told The Associated Press that the two efforts could complement one another.

“We affirmatively want to work together with the accord,” he said.

But Scott Nova, executive director of the Worker Rights Consortium, one of the groups involved in negotiating the global pact, attacked the U.S. plan as “a sham.” The U.S. retailers, he contended, were mainly trying to limit impact on their revenues.

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