Loblaw to compensate victims, families of Bangladesh factory collapse

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TORONTO – Grocery giant Loblaw Companies Ltd. (TSX:L) says it will provide long-term financial assistance to the victims and families affected by a deadly factory collapse in Bangladesh in April.

The company said Thursday the compensation will go to those who worked at the New Wave Style factory, which produced clothing for Loblaw’s Joe Fresh clothing line. The company will also pay three months in wages to workers until the longer term funds kick in.

The New Wave Style factory was one of five manufacturing plants in the Dhaka plaza that collapsed, killing more than 1,100 workers on April 24.

Loblaw did not disclose the total compensation amount.

In addition, the company has joined with British clothing retailer Primark to provide financial assistance to workers of all retailers in the factory plaza.

“Should the other brands not step forward and join in this funding, we will join Primark and immediately contribute to the payment of three months wages for the approximately 3,600 individuals involved, regardless of the brand apparel that was being produced in their workplace,” said Bob Chant, Loblaw’s senior vice-president of corporate affairs and communications.

The company has previously donated $1 million to Save the Children Bangladesh and the Centre for Rehabilitation of the Paralysed, to help those in the country’s garment industry.

This latest announcement marks the six-month anniversary of the deadly factory collapse, which has been called the industry’s worst disaster.

Following the accident, Loblaw signed a five-year pact to improve fire and building safety in Bangladesh.

Several other big retailers have also signed the pact including Benetton, trendy Swedish fashion chain H&M, C&A of the Netherlands, British retailers Tesco and Primark, and Spain’s Inditex, owner of Zara.

The agreement requires that the companies conduct independent safety inspections, make their reports on factory conditions public and cover the costs for needed repairs.

The companies that agreed to the pact join two other retailers that signed the contract last year: PVH, which makes clothes under the Calvin Klein, Tommy Hilfiger and Izod labels, and German retailer Tchibo.

Working conditions in Bangladesh’s garment industry have come under increased scrutiny in recent years. Since 2005, at least 1,800 workers have been killed in the Bangladeshi garment industry in factory fires and building collapses, according to research by the advocacy group International Labor Rights Forum.

It came months after a fire in another garment factory in Bangladesh in November killed 112 workers.

— With files from the Associated Press

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