CCC: KIK to pay fair compensation to Pak factory victims

01 Nov '12

3 min read

The Clean Clothes Campaign (CCC) calls on the German textile discounter KIK to pay a fair and just compensation for all the victims of the garment factory fire at Ali Enterprises in Pakistan. The immediate relief payments that KIK promised are urgently needed and welcomed, but the amount pledged covers less than 4% of what ultimately will be needed.

According to recent press articles KIK is presently offering an amount of 500.000 US$ for immediate relief to the victims of a fire that broke out September 11th at jeans manufacturer Ali Enterprises in Karachi and killed at least 318 workers.

Lars Stubbe from the CCC Germany says in regard to the KIK offer: "The CCC appreciates that one month after the tragedy KIK as the main buyer and as one of Europe's leading textile discounters finally is taking some responsibility for immediate relief. This first offer is seen as a part of a substantially higher payment of compensation. CCC urges KIK to come to an agreement with local trade unions and labour rights groups to ensure that the entire amount due will be covered and prevention measures implemented."

CCC believes that the offer of 1 million US$ in total (500.000 US$ for immediate relief and 500.000 US$ for the longer term that KIK confirms over email they are willing to make) is far too small. Conservative calculations based on international standards and good practice indicate that at least 20 million Euro's (about 25.8 million US$) will be needed for fair and just compensation, covering damages as well as loss of income, for the families of all deceased. On top of that medical costs and compensation for the injured will need to be paid.

CCC appreciates that KIK has consulted credible local organisations on the distribution of the money for immediate relief and trusts that the funds are disbursed transparently and quickly to the suffering victims. However an agreement between KIK and the key local trade unions and organisations involved, including those consulted so far, on the entire amount due by KIK and on the implementation of prevention measures is still outstanding.

“Immediate relief payments are urgently needed and welcomed, in particular to the families of the unidentified death who so far have received no compensation at all” says Ineke Zeldenrust of the international Secretariat of the CCC commenting KIKs’ activities. “Initial payments can at a later date be deducted from the total amounts due.”

It seems that the moment though KIK is trying to pay off the terrible deaths of 318 workers who were producing their jeans with a cheap offer. They can easily afford to pay much more: 1 million US$ corresponds to less than 0,05 % of their annual sales.

KIK has repeatedly stated publicly that the cause of the fire needs to be investigated. But up to date the company itself has done little to clarify its role, or to contribute to a full public investigation. . The CCC urges KIK yet again for more transparency, by fully declaring the history and nature of its relationship with Ali Enterprises, by disclosing all of the audits undertaken by UL Responsible Sourcing (on behalf of KIK) and by providing the names of all other buyers producing clothes at Ali Enterprises.

The Clean Clothes Campaign (CCC)

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