Britain’s second largest supermarket chain last night launched an investigation into allegations that workers who make its clothes in Bangladesh are being forced to work up to 80 hours a week for as little as 4p an hour.

Asda, one of three major discount clothing retailers accused of breaching international labour standards, said it would audit its suppliers in response to a report in today’s Guardian into the pay and conditions of Bangladeshi garment workers who supply British companies.

A spokesman for Primark, which also uses the factories, said Labour conditions were a matter of “considerable concern”.

Employees of factories making clothes for George at Asda, Tesco and Primark said their wages were so low that, despite working up to 84-hour weeks, they struggled to provide for their families. There were also reports of physical and verbal abuse by supervisors and of workers being sacked for taking sick leave.

All but one of the eight workers interviewed, from seven different factories, claimed they were forced to work 12-hour days and sometimes all night to finish an order. Workers from factories supplying all three retailers said they were refused access to trade unions and claimed that, in the last month, four colleagues had been dismissed for trying to organise a union.

Parvin, 25, a sewing machine operator making jeans for Primark, told the Guardian she felt “threatened and frightened” after witnessing a colleague being slapped by a supervisor for not meeting her target. Azizul, 28, who works in another factory producing items for Primark, said he had been sacked and his wages withheld for taking two days off to take his baby daughter to hospital.

The three retailers are among the most powerful clothing brands in Britain. Last year, a report estimated the country’s burgeoning value-clothes market to be worth 7.8bn. Asda was reportedly the biggest player with 17% of the market, Primark second with 15%, and Tesco fifth after Matalan and New Look with 11%.

The allegations of breaches in international labour standards follow similar claims last year.

All three retailers have signed up to the Ethical Trade Initiative, a voluntary code of conduct which sets out basic rights for employees, including a working week of no more 48 hours, voluntary overtime not exceeding 12 hours a week, and payment of a “living wage”. They say they are doing their best to improve workers’ rights.

However, one factory owner in Bangladesh, who only supplies to the US and German market, told the Guardian buyers gave him little choice but to keep wages low. Mohammed Lutfor Rahman, chairman of the Luman Group, said: “Buyers who come to Bangladesh tell us, ‘we are businessmen, we want to make money. If we see cheaper prices in China we will go there’.”

Mr Rahman added: “I would be the happiest man in the world if I could provide my workers with good money, air conditioning, health benefits. They are like children to me. But if I cannot cover the costs of running a factory, it will close.”

Charities campaigning for workers’ rights accuse retailers of maximising profits by demanding rock-bottom prices from suppliers in the developing world.

John Hilary, the campaigns and policy director of War on Want, said: “Price wars between the three retailers Asda, Tesco and Primark have driven the price of high street clothing down to 50% of what everyone else is charging. You have this relentless pressure on suppliers to keep costs down and, faced with these incredibly powerful retailers, suppliers in Bangladesh and China have no room for manoeuvre. Even the ETI have agreed that the buying practices of the UK retailer sector are driving down wages and having a negative effect on working practices.”

Mr Hilary said that factory audits were not reliable enough to ensure better conditions for overseas workers and called for British government regulation.

Yesterday, a spokesman for Asda said that it would re-audit all its Bangladeshi factories in the light of the Guardian’s findings. He added: “We find abuse of any kind unacceptable. It appears that one of our approved factories, which are audited up to three times a year, has subcontracted this work to another factory without our knowledge and against our wishes.”

Primark said that Labour conditions were a matter of “considerable concern”. In a statement it said that it had audited every one of its Bangladeshi suppliers in the last six months and had “agreed a programme of remediation” with those not complying with its code of conduct.

A spokesman for Tesco said it could not take any action because it was not provided with the names of the factories concerned. He said: “These allegations are serious but without being provided with any detail we cannot investigate them.” He added that Tesco had recently completed unannounced audits at all 48 sites in Bangladesh.

November 1, 2007 — Auto sales

GM sales may have risen 2.1 percent in Oc tober, marking three straight months of gains for the first time since 2004, while Ford’s could fall 16 percent and Chrysler might slide 7.9 percent, based on a Bloomberg survey. The automakers report re sults today.

Jones keeps up

Jones Apparel Group said third-quarter profit increased sixfold to $400.1 million, or $3.97 a share, after it sold Barn eys New York for $942.3 million in cash.

Wal-Mart

A federal appeals court refused to recon sider a decision that may lead to prison for Thomas Coughlin, the former Wal-Mart vice chairman who pleaded guilty in 2006 to steal ing from the company.

Jag bids

Ford expects to re ceive at least five sec ond- round bids for Jag uar and Land Rover this week, sources said. In dian carmaker Tata Mo tors and buyout firms One Equity, Ripple wood, and TPG are all expected to have made offers by tomorrow, said the sources.

Aon gone

Aon Corp., the world’s second-largest insurance broker, said it would cut 2,700 jobs in a restruc turing plan that will cost the company $360 mil lion before taxes.

Regal Rigas

The headquarters John Rigas built for Adelphia Communica tions as the company slid into bankruptcy drew a winning bid of $3.4 million after a three-week Internet auction. The 72,056 square- foot, three- story office building in Coudersport, Pa., boasts polished granite interi ors and space for 2,000 employees and is worth $30 million, said LFC Group of Cos.

Copyright 2007 Reuters. Click For Restrictions

The cash squeeze that brought Bear Stearns to its knees and prompted emergency aid from the U.S. Federal Reserve is fanning fears that other investment banks might be vulnerable to the crisis of confidence gripping Wall Street, causing sharp drops in the dollar and global stock markets Monday.

The U.S. currency - a barometer of investors confidence in the U.S. economy, the worlds largest - fell to its lowest level ever against the euro, with the European currency trading at $1.5904 before falling back slightly.

The dollar also fell as low as 95.72, its weakest level in nearly 13 years, raising questions about when the Japanese government would step in to protect its own fragile economy. Crude oil rose to a new high, just under $112 a barrel.

News early in the Asian business day that JPMorgan Chase agreed to pay just $2 a share to buy all of Bear Stearns, coupled with the Feds involvement in the bailout of the prestigious U.S. investment bank, unnerved investors. The acquisition underscored the severity of the credit crisis in the United States and the weakness of the American economy.

The Fed also lowered a lending rate to banks, another in a series of steps aimed to ease a credit crunch. It was an unusually timed move designed to shore up confidence as policy makers prepare to discuss a further cut in interest rates Tuesday.

“The fear is how many more skeletons in the closet are still there in the global credit markets?” David Cohen, an economist at Action Economics in Singapore, told Reuters. “This is another effort by the Fed to calm things down, but the cloud on the horizon is just how much more of these credit issues are still out there.”

Sentiment in financial markets has taken a turn for the worse over the past week. The liquidation of big funds like Carlyle Capital, problems at Bear Stearns and rumors of possible other problems on Wall Street have soured investor appetite across the globe. Repeated interventions by the Fed, as it pulls new tools out of its box with increasing frequency, has given only short-term relief to markets.

Stocks in Asias two emerging giants, China and India, suffered the biggest losses on Monday. The Shanghai A share market was down 3.6 percent in late trading, the Hang Seng index in Hong Kong was down 5.2 percent, and the Shenzhen A share market was down 6.4 percent. Investors in the China region were troubled not only by the financial troubles in the United States but also by a weekend of news reports of unrest in Tibet and adjacent Chinese provinces.

“Local investor sentiment is not good - the Hong Kong market is really caught in the middle between happenings in China and the United States,” said Ricky Chan, a stockbroker at Phoenix Capital Securities in Hong Kong.

Declines in Tokyo came even as the Japanese central bank, the Bank of Japan, moved to shore up financial markets by injecting $4.1 billion into short-term money markets.

Asian stocks have been hurt by the weakness of the dollar, which erodes the value in local currencies of overseas profits and forces big exporters like Toyota and Sony to raise prices in foreign markets.

Tokyos benchmark Nikkei 225 index lost 3.7 percent to close at 11,787.51 points, after declining as much as 5 percent during the day.

By late afternoon in Europe, the CAC 40 in Paris had plunged 2.7 percent, and the FTSE 100 index in London had slipped 2.96 percent and the DAX in Frankfurt had tumbled 3.88 percent.

U.S. stocks followed the downward trend. The Dow Jones industrial average slipped .80 percent in early trading Monday, the Standard Poors 500-stock index fell 1.45 percent and the Nazdaq slid 1.62 percent.

The U.S. economy delivered still more bad news Monday when the Federal Reserve announced that industrial output fell by one-half a percent in February, the biggest decline since October.

The White House announced that President George W. Bush would make a statement early Monday in Washington, following a regularly scheduled meeting with top economic advisers.

Investors were bracing for another volatile week in the markets as bankers and policy makers deal with the fallout from their bid to rescue Bear Stearns.

“This is going to go down in very historic terms,” Peter Dunay, chief investment strategist for Meridian Equity Partners, told The Associated Press. “This is about credit being overextended, and how bad it is for major financial institutions and for individuals. This is why were probably heading into a recession.”