GO
Loading...

Europeans fault American safety effort in Bangladesh

Steven Greenhouse
Monday, 18 Nov 2013 | 10:17 PM ET
Bangladeshi rescue workers look on at the scene following a blaze that engulfed a garment factory in Sripur on October 9, 2013.
STRDEL | AFP | Getty Images
Bangladeshi rescue workers look on at the scene following a blaze that engulfed a garment factory in Sripur on October 9, 2013.

Tensions broke into the open on Monday involving two large groups of retailers — one overwhelmingly American, the other dominated by Europeans — that have formed to improve factory safety in Bangladesh.

An official from the European group voiced concern that the American retailers would piggyback at no cost on the efforts of the Europeans — which includes H&M, Carrefour and more than 100 other retailers — in financing safety upgrades at hundreds of factories.

The members of the European-led group, the Accord on Fire and Building Safety in Bangladesh, have made binding commitments to help pay for fire safety measures and building upgrades when shortcomings in safety are found in the more than 1,600 garment factories its members use in Bangladesh.

(Read more: Bangladesh garment workers protest, factories shut)

While the American-dominated group, which has 26 members, including Walmart Stores, Target and Gap, has stopped short of making such a binding commitment, it has pledged to provide loans for the improvements.

Scott Nova, executive director of the Worker Rights Consortium, a labor rights group based in Washington that is a member of the Europe-led accord, said members had a "significant concern about a free-rider situation."

Violent clashes break out in Bangladesh
Clashes broke out in Bangladesh today as garment workers continued to protest for a third straight day. The ongoing protests have closed 200 factories and left dozens of people injured.

Jeff R. Krilla, the president of the American-dominated group, the Alliance for Bangladesh Worker Safety, said he was surprised by the criticism, noting that his alliance had agreed to make $100 million in low-cost loans available to Bangladesh factory owners to finance safety improvements.

In a sharp exchange in a telephone conference call on worker safety in Bangladesh that was organized by the Boston Global Forum, a nonprofit research organization, Mr. Krilla said his group's members were making a significant financial commitment to improving safety, including a total of $50 million over five years in contributions by retailers in the alliance.

The two groups, founded after the Rana Plaza factory building collapsed last April, killing more than 1,100 workers, are just beginning factory inspections. Despite the friction, they have been working closely together to develop joint inspection standards on fire and building safety.

(Read more: Wal-Mart to give update on Bangladesh woes: report)

Srinivas B. Reddy, director of the International Labor Organization's office in Bangladesh, described a change in attitude among Bangladesh factory owners who have frequently been criticized by the United States and other countries for shunning safety concerns and suppressing labor unions.

"The factory owners in Bangladesh have clearly realized that unless these issues are addressed in terms of improving safety and labor rights, the industry may land in crisis," Mr. Reddy said.

That could lead to the loss of orders from Western companies. Bangladesh is the world's second-largest garment exporting nation after China, exporting nearly $20 billion in apparel each year.

(Read more: Stop attacking Topshop over Bangladesh: CEO)

In the conference call, Mr. Nova, in a clear reference to the American-led alliance, said that members were concerned about "the tremendous lack of worker involvement" in some factory safety efforts.

The European-led accord has two giant union federations as members with tens of millions of members, IndustriALL and Uni Global. The American alliance does not have any formal union participation, but Mr. Krilla said his alliance expected to work closely with Bangladeshi unions.

More from the New York Times:

A living wage in Bangladesh
Protests escalate in Bangkok, rattling government and raising fears
Skeptics see euro eroding European unity

In recent months, Walmart, H&M and other retailers have sponsored their own emergency safety inspections of factories, in part to prevent any new disasters before inspections called for in the groups' accord begin at hundreds of factories.

Late Sunday, Walmart posted on its website the results of 75 inspections that it commissioned for factories it uses in Bangladesh.

Kevin Gardner, a Walmart spokesman, said the reports showed that many factories had "made real improvements that are making the supply chain safer for thousands of workers in Bangladesh."

(Read more: Big brands face scrutiny over factory safety)

Mr. Gardner said that 34 of the 75 factories had moved from having a D or C rating to having an A or B rating.

"This is the first time a retailer has published results of factory audits on this scale," Mr. Gardner said. "We believe transparency is vital to improve worker safety in Bangladesh."

In a separate interview, Mr. Nova criticized Walmart's inspection reports as inadequate.

"I expected to see much more substantive detail," he said. "They really don't point out specific or actual hazards."

(Read more: Clothes not to die for: A push for ethical apparel)

He praised Walmart for disclosing the names of its factories, which many retailers refuse to do. "But in terms of public disclosure, it's pretty useless," he added. "There's no way for workers at a factory to tell what specific hazards they face, whether it's a lack of smokeproof enclosed staircases or something else."

  Price   Change %Change
WMT
---
TGT
---
GPS
---
HM.B
---
CA
---

Featured

Contact Retail

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    › Learn More

Consumer