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Exposé Reveals Wal-Mart Blocked Improvements Despite Vows to Improve Safety After Deadly Factory Fire

StoryJanuary 03, 2013
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Wal-Mart has vowed to improve safety problems among suppliers who make clothes for the company after at least 111 workers died in a deadly fire at a Bangladesh garment factory. But inspection reports found inside the facility underscore fundamental problems with how Wal-Mart’s supply chain allows it to avoid improving conditions. “One of the main monitoring companies, inspection companies for Wal-Mart, admitted that 'We don't even check whether factories have emergency exits, whether they have fire escapes or fireproof, smoke-proof enclosed staircases.’ And this factory did not have outdoor fire escapes, did not have enclosed staircases,” says Steven Greenhouse, labor and workplace reporter for the New York Times about his latest investigation, “As Walmart Makes Safety Vows, It’s Seen as Obstacle to Change.” [includes rush transcript]

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StoryNov 27, 2012Bangladeshi Labor Activist Finds Burned Clothes with Wal-Mart Labels at Site of Deadly Factory Fire
This is a rush transcript. Copy may not be in its final form.

JUAN GONZÁLEZ: We turn now to new revelations in the fire that killed at least 111 workers in a garment factory in Bangladesh used by several Wal-Mart suppliers. It was the worst industrial accident in the country’s history. First, we turn to the voices of some of the young women seamstresses who escaped the inferno late last November, on a Saturday night, as they rushed to meet holiday orders from overseas customers.

PARUL BEGUM: [translated] How the factory fire caught, I don’t know that. But when we heard “Fire!” we all rushed and were trying to get out of the factory. The factory worker broke a window, and one of the workers pulled me through the window. Immediately after the fire broke, we tried to run out, but the door was locked. When the floor became dark because of smoke, the boys rescued me.

NILMA: [translated] When the building caught fire, I didn’t know, and many of us didn’t know, because soon after the fire, the total floor was full of smoke, and we couldn’t see anything then. And there was a chamber. We ran there, and all the workers broke the windows of the chamber, and we all could get out through that window.

JUAN GONZÁLEZ: Survivors said an exit door at the factory was locked, fire extinguishers didn’t work, and that when the fire alarm went off, their bosses ordered them to stay at their sewing machines. Many victims were trapped or jumped to their deaths from the eight-story building, which had no emergency exits or fire escapes. More than 50 of the bodies retrieved were burned so badly they could not be identified. And reports showed—a document posted on Tazreen Fashions’ website indicated that an “ethical sourcing” official for Wal-Mart had flagged “violations and/or conditions which were deemed to be high risk” at the factory.

AMY GOODMAN: Aftter the fire, Wal-Mart said it fired the suppliers that subcontracted work to Tazreen Fashions and that they were using the factory without its approval. But critics say inspection reports discovered in the Tazreen factory, which were obtained by the New York Times from a labor rights group, underscore fundamental problems with Wal-Mart’s supply chain in Bangladesh, allowing it to avoid addressing safety problems.

Shortly after the fire, Democracy Now! spoke with Kalpona Akter, a labor organizer with the Bangladesh Center for Worker Solidarity, who visited the factory and took pictures of the charred clothing labels she found there, including the Wal-Mart brand Faded Glory.

KALPONA AKTER: Now, after burning and, you know, 112 or 120 workers dead, they cannot just wash their hands and say that, “OK, we will not do any business with them.” They have to be with this factory and improve the safety standards in that factory. That is our demand.

AMY GOODMAN: Well, for more, we’re joined by the reporter following much of this. Steven Greenhouse has been the labor and workplace reporter for the New York Times since October 1995, where he has long covered Wal-Mart as part of his beat, including an exposé of how Wal-Mart stores in the United States locked in their workers at night. His latest piece on the fire at Wal-Mart’s supplier in Bangladesh is called “As Walmart Makes Safety Vows, It’s Seen as Obstacle to Change.”

Steven Greenhouse, welcome to Democracy Now! It’s good to have you back. Lay at your findings. What most surprised you?

STEVEN GREENHOUSE: So I worked with our reporter in South Asia, Jim Yardley, and we found several surprising revelations in investigating Wal-Mart’s relationship with this Tazreen factory. First, we obtained a series of inspection reports that showed that over nearly a year Wal-Mart suppliers continued doing work in this factory, even though it was found to, you know, have many serious safety problems. Each report found a lack of fire extinguishers. Several reports found lack of smoke detectors. There was a lack of fire alarms and firehose pipes on the factory’s fourth and fifth floors. Each report found, you know, partially blocked access to exit routes.

One of the big revelations we found in our investigative report was that one of the main monitoring companies, inspection companies for Wal-Mart, admitted that “We don’t even check whether factories have emergency exits, whether they have fire escapes or fireproof, smoke-proof enclosed staircases.” And this factory did not have outdoor fire escapes, did not have enclosed staircases. It had three staircases which all led down to the ground floor where the fire had begun. So, you’re really screwed if you’re in a factory and have to go the down the staircases that lead right to where the fire was.

Another revelation we found was that while the CEO of the company, Mike Duke, gave a major address at the Council on Foreign Relations saying that “We, Wal-Mart, will not use unsafe factories,” it turns out that the company’s head of ethical sourcing sent a letter around to other retailers two weeks earlier saying, you know, we must—you know, “We acknowledge that our audits, our inspections, are inadequate on fire and electrical safety.” I think this dovetails with what this inspection company said, that “We don’t even check for fire” —

JUAN GONZÁLEZ: Well, Steve, we actually have—we actually have a clip of the Wal-Mart president and CEO, Mike Duke, speaking in New York last month. He was greeted by protesters who were upset, in part, about the deadly Tazreen factory fire. This is Bloomberg L.P. President Dan Doctoroff introducing Duke at a meeting hosted by the Council on Foreign Relations.

DANIEL DOCTOROFF: I want to, first of all, congratulate all of you for making it through the enthusiastic crowds outside. I’m told that the last person who received such a welcome was Muammar Gaddafi. But—

JUAN GONZÁLEZ: And here’s a comment Wal-Mart President and CEO Mike Duke made during his interview, responding to a question about anger over the lack of fire safety at its suppliers, like the Tazreen factory.

MIKE DUKE: Over the recent years, Wal-Mart has made the factories in Bangladesh and in other countries around the world safer, particularly in this area of fire safety. You know, back a few years ago, I’d say in 2010, we had a very serious focus in Bangladesh on fire safety. As a matter of fact, in 2010, we had 94 factories that we stopped doing business with, we decertified, and said we would no longer have products produced in those particular factories. I believe we had 23 other factories that corrected and moved up their standards in the area of fire safety and made some progress with some other factories. In 2011, there was even more progress made, and we worked with other organizations and other retailers to raise the bar, and did a tremendous amount of training across the country. I believe over 3,000 factories went through the training that was developed, including fire safety and the standards even for the associates to know, and then, in 2012, even raising the bar more with even additional audits and additional focus.

You know, and unfortunately, you know, this particular factory was one of the ones that had been decertified and was one that Wal-Mart did not use as an authorized—you know, I will tell you that the particular supplier, when we found out had used an unauthorized factory, we took swift action. We terminated our relationship with that supplier, would no longer purchase any product. But with all of that, we’re still stepping back again and saying, “What else can we do?”

JUAN GONZÁLEZ: Steve Greenhouse, your response to this, Wal-Mart’s claim of its efforts to assure safety in Bangladesh?

STEVEN GREENHOUSE: Wal-Mart is taking some efforts not to use unsafe factories, but a lot of critics, both here in the United States and in Bangladesh, say it’s not doing nearly enough. You know, while it might have left 94 factories that it deemed unsafe, then, again, the critics say, it goes to other factories that are often also unsafe. And if Wal-Mart—if a Wal-Mart inspector finds a factory unsafe, it usually takes at least 18 months, or three “orange” ratings over 18 months, over two years, for Wal-Mart to exclude the factory. And some critics say Wal-Mart kind of plays a shell game. It’s in these factories for a year or two, until they’re deemed safe, and then it will go to another factory.

In 2010, Juan, there where two very bad factory fires in Bangladesh, one in which 21 died, one in which 29 died, including people jumping from the eighth and ninth floors, just like the Triangle Shirtwaist fire in New York City in 1911, where 146 people died about a mile or two from here.

AMY GOODMAN: Also young women.

STEVEN GREENHOUSE: Also young women, absolutely. And one thing that amazed me and disappointed me in investigating the Tazreen, you know, factory is that we have all these American companies doing business in Bangladesh in factories that don’t have some of the most basic, basic, you know, safety mechanisms, like fire escapes, like enclosed staircases. And I wonder how companies say, “We only want to use safe factories,” when, you know, anyone who knows the least amount about factory safety will say—especially in as flammable a place as an apparel factory, will say we need—you know, “You need fire escapes. You need enclosed staircases.”

Also, after the horrific fires in 2010, there was an emergency meeting held in Bangladesh in April 2011 where labor groups, Bangladesh government people, Bangladesh manufacturers, Bangladesh NGOs, and retailers like Wal-Mart, Sears, Target participated. And we obtained the minutes of the meeting. And there, Wal-Mart spoke out against proposals for the Western retailers, the deep-pocketed retailers, to really finance the needed corrective actions to ensure fire safety in the factories. Wal-Mart said, “We just—you know, it’s not financially feasible. We can’t afford it.” People I’ve interviewed said it wouldn’t really cost that much to make the 4,500 factories safe. They estimate it would cost about $3 billion over five years, $600 million a year, which is just like 3 percent of the cost of the annual amount of export—garment exports. So that would just raise, you know, like a $20—you know, it would raise the cost of, say, a $20 shirt by a few cents.

JUAN GONZÁLEZ: And the importance of Bangladesh to the world production chain of garment—especially in the garment—in garments to Sears, to Targets, to Wal-Marts, all these major companies?


STEVEN GREENHOUSE: We often think that China is, you know, the humongous exporter of garments. And it is, but more and more companies, apparel companies, are leaving China and sourcing instead in Bangladesh. Bangladesh is now the world’s second-largest exporter of apparel. It exports $19 B-billion worth of apparel, you know, for Wal-Mart, for Target, for H&M, for Tommy Hilfiger.

You know, an interesting thing now is that Tommy Hilfiger—you know, the parent company of Tommy Hilfiger, PVH, and this German retailer, Tchibo, have embraced a really important plan to try to assure factory safety. They have promised to, you know, really pay for the needed factory improvements at various garment plants and have independent inspectors look at the plants. And if the inspectors find that the safety situation is adequate, then these companies will step up and pay for the improvements. They’re saying, “It’s just two of us. We won’t really make this plant operational until we get two other companies to join us.” And they’re pushing very, very hard for Wal-Mart and other companies to join them.

You know, Wal-Mart—you know, Mike Duke says Wal-Mart is a leader in factory safety. People point to this April 2011 meeting where Wal-Mart, you know, as the 800-pound gorilla, so to speak, in many ways blocked an important plan. I think of the movie Lincoln, where Lincoln says, “I am clothed in immense power.” And I often think Wal-Mart, in the world of retailing and the world of apparel, is clothed in immense power, and Wal-Mart really has the ability, if it wants, to really turn things around, to be a game changer in Bangladesh. And it wouldn’t cost the company that much, and it could save many, many lives.

AMY GOODMAN: As you write, Steve, “Walmart buys more than $1 billion in garments from Bangladesh each year, attracted by the country’s $37-a-month minimum wage, the lowest in the world.” Thirty-seven dollars a month. What about union organizing in Bangladesh? Of course, we can ask about it when it comes to Wal-Mart in the United States, as well.

STEVEN GREENHOUSE: You had Kalpona Akter on. She’s an impressive, very active union organizer. She heads the Bangladesh Center for Worker Solidarity. You know, there is a workers’ movement in Bangladesh. There was a big fight two, three years ago to raise the minimum wage, which I think was just $20, $25. They got it all the way up to $37, which is still quite, quite low. There’s a lot of ferment in Bangladesh. There’s a lot of resistance to unionizing individual plants. One of the nation’s foremost union organizers, Aminul Islam, was found murdered six, eight months ago. My colleague Jim Yardley did a very moving story about his death, and his piece points to perhaps government folks or business folks perhaps hiring someone to murder him. And I think, as we see sometimes in the United States, a lot of workers in Bangladesh are scared to stick their necks out and support a union, because they might get in trouble, they might get fired.

AMY GOODMAN: Finally, as we wrap up, we did invite Wal-Mart on, as we did in our previous segments. They didn’t come on. But you have said Wal-Mart is calling on factory owners to make fixes, but people say owners are on razor-thin margins because the company pays such low prices, so they can’t pay for the corrections.

STEVEN GREENHOUSE: Yes. When Jim Yardley and I researched the article, you know, we spoke to some factory owners, and they say, “We are paid such low prices by Wal-Mart and other Western buyers, Western retailers, that we can’t afford the, you know,$500,000, $300,000 in investments in fire escapes and in enclosed staircases.” And they say the folks with the big pockets should be doing this. And, you know, Wal-Mart has called on the Bangladesh government to get more aggressive in doing inspections and to phase out, close down—

AMY GOODMAN: Five seconds.

STEVEN GREENHOUSE: —unsafe plants. And Bangladesh, you know, is so eager to attract business, it’s probably not going to become a very tough policeman.

AMY GOODMAN: We want to thank you for being with us, Steven Greenhouse, the New York Times. We’ll link to your article there.

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