The American plan commits $42 million for worker safety, including inspections and an anonymous hot line for workers to report concerns about their factories, and more than $100 million in loans and other financing to help Bangladeshi factory owners correct safety problems. But unlike the accord joined mainly by European retailers that was unveiled on Monday, the plan lacks legally binding commitments to pay for those improvements.
Some labor rights groups estimated that it would cost as much as $3 billion to bring Bangladesh’s garment factories up to an acceptable safety standard.
Under the effort announced on Wednesday, called the Alliance for Bangladesh Worker Safety, the participating companies will contribute money — from a modest amount up to $1 million a year, depending on the level of business each does in Bangladesh. This would create a fund of $42 million during the five years of the plan.
The proposal calls for the retailers to inspect the estimated 500 Bangladeshi factories that the North American retailers use within 12 months, and then develop plans to fix any substantial safety problems that are found.
The North American retailers plan to develop a common safety standard for the factories by October and to create a clearinghouse to share information among themselves about which factories have been approved for production and which need safety improvements.
Their plan calls for “shared accountability” in responding to those safety problems: the companies would work closely with the factory owners, the government of Bangladesh and various government and aid agencies to figure out ways to finance safety improvements. If serious safety problems were discovered at a particular factory, the plan’s director would inform the Bangladeshi government, the factory owner and what the group calls the factory’s “worker participation committee,” a group to be elected by a factory’s workers.
That differs from the way retailers in the European-dominated plan take responsibility for safety violations. The Europeans pledge to ensure that there is money to fix serious fire and building safety problems in any of the factories they use in Bangladesh.
Under the American plan, the onus is on factory owners to improve their workplaces. Unlike the European group, the North American retailers are not promising to finance needed improvements, outside of the loans. Essentially, if a factory is not up to par and does not fix the problems itself, the American retailers say they will no longer do business there.
“In terms of legal liability, if a worker reports a factory is not measuring up, we have the measures to respond, to investigate,” said Jay Jorgensen, global chief compliance officer for Wal-Mart. “If a factory is not meeting the standards,” he said, “under our agreement they’re going to be terminated. That’s the ultimate pressure point on a factory to treat its workers well — the continuation of business.”
Five labor rights groups, including the Worker Rights Consortium, the Clean Clothes Campaign and United Students Against Sweatshops, criticized the American plan. “Wal-Mart, Gap and the corporations that have chosen to join them, are unwilling to commit to a program under which they actually have to keep the promises they make to workers and accept financial responsibility for ensuring that their factories are made safe,” the groups said in a statement.
The five organizations faulted the plan for being “company-developed and company-controlled,” adding that “under the Gap/Wal-Mart scheme, brands and retailers are not obligated to pay one cent toward the renovation and repair of their factories in Bangladesh.”
The retailers said repeatedly that their plan contained many of the same elements as the European-dominated effort: inspections of all factories, development of remediation plans, sharing of information on the inspections and safety training for Bangladeshi workers.
Article source: http://www.nytimes.com/2013/07/11/business/global/us-retailers-offer-safety-plan-for-bangladeshi-factories.html?partner=rss&emc=rss