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29 Oct 2022

Futch Anthony Inso, Cebu Daily News

Philippines: Manufacturers attribute retrenchment to reduction of clients' orders

See all tags Allegations

"4,000 workers from 5 MEPZ firms lose jobs", 29 September 2022

Around 4,000 workers from five locators of Mactan Export Processing Zone (MEPZ) in Lapu-Lapu City, which engaged in manufacturing clothes have lost their jobs after they were retrenched by these firms.

In their official statement, the five MEPZ firms explained that the downsizing of workers was needed since the world was now on the brink of a global recession.

“As the world is now on the brink of global recession, with higher than expected inflation and the global financial conditions are becoming tighter, our business and that of our customers are not an exemption especially being classified as a non-essential luxury product,” read their statement.

Among the locators, who implemented a retrenchment program, were Mactan Apparels, Inc.; Metro Wear, Inc; Globalwear Manufacturing, Inc.; Feeder Apparel Corporation; and Vertex OOne Apparel Phils. Inc.

The locators also explained that their financial health was also affected by the COVID-19 pandemic, the onslaught of super typhoon Odette, supply chain issues, increasing gas prices, and the conflict war between Russia and Ukraine, which has resulted in their unstable operations.

“The sudden dropping and reduction of orders from our clients while increasing operational costs left us to face head-on to deal with the economic struggles and financial shortage; thus, our company perceived objectively and in good faith the need to downsize our current manpower through a retrenchment program,” it added.

The retrenchment program will also help to keep their business afloat and continue the employment of 75 percent of their workforce.

The total workforce of the five locators is more than 18,000.

“The affected workers shall receive a separation pay in accordance with the law,” the official statement said, adding that they were grateful to the contributions of those affected workers.


Part of the following timelines

Philippines: Factories that supply to global brands allegedly sack about 4,000 workers without social dialogue; companies respond

Global: Garment workers face mass layoffs, suspended employment & reduced working hours as suppliers report reduced & cancelled orders from brands amid cost-of-living crisis

Philippines: Around 4000 garment workers retrenched from five factories due to global recession; incl. co. responses