Employees at hundreds of garment factories walked off the job yesterday after five labour unions called for a nationwide strike in the wake of the Ministry of Labour’s decision to raise the sector’s minimum wage by $15 next year, rather than the $80 increase they desired.
Yesterday morning, Labour Minister Ith Sam Heng announced that the monthly minimum wage for employees at garment and shoe factories – which now stands at $80, including a $5 health bonus – will rise to $95 in April. Wages will climb another $15 in 2015, then $16 in 2016 and $17 in both 2017 and 2018, reaching a total of $160 by 2018.
The news was greeted with consternation by independent unions.
“We will go on strike because what we got is so much less than what we demanded,” said Ath Thorn, president of the Coalition of Cambodian Apparel Workers’ Democratic Union (C.CAWDU). “Workers must demand more because they still earn low wages.”
In a joint statement released hours after the ministry’s decision, C.CAWDU, the National Independent Federation Textile Union of Cambodia (NIFTUC), the Cambodia Alliance of Trade Unions (CATU), the Collective Union of Movement of Workers (CUMW) and the Free Trade Union (FTU) declared more than 200,000 union workers at 300 factories will strike until the government agrees to set the minimum wage at $160.
“If there is no further negotiation, we will continue this very large protest and hold a rally in Phnom Penh in the near future,” the joint statement says. “We appeal to all workers to unite under our demand.”
A Labour Ministry working group made up of ministry officials, labour union representatives and the Garment Manufacturers Association in Cambodia (GMAC) last week recommended the ministry use one of three schemes to raise garment workers’ minimum wage to $160 by 2018. The group said the ministry should either raise minimum salaries by $16 each year, increase pay annually for five years based on variables such as the economy and inflation, or immediately hike the minimum wage to $160 next year.
Most factories in the Kingdom could not bear the financial burden of the government suddenly doubling employees’ minimum wages, GMAC secretary-general Ken Loo said last week.
A decree from the Labour Ministry requiring factories to begin paying employees at least $160 per month would bankrupt Injae Garment Co, Ltd in the capital’s Russey Keo district, owner Nam-Shik Kang said in an email yesterday. Even the $15 raise next year will create significant financial problems for the factory.
“Rather than being happy, I am worried that we cannot reach our break-even point when we start paying a $95 minimum wage,” Kang said. “Injae would shut down the factory immediately if forced to pay a $160 minimum wage.”
But Dave Welsh, country director for labour rights group Solidarity Center, yesterday said he believed factory owners exaggerate the impact an $80 wage hike next year would have on their bottom lines, while raising wages incrementally would prove no burden at all.
Workers will still earn below a living wage – a study by NGOs Community Legal Education Center and Labour Behind the Label released in September found Cambodia’s living wage to be about $150 per month – and factory management, along with the government, will have to deal with strikes and other industrial strife as a result, he said.
“This notion of small incremental change is not going to benefit anyone,” Welsh said. Fallout from the decision, he added, will likely force the Labour Ministry to revisit the issue later next year.
Apparently anticipating industrial unrest resulting from the decision, Labour Minister Sam Heng yesterday told representatives of C.CAWDU and NIFTUC that striking as a response would be a futile effort.
“Holding a strike or demonstration is the right of any union or organisation in our Kingdom,” Sam Heng said before unions officially called for a mass strike. “[But] I want to appeal to all [unions] that it is useless for them to go on strike, because it will not benefit the workers.”
The message seemed to have little impact on unions or workers, who began walking off the job in droves after news got out about the Labour Ministry’s decision.
CATU president Yang Sophorn yesterday said that all of the approximately 40 garment factories across Svay Rieng’s Manhattan and Tay Seng special economic zones are now shuttered. The few that remained functional after thousands of workers began striking last week left work following the Labour Ministry’s decision, she said.
“No workers will go to work, because the government did not meet their demand,” Sophorn said. “I can’t say when the strike will end, but those workers will not stop [striking] until their demands are met.”
ADDITIONAL REPORTING BY JAMES HALL AND CHHAY CHANNYDA