WASHINGTON — Labor and human rights groups working with organizations in Bangladesh and their own staffs on the ground there said they have found more labels and turned up the names of seven factories that subcontracted work to the Smart Export Garment Ltd. factory, where seven garment workers died in a fire over the weekend.
This story first appeared in the January 30, 2013 issue of WWD. Subscribe Today.
The fire, which also injured at least 15 workers, has sparked protests in Bangladesh and calls for action and change by U.S. and international labor rights groups. It follows on the heels of the Tazreen factory fire in late November that claimed the lives of more than 111 garment workers in Ashulia, Bangladesh.
The staff of the Institute for Global Labor and Human Rights in Dhaka interviewed a supervisor at Smart Export, who identified seven factories that allegedly subcontracted work to Smart Export. All seven factories are reportedly members of the Bangladesh Garment Manufacturers and Exporters Association.
The factories identified by the supervisor include Mrinmoy Fashion Ltd., Concord Fashion Export, Shintex BD Ltd., Syntex Knitwear Ltd., Energy Pac Fashion Ltd., MHC Apparels Ltd. and Mac-Tex Industries.
“There are apparently a lot of these sweatshops and subcontracting factories operating in Bangladesh and receiving work from more established factories, which was the case here,” said Barbara Briggs, assistant director at the Pittsburgh-based Institute for Global Labor and Human Rights. “The question now is are the labels whose production were there going to take any responsibility?”
“Retailers know very well that the demands they place on suppliers cannot be met without subcontracting, but they turn a blind eye,” said Scott Nova, executive director of the Worker Rights Consortium. “This allows them to take advantage of the cheap costs these shady subcontract factories offer, at the expense of worker rights and worker safety, while maintaining deniability. When a disaster occurs, they claim they are shocked to discover that unauthorized subcontracting was going on.”
The Bangladesh Center for Worker Solidarity and Worker Rights Consortium said they have discovered more labels and/or apparel at Smart, including the label Okay Men, produced by Kik, a German apparel and nonfood discounter; Mim, a French retailer and women’s apparel and accessories brand, which is a subsidiary of New Look, and Max, a retail chain in the Middle East owned by Landmark Group.
A spokeswoman for Kik denied the company used Smart Export in an email early Wednesday morning.
“The accusations against us which are related to the recent and tragic events in a suburb of Dhaka are incorrect,” she said. “We have never had any business relationship with Smart Export Garment Ltd. Furthermore there is noevidence that orders were sub-contracted to Smart Export Garments Ltd. We explicitly reject contrary statements.”
However labor groups provided WWD with documents and digital images of labels said to be found in the rubble of Smart Export, including an “Okay Men” label, which is produced by Kik.
The Kik spokeswoman also said the company has held “exploratory discussions” with a coalition of labor and human rights groups pressing retailers and brands to sign a binding “Bangladesh Fire and Building Safety Agreement,” she said. The company is also considering cooperating with the International Labor Organization, BGMEA and the Buyer’s Forum, a group of large international trading companies, to address the fire safety issues in Bangladesh’s garment industry.
She added that Kik also plans reach an “appropriate agreement” and participate in the relief fund for victims of the separate Tazreen fashion fire in November.
The two other retailers have not responded to an inquiry for comment.
Other labels and documents found and previously reported by labor groups include Bershka and Lefties, owned by Inditex Group; the Sol’s label owned by Paris-based Solo Invest; the Fox & Scott label registered to Sylvain Scemama in Paris, and swimwear brand Hawaiian Authentics, produced by New York-based M. Hidary & Co. Inc.
Richard Levine, an executive with M. Hidary & Co., said, “We have no association or production at the Smart Export factory in Bangladesh. We are looking into how a document may have gotten there. We work hard with our manufacturing partners to make sure that they abide by safety codes so incidents like this are avoided.”
However, labor groups provided WWD with several documents they said were found at Smart Export after the fire. Among them was a purchase order on M. Hidary & Co. letterhead for units of its men’s swimwear “Hawaiian Authentics” brand. The purchase order, made in August last year, listed the order being placed with a factory named Fashion Store Ltd. It also names the vendor as Grace Fashion Ltd.
Spain’s Inditex SA, the owner of the Zara retail chain, said Monday it has terminated its relationship with two suppliers over suspicions they illegally subcontracted some of their business to the Smart factory. A spokesman also denied having dealings with Smart and said the company has sent a team to Bangladesh to investigate.
According to a Bangladeshi news report on Tuesday, State Minister of Labor and Employment Begum Monnujan Sufian said the government will inspect at least 500 unlicensed garment factories in the next two weeks to check for fire safety compliance.