Bangladesh deadly fire and multinational corporations


This video is called Labor conditions put into question after Bangladesh fire.

By Peter Symonds:

Global retail giants and the Bangladesh factory fire

7 December 2012

The Bangladeshi garment factory fire that killed at least 112 workers on November 24 has given a glimpse into the murky and obscure relations between global retail giants such as Walmart and the thousands of unsafe sweatshops in Bangladesh and other poor countries that produce their products.

After the fire, Walmart immediately sought to distance itself from the Tahzreen Fashions factory, in the Ashulia industrial zone north of the capital Dhaka. After its Faded Glory brand was discovered in the burnt-out factory, Walmart blamed its supplier, saying the company was not authorised to produce at Tahzreen Fashions.

Documents found by the Bangladesh Centre for Worker Solidarity show that at least five of Walmart’s suppliers sourced goods from the Tahzreen Fashions factory at some time this year. In a telephone interview this week with Bloomberg, Walmart spokesman Kevin Gardiner admitted that there was a “period in 2012 where the factory was active,” though it was “de-authorised months before the fire.”

Walmart and other transnational corporations are, of course, desperate to deny any responsibility, because a great deal is at stake. Entire corporate departments are devoted to “ethics”, designed to protect each company’s public relations image, head off potential legal action and ensure that profits do not suffer.

Walmart and Sears Holdings say they have now sacked the suppliers that used the Tahzreen Fashions factory. Dismissing individual suppliers or factories, however, simply means switching manufacture to other suppliers and plants that are likely to be just as unsafe.

According to the Wall Street Journal, Walmart sources garments worth more than $1 billion a year in Bangladesh, where labour is cheaper than in other low-cost platforms such as China and Sri Lanka. When it comes to quality, supply times and cost, the retail giant rigorously polices every detail. When safety is the issue, Walmart establishes guidelines and conducts occasional factory audits, but insists that it is the responsibility of suppliers to use approved factories.

In reality, manufacturers in Bangladesh, operating on tight profit margins and deadlines, often cut corners—farming out work to other factories and slashing costs, including on safety. One garment manufacturer told Reuters sub-contracting was “a very common practice”. He explained: “Walmart goes to the lowest bidder, so manufacturers have to work on high volumes, but no one can find enough compliant factories to fulfil the orders, so they subcontract.”

These multi-layered relations, running from transnational corporations to suppliers to manufacturers or manufacturing groups to subcontractors, provide what is known in the world of intelligence agencies as plausible deniability. Corporate giants such as Walmart are aware of the sweatshop conditions required to manufacture their goods at the cheapest price, but choose to turn a blind eye so as to deny responsibility if anything happens.

Scott Nova, executive director of the Washington-based Workers Rights Consortium, commented to the New York Times: “It was not a single rogue supplier as Walmart claimed—there were several different US suppliers working for Walmart in that factory. It stretches credulity to think that Walmart, famous for its tight control over its global supply chain, didn’t know about this.”

Nor is it a question of one rogue factory. According to Kalpona Akter, executive director of the Bangladesh Centre for Worker Solidarity, some 50 percent of the country’s garment factories do not meet the government’s very basic, legally-required work safety standards that include emergency exits and fire extinguishers. The Tahzreen Fashions fire began on the ground floor, trapping hundreds of workers in the floors above.

Walmart’s real attitude to factory safety in Bangladesh was indicated at a meeting convened in April 2011 in Dhaka when it was asked to pay higher prices in order to finance safety improvements, set out in a contractually enforceable memorandum. Walmart’s director of ethical sourcing, Sridevi Kalavakolana, reportedly refused.

The stance taken by Kalavakolana and her counterpart at Gap was contained in minutes obtained by Bloomberg. “Specifically to the issue of any corrections on electrical and fire safety, we are talking about 4,500 factories and in some cases very extensive and costly modifications would need to be undertaken to some factories. It is not financially feasible for the brands to make such investments,” they told the meeting.

The Workers Rights Consortium has pointed out that factory costs represent a small part of the sale price of a garment—about $4 on a $20 shirt. The cost of safety renovations and training programs could add 2.5 percent to the factory cost, which would increase the retail price to $20.50 for the shirt.

Two other companies—PVH Corp, which owns the Tommy Hilfiger brand, and German retailer Tchibo—eventually signed the memorandum earlier this year. After negotiations, according to Scott Nova, Gap refused to sign, objecting to the higher prices, public disclosure of the Bangladesh factories involved and the legally binding character of the memorandum. Instead, Gap announced its own more limited four-part plan on safety.

Walmart spokesman Gardner refused to comment on the Dhaka meeting, other than to tell the New York Times, that Kalavakolana’s remarks were taken “out of context”.

Even if all four corporations had signed the memorandum, improvements in safety standards would be marginal. Manufacturers are under intense cost pressures in the cutthroat competition for contracts. Edward Hertzman, who runs the trade magazine Sourcing Journal, told Reuters that the factory certification process was often cosmetic. “A lot of times factories find ways to get around these certifications. Everything looks kosher on the day of the audit, but they are really not up to par,” he said.

An essential role in maintaining the charade of corporate concern about workers’ conditions and safety is played by various government bodies, trade unions and non-government organisations in Bangladesh and the US, which maintain the illusion that transnational giants can be cajoled and pressured to ensure the “ethical sourcing” of their products.

Just as retailers switched from countries like China and Sri Lanka, if costs rise in Bangladesh, items would be sourced in other countries with even lower wages and fewer restrictions on the exploitation of the working class.

Bangladesh officials admitted on Friday that the Tazreen garment factory in which 112 workers lost their lives had its fire safety certification taken away five months before the blaze: here.

At least 13 workers, including two women, died and many others were injured in a devastating fire that erupted at the five-storey Appco Bangladesh plastics factory in Dhaka’s Mirpur 1 district on Saturday afternoon. It took about 20 fire trucks three hours to extinguish the blaze, which is believed to have been caused by an exploding gas cylinder in a ground floor boiler room. Fuelled by plastics and other high flammable material, the fire rapidly spread throughout the building: here.

22 thoughts on “Bangladesh deadly fire and multinational corporations

    • Hi Waldo, I don’t know Peter Symonds personally, so I am not sure what he has read and has not read.

      P.T. Bauer was made Baron Bauer by Margaret Thatcher. Maybe Peter Symonds would say that Baron Bauer read too much Thatcherite ideology and not enough critical analysis about how capitalism works in pracrtice as opposed to Thatcherian theory.

      As Baron Bauer died in 2002, I am not sure his work is directly relevant to this 2012 deadly Bangladesh factory fire. I am not sure that he ever wrote about factory fires.

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        • In the very article which we are discussing, Peter Symonds quotes the Wall Street Journal. I would be extremely surprised if Rupert Murdoch would agree with socialism (or with laws against phone hacking or against burglary, for that matter).

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    • Yes Rebecca! One should hope that the workers’ movement in Bangladesh will manage to enforce better safety measures; so that so many people will not have to die in a factory fire again.

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  1. Pingback: Indian musician Ravi Shankar dies | Dear Kitty. Some blog

  2. Friday, 28 December 2012

    Police fire rubber bullets and teargas at Savar workers

    At least 50 people were injured as garment workers clashed with police in Savar on the main road between Dhaka and Aricha in Bangladesh on Monday.

    Police said when the workers of DNS garment saw closure notices hanging on the factory gate located in the Rajphulbaria area they staged a demonstration in front of the factory demanding wages they are owed.

    Later, workers took to the street and put up a barricade on the road, to block traffic for an hour from 11am.

    Police fired rubber bullet and tear gas shells to disperse them. The workers responded by throwing bricks.

    Policed then chased workers and injured 50 of them.

    A female garment worker was admitted to Dhaka Medical College Hospital with injuries.

    The incident was followed by at least 30 workers being injured in a clash with the police on Tuesday, when the workers of a sweater factory blocked the Dhaka-Aricha highway in Savar for about an hour, pressing for their arrears and reopening of the factory.

    Witnesses and the industrial police said that several hundred workers of DNS Sweater Ltd at Rajfulbaria blocked the busy Dhaka-Aricha highway in the morning demanding arrears and reopening of the factory.

    The workers also threw bricks and stones at the police. At least 30 workers were injured in the clash..

    Workers said the management of the factory have kept it closed since December 15 without assigning any reason and notifying the workers.

    They also said that they were yet to get their wages for November.

    The workers demanded wages for November and December and immediate reopening of the factory.

    Ashulia industrial police deputy director Ali Ahmed Khan said the management of the factory assured the industrial police of paying the wages to the workers on January 10, 2013.

    Meanwhile, Jasim Khan from the Department of Labour rejected over 450 applications for Trade Union registration during last three years.

    The garment owners subsequently sacked over 250 worker leaders who submitted those applications to DoL.

    The DOL has only 149 registered union work places for the garments sector despite the workers’ desire to join trade unions in over 5000 factories across the country.

    Of the 149 factories that accept trade unionists, 125 are in Dhaka and remaining 24 are in Chittagong.

    Most of the registered trade unions were registered before the 1990’s.

    Nazma Akther, President of Sammilito Garments Sramik Federation (SGSF) said: ‘The DoL are not giving us new registration on the ground of many unmet conditions that are difficult to meet and are not legally required.

    ‘We from our federation have made applications for about 15 new trade unionists during the last two and half years but all of these applications have been rejected.’

    She said the trade union leaders are refraining from submitting new applications for unions because many of the factory leaders who submit applications lost their job during the period.

    Babul Akther, General Secretary, Bangladesh Garments and Industrial Workers Association (BGIWA) said that over 250 workers who had submitted applications to get their trade union registered with the DoL have lost their job during last two and half years.

    An investigation found documents on workers who had submitted union applications at the DoL lost their jobs from the factories concerned.

    Shahidul Islam of Bangladesh Nationalist Garments Sramik Dal alleged that Elie Fashion sacked Alamin and Jostsna Akther and threatened them with severe consequences if they talked to the media about their sacking.

    Amirul Haq Amir President of National Garments Workers Federation (NGWF) said ‘We can not protect workers who file applications for unions. So we are not submitting any applications.’

    When asked, Bangladesh Garments Manufacturers and Exporters Association (BGMEA) President Shafiul Islam Mohiuddin denied the allegation that they had stopped any workers joining trade unions, he also rejected the fact that many workers leaders have been sacked.

    Over 250 pregnant female workers have been sacked from different garments factories during last three years, leading trade unionists alleged.

    A few garment factories are paying maternity leave and related benefits but most garments factories are not complying with the guideline of the the Bangladeshi government’s minimum wage board.
    Nazrul Islam Khan, Secretary General of Bangladesh Institute of Labour Studies (BILS) said one of important issues for all working women is her right to maternity benefit.

    But, in Bangladesh the majority of women workers are deprived of this right for various reasons such as the weakness of relevant rules/acts a lack of enforcement, the negative attitude of the employers, lack of awareness among women workers about this right, and lack of seriousness on the part of the government to implement and monitor the relevant laws at workplaces.

    Besides, garments factories which operate on a subcontract basis do not pay the minumum wage to their employees.

    The killing of a trade unionist is common in Bangladesh, the police itself filed around 85 cases against workers and trade union leaders during last three years for their alleged involvement in destructive activities and vandalism.

    Currently 30 RMG trade union leaders including Garment Workers Unity Forum (GWUF) president Moshrefa Mishu are on bail.

    The police filed cases against 18 thousand workers at Ashulia and another 5000 workers at Tejgaon in August and October 2010.

    The crucial role in ending the strikes is played by some trade unions, who struck a deal with the government and employers.

    The minimum wage was to be lifted to about $US43 a month, still well below the poverty line and just over half of what had been demanded originally.

    The workers would not dare to launch any fresh agitation against the wholesale degradation of their grades at many of the compliant factories.

    ‘We are afraid of further repression and job loss if we launch agitation at this moment,’ Towhidur Rahman, President of Bangladesh Apparel Workers Federation (BAWF) said.

    Babul Akther, General Secretary, Bangladesh Garments & Industrial Workers Federation (BGIWF) alleged that the repression of garments workers has turned wore than at any point of the history of the sector.

    Currently a clothing worker’s minimum average wage per hour in Bangladesh is just 21 US cents.

    Many workers, who have received no rise since 2006, simply cannot make ends meet with their present pay.

    http://wrp.org.uk/news/8242

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  3. Thursday, 10 January 2013

    ARREST FACTORY FIRE CULPRITS

    THE National Garment Workers Federation (NGWF) Bangladesh held a symbolic one-hour hunger strike last Friday and are taking continuous actions to establish garment workers rights.

    Their demands include the immediate arrest and trial of Tazreen Fashion’s owner and other culprits of factory fire, payment of wages, allowances and compensation to 15,000 workers of Hallmark Group, the placing and passing in Parliament of an amendment to the Labour welfare foundation act, a Labour law establishing a safe workplace in the garment sector and implementation of free trade union rights.

    Several hundred garment workers observed a symbolic hunger strike last Friday, January 4, demanding the immediate arrest and trial of Tazreen Fashion’s owner and other culprits for responsibility in killing of 112 workers in last November’s factory fire.

    Organised by National Garment Workers Federation (NGWF), the symbolic hunger strike was held in front of National Press Club in Dhaka city from 11am to 12noon.

    NGWF President Amirul Haque Amin presided over the programme, which was addressed by General Secretary Ms Safia Parveen, central leader Md Faruk Khan & Ms Sultana Akter.

    The speakers demanded publication of the list of workers who were killed in the Tazreen fire, arrangement of proper medical treatment for the injured and payment of compensation on the basis of ‘Loss of earnings’.

    The speakers demanded immediate payment of wages, allowances and compensation to 15,000 workers of Hallmark Group, which the owners closed down on October 10, 2012.

    The owner of Hallmark Group was arrested for a massive bank scam.

    In case of non-compliance with the demand, memorandum will be submitted to concerned ministries, including the Labour Ministry.

    Stressing the need for accepting trade union rights as a basic right of the Garment workers, the programme demanded implementation of this demand.

    http://wrp.org.uk/news/8272

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  6. Factory fire kills seven workers

    Sunday 27 January 2013

    by Our Foreign Desk

    A fire swept through a clothes factory in Bangladesh’s capital Dhaka on Saturday, killing at least seven women workers and injuring five others.

    The fire at the Smart factory occurred just two months after a blaze killed 112 workers in another factory near the capital, raising questions about safety standards and treatment of workers in Bangladesh’s £13bn garment industry that exports clothes to leading Western retailers.

    The country has more than 4,000 garment factories.

    A fire official said the fire’s cause was not clear but the government has begun an investigation into the blaze amid claims that the two-storey building’s only emergency exit had been locked.

    Doctors said most of the victims suffocated.

    Dhaka deputy police commissioner Monzurul Kabir said the bodies of seven women were recovered from the top floor of the factory in the city’s Mohammadpur area.

    It took about two hours for firefighters to bring the blaze under control, with volunteers pitching in as a large crowd gathered outside.

    More than 600 garment workers have been killed in factory fires in Bangladesh since 2005.

    http://www.morningstaronline.co.uk/news/content/view/full/128734

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