Saturday, 18 September 2010

Garment Strike in Phnom Penh Reaches Critical Mass: Will Adidas, Gap, and Puma Pay Workers A Living Wage?

via CAAI

Friday 17 September 2010
by: Anne Elizabeth Moore, t r u t h o u t | Report

On Monday, following a wave of strikes across Asia, around 60,000 textile workers in Phnom Penh walked off factory lines, protesting pay that stands at around half the living wage. By Wednesday, according to Kong Athit, Secretary General of the Cambodian Labour Confederation, the number of strikers had swelled to over three times that. By some estimates, around two thirds of the 297,000 garment workers and 48,000 athletic-shoe makers refused to work in protest of low wages. (The Garment Manufacturers Association in Cambodia (GMAC), the organization that sets the minimum wage, has also seen an increase in protesters, but suggests a smaller number.) As protests hit a flashpoint Thursday, unions and government quickly agreed to renegotiate wages. A meeting will take place September 27.

(Photo: Bart Geesink / Flickr)

As many as 210,000 young women walked off their jobs this week, according to union sources. The strike followed a string of protests and walkouts this summer, many of which ended in violence. In July, the four-year-old minimum wage of $55 was raised to $61, following the release of a report that a living wage for garment factory workers in Phnom Penh hovered around $91 per month. This pay hike, which will not go into effect until October, will then freeze wages until 2014. Between 3,000 and 4,500 workers protested what they considered a paltry raise at a July 25 demonstration at the National Assembly.
Two days later, a strike at PCCS Garments, a Malaysian-owned manufacturer of goods for Adidas, Gap, and Puma, ended when police used electric shock batons to beat the young women laborers. (Over 90 percent of the sector’s employees are female, and the majority of the goods produced are exported to the US. The bulk of the remainder go to German companies.) Police attempted to force 3,000 workers back into the factory with assault weapons and tear gas. Workers retaliated with plastic chairs and water bottles. Nine were injured.

Those on strike this week say $61 per month is insufficient compensation, and it’s easy to see why: Workers often share small rooms - occasionally in factory-owned housing - paying between $15 and $25 per month in rent. (Cambodia uses the US dollar nationally, instead of its own currency, the Riel.) Utilities can add another $10 per month, and food costs run about a dollar a day. This alone totals $55 to $65 per month. Yet workers are sent to the city to support farm families back in the provinces, so also send around $50 remittance back home every month. The UN estimated last year that the wages of factory workers keep about 1.6 million of the nation’s 14 million people afloat.

Despite the pay rate, the International Labor Organization’s Better Factories Cambodia program found in 2008 that only 97 percent of the inspected textile factories comply with minimum pay standards for regular workers. In recent days, however, more and more workers have lost permanent positions and work casually. Better Factories Cambodia found that factories meet pay standards for these workers only 70 percent of the time.

Chea Mony, the head of the Free Trade Union of Workers of the Kingdom of Cambodia (and brother of slain union leader Chea Vichea initially agreed with the new monthly wage increase, parroting the GMAC’s concerns that international investors might no longer support the industry if further wage increases were sought, and the industry itself could dry up. Still, workers were agitated. Other union representatives criticized Mony, who wavered between support for the wage increase and support for the strikers. Several strikes were called over July and August, and then called off again.

Cambodia’s labor history is nearly as difficult as its revolutionary past. To take advantage of a mid-1990s quota system that offered developing nations a fair shot at exporting clothing to the US market, Cambodia began importing fabric and rubber - both necessities for making lucrative sportswear. These quotas ended in 2004.

It was a hard year for the industry. Beloved labor leader Chea Vichea had been murdered after winning the last major pay raise on behalf of textile workers. (Two more labor leaders have been murdered since.) Garment work slowed gradually until 2008. Then US orders dropped off drastically. Some factories closed up shop then, others laid off workers. Many of those that remained open doubled workloads but not pay, changed contracts to make it easier to fire employees or simply stopped meeting workers' demands for rights.

For those who continue to work, conditions at the factories have worsened. Overtime is often mandatory, with only 8 percent of companies adhering to laws limiting compulsory overtime. Work days frequently stretch to ten hours, and workers labor seven days per week. Sick leave is paid out 66 percent of the time, and half of the companies inspected by Better Factories Cambodia failed to meet basic health and safety requirements.

Still, the factories present one of the only employment options in the developing nation - and even at far below living wage, it's an option that averages slightly better than Cambodia’s gross national income per capita, estimated by the World Bank last year to be $650, or about $54 a month.

Yet GMAC secretary general Ken Loo claims the low minimum wage isn’t the average wage of Cambodian garment workers. "I don’t understand why they are so bent up on this minimum wage issue," he told reporters. "Most of the workers, with the exception of very, very few, those that maybe just joined the industry - most of the workers are not drawing minimum."

Workers, in fact - benefiting from bonuses for attendance, performance, seniority, and overtime pay - can pull in around $94 per month. (Studies estimate the average earnings to be closer to $71 per month.) But these benefits, too, have disappeared in the recent economy. Relying on them to meet basic living wage standards not only raises serious human and labor rights concerns, but also strikes labor leaders as short sighted.

The garment industry remains Cambodia’s third-largest economic sector. Garment workers’ strikes across Asia - in China, Vietnam, Myanmar and Bangladesh - have become common in recent months, as word spreads through the region of battles fought and won. But Cambodia has seen double-digit inflation in recent years, and continues to struggle with basic necessities such as electricity costs and the paucity of local resources for the industry that employs mostly women and supports around 7 percent of the nation.

The success of the garment work strike in Cambodia signals a tipping point for the global textile industry - and means the world’s biggest clothing brands can’t get away with paying half a living wage to workers any longer.

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