Walmart and the Illusion of Safety

Following a host of workplace
tragedies in Bangladesh, Labour rights unions, NGOs and the ILO met with
business interests in Germany on April 29, 2013 and outlined an agreement with
respect to fire and building safety for the Bangladesh region[1].
Roughly 50% of factories in Bangladesh don’t meet legal safety requirements[2].
This agreement is significant in that it would bind the companies that sign on
to the accord to satisfy their safety commitments under the agreement.

Among other things, the accord
is said to provide for improved inspections, training, transparency and dispute
resolution. Labour groups involved in the agreement also successfully included
mechanisms that would require employers to step up and pay more to suppliers in
order to secure living wages for the workers. The agreement would go a long way
toward protecting Banagladesh workers from future calamities. Signing the
agreement is voluntary. Yesterday was the deadline set for retailers to join
the agreement. At least 24 retailers have signed on.  

Despite there being broad recognition that safety
and living wages are crucial to the development of a workplace culture that
protects and values the lives of workers, not all major retailers are on side. The
most notable dissenter, unsurprisingly, is Walmart. Walmart asserts that it has
its own fire and safety plan that goes beyond the goals set by the agreement[3]. This
may be true, but before anyone applauds Walmart for its plan, it’s worthwhile
to note that its plan has some stark differences from the agreement. Perhaps
most importantly, t
he Walmart
plan is not legally binding[4]. Factories
that fail to follow the so-called safety plan designed by Walmart will face
extremely limited consequences, if any at all. Of the options available to
Walmart, this one is clearly on the inadequate end.

If Walmart truly
cared about workers, there are proactive steps the company could take to
protect workers, even while refusing to sign the agreement. One measure that
would send a clear message to any factory that refuses to abide by safety plans
would be to limit business with the factory. Such a negative impact on the
bottom line of any factory could not but encourage compliance with safety
measures. But Walmart has shown no signs it would enact any such kind of
enforcement mechanism. Despite the company touting that its plan imposes more
stringent fire and safety standards than the agreement crafted in Germany, if
there is no enforcement mechanism Walmart’s plan is potentially worthless.
Walmart could promise the most comprehensive protection of workers’ rights in
its plan, but if there’s no incentive for the factories to abide by the plan,
nothing will improve.

In fact, the plan
might even end up benefiting factories that don’t abide. The factories that
don’t enact the safety requirement in the plan will keep their costs down. From
a bottom line perspective, there’s a danger that Walmart may prefer these
companies to those that would cut into costs by attempting to protect
workers.  In short, the regrettable
likelihood is that the Walmart plan is simply business as usual. We can only
hope the agreement and the international attention the conditions have garnered
will foster an environment welcoming of unionization in Bangladesh.

Walmart is the
world’s largest retailer and could have taken a leading role in these
discussions, protected workers and created a workplace safety culture that
would ripple across the region. While Walmart has demonstrated its
unwillingness to show regard for Bangladesh workers, the companies that have
signed on to the safety accord may yet provide the first step toward making up
the safety deficit left by Walmart. If workers with new protections are able to
parlay the recent interest in workers’ rights in the region into unionization,
future tragedies may yet be prevented. A large union presence has been
repeatedly proven to elevate conditions for all workers. For those workers
employed in factories that supply Walmart the collateral effect of unionization
across the region could be their best chance to see the implementation of true
safety standards. If Walmart won’t sign the agreement to give workers improved
conditions the least the company could do is take away the carrot from
companies who undermine those conditions.


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