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Businesses shut amid Covid exempted from ‘payments’

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Factories and enterprises that are closed due to the pandemic do not have to pay damages and prior notice payments to workers. Hong Menea

Businesses shut amid Covid exempted from ‘payments’

The Ministry of Labour and Vocational Training announced that businesses closed due to the Covid-19 pandemic do not have to pay “damages” and “prior notice payments” to workers.

The explanation was a response to a request by the Garment Manufacturers Association in Cambodia (GMAC) to clarify the laws as stated in Article 82, 87, and 91 of the Labour Law.

The ministry’s letter to GMAC dated June 29 said the labour law states that economic hardship or any special difficulties that cause the suspension of activities for longer than two months allows for the suspension of employment contracts.

That means, the letter said, the economic consequences for factories and enterprises in the textile, garment, footwear, travel products and handbags business as a direct result of Covid-19 is a reason that may be considered for the termination of employment contracts.

The ministry’s Department of Labour Inspection director Ouk Chanthou said some factories were directly affected by Covid-19, which was the reason that led to the cancellation of all orders, suspension of acceptance of manufactured goods and non-payment of contracts.

He said based on this situation, businesses do not have to pay damages and prior notice payments.

Collective Union of Movement of Workers president Pav Sina expressed regret over the decision, saying it was not transparent to workers at all.

He said it was not only the employer who is impacted by the Covid-19 crisis, so the Ministry of Labour should set up a dialogue between stakeholders before deciding the benefits that workers receive.

Sina expressed his desire for the employer to show the effects of the Covid-19 disease, of not having purchase orders or payments from buyers, so that companies wil not take advantage of workers.

“We want to be transparent because workers are seriously affected. We want to be transparent because, as of this time, we have no report on how much GMAC has been impacted.

“We would like to see all the information from the affected factories so the union also has the ability to communicate directly with the buyers,” he said.

Sina expressed concern that as the Ministry of Labour gives greater priority to employers, they will use these reasons to terminate workers and escape from paying benefits. “It is becoming easier to terminate workers,” he said.

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