Cambodia: 1,000 garment workers strike over unpaid wages & benefits at factories producing for intl. brands; Includes company responses

In January 2020, nearly 1,000 garment workers in Kandal province, Cambodia, went on strike over unpaid wages and benefits at sister factories Dignity Knitter Ltd. and Eco Base. According to local reports, workers are owed wages since mid-December and are struggling to pay bills and expenses. Workers say it is not the first time the factories have delayed payment of wages. 

Business & Human Rights Resource Centre invited C&A, Debenhams and John Lewis & Partners to respond to the situation after identifying them as brands sourcing from Dignity Knitter and Eco Base, based on public records. We also approached Arcadia Group who confirmed it had not worked with Dignity Knitter since July 2017. 

C&A said it ended its relationship with Dignity Knitter in September 2019, after it had uncovered previous delayed payments for workers and identified a risk of reoccurrence after engaging factory management and the supplier as part of its own due diligence. 

John Lewis and Debenhams confirmed relationships with Eco Base and Dignity Knitter, respectively. Both brands said the cases have been forwarded to the Arbitration Council. Debenhams also said it is engaging with Better Factories Cambodia and other brands and retailers to find a solution, and will continue to closely monitor the situation. The full responses are included below. 

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4 July 2020

Cambodia: About 1,000 garment workers remain uncompensated six months after their factories' suspensions

Author: Khy Sovuthy, CamboJa

"Six months on, over 1,000 factory workers await compensation", 01 July 2020

More than 1,000 garment workers from two factories in Kandal province are waiting on a joint committee of Labor Ministry and local officials to decide their fate after going six months without pay.

Dignity Knitter factory and Eco Base factory in Takhmao City, both of which have the same owner, suspended operations … and promised to compensate employees for their months of back pay, plus half pay in the months following suspension, according to union representatives employed there.

Ministry and union officials said the Labor Ministry had formed a joint committee with provincial authorities last month to sell off sewing machines and other equipment at the factories in order to provide compensation to workers…

Siang Yot, a legal officer at CCAWDU, said that a resolution had been delayed because the Labor Ministry had run into a dead end after discovering that the former owner said he had handed over the company to someone else…

Phin Sophea, a CCAWDU representative who was employed at Dignity Knitter factory for 14 years, said that about 400 to 500 workers had gathered outside the factory … waiting to hear the committee’s findings, but were instead told that the inventory was not yet completed…

Leng Srey, 45, a CCAWDU representative at the Eco Base factory who had also worked there for 14 years, said all of the company’s 224 employees had not been paid since January, although the factory did not suspend operations…

Read the full post here

26 May 2020

Cambodia: Fired garment workers keep watch 24/7 outside their former factories' compound; while owners fail to honour payment

Author: Hun Sirivadh, VOD

"Awaiting Payouts, Fired Garment Workers Keep Watch Outside Factory", 23 May 2020

When Sour Socheat settles in for the night under a tent in Takhmao City, she knows she will not sleep. 

On the three or four nights per week that she guards the entrance of the shuttered factory where she used to work, Socheat says she and the other unemployed garment workers on watch are disturbed by animals, drug users and gangsters. 

“Every night, we cannot sleep,” she said. “We need to play [games] and sit together until early morning. Sometimes big trucks drive very fast, shaking the ground, frightening us a lot, and when it is raining, we cannot sleep here and so we go to ask a neighbor’s permission to stay under their canvas for one or two nights.”

... “We do not trust the company,” Socheat said. “It is very difficult for us, but we will still sleep [outside] and guard this factory until [our demands] are addressed.”

... The workers have reason to be on guard. Located in Takhmao City’s Sitbou commune, Dignity Knitter and its sister factory Eco Base — which supplied to international brands including U.K. retailers Debenhams and John Lewis — started shorting workers of their wages ... and later fired more than 1,000 employees in total.

... Kong Atith, CCADWU’s president, said that as the demonstration vigil continues, workers’ health and safety face higher risks, especially during the Covid-19 pandemic...

Both Eco Base and Dignity Knitter had failed to pay workers’ wages in the past, so even as the May 30 payout deadline approaches, Socheat said she would continue to spend nights outside her former workplace...

Read the full post here

Company response
10 February 2020

Debenhams' response

Author: Debenhams

... [W]e were made aware by Better Factories Cambodia (BFC) that approximately 877 workers at Dignity Knitter Limited factory went on strike from the 17 January to 20 January 2020, due to December wages not being paid. Once notified we worked in collaboration with BFC and our supplier partner to understand more about the on-going situation. We have since received and confirmed the following updates:

  • The factory agreed to pay a first payment for the December wages, however as both parties did not reach complete agreement of all points, labour officials forwarded the collective dispute to the Arbitration Council.
  • The decision from the Arbitration Council meeting is expected mid-February 2020 and will outline timelines for compensation of the workers

As a partner member of BFC we are continuing to collaborate with them as they monitor the negotiations between the factory management and the workers’ union... We are also in contact with other brands and retailers that use the same factory to ensure that we are all working together to reach a solution. We will therefore continue to closely monitor... and provide support as they work to facilitate the agreement between all parties as part of the Arbitration Council...

[The full response is attached]

Download the full document here

Company response
9 February 2020

C&A's response

Author: C&A

... Dignity Knitter is not our supplier since September 2019... 

[D]uring August 2019, C&A Sourcing and SSC team visited Dignity [and]... found out that an important number of workers were striking... It is important to underline that for these type of visits, we randomly select the factories and they are fully unannounced...

[T]he C&A team started to investigate immediately... [and] uncovered...delayed payments for a number of workers. The strike was settled quickly as payments were made... [which] was verified by our team... However... we identified a... risk of re-occurrence... [and] discussed the situation with the Supplier based in Hong Kong and they did not want to change their current payment process nor improve the administrative loopholes they had.   

We do not want to have business partners that are putting workers at risk by not improving their way of working... [so] we came to the joint decision... we would no longer source from Dignity Knitter.

[The full response is attached]

Download the full document here

Company response
4 February 2020

John Lewis' response

Author: John Lewis

"We were very concerned to hear that workers in Eco Base factory are owed wages. This is completely unacceptable. We are a member of the Better Work programme and have been in contact with 'Better Work' representatives in Cambodia who have confirmed that the case has been forwarded to the Arbitration Council."

21 January 2020

Cambodia: Garment workers at sister factories continue to protest over unpaid wages & benefits

Author: Khut Sokun, VOD

"Workers at Struggling Factories Protest Over Unpaid Wages", 21 January 2020

...More than 900 workers from sister factories Dignity Knitter and Eco Base Factory in Prek Tra Pring village... have protested for the past six days to demand their unpaid salaries and seniority payment...

[H]ead of the local chapter of the Coalition of Cambodian Apparel Workers Democratic Union (CCADU) [said]... workers are struggling to pay their bills... after the company failed to pay them since mid-December...

[T]he factories’ owner promised to pay $50 to the workers for the second period of December... Workers decided to return to work... as long as they received the payment, but the owner has not yet said when January’s compensation would arrive.

Asked why the factories had failed to pay the workers on time... administrative chief for the Dignity Knitter and Eco Base factories, refused to comment, saying it was an internal affair...

[D]eputy head of the CCADU... at Eco Base... said this was not the first time the factory had been unable to pay workers on time, and she was concerned the owners... would close the factory without warning...

Read the full post here

20 January 2020

Cambodia: About 1,000 garment workers go on strike to demand their missing wages

Author: Davin Sen, Khmer Times

"Worker reps, factory management to meet today over missing wages", 20 January 2020

Representatives of workers and factory management are set to meet today after about 1,000 workers of Dignity Knitter Limited in Kandal province’s Sa’ang district went on strike to demand their missing wages.

Pin Sophea, president of the Coalitions of Cambodian Apparel Workers’ Democratic Union at Dignity Knitter factory, said ... about 1,000 workers went on strike ... after the factory’s management team failed to pay their December wages and seniority pay which was due ...

“If the company shuts down or has a financial problem, it should at least pay their last wages and seniority pay according to the labor law,” he said.

Sou Sokcheat, one of the striking workers, said that factory management promised to pay their December wages ... but failed to do so.

“When they pay us late, it affects our living because we need to pay our rent, children’s school fees, electricity and water bills,” Ms Sokcheat said.

Lao Hot, chief of Dignity factory administration, ... said representatives of factory, workers, union leaders and labor officials will meet today to talk about missing wages...

Ms Sokcheat however added: “We will wait for the results of the negotiation [today]. If no deal is reached, workers will continue to protest.”

Read the full post here