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March 24, 2014

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Primark sets aside £5.4 million in compensation as factory collapse anniversary approaches

Primark has set aside £5.4 million to pay long-term compensation to 580 workers or their family members who were hurt or killed when an eight-storey building collapsed last year. 

The incident, which happened in April 2013, killed more than 1,100 people. In addition to the death toll, more than 2,500 people were injured in the disaster.

Last month, the global trade union IndustriALL called a meeting of some of the world’s largest retailers in Geneva to discuss a long-term compensation fund of $74.6m (£47.2m) for the workers injured in the disaster, and the families of those who died.

Rana plaza collapseDiscount clothing firm Primark, part of Associated British Foods, says it is about to start paying compensation to victims of the Rana Plaza disaster who worked for its supplier New Wave Bottoms.

The incident highlighted the topic of safety for workers in developing countries, with several large firms committing to boost standards and inspect conditions at their suppliers more often.

Primark is also putting a further £602,000 into the Rana Plaza Donors Trust Fund, on top of the £1.2 million it has already given to staff or their families in competitor supply chains who suffered in the incident.

The communal funding is being organised by the International Labour Organisation, a UN body, but it is thought to be well short of the £24.1 million target. Primark, one of the few names to say it has paid in, said it was “pleased” to be able to start making payments as the anniversary of the collapse approaches.

A spokesman said it had committed to paying the compensation “as quickly as possible” within a week of the collapse and had been working towards that since then. “We are determined to meet this responsibility to workers in our supply chain,” he said.

Following the incident Paul Lister, head of corporate governance at Primark’s parent company, Associated British Foods, spoke to the BBC, saying “a lot has been done” since the fire to improve standards, and that the events of April were a “huge tragedy”.

“We looked on in horror. We knew our clothes were in the building, and we accepted responsibility,” he said.

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