British clothing retailer Primark will start paying compensation to the Rana Plaza victims within this week.
The retailer will disburse $9 million to 580 workers (or their dependants) of New Wave Bottoms, one of the five garment units that were housed in the ill-fated Rana Plaza building.
“The payment will be met in full, in cash, directly by Primark and will amount to some $9 million,” the retailer said in a statement yesterday.
Primark is giving away the compensation only to the workers of New Wave Bottoms as the retailer used to source garments from this unit on the second floor of the building.
Besides this amount, Primark has already disbursed $2 million to the workers or their families immediately after the collapse of the building.
Another $1 million will go to a common fund -- Rana Plaza Donors Trust Fund -- where International Labour Organisation is the chair.
“This brings Primark's total aid and payments to $12 million,” the statement said.
Primark is distributing the money on its own although the retailer is one of the signatories in the Accord on Fire and Building Safety in Bangladesh initiated by IndustriALL, said Roy Ramesh, general secretary to the IndustriALL Bangladesh Council.
“Such a separate initiative by Primark may create problems in the whole compensation package,” Ramesh said, adding that a $40 million common compensation fund has been formed for the Rana Plaza victims. Many retailers have already paid to the fund, he added.
IndustriALL has recently sent letters to 150 signatory retailers and brands to contribute to the compensation fund as soon as possible so that the money can be distributed among the victims before April 24, the first anniversary of the collapse.
The retailer said: “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.”
Payments will be delivered to the victims through Brac Bank and Bkash accounts, Primark said in the statement.
Primark's work has involved medical and vulnerability assessments, with payments to the injured awarded in the light of medical assessments.
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 dependants of the deceased and missing workers, according to actuarial estimates of lost earnings.
"With the first anniversary of Rana Plaza collapse 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," a Primark spokesman said in the statement.
Primark has also tried to minimise the hardship caused by delay in long-term compensation payments reaching all the victims, the retailer said.
"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."