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Wal-Mart and the deadly Bangladesh fire

November 27, 2012 - Harry Eagar
According to a wire story in The Maui News, Wal-Mart is "distancing" itself from the fire in which more than 100 employees of one of its suppliers were killed.

A statement claimed Tazreen was no longer authorized to sew for Wal-Mart but had done so via a subcontractor "in direct violation of our policies."


One of the things I carried away with me from 40-plus years of business reporting was an anecdote about the Wal-Mart store in Ames, Iowa. A college professor of business writing a magazine article about Wal-Mart (whose founder got his start peddling shirts in Iowa) asked the manager of the Ames Wal-Mart to turn on the exterior lights of his store shortly before sunset in order to provide the magazine's photographer with a showier background.

The manager said he couldn't turn his own lights off or on. "That's controlled from Bentonville," he said.

Do I believe Wal-Mart did not know who was sewing its shirts in Bangladesh? Not in one million years.

UPDATE, Nov. 28

The fire has emboldened lots of commenters to talk about Wal-Mart. One of the more incisive comments comes from the Washington Post's Harold Meyerson, who delves into Wal-Mart's culture of deniability:

"But the very essence of the Wal-Mart system is to employ thousands upon thousands of workers through contractors and subcontractors and sub-subcontractors, who are compelled by Wal-Mart’s market power and its demand for low prices to cut corners and skimp on safety. And because Wal-Mart isn’t the employer of record for these workers, the company can disavow responsibility for their conditions of work.

"This system isn’t reserved just for workers in faraway lands: Tens of thousands of American workers labor under similar arrangements. Many are employed at little more than the minimum wage in the massive warehouses in the inland exurbs of Los Angeles, where Wal-Mart’s imports from Asia are trucked from the city’s harbor to be sorted and packaged and put on the trucks and trains that take them to Wal-Mart stores for a thousand miles around.

"The warehouses are run by logistics companies with which Wal-Mart contracts, and most of the workers are employed by some of the 200-plus temporary employment companies that have sprung up in the area — even though many of the workers have worked in the same warehouses for close to a decade. Last year, the California Department of Industrial Relations, suspecting that many of these workers were being cheated, charged one logistics company that runs a warehouse for Wal-Mart with failing to provide its employees with pay stubs and other information on their pay rates. Wal-Mart itself was not cited. That’s the beauty of its chain of deniability."

The whole thing is worth reading.


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