Disney, Wal-Mart, Sears used deadly Bangladesh factory

The garment factory in Bangladesh where 112 people were killed in a fire had been making clothes for Wal-Mart, Disney, Sears and other major global retailers some of whom say they thought they had stopped doing business with the place.

The apparent confusion underscored what some industry experts say is a major obstacle to improving factory safety in developing nations: Many retailers in the U.S. and Europe rely on such a long and complex chain of manufacturers, vendors and middlemen to keep their shelves stocked that it is difficult to keep track of where certain products are made.

Amid the blackened tables and melted sewing machines at Tazreen Fashions Ltd., an Associated Press reporter discovered clothes and account books Wednesday that indicated the factory was used by a host of U.S. and European retailers.

Among the items discovered: children's shorts with Wal-Mart's Faded Glory label, hooded sweaters marked "Disney Pixar," shorts with hip-hop star Sean Combs' ENYCE tag, and sweaters from the French company Teddy Smith and the Scottish company Edinburgh Woollen Mill. Sears was among the companies listed in the account books.

The tragedy is putting a spotlight on dangerous workplace conditions around the world, with no clear answers to how consumers should react or who is ultimately responsible.

Production without companies' approval

Wal-Mart said that it received a safety audit that showed the factory was "high-risk" and had decided well before the blaze to stop doing business with Tazreen. But it said a supplier had continued to use Tazreen without authorization.

When pressed for an explanation of how a supplier could use a factory without the retailer's approval and whether it happened often, Kevin Gardner, a Wal-Mart spokesman, did not directly address the issue in emails to The Associated Press.

Sears said it learned after the blaze that its merchandise was being produced there without its approval through a vendor, which has since been fired. Walt Disney Co., which licenses its characters to clothing makers, said its records indicate that none of its licensees have been permitted to make Disney-brand products at the factory for at least a year.

Retailers like Wal-Mart have contract clauses that require suppliers to disclose all factories and subcontractors producing merchandise for sale. But it's hard to crack down on unauthorized subcontracting, said Josh Green, chief executive of New York-based Panjiva, which tracks shipments for factories outside the U.S.

"The reality is you have to have round-the-clock monitoring of every aspect of the supplier's operations," he said. "It's just not feasible."

Green noted that subcontracting is pervasive as suppliers look for ways to cut costs.

"You have relentless pressure that consumers put on retailers and that retailers put on their suppliers to deliver lower and lower prices," he said. "And that pressure is a key reason why you see factories cutting corners."

'The labels are legally protected, but there are no similar laws to protect rights of the worker.' Charles Kernaghan, Institute for Global Labour and Human Rights

Bangladesh's fast-growing garment industry second only to China's in exports has long provided jobs and revenue for the desperately poor country, while turning out the low-priced products shoppers in the U.S. and other countries have come to enjoy. But the industry has a ghastly safety record; more than 300 workers have died in garment factory fires in Bangladesh since 2006.

Labour activists have seized on the blaze the deadliest in Bangladesh's nearly 35-year history of exporting clothing to argue that retailers must insist on more stringent fire standards.

Charles Kernaghan, director of the Institute for Global Labour and Human Rights, said nothing will change unless clothing companies protect workers as vigorously as they do their brands.

"The labels are legally protected," he said. "But there are no similar laws to protect rights of the worker."

Green said some companies are more conscientious than others in selecting factories. Some pick a manufacturer and do little or no investigation, he said, while others analyze factories' past infractions and pay monthly visits.

"There's a fundamental difference between companies who do the check-the-box approach and companies who are serious about due diligence," he said.

3 factory officials arrested

On Wednesday, police arrested three factory officials suspected of locking in the workers who died in Saturday's blaze on the outskirts of Dhaka. Police Chief Habibur Rahman said the three will be questioned. He said the factory owner was not among those arrested.

About 1,400 people worked at the factory, about 70 per cent of them women. Survivors said exit doors were locked, and a fire official said the death toll would have been much lower if the eight-story building had had an emergency exit.

The fire broke out on the ground floor, where a factory worker named Nasima said stacks of yarn and clothes blocked part of the stairway. Nasima, who uses only one name, and other workers said that when they tried to flee, managers told them to go back to their work stations.

"Everyone was screaming for help," Nasima said. "Total chaos, panic and screaming. Everyone was trying to escape and come out. I was pulling the shirt of a man. I fainted and when I woke up I found myself lying on the road outside the factory. I don't know how I survived."

Workers expressed support for the factory owner, Delwar Hossain. Mohammad Rajib said he is "a gentle man" who heeded workers when they protested for more pay and against rough treatment by some managers.

"He took action and fired some of them," he said. "He did not sack any worker. He told us: `You are my people. If you survive, I will survive."'