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Analysis: Employers have rights, too

Analysis: Employers have rights, too

Ken Loo

In Dates:
July 8, 2010
Labour Advisory Committee raised the minimum wage from US$50 to $61. The LAC announced that other allowances will be open for negotiations at a later date.
July 9, 2010
Free Trade Union submitted request to negotiate other allowances.

July 11, 2010
Met FTU’s Mr Chea Mony and agreed to negotiate but only after October 2010. Mr Chea Mony agreed and called off strikes scheduled for July 13.

July 14, 2010
CCTU’s Mr Vong Savann submitted request to negotiate other allowances.

July 16, 2010
Met with Mr Vong Savann and expressed willingness to negotiate but after October 2010. He agreed.

July 18, 2010
NACC’s Som Aun submitted request to negotiate other allowances.

July 20, 2010
Met with Som Aun and expressed willingness to negotiate but after October 2010. Som Aun agreed.

August 3, 2010
Received official notification from CLC and CNC threatening to strike unless GMAC renegotiated minimum wage; GMAC replied that it will not renegotiate minimum wage again and that a request must be submitted to LAC to negotiate other allowances.

August 19, 2010
Received CC’d letter from CLC and CNC to minister of labor demanding renegotiations in minimum wage and threatening to strike from September 13-18.

August 21, 2010
Official reply informing CLC and CNC that GMAC will not renegotiate minimum wage and to submit request on other allowances to the LAC.

September 6, 2010
Met with CLC and CNC at GMAC office and indicated willingness to negotiate other allowances but only after October 2010. CLC and CNC demanded immediate renegotiation of the minimum wage, which GMAC rejected.

September 10, 2010
Received letter from CLC and CNC threatening a strike on September 13-18 and demanding immediate negotiations on living wage and related allowances.

September 13, 2010
Strikes occur at 10 factories.

Directly after the meeting of the Labour Advisory Committee, it was clear that there would be negotiations on other allowances in addition to the change in the minimum wage. The five other union representatives of the LAC understood this point and proceeded to submit their respective demands to Garment Manufacturers Association of Cambodia for negotiations on these other allowances. The Free Trade Union – which had threatened to strike on July 13 – was the first union to do so. After meeting with GMAC and hearing our explanations and reasons, all six unions representing the majority of workers in the apparel and footwear industry agreed to delay such negotiations until after October 2010.

Only Mr Ath Thon and Ms Morm Hhim refused to accept the decision of the LAC, even though they were full voting members of the committee and the decision passed by an overwhelming majority of 25 out of a possible 27 votes. They continued to call for further negotiations on the minimum wage, claiming that the process was flawed and biased. In any democratic society, it has always been that the minority has to comply with the wishes of the majority, but we have a case here where the minority is creating trouble through inappropriate behaviour and objections to the decision of the majority.

Upon receiving their correspondence on August 19, in which unions threatened to strike from September 13-18 unless fresh negotiations took place over the minimum wage, GMAC replied via letter (reference number 081/08/10) that we would not renegotiate the minimum wage, as this had already been decided by the tripartite LAC. GMAC also informed the CLC and CNC that they should forward all other requests on related allowances to the LAC for consideration. We also responded similarly in all our interviews with the local and international media.

In a further attempt to reach a compromise and arrive at a satisfactory outcome for all, GMAC met Mr Ath Thon on two occasions to present our case casually and reason with him. Seeing no positive outcomes from these two meetings, GMAC called for an official meeting with the CLC and CNC on September 6 in a final attempt to find a compromise. We reiterated our position that we were willing to negotiate the other allowances but only after October 2010. Our main reason was to allow for the implementation of the increase in minimum wage and provide ample time for our members to assess the impacts this would have on our bottom line. However, they continued to insist on immediate negotiations that we were unable to comply with.

In a sudden twist, we received a letter on September 10 indicating that they were amending their demands from minimum wage to living wage.
The letter again threatened that GMAC must hold negotiations before September 13 or strikes would go ahead as planned.

The CLC and CNC have always claimed that the strikes were legal by virtue of the fact that they had given ample prior notice. We would like to ask for the opinion of all stakeholders if the notice given on September 10 was sufficient. In addition, was it reasonable to expect GMAC to organise negotiations over the weekend before the September 13 deadline? In any case, the labour dispute resolution process in Cambodia clearly indicates that any labour dispute must undergo arbitration before any industrial actions are sanctioned.

The strikes from September 13-16 have resulted in direct losses for our members in excess of US$15 million. This is an extremely conservative estimate based on production loss, extra costs incurred to arrange alternate transportation for delayed shipments, discounts offered to buyers because of delays in shipments and direct damage inflicted on factory property. We have not even begun to estimate the damage to reputation and good will in each factory, and indeed, the industry at large when buyers cancel and/or reduce orders. In addition, striking workers have also suffered from a loss of wages and allowances during the strike days. Workers that were prevented from turning up to work also suffered a loss of wages.

GMAC feels all these losses to the various stakeholders are totally unnecessary. The end result of such strikes is that GMAC and the unions may soon engage in negotiations on the various allowances. However, GMAC had always given our commitment to carry out such negotiations after October 2010. Had it not been for the strikes, GMAC would have had ample time to prepare for such negotiations that could begin over the next few days. But as we are still reeling from the shock and impact of the strikes, any negotiations will now have to be delayed for at least one month.
Are the unions in question really fighting for the benefits of the workers?

Finally, we would like to say that it is stated clearly in Article 337 of the Cambodian Labour Law that the courts have sole jurisdiction to rule on the legality of any strike. Hence, employers have no choice but to seek the courts’ decision to ascertain if there has been any violation of the law.

Indeed, it is for the sole purpose of upholding the rule of law in Cambodia that we turn to the courts. In the event the courts deem the strikes as illegal, all we seek is justice for our members. To respond to allegations that employers are “intimidating union activists and violating workers rights to organise and strike”, GMAC wishes to state categorically that we respect such rights of the workers but only if the strikes were conducted in compliance with procedures. We would humbly ask that all stakeholders respect our rights to protection under the law.

Ken Loo is the secretary general of the Garment Manufacturers Association in Cambodia.


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