North American retailers set 5-year Bangladesh factory plan

Wed Jul 10, 2013 10:12am EDT
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By Jessica Wohl

July 10 (Reuters) - Nearly 20 North American retailers including Wal-Mart Stores Inc and Gap Inc unveiled a 5-year safety plan for Bangladesh garment factories on Wednesday that would include inspecting every factory within a year.

The announcement in Washington by the Alliance for Bangladesh Worker Safety on Wednesday comes after 1,129 workers were killed in the collapse of a Bangladesh garment plant in April and another 112 people perished in November fire at a Bangladesh factory.

A separate safety plan including coordinated inspections was announced by a group of mainly European brands on Monday.

A few student protesters were outside the building in Washington, where the plan was announced. The group United Students Against Sweatshops handed out fliers, saying "Gap and Walmart: Bangladeshi Workers Reject Your Fake Safety Plan."

Funding for the North American plan is based on how much production each retailer has in Bangladesh; those at higher levels will pay $1 million a year for five years.

So far, $42 million has been raised for the project. Ten percent of the funds will be set aside to assist workers temporarily displaced by factory improvements or if a factory closes for safety reasons. The money will also support a non-governmental organization chosen to implement it. A decision on the NGO should come within 30 days.

The 17 current members of the alliance include: Canadian Tire Corp Ltd ; Carter's Inc ; The Children's Place Retail Stores Inc ; Gap; Hudson's Bay Co ; IFG Corp; J.C. Penney Co Inc ; Jones Group Inc ; Kohl's Corp ; L. L. Bean Inc; Macy's Inc ; Nordstrom Inc ; Public Clothing Co; Sears Holdings Corp ; Target Corp ; VF Corp ; and Wal-Mart.

Hong Kong sourcing company Li & Fung Ltd, which does business with many of the companies involved, is serving as an adviser. Additional members are expected to join in the future.   Continued...