Business

Friday 25 July 2014

Penneys pays more compensation to Bangladesh factory victims

Emma Thomasson

Published 24/10/2013|10:35

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Penneys plans to link its protected Mary Street store, featuring the original dome, with a nearby new office building it owns. The flagship Dublin store was
built in 1905 and only recently underwent a major refurbishment. The brand continues to expand with its mix of up-to-date fashions and cheap prices
Penneys

Primark will make another compensation payment to victims of the Rana Plaza factory disaster in Bangladesh.

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The discount clothing chain, which operates as Penneys in Ireland, is calling on other international brands to follow suit.

The collapse of Rana Plaza on April 24 that killed 1,129 people has galvanised some of the clothing industry's big names to try to improve safety standards at suppliers but they have failed to agree on a compensation fund for victims despite months of wrangling.

Worker rights groups have accused wealthy western producers of evading financial responsibility for a disaster that highlighted the gruelling and poorly paid conditions in which millions of Bangaleshis work.

Primark, the only retailer that sourced from the factory to pay compensation so far, said it would pay out for the third time to workers or their dependents from New Wave Bottoms, the supplier that was producing clothing for the chain. It had some 550 workers at the factory at the time of the collapse.

The chain, owned by Associated British Foods, also said it was pressing ahead with plans to pay long-term compensation to the 550 in the New Year despite the lack of an industry-wide agreement.

"Primark is calling on other brands involved in the Rana Plaza disaster to make a contribution by paying short-term aid to some 3,000 workers or their dependents who made clothes for their labels," it said in a statement.

About 3.6 million people work in Bangladesh's clothing industry, making it the world's second-largest clothing exporter behind China, but some of the workforce, which is mostly female, earn as little as $38 a month. About 60 percent of garment exports go to Europe and 23 percent to the United States.

The International Labour Organisation has been coordinating talks to try to get an agreement on setting up long-term funds for Rana Plaza workers and for victims of a fire at the Tazreen factory in November 2012, which killed 112 workers.

ANNIVERSARY VIGIL

IndustriALL and UNI, two global trade unions that have been involved in the process, are planning a candlelit vigil at sundown at Rana Plaza to mark the six-month anniversary.

"Survivors and victims' families at Rana Plaza today remembered their loved ones and all ask the same question: When will we finally receive compensation for our loss?" the unions said in a statement.

Many of the 28 brands supplied from Rana Plaza have shunned the attempts to set up a fund, with some saying their production was outsourced to the factory without their knowledge, while others say they prefer to pursue their own compensation plans.

Advocacy groups, the Clean Clothes Campaign (CCC) and the International Labor Rights Forum, noted that Canada's Loblaw Cos Ltd had also committed to provide short-term relief, while Italian retailer Benetton and Spanish chain El Corte Ingles were participating in attempts to establish a fund.

They said Zara-owner Inditex, Britain's Bonmarche and Mascot of Denmark had signalled their intent to contribute to a fund, but said scores of other brands were doing too little.

"It is time that all brands linked to the tragedies step up and ... pay into the fund, and thereby take financial responsibility for a disaster that they failed to prevent," said Ineke Zeldenrust of the CCC.

A group of North American retailers and apparel makers set up after the disaster has already completed inspections of more than half of Bangladesh garment factories with whom they do business in an effort to improve fire and building safety, the group said this week.

Reuters

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