Business 10th Edition by Ferrell,Geoffrey Hirt,Linda Ferrell

Exercise 11

Bangladesh Factory Disasters Prompt Better Safety Standards
Tragedies in Bangladesh are causing retailers to rethink how they approach worker safety in the factories from which they outsource. A fire at one Bangladesh factory killed 112 workers, and a building collapse at another factory killed more than 1,100 workers. In response many of the companies that use factories in Bangladesh are joining together with IndustriALL, a global federation of unions, to ensure safe working conditions. The proposal, crafted for the purposes of global agreement, requires that companies conduct and pay for safety inspections, publish the results, and have money set aside for any necessary renovations. These measures are estimated to cost each company about $500,000 per year.
Approximately 70 companies are included in the agreement, and it covers approximately 1,000 factories in Bangladesh. If a factory is found to have insufficient safety mechanisms, operations will be put on hold and workers will be sent home with pay until the repairs are made.
While this agreement was tailored for a global audience, many American companies are wary of joining the collaborative effort. Walmart and Gap are cautious because the agreement would make them vulnerable to unrestricted liability and potential lawsuits. Instead, the two companies are drafting their own set of safety standards to address unsafe factory conditions. While most of their initiatives are similar to those of the IndustriALL pact, they stop short of committing to financing necessary renovations. Supporters of the pact say that this last requirement is the enforceable part of the solution and that without it, there is no meaningful proposal. 66
Describe some ways that IndustriALL will improve worker safety.