Walmart’s Worker-Safety Plan Draws Ire of Labor Activists

Proposals to safeguard worker rights in developing nations in the wake of Bangladesh's Rana Plaza factory collapse are trashed by labor activists

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Taslima Akhter for TIME

The collapsed Rana Plaza in the Savar neighborhood of Dhaka, Bangladesh, on June 1, 2013

Bangladesh’s Rana Plaza factory collapse on April 24 claimed the lives of 1,129 garment workers and opened the world’s eyes to the true cost of cheap, throwaway fashion. A public outcry in the wake of the disaster, in the Savar neighborhood outside the capital, Dhaka, led to calls for codifying labor rights to prevent similar tragedies occurring in the future. But some of the world’s largest retailers have been reticent, putting profits before safety, according to rights activists. On Wednesday, Walmart, Gap and other major high-street brands revealed their latest proposal. Worker groups, however, remain unconvinced.

(PHOTOS: A Final Embrace: The Most Haunting Photograph From Bangladesh)

Bangladesh is the world’s second largest apparel exporter, with about 4 million people involved in the industry, toiling in often sweatshop conditions for subsistence wages. The Obama Administration suspended trade privileges for Bangladesh last month to push its government to remedy this situation. Retailers have similarly been under pressure, and the Bangladesh Worker Safety Initiative is the latest plan spearheaded by Walmart to improve working conditions. Features include funding safety upgrades, holding inspections and providing employees with a hotline to report complaints.

Yet criticism has been fierce. Liana Foxvog, director of organizing and communications for the Washington-based International Labor Rights Forum (ILRF), believes that one of the major tenets of the plan — a fund to improve facilities so that they meet safety regulations — is fatally flawed. While the Worker Safety Initiative does provide funds for improving workplace safety, companies are not legally responsible for making the repairs. Moreover, the level of funding discussed is paltry compared with requirements. Companies involved — including J.C. Penney, Target, Macy’s, Sears, Nordstrom and L.L. Bean — have so far raised $42 million in grants to improve factory infrastructure and $100 million in low-rate loans and access to capital. But Foxvog and other experts estimate the cost of necessary improvements would be $300,000 to $500,000 per factory, possibly reaching $1 billion in total.

Of course, funding safety upgrades is only half the battle. Unless retailers pay workers’ salaries during factory renovation, many would lose their income for months, leaving them destitute. Such provisions are conspicuously lacking in the Worker Safety Initiative. Brian Finnegan of AFL-CIO, the U.S.’s largest labor-union federation, echoes many of the ILRF’s concerns, and adds that the process by which the Worker Safety Initiative was formulated all but guarantees failure. “The only people negotiating [the agreement] are companies,” says Finnegan. “There was no one on the other side of the table here.” Finnegan thinks that independent investigators should conduct factory inspections instead of the businesses themselves, but that even this has problems, as workers can be easily intimidated into giving false statements.

(MORE: After Rana Plaza, Bangladesh’s Shipyard Workers in Danger of Being Forgotten)

Rights groups are also skeptical of Walmart and other alliance members’ claim that empowering worker-participation committees and providing an anonymous phone line to report violations will make a tangible difference. Charles Kernaghan, director of the Pittsburgh-based Institute for Global Labour and Human Rights, described the worker committees as “completely useless” and generally pawns of factory owners. When workers genuinely attempt to collectively organize, Kernaghan says, they are savagely threatened. Foxvog was equally dismissive of the complaints hotline, stating that these go directly to the company with no independent means of verification or ensuring meaningful action is taken.

Damningly for Walmart and other Worker Safety Initiative backers, virtually all workers’-rights groups advocate a separate plan, the Accord on Fire and Building Safety in Bangladesh, which has already been signed by at least 70 mostly European retailers and some American companies, such as Abercrombie & Fitch and PVH, which owns Calvin Klein and Tommy Hilfiger. Unlike the Worker Safety Initiative, the Accord is legally binding and would give workers the right to take their grievances to arbitration. Should the arbitration committee find in favor of the workers, signatory companies would be required to pay damages. Rights groups are not alone in favoring the Accord. Senior Democratic Congressmen Sander Levin and George Miller said they were “deeply disappointed” that U.S. retailers are pushing the alternative Worker Safety Initiative “that borrows the rhetoric of the Accord but not its critical elements.”

Those mainly American companies that reject the Accord cite fears of increased legal liability. Johan Lubbe, a legal adviser to the National Retail Federation, has said that because of comparatively lax class-action laws that favor the plaintiff, American firms would be on the hook for huge sums in the event of another catastrophe. But in a recent editorial for the Los Angeles Times, two law professors disputed this claim, saying that the only legal liability for signatories would be to abide by its terms. Foxvog was equally unconvinced, pointing out that the only enforcement mechanism of the Accord is a neutral arbitrator, and has nothing to do with class-action suits.

In a statement, the AFL-CIO implied that the weakened plan was nothing but a smokescreen. “Rather than sign the binding Accord,” read the statement, “Walmart and Gap are pushing a weak and worthless plan that avoids enforceable commitments.” While the horrors of Rana Plaza remain burned into the minds of working men and women everywhere, it appears some of the world’s richest companies have much shorter memories.

MORE: Dying for Some New Clothes: Bangladesh’s Rana Plaza Tragedy

9 comments
Hermione
Hermione

Wal-Mart does not do right by it's American customers, and I am not just talking about sweatshop goods.  I rarely buy clothes from Wal-Mart, because I can rarely find what I need.  I have also seen empty spots on shelves, not a good thing for retail business.  If Wal-Mart wants to keep my business, then Wal-Mart needs to start stocking it's shelves with reasonable products, and not keep cutting the hours of part-time associates.  I am sick and tired of going into brick-and-mortar shops, and NOT being able to get waited on.

eddarthere
eddarthere

It is the Government of Bangladesh responsibility to enforce their standards, not Us retailers. Can you imagine IKEA coming over here and telling the US what standards they expect the US to have. Then expect IKEA pay for, and enforce those standards. Walmart HATERS love to blame everything on Walmart.

tom.litton
tom.litton

@eddarthere Bangladesh can't enforce the standards alone.  If they tried, the companies would move to another country that doesn't, and their economy will crash, leaving millions in poverty. 

The only way it works is if the standards are applied everywhere at the same time. And that means the standards have to be applied to retailers and/or through international treaties with embargoes if necessary (the later being problematic in it's own right).

Hermione
Hermione

@eddarthere 

Yes, the government of Bangladesh should enforce standards.

Yet there is nothing wrong with the American consumers demanding some 'standards' as well.  Money talks, and I choose to spend less money at Wal-Mart this year. 

Padmore
Padmore

@eddarthere The USA is a developed country able to create and more importantly properly enforce the complex system of regulation needed to protect workers. The government of Bangladesh simply cannot, it is unfair to expect the same. Furthermore I would expect Ikea to have high standards in the USA, just as it should worldwide and the same applies for Walmart. Companies do have a responsibility to those they employ, as it their workers who are producing their products and so making them money.

dectra
dectra

WalMart likes you to think that they're on the side of ordinary Americans....but they're not. They have driven countless manufacturing jobs from this country. Now they're in cahoots with sweatshop owners in other countries. Bet that cheap t-shirt doesn't look so good with blood on it, now does it?

tom.litton
tom.litton

@dectra This is why i find it hilarious when people advocate for turning the federal government over to Walmart executives.

eddarthere
eddarthere

@dectra"They have driven countless manufacturing jobs from this country" That is BS. Unions have driven most manufacturing jobs from the US. The US is no longer competitive in labor intensive jobs. Blame the World or the poor people of these Third World countries, not Walmart


Read more: http://world.time.com/2013/07/11/wal-marts-smokescreen-worker-safety-plan-draws-ire/#ixzz2YmrRlcKF

tom.litton
tom.litton

@eddarthere @dectra It isn't the fault of unions.  It's the fault of the relative cost of living and expected standards.  Americans couldn't survive on the wage of those workers.  

Nor would we stand for the lack of standards that allowed this accident to happen.  Well except in Texas.

I would expect the workers to unionize when they need to in order to earn a living wage.