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Ikea has agreed to pay €6mn to compensate former prisoners in East Germany who were forced to work producing its furniture.
An investigation in 2012 found that political and other prisoners were made to work for the retailer between 1960 and 1990, and that some managers were aware of this from about 1978-81.
Ikea said it would voluntarily pay into a German government fund being set up to compensate victims of the East German dictatorship.
“We deeply regret that this happened. Since it became known that Ikea products were also made by political prisoners in the GDR (former East Germany), Ikea has consistently worked to clarify the matter,” said Walter Kadnar, chief executive of Ikea Germany.
Evelyn Zupke, the German parliament’s special representative for GDR victims, welcomed Ikea’s decision.
“Ikea’s pledge to support the hardship fund is an expression of a responsible approach to dealing with dark chapters in the company’s own history. We can’t undo what prisoners had to suffer in the GDR’s prisons but we can treat them with respect today and support them,” she said.
Tens of thousands of political prisoners were used as forced labour in the GDR. After decades of campaigning by victims, the government this year unveiled plans for a fund to provide compensation for those who faced persecution. Justice minister Marco Buschmann said that Berlin recognised the “often life-long suffering” of those who lived under communism.
The fund, which will be created based on a draft law that must still be passed by parliament, would also include a €1mn contribution from the federal government. It has been broadly welcomed by campaigners, though they said that some of the proposed payments — such as a one-off sum of €1,500 for those relocated from the GDR’s border region — were far too small.
Ikea commissioned an independent report more than a decade ago after revelations in Swedish and German media about the company’s use of forced labour.
The report found that at least 66 East German companies with 117 factories had connections with Ikea from 1960 to 1990. Political and other prisoners made furniture for Ikea at the factories of these companies and in some prisons.
Experts said at the time that Ikea was just “a small part” of the widespread use of forced labour in East Germany. Ikea in 2012 financed a study of forced labour by UOKG, an association of victims of communist oppression, and promised to compensate victims.
“We gave our word to those affected that we would participate in supporting them. We therefore welcome the implementation of the hardship fund and are pleased to be able to keep our promise,” said Kadnar.
Dieter Dombrowski, chair of UOKG, called Ikea’s decision “groundbreaking” and said that his organisation hoped “other companies will follow Ikea’s example”.
Ikea has overhauled its sourcing and production in recent decades after damaging revelations about the use of child labour in the 1990s. But it still faces scrutiny, especially over sourcing of wood including from Russia and Belarus.
