Uniqlo Rejects Bangladesh Safety Agreement as Worker Unrest Spreads

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Uniqlo, the fourth-largest retail brand in the world, has gone the way of Walmart and refused to sign the Bangladesh safety agreement, opting instead to monitor its factories on its own.

“We want to first focus on what we can do right now, on our own,” Yukihiro Nitta, head of Fast Retailing’s Corporate Social Responsibility group told the Wall Street Journal. He said the company also will hire a Japanese company to assess the soundness of its suppliers’ factories in Bangladesh, noting that ultrasound and x-ray technology can be used to check for cracks in concrete and piping.

Most of the 30 companies who have signed, including Uniqlo’s rival H&M, are European. Meanwhile, American companies including Walmart, Gap, JCPenney, Sears and Target have all held out on the point that the agreement includes a legally-binding clause, one that they argue could hurt US companies more than their international counterparts. For Uniqlo, this isn’t the first time the company, owned by Japan’s Fast Retailing, has come under activist pressure. Earlier this year, the brand bowed to a cause to sign a detox pledge spearheaded by Greenpeace, in which the company agreed to stop releasing hazardous chemicals throughout its supply chain and products by 2020.[more]

While Uniqlo and other retailers go their own way, concerns for safety have propelled US government teams to visit Bangladesh to conduct their own evaluations and meetings with local authorities. George Miller, the top Democrat on the House Education and the Workforce Committee is currently in Bangladesh to personally inspect garment factories and meet with workers, victims, factory owners and government officials. Miller has been urging American companies with factories in Bangladesh to sign the building and fire safety agreement.

Despite the heightened attention on safety, local owners and managers have brought to light a root cause of the issue—a broken system where the cheapest laborers get the most business. Factory owner Adnan Bhuiyan told NBC News that it is extremely difficult to keep up with the minimum compliance because of costs. “Look, we make a particular brand of polo shirt, which they pay us $15 to make and they sell for $150. We only make five percent on that by the time we pay the bank, the workers and compliance costs.” Bhuiyan muses that while retailers may be pulling out of factories now over concerns, they won’t be gone for long. “What Bangladesh is providing is the highest craftsmanship with the lowest price tag, so I don’t think the buyers will go to another place to make their clothes.”

That small price tag is the motivation behind continued unrest in Bangladesh as workers continue to protest low wages and unsafe working conditions. According to a Reuters report, a Bangladesh factory where Walmart inspectors spotted cracks in the walls and ceiling is still operating and making shirts for the world’s largest apparel maker, US-based VF Corp, even after Walmart and Inditex stopped its operations there. The third-party inspector group which was hired by the building’s owner, Nassa Group, said the “consultant examined all the columns and beams on all floors and found ‘no significant or impermissible foundation settlement has taken place,’” according to Reuters.

Protest and violence have spread to Cambodia as well after a ceiling collapse in a factory that made Asics shoes killed several people. Nearly 3,000 workers protested over low wages in front of a major factory that produces for Nike. The workers are apparently demanding an additional $14 per month be added to their $74 minimum monthly wage. A confrontation with local police resulted in at least 23 people being injured, according to The New York Times. A Nike spokeswoman in the US said the company “requires contract manufacturers to respect employees’ freedom of association,” and that the company was investigating the allegations.

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