American Eagle splits with Walmart over Bangladesh
In mid-July, partly in response to public pressure, US garment manufacturer and retailer American Eagle Outfitters confounded media observers by signing on to the international Accord on Fire and Building Safety for Bangladesh, a compact among more than 70 international retailers, the bulk of the ready-made apparel industry that represents 80% of Bangladesh’s economy
Until that announcement, media reports had lumped American Eagle in with the Walmart-associated resisters -- more than a dozen major US garment makers and brands that balked at joining the global accord and even snubbed it for requiring legally binding financial commitments to raise Bangladesh standards.
The same day it had clearly lost American Eagle, the Walmart group – including such brands as J.C. Penney, Target, Menomonee Falls-headquartered Kohl's, Macy's, Sears, Gap and Nordstrom – revealed its voluntary and curiously similarly named effort (the Alliance for Bangladesh Worker Safety). Cover was provided this rival concept through US retailer trade groups by promises that respected former US senators George Mitchell (Democrat) and Olympia Snowe (Republican) would facilitate further discussion.
But this Walmart coalition is being roundly criticized by the international human rights community and many garment industry insiders as diluted, nonbinding and a publicity move to allow US companies, unlike the global accord, to slowly bail out of Bangladesh because of costs to shareholders – much as Disney on its own has already done by saying “financial feasibility” would cause it to leave Bangladesh rather than improve circumstances.
Charles Kernaghan, executive director of the respected Institute for Global Labor and Human Rights, noted in interviews that the Walmart contingent’s resistance was based on “union animus,” a fear of helping Bangladesh workers organize to improve their “horrifying wages” -- $38 a month for full time pay, which experts say is only half of basic living wage in this Third World country. The resistance, he suggested, was fear that legally binding improvements for workers would help unions organizing those workers.
When American Eagle joined the European accord, it took pains to say it welcomed all efforts to help garment workers (which technically included the Walmart group) but pointedly preferred the accord that required financial commitment and legal teeth. "Our company has a reputation of good behavior toward our workers and we made a decision based on what seemed right to us,” said American Eagle corporate spokesman Iris Yen in a July 16 interview, citing the company’s website promotion of its own self-monitoring efforts in Bangladesh dating back a decade.
Yen said it was internal discussions that brought the decision, declining to address the claims of bending to pressure from Unite Here, a union that flooded 40 American Eagle outlets for weeks with petitions demanding meaningful action.
Bangladesh has grown into a major player as well as a major stain on the global apparel market, now standing third behind China and India in ready-made apparel manufacturing.
When the collapse of Rana Plaza in Bangladesh April 24 killed 1,127 workers and maimed 2,500 more crowded into five rickety substandard garment factories built haphazardly atop each other, it was the worst tragedy in international garment history.
The Rana Plaza was the culmination of decades of factory fires, building collapses, exposes of sweatshops and noted US brands plucked out of the rubble. But until Rana Plaza, few consumers understood how this tiny but densely populated country crammed between gigantic India and troubled Myanmar (Burma) had grown into so gigantic an economic force in the garment world. Nearly 4 million of its residents (90% women) work at carts or machines in these factories.
Individual brands have tried to reassure concerned US shoppers by announcing internal standards, product chain inspectors and “Standards for Safety” (a Walmart policy of red-listing substandard factories). But the problem has grown so huge that self-monitoring pledges are producing skepticism from consumers as well as international unions and major human rights groups such as the International Labor Rights Forum. While such groups loudly support the European accord and openly snicker at the Walmart version, their spokesmen point out that neither approach directly addresses the real problem – raising those low wages by pressure on the Bangladesh government and increased payments for garment work.
Many garment employees are actually children or young adults working 50-60 hours a week, sewing and assembling garments– and often let go when their speed slows down at age 28 or 30, quickly replaced by ever younger, more desperate workers, Kernaghan notes.
It is this endlessly available exploitable youth able to sew tirelessly that makes Bangladesh so attractive to the global industry. This was captured in a famous image from a sweatshop photo made into an 8-by-9 foot tapestry by artist Terese Agnew. Created over two years totally out of thousands of clothing labels cut out of closets and sent to her (a social movement in itself) the Portrait humanized the plight of Bangladesh workers. After Rana Plaza, it rose out of Brooklyn storage to anchor the new Museum of Wisconsin Art, now on exhibit through January, 2014, at 205 Veterans Ave. in West Bend -- much as it anchored the Columbus Circle opening in 2008 of Manhattan’s prestigious Museum of Art & Design. Agnew, featured on PBS as one of American’s major fabric artists, has now turned her own website – tardart.com -- into a fundraiser for Bangladesh garment workers and a way for consumers to complain to companies resisting the major binding accord on building and safety standards.
In the Walmart pact, individual retailers can voluntarily pledge capital so factories found in violation can make safety renovations. By contrast, the European accord obligates companies to ensure their factories have the capital to make necessary repairs.
There are other major differences. The European pact -- two years in development -- is legally binding on the signers and puts the financial responsibility on improving factory conditions on the retailer rather than the supplier. The Walmart accord – cobbled together in reaction to Rana Plaza – has a hidden factor behind the voluntary pledge of $42 million to improve Bangladesh plants. It is up to retailers to provide low-interest loans if they find abuse but they can also walk away – even into another low-wage country.
While Walmart has brands familiar in the US in its pact, it has lost to the other accord such US retail giants as Abercrombie and Fitch and PVH (whose brands include Tommy Hilfiger, Calvin Klein, and Izod) as well as, now, American Eagle. The larger accord has bound together H&M, the Swedish company that buys the most apparel from Bangladesh, Europe’s largest clothing retailers Hennes & Mauritz and Spain’s Inditex as well as British Primark and Tesco and the Dutch C&A.
Workers rights groups support this larger accord as “positive” but concede it is “belated.” They agree with Kernaghan that even a forward-looking safety accord is dancing around the edges of the basic problem – but with a pragmatic purpose, noted UNI Global Union’s leader Phillip Jennings: “A binding accord improving safety and building standards establishes the circumstances and pressure to raise living conditions and pay for workers.”
Geographically closer to Bangladesh, Europeans and Asian makers of garments are perplexed at the US holdouts, pointing out the strong legal precedents in the US if those companies want to resist foreign pressure on their corporate behavior. Anna Gedda of H&M, a driving force in the accord along with Uni Global Union, the world’s largest federation of garment employees, notes that a binding legal accord “only seems a concern to the Americans” while most garment companies recognize that in the wake of Rana Plaza “nothing less than absolute commitment would be believable.”
Kernaghan, who is burning up the air-miles from the US to Bangladesh developing relief efforts and pushing for deeper involvement by officials as well as workers, feels the Walmart contingent is relying on remoteness -- 8,000 miles of distance and consumer indifference to the plight of Third World workers. He points out how America galvanized around its own garment horrors a century ago – Manhattan’s Triangle Shirtwaist factory fire – to change US labor laws to eradicate child labor, locked fire doors and mandate eight-hour days and overtime. In a YouTube video he recounts amazing similarities between New York City more than a century ago and today’s Bangladesh garment factory abuse.
Dominique Paul Noth served as senior editor for all feature coverage at the Milwaukee Journal after decades as its film and drama critic, then was appointed special assistant to the publisher and the company’s first online producer. For the past decade he was editor of the Milwaukee Labor Press and website, milwaukeelabor.org. He now writes as an independent journalist on culture and politics.
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