Wal-Mart to H&M Agree on Bangladesh Work Safety Standards

Two groups led by the U.S. and European retailers including Wal-Mart Stores Inc. (WMT) and Hennes & Mauritz AB (HMB) agreed to improve work safety inspection standards in Bangladesh.

The Alliance for Bangladesh Worker Safety, led by a group of North American apparel companies, and the Accord on Fire and Building Safety whose members mainly are European retailers, have agreed on a “common, minimum criterion for fire and structural inspection safety standards, pending a few final modifications” the group said in a statement posted on its website yesterday.

“The challenges in Bangladesh are many and complex, and the solution requires collaboration across all interested parties,” Jeffrey Krilla, president of the alliance, said in the statement that didn’t disclose details of the agreement.

International retailers have been under pressure to help improve conditions across Bangladesh’s apparel industry. Clothing makers in the country are trying to rebuild their image after the April collapse of the Rana Plaza factory complex killed more than 1,100 people in the country’s worst industrial disaster.

The agreement was made with the retailer groups as well as the Switzerland-based International Labour Organization and the Bangladesh University of Engineering and Technology, according to the statement. Phone calls to ILO, the Alliance and the Accord on Fire and Building Safety weren’t answered outside business hours.

Photographer: Munir uz Zaman/AFP/Getty Images

A garment worker runs through a cloud of tear gas fired by riot police during clashes in Gazipur, a key garment manufacturing hub outside Dhaka, on Nov. 19, 2013. Close

A garment worker runs through a cloud of tear gas fired by riot police during clashes... Read More

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Photographer: Munir uz Zaman/AFP/Getty Images

A garment worker runs through a cloud of tear gas fired by riot police during clashes in Gazipur, a key garment manufacturing hub outside Dhaka, on Nov. 19, 2013.

The Alliance also said it has added 66 more factories into the supplier database, bringing the total to 686 Alliance member factories. The Alliance’s members include J.C. Penney Co. (JCP), Gap Inc., Target Corp. and Macy’s Inc. The Accord has members including Inditex SA (ITX), Carrefour SA and Marks & Spencer Group Plc.

Wage Increase

Unsafe factories and wages higher than only Myanmar in Asia have sparked labor tensions in Bangladesh’s $20 billion garment industry. A series of protests by workers demanding higher wages have taken place in the past several months in the industrial zones of Gazipur and Ashulia on the outskirts of the capital Dhaka. Some workers clashed with the police in demonstrations that forced the shutdown of factories.

Two workers died and 30 others injured in a protest this week as thousands took to the streets demanding a higher monthly salary of 8,000 taka ($103). The government last week increased the minimum wage to 5,300 taka, below the amount unions are demanding.

Production Resumed

Except for one or two factories, most that had been shut by labor unrest have resumed production, Abdus Salam Murshedy, president of Exporters Association of Bangladesh, said via phone today. “Workers have joined work,” he said. “We expect that the government will issue a formal, written notice on the new wage structure today. The situation is returning to normal.”

Bangladesh Prime Minister Sheikh Hasina yesterday urged workers to accept the wage increase and to end violence, she said in a speech broadcast by Bangladesh Television.

Bangladesh police arrested five union leaders over charges of instigating violence in the garment industry, Mostafizur Rahman, additional superintendent of police in Gazipur district said yesterday, without naming those arrested.

To contact the reporters on this story: Stephanie Wong in Hong Kong at swong139@bloomberg.net; Arun Devnath in Dhaka at adevnath@bloomberg.net

To contact the editor responsible for this story: Stephanie Wong at swong139@bloomberg.net

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