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Wal-Mart Draws Protests in Bangladesh

Workers took to the streets to criticize the global retail giant for not doing enough after retailer unveiled sourcing policy changes.

Hours before Wal-Mart Stores Inc. began meetings with its clothing suppliers from the U.S. and Canada on Thursday to explain sourcing policy changes unveiled this week, apparel industry workers in Dhaka, Bangladesh, took to the streets to criticize the global retail giant for not doing enough.

This story first appeared in the January 25, 2013 issue of WWD.  Subscribe Today.

Garment workers held up posters and said that they expected compensation from Wal-Mart for those killed or injured in the deadly Tazreen factory fire in late November, which took the lives of 111 people. The police were on high alert, and workers also demanded the owner of the factory be arrested.

“We don’t want a zero tolerance approach from Wal-Mart,” said Salim Hussein, an industry worker who joined the protest. “We want much more than that — we want to receive higher wages for the living, we want compensation for the dead.”

The workers have been growing irate over the lack of compensation to the survivors of the fire and the approach by the Bangladesh government, which they say has been supporting the factory owner who should be held accountable for the death and injuries of workers.

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The reaction has been pouring in as workers discuss Wal-Mart’s zero-tolerance approach to subcontracting that was revealed Tuesday. The new policy would go into effect on March 1, replacing the previous one, where a supplier was given three chances to correct mistakes. Wal-Mart has also said that a mandatory employee stationed in countries where suppliers subcontract would go into effect to ensure a higher level of compliance.

Brooke Buchanan, communications director at Wal-Mart, said the retailer had planned to meet with suppliers when it sent them a letter outlining its new policy on Tuesday. “We said we’d have a first supplier summit with apparel manufacturers in the U.S. and Canada,” she said. “We’re meeting to talk through the policy.”

Asked if the retailer plans to meet with suppliers in other countries, Buchanan said, “We’re working on setting those up. This is the first of many.”

Workers in Bangladesh said Wal-Mart needed to “show more responsibility” as inspection reports at the Tazreen factory showed that the retailer was aware of fire safety violations for more than a year.

Among the other recommendations in Wal-Mart’s new policy is a special package of measures for Bangladesh, which include a strengthening of processes and protocol for fire safety in the country. To this end, active facilities will be reviewed and corrective action taken within a 30-day period.

The fact sheet issued by Wal-Mart noted that “although a global approach was necessary, there would be heightened attention to the risks specifically related to building structures in Bangladesh.” Other measures include a requirement that new facilities be qualified before being made active, suppliers would need to have a company representative in each country to ensure compliance, enhanced fire safety standards in all countries, and facilities that have fire safety-related violations must initiate corrective actions immediately, with repairs completed no later than 30 days after being identified.

Hasan Tarique Chowdhury, a lawyer and worker solidarity activist, said Wal-Mart’s zero-tolerance approach may only exaggerate problems in Bangladesh.

“Workers are not sure if Wal-Mart is doing good or bad,” Chowdhury said. “Wal-Mart policies needs to be more transparent for the workers. What workers would really like is to know how much they are paying the workers in international markets, and how much they pay in developing countries like Bangladesh. Workers are becoming more conscious of international labor markets and terms and conditions set out by [such groups as] the United Nations and the International Labor Organization.”

Rokeya Kabir, chairwoman of the Association of Development Agencies Bangladesh, said the Wal-Mart approach was “bureaucratic.”

“They should have a joint program with the workers on this situation,” Kabir said. “They should increase the margins that they are offering to the workers and make sure the environmental costs are taken into consideration.”

Roy Ramesh Chandra, chairman of the Bangladesh National Council of Textile Garments and Leather, said, “The company will have to take responsibility for their part and give compensation to the workers for the loss of future earnings.”

Most union leaders are clear that they don’t want to lose any business in the $20 billion industry and are willing to work out solutions that would please both sides.

“Just include us in the process,” said Dalia Khan, a labor activist.