Wal-Mart meets over factory safety plan

Wal-Mart, the world's biggest retailer, has said it is meeting with retailers, industry associations and the Bipartisan Policy Center to work on a plan to improve fire and safety regulation in its subcontracted garment factories in Bangladesh.

The discussions in New York are part of the previously announced Safer Factories Initiative and are organised by the Bipartisan Policy Center, a nonprofit policy and advocacy think tank, the centre said in a statement on Friday Bangladesh time, according to Bloomberg.

The working group will release a plan by early July, it said. The talks are co-chaired by former US Senate Majority Leader George Mitchell and former US Senator Olympia Snowe.

The retailers and industry groups requested that the center convene the discussions and Mitchell and Snowe act as independent moderators, according to the statement. The first discussion was held May 29 in New York, and future talks will be held in New York and Washington.

"Retailers approached us and asked us to facilitate an independent forum to discuss how to create an effective, unified safety plan in response to the recent tragedies in Bangladesh," Mitchell said in a draft release obtained by Women's Wear Daily.

"The purpose of these meetings will be for the Alliance to agree upon and establish a framework to effectively address the systemic safety issues and improve working conditions within the Bangladeshi garment industry."

Major European retailers signed an “Accord on Fire and Building Safety in Bangladesh” with two global trade union federations on May 12 to pledge at least $60 million over five years to monitor safety in Bangladesh factories.

A small fund will be established to finance the safety inspector’s office created by the accord, with each signatory to contribute up to $500,000 a year, depending on their production volumes. Bloomberg estimated that the fund would cost H&M less than 0.1 percent of its annual profits.

Some 30 big name European retailers, including H&M, Marks &Spencer, Benetton, Mango, Carrefour, Inditex, Tesco, C&A, Tommy Hilfiger, Calvin Klein, Zara, Abercrombie and Primark, signed the contract that will mandate independent safety inspections of factories, as well as cover the costs of repairs.

But Wal-Mart, the third largest public corporation in the world, and GAP and 12 other retailers in North America, refused to sign the accord. Wal-Mart also said it will conduct its own inspections of the 279 factories it uses in Bangladesh within six months and publish findings.

GAP, which is reported to offer the strongest opposition to the new plan, is said to be concerned that the agreement would entangle the company in legal cases filed by American lawyers on behalf of workers in Bangladesh and seeks reduced legal liability.

Wal-Mart, which has been independently conducting factory inspections in Bangladesh since Tazreen Fashions fire killed 112 workers last year, has rejected the agreement’s inclusion of “dispute resolution mechanisms”.

The two American companies are now working on their own independent safety plan, according to Women's Wear Daily.

Wal-Mart and other retailers have been discussing an agreement intended to improve labour conditions in Bangladesh since the April 24 collapse of the Rana Plaza factory that killed at least 1,127 and followed a series of deadly fires.

In 2011, several major western retailers, led by Wal-Mart, rejected a proposal made by a group of Bangladeshi and international unions that proposed a way to make Bangladesh's garment factories safer.

At the time, Walmart's representative said it was "not financially feasible ... to make such investments."

The inspections would have been funded by contributions from the $20 billion western brands make from the garment industry a year and the annual $1 trillion such retailers make per year in the global garment industry.