Loblaw announced today it will provide long-term compensation to victims and their families in the Rana Plaza garment factory collapse in Bangladesh that killed more than 1,100 workers six months ago.
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The company will also pay three months' wages to all workers at New Wave Style, the company that makes its Joe Fresh clothes. The money "will assist in financial needs until long-term funds begin to flow," Loblaw said.
Loblaw did not disclose the total compensation amount. The minimum wage for garment workers in Bangladesh is $38 a month.
The factory made clothes for Loblaw and other companies in the clothing industry.
Loblaw said it supports a proposal by U.K. clothing retailer Primark for funding compensation to clothing-factory victims. It also encouraged other brands that had clothing manufactured at Rana Plaza to take part.
"Should the other brands not step forward and join in this funding, we will join Primark and immediately contribute to the payment of three months' wages for the approximately 3,600 individuals involved, regardless of the brand apparel that was being produced in their workplace," Loblaw's Bob Chant said in a statement.
An investigation by CBC's the fifth estate found earlier this month that dangerous working conditions remain widespread in the Bangladesh garment industry.
The industry continues to supply major retailers in Canada such as Loblaw and Wal-Mart.
Brad Loewen, the Winnipegger hired by a consortium of retailers, unions and watchdog groups that have signed an accord to improve fire and building safety in Bangladesh factories, was optimistic Thursday about the task of actually making changes.
"Yes, I think we have quite a large hammer, in that the brands who are the signatories to the accord will refuse to do business with factories that do not comply," he told CBC News. "And I think that's going to be a huge incentive to comply."
Loewen will be responsible for the inspection of 1,750 factories in Bangladesh and has taken the job for a five-year term.
This latest announcement marks the six-month anniversary of the deadly factory collapse, which has been called the industry's worst disaster.
Following the accident, Loblaw signed a five-year pact to improve fire and building safety in Bangladesh.
Several other big retailers have also signed the pact including Benetton, trendy Swedish fashion chain H&M, C&A of the Netherlands, British retailers Tesco and Primark, and Spain's Inditex, owner of Zara.
Calvin Klein, Izod
The agreement requires that the companies conduct independent safety inspections, make their reports on factory conditions public and cover the costs for needed repairs.
The companies that agreed to the pact join two other retailers that signed the contract last year: PVH, which makes clothes under the Calvin Klein, Tommy Hilfiger and Izod labels, and German retailer Tchibo.
Working conditions in Bangladesh's garment industry have come under increased scrutiny in recent years. Since 2005, at least 1,800 workers have been killed in the Bangladeshi garment industry in factory fires and building collapses, according to research by the advocacy group International Labor Rights Forum.
It came months after a fire in another garment factory in Bangladesh in November killed 112 workers.