July 10 (Reuters) - Nearly 20 North American retailers including Wal-Mart Stores Inc and Gap Inc unveiled a 5-year safety plan for Bangladesh garment factories on Wednesday that would include inspecting every factory within a year.
The announcement in Washington by the Alliance for Bangladesh Worker Safety on Wednesday comes after 1,129 workers were killed in the collapse of a Bangladesh garment plant in April and another 112 people perished in November fire at a Bangladesh factory.
A separate safety plan including coordinated inspections was announced by a group of mainly European brands on Monday.
A few student protesters were outside the building in Washington, where the plan was announced. The group United Students Against Sweatshops handed out fliers, saying "Gap and Walmart: Bangladeshi Workers Reject Your Fake Safety Plan."
Funding for the North American plan is based on how much production each retailer has in Bangladesh; those at higher levels will pay $1 million a year for five years.
So far, $42 million has been raised for the project. Ten percent of the funds will be set aside to assist workers temporarily displaced by factory improvements or if a factory closes for safety reasons. The money will also support a non-governmental organization chosen to implement it. A decision on the NGO should come within 30 days.
The 17 current members of the alliance include: Canadian Tire Corp Ltd ; Carter's Inc ; The Children's Place Retail Stores Inc ; Gap; Hudson's Bay Co ; IFG Corp; J.C. Penney Co Inc ; Jones Group Inc ; Kohl's Corp ; L. L. Bean Inc; Macy's Inc ; Nordstrom Inc ; Public Clothing Co; Sears Holdings Corp ; Target Corp ; VF Corp ; and Wal-Mart.
Hong Kong sourcing company Li & Fung Ltd, which does business with many of the companies involved, is serving as an adviser. Additional members are expected to join in the future.
"The safety record of Bangladeshi factories is unacceptable and requires our collective effort," member chief executives said in a joint statement. "We can prevent future tragedies by consolidating and amplifying our individual efforts to bring about real and sustained progress."
Goals include developing common safety standards within three months, sharing inspection results, and getting factories to support the democratic election and operation of worker participation committees.
An independent board chairman, set to be named in the next few weeks, will oversee the plan. Four retailers and four others will also be on the board.
The plan, Bangladesh Worker Safety Initiative, was developed with assistance from former U.S. Senators George Mitchell and Olympia Snowe, who acted as independent facilitators at the Bipartisan Policy Center. The group has asked Mitchell and Snowe to verify the effectiveness of the program over at least the first two years.
Some companies are also set to offer a combined total of over $100 million in loans and access to capital to help factory owners improve safety.
The North American group's plan is being backed by the American Apparel & Footwear Association, Canadian Apparel Federation, National Retail Federation, Retail Council of Canada, Retail Industry Leaders Association, and the United States Association of Importers of Textiles & Apparel.
A larger number of mostly European retailers and brands backed a safety accord put together with the help of labor unions. The group behind that plan includes the world's two biggest fashion retailers, Inditex SA, owner of the Zara chain, and H&M. A small number of North American companies such as PVH Corp signed onto that accord.
Also on HuffPost:
PVH, the company that owns labels Calvin Klein, Tommy Hilfiger and Izod labels, initially made a commitment to factory safety in March 2012 and reaffirmed its<a href="http://www.pvh.com/investor_relations_press_release_article.aspx?reqid=1818634" target="_blank"> commitment after the Bangladesh factory collapse</a>, according to a company press release. PVH has pledged <a href="http://www.bloomberg.com/news/2013-05-14/h-m-inditex-joining-bangladesh-pact-pressures-wal-mart-retail.html" target="_blank">$2.5 million to the accord</a>, Bloomberg News reports.
German retailer Tchibo also <a href="http://www.huffingtonpost.com/2013/05/14/benetton-bangladesh-safety-pact_n_3272219.html?1368543349" target="_blank">signed on to the pact last year</a>.
Swedish retailer H&M became the first company in the wake of the Bangladesh building collapse to <a href="http://www.huffingtonpost.com/2013/05/13/hm-bangladesh_n_3265762.html?1368453479&utm_hp_ref=business" target="_blank">sign the safety pact</a>. The company said in a statement that it hoped the agreement would help lead to an "industry in which no worker needs to fear fires, building collapses or other accidents that could be prevented with reasonable health and safety measures."
Just hours after H&M made their announcement to sign on to the pact, Dutch retailer <a href="http://www.retaildetail.eu/en/eur-europe/eur-fashion/item/15151-hm-inditex-and-ca-sign-charter-for-safer-factories-in-bangladesh" target="_blank">C&A followed suit</a>.
Inditex SA, owner of the Zara chain, committed to the pact as well. A spokesperson told CNBC that "the accord has not come out yet, but as you know <a href="http://www.cnbc.com/id/100731788" target="_blank">we have played a very active part in its development</a>."
"For the multinational retailers like Tesco who source from Bangladesh, we must help it to <a href="https://www.tescoplc.com/talkingshop/index.asp?blogid=114" target="_blank">change in a positive way</a>, a way which sustains and improves the livelihoods of all those who work in the industry," Kevin Grace, director of Tesco, wrote in a blog post about the British retailer's decision to join the pact.
After initially <a href="http://www.huffingtonpost.com/2013/04/29/bennetton-bangladesh-factory-collapse_n_3179523.html" target="_blank">denying its ties to the collapsed Bangladesh factory</a> only to admit later that its <a href="http://www.dailymail.co.uk/news/article-2321843/Benetton-admits-clothes-illegal-Bangladesh-factory-collapsed-killing-900-workers.html" target="_blank">clothes were indeed made there</a>, Italian fashion brand <a href="http://www.huffingtonpost.com/2013/05/14/benetton-bangladesh-safety-pact_n_3272219.html?1368539289" target="_blank">Benetton committed to the pact on May 14</a>, according to a company spokesperson.
El Corte Ingles
The Spanish department store group El Corte Ingles said their suppliers signed on to the pact, Scott Nova of the Worker Rights Consortium told The Huffington Post.
Nova also confirmed that British retailer Next has signed on to the accord.
Primark, a British retailer that <a href="http://business.time.com/2013/05/02/bangladesh-factory-collapse-is-there-blood-on-your-shirt/" target="_blank">admitted some of its clothing was made at the collapsed factory</a>, was also one of the first retailers to <a href="http://metro.co.uk/2013/05/14/primark-hm-and-zara-sign-bangladesh-safety-agreement-3758237/" target="_blank">sign on to the pact</a>.
Mango, which was one of the companies that <a href="http://www.thedailybeast.com/articles/2013/04/30/jcpenney-mango-among-companies-that-used-fatal-bangladesh-factory.html" target="_blank">sourced products from the fatal factory,</a> agreed to the accord, a spokesperson told The Huffington Post.
Marks & Spencer
British retailer Marks & Spencer, which <a href="http://www.chicagotribune.com/business/sns-rt-us-bangladesh-building-safetybre94d0i3-20130514,0,3758384.story" target="_blank">sources from 60 factories in Bangladesh</a> according to the Chicago Tribune, committed to the accord on May 13.
The French retailer <a href="http://money.msn.com/business-news/article.aspx?feed=OBR&date=20130514&id=16476984" target="_blank">Carrefour</a> announced on May 14 that it would sign the accord, according to Reuters.
Loblaw Companies, the owner of Joe Fresh, committed to the accord on May 14 according to a statement emailed to The Huffington Post. The Canadian brand was <a href="http://business.time.com/2013/05/02/bangladesh-factory-collapse-is-there-blood-on-your-shirt/" target="_blank">manufacturing apparel</a> at the Rana Plaza factory, Time reports.
Abercrombie & Fitch
Abercrombie & Fitch verbally agreed to the accord on May 15, a company spokesperson confirmed to HuffPost.