Primark meets its commitments to long-term compensation for Rana Plaza victims

17 March 2014 

  • $9.0 million long-term payments start to pay out to Primark supply chain workers  
  • Additional $1.0 million payment made to non-Primark supply chain workers, taking total aid  to non-Primark workers of some $3.0 million 
  • Brings total aid and payments to $12 million

Primark is today announcing that it will begin making long-term payments to the 580 workers (or their dependents) of Primark supplier, New Wave Bottoms, which occupied the second floor of the eight storey building, who died, or were injured as a result of the Rana Plaza building collapse in Bangladesh. The payment will be met in full, in cash, directly by Primark and will amount to some $9.0m. Payments will begin week commencing 17 March.

Primark is also today announcing a further payment of $1.0m to workers in its competitors’ supply chain.  This money will be paid to the Rana Plaza Donors Trust Fund (Trust Fund) chaired by the International Labour Organisation (ILO) for distribution.  This is in addition to the some $2.0m which Primark has already distributed to these workers, or their families.

This brings the total that Primark is paying to the victims of Rana Plaza to some $12 million.

Following a very constructive meeting with the ILO in Geneva last week, Primark is making the long-term payments, for purposes of recognition, as compensation under the auspices of the Coordination Committee of the Rana Plaza Arrangement.

In the immediate aftermath of the collapse of Rana Plaza, Primark promised that it would meet its responsibilities in full and that it would pay long-term compensation to the workers, or their dependents, employed in New Wave Bottoms.  Primark has worked diligently with local partners in Bangladesh over an eleven month period to establish a rigorous, sustainable approach to compensation.  It has also liaised closely with the ILO throughout.

Payments are being delivered to victims through the BRAC and Bkash banks, the mechanism used for the distribution of short term financial assistance.

Primark’s work has involved medical and vulnerability assessments, with payments to the injured awarded in the light of these medical assessments. Assessments have been carried out with the support of Dhaka University Institute of Vulnerability Studies and Disaster Management, Dhaka University Medical College, doctors from Complejo Hospitalario Universitario Juan Canalejo (La Coruna, Spain), The Bangladesh National Women’s Lawyers Association, and Naripokkho, Primark’s NGO implementation partner.  Primark would like to thank all these institutions for their support over a lengthy period.

Payments will be made according to the impact of the injury and level of disability resulting from the collapse, and in the case of the dependents of the deceased and missing workers, according to actuarial estimates of lost earnings. Primark also seeks to address the vulnerability of those receiving payments, and their capacity to control and manage large sums of money.  This work is being carried out by The Bangladesh National Women’s Lawyers Association and Naripokkho who will offer, and manage on behalf of Primark, direct assistance and on-going support to vulnerable victims and beneficiaries.

Primark has decided to pay out now to ensure that the New Wave Bottom workers, and their dependents, are paid in full within 12 months.  No further payments should be required for the workers at New Wave Bottoms. Primark’s payments are in addition to the short-term financial assistance provided by Primark for all other workers at Rana Plaza.

In the event that qualifying workers, from New Wave Bottoms, have not yet registered  with Primark, for whatever reason,  Primark confirms its intention to leave both its short term financial assistance and this long-term scheme  open for payments.

A Primark spokesman said:

“We are announcing today that we are paying a total of $12 million as a result of the collapse of the Rana Plaza building in Bangladesh. Within a week of the collapse, Primark committed to paying long-term compensation to the workers of Primark supplier, New Wave Bottoms, as quickly as possible.  Since then, we have been working to enable the payments to be made.

“With the first anniversary of Rana Plaza fast approaching, we are determined to meet this responsibility to workers in our supply chain.  We are therefore pleased to be in a position to now press ahead with payments.

Primark has also tried to minimise the hardship caused by delay in long term compensation payments reaching all the victims. For that reason we have paid short-term financial assistance equivalent to nine months wages to all 3,600 Rana Plaza workers, most of whom were making clothes for our competitors. We have also announced today a $1.0m payment to the Rana Plaza Donors Trust Fund.

We support the International Labour Organisation in urging other retailers sourcing from Rana Plaza to donate to the Trust Fund, so that it can pay out in full to the remaining victims.”

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