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Alliance Seeks Closure of Five Factories in Bangladesh

The alliance said it will compensate 350 workers who will be temporarily laid off while the factory owners work to remediate the problems.

WASHINGTON — The Alliance for Bangladesh Worker Safety said Friday that four of five garment factories it recommended for immediate closure and remediation have been shut down by the Bangladeshi government because of serious building and fire safety issues.

An alliance spokesman, speaking on the condition of anonymity, confirmed that four factories have been closed and that a fifth factory will be inspected over the weekend.

The alliance, which includes Wal-Mart Stores Inc., Gap Inc., VF Corp. and Target Corp., said it will compensate 350 workers who will be temporarily laid off while the factory owners work to remediate the problems.

The alliance can only make recommendations to suspend operations of a factory and close it for remediation to a National Tripartite Committee Review panel. The review panel then makes a recommendation to the Bangladeshi Minister of Labor, which has the ultimate authority to close a factory, the spokesman said.

The tripartite committee is slated to make a site visit to the fifth garment factory this weekend and will issue a decision “shortly,” he added.

Inspections of the five garment factories turned up structural faults in the four buildings they are housed in, as well as “overloaded conditions…raising immediate concern for the safety of workers in these factories,” the alliance said.

The group said it will work in partnership with BRAC, a global development organization, to disperse funds directly to the workers displaced by the closure of the five factories. It will draw the money from a $5 million worker-safety fund that the companies set up at the launch of the initiative, following two factory and building tragedies in Bangladesh that claimed the lives of more than 1,240 workers in the past 18 months. The fund will help pay the workers’ salaries for two months, in partnership with factory owners.

“While no one wants to see employees out of work as a result of a factory closure, ensuring that immediate safety issues are addressed is our top priority,” said Ellen Tauscher, the alliance’s independent chair. “No factory worker should have to put themselves at risk to earn a living, and we’re working to make sure that is a reality in Bangladesh.”

Brands and retailers have agreed to funding and conducting the inspections and assisting in covering the salaries of displaced workers. Factory owners also have access to $100 million in capital to help finance the cost of factory improvements through the alliance.

The alliance said it has inspected 450 of the 650 garment factories its 26 member retailers and brands use in Bangladesh. Its goal is to complete inspections of all of the factories by July.

In separate news, the alliance said the government of Bangladesh has agreed to allow duty-free imports of fire and safety equipment into the country, following pressure from alliance members and six major trade associations calling for the elimination of the high duties.

In a letter to Bangladeshi Prime Minister Sheikh Hasina, the six industry groups said the high duties on safety-equipment imports made the difficult task of remediating unsafe factories “next to impossible.”

The Bangladesh government has agreed to eliminate duties on fire doors, which can be as high as 61.09 percent, and on sprinkler systems, which reach as high as 31.07 percent.

The U.S. Trade Representative’s office also said the Bangladeshi government revealed it is eliminating the tariffs at the inaugural meeting of the U.S.-Bangladesh Forum on Trade and Investment in Dhaka earlier this week.