Logo of Phnom Penh Post newspaper Phnom Penh Post - Buyers urged to pay up as 200,000 face layoffs



Buyers urged to pay up as 200,000 face layoffs

Content image - Phnom Penh Post
The Garment Manufacturers Association in Cambodia (GMAC) said 180 factories have suspended operations and another 60 will do so soon, with some 200,000 workers bearing the brunt. Hong Menea

Buyers urged to pay up as 200,000 face layoffs

The Garment Manufacturers Association in Cambodia (GMAC) said 180 factories have suspended operations and another 60 will do so soon, with some 200,000 workers bearing the brunt. There is no indication of when work will resume.

Hence, it urged buyers to honour payment terms for goods that had been received or are still being shipped amid the Covid-19 pandemic.

Some buyers, it said, had made commitments on payments since its appeal early last month, but the situation has become worse, especially for Cambodia’s garment sector, as the pandemic paralyses global trade and economies.

“We understand the difficulty that buyers are facing, but we strongly appeal to all of you to honour your payments for goods already received and or in transit to you.

“Cambodian manufacturers are already suffering from many cancellations and no new orders and cannot withstand any defaults in payment,” it said.

“Products are shipped in good faith and our manufacturers shall be paid what they are owed, anything less would not be fair.

“Payment terms can be discussed but no payment is unacceptable, and we, therefore, appeal to your sense of decency to make good on your debt,” it said.

With the factory suspensions, lay-offs, it said, will affect not only the workers but also their families who depend on them to sustain their livelihoods.

Ministry of Labour and Vocational Training spokesperson Heng Suor declined to comment, referring reporters to GMAC.

Cambodian Labour Confederation president Ath Thorn said the Kingdom’s garment sector could face a crisis if buyers default on payments. He said while no new orders have been placed due to the pandemic, factories still have to pay workers’ wages every month.

He said that could eventually lead to workers protesting for a solution.

“If there are measures in place, it would help not only the factories but also the workers because they [workers] can at least receive $70 [allowance] per month now.

“We should also let the factories suspend instead of shutting down because by doing so the workers will still receive their wages amid the pandemic,” he said.

Thorn called on the government to provide incentives to the factories in the meantime.

“The government should exempt the factories from some obligations because it can help workers. Of course, there might be no new orders for their products amid the crisis, but unlike workers, employers make profits. If workers have no work and no salary, they will face hardship in life,” he said.

Thorn said he was unsure if the 180 factories that have suspended workers have fully complied with the labour ministry’s guidelines. The factories, he said, are required to pay suspended workers in two stages – 40 per cent in the first and 30 per cent in the second.

He said he had observed that the factories have complied with the first stage.

“In the second stage, the factories are required to pay only $30 to the workers. We don’t know if the workers have received their allowance.

“As to how long the factories can afford to pay the allowance, it depends on when the Covid-19 crisis is over. To be fair, if there are no new orders for their products, whom will they sell them to?” he asked.

MOST VIEWED

  • Hun Sen says Kingdom not a 'satellite country'

    Prime Minister Hun Sen said Cambodia had sent diplomatic notes to various embassies demonstrating its stance and clarifying allegations that the Kingdom is a satellite country of China which will allow it exclusive access to the Ream Naval Base in Preah Sihanouk province. The response

  • Vast Prince Manor fun park opens to much fanfare in Kandal

    Chinese-owned Prince Culture and Development Co Ltd officially launched the $85 million Prince Manor entertainment centre in Kandal province on Wednesday. Prince Manor is located along National Road 1, 20km from the centre of Phnom Penh. It is the first major theme park project in Cambodia and

  • Angkor provides ‘valuable’ water storage

    The Apsara National Authority (ANA) has stored millions of cubic metres of water at reservoirs in the Angkor area after Cambodia experienced a series of rainstorms over the last few days. The storing of the water, besides serving temple conservation, will also be used to

  • Floods prompt evacuations in Kampong Speu

    Rain-induced floods and water flowing from Kampong Speu province have submerged the houses of 1,527 families living close to the Prek Thnot River in Spean Thma, Tien, Kong Noy and Roluos communes in Phnom Penh’s Dangkor district, according to data from local authorities. Spean Thma

  • Serving coffee with a side of robots

    The eye-catching glass building surrounded by greenery at the intersection of Streets 371 and 2002 in Phnom Penh’s Sen Sok district is more than just another coffee shop where you can while away a few hours. UrHobby House cafe is filled with robots and characters from

  • Banteay Meanchey floods kill one more as death toll reaches 15

    As floodwaters start to recede in Pursat, Battambang and Pailin provinces and Phnom Penh, Banteay Meanchey continues to bear the brunt as one more person was killed on Monday, bringing the total number of flood-related deaths to 15 in the province this month. Banteay Meanchey provincial