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Bangladesh collapse: Accord divides US, Europe retailers

H&M and other European retailers have signed a building and fire safety accord meant to improve conditions in Bangladesh garment factories in the wake of last month's deadly collapse. But major US companies, including the Gap and Wal-Mart, have not signed on. 

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People watch as a cable car is turned near a Gap retail store in San Francisco, California, May 8, 2013. The world's two biggest fashion retailers, Inditex and H&M, along with several other companies have backed an accord aimed at preventing another disaster like last month's Bangladesh factory building collapse. Gap has said it will not sign the agreement without 'modification to a single area – how disputes are resolved.'

Robert Galbraith/Reuters/File

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The Bangladesh factory collapse – the worst industrial accident in almost three decades – has galvanized concern about the safety of local garment workers, but it's driving a wedge between US and European retailers in terms of a response. Thus far, Europe stores are coming off smelling a little sweeter than American ones.

On Monday, Swedish clothing giant H&M, along with supermarket chain Tesco and Inditex (parent company of the Zara clothing stores), pledged to sign a legally binding agreement to improve safety conditions in Bangladeshi factories. The agreement, dubbed the Accord on Fire and Building Safety in Bangladesh, requires retailers in the world’s second-largest exporter of clothing (after China) to submit to third-party inspections and pay for repairs and safety improvements.

“The parties will be committed to the goal of a safe and sustainable Bangladeshi Ready Made Garment (RMG) industry in which no worker needs to fear fires, building collapses or other accidents that could be prevented with reasonable health and safety measures,” the company said in a Monday press statement. The Accord, designed for a five-year period, is a pragmatic step towards addressing improved fire and building safety in the RMG Industry.”

The accord is the product of an April 29 summit in Germany, in which retailers including H&M, Wal-Mart, J.C. Penney, and a slew of others met with labor rights groups in Germany to hash out ways to improve safety conditions in Bangladesh, according to the Associated Press. The country's unsafe labor conditions were at crisis levels well before the April 24 tragedy, which claimed at least 1,127 lives.

But US-based companies have been reluctant to sign on, for a variety of reasons.  According to a company statement issued yesterday, Gap was “pleased that an accord was in reach,” and  “ready to sign on [Monday] with a modification to a single area – how disputes are resolved.”

Gap was not among the retailers that subcontracted work to Rana Plaza, site of the fatal building collapse. 

Only one major US company thus far has signed the accord – PVH, which owns the Calvin Klein brand. Disney, meanwhile, has pulled its operations out of Bangladesh, a process it started last month.

Wal-Mart hasn’t said whether it will sign, though it intends to stay in Bangladesh. The retailer issued a statement Monday asking the Bangladeshi government to stop production at one factory, Stitch Tone Apparels, and inspect another, Liz Apparels, because company inspectors found various potential dangers, including structural problems.

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"The government of Bangladesh did the responsible thing last week by closing factories believed to be dangerous," Rajan Kamalanathan, vice president of ethical sourcing for Wal-Mart, said in a  press statement. "We call on them to show the same leadership in the Stitch Tone Apparels and Liz Apparels cases, and take any actions necessary to ensure safe conditions."

Gap, meanwhile, had become a prime target for those pushing for sweatshop reform in Bangladesh, even before it balked at the new agreement. Last week, as reported by Salon, the International Labor Rights Forum and United Students Against Sweatshops launched "Gap Deathtraps," a campaign urging the retailer to sign the agreement and turn its regulatory oversight over to a third party.

"Gap is a major producer in Bangladesh and labor groups are urging Gap to become an industry leader in factory safety," the site's entry page reads. "Gap was not a buyer at the sites of the most recent disasters – Tazreen and Rana Plaza – but their leadership could help prevent further tragedies from happening in the Bangladesh garment industry." 


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