Burmese migrant workers' factory announces closure
Although the factory, under pressure from its buyer Jack Wolfskin, continued to pay the minimum wage, workers had still not been registered and had not received employment contracts when the closure was announced. There were indications that the factory would refuse to provide legally mandated severance payments. Through intervention by Jack Wolfskin and the Fair Wear Foundation, severance payments have now been paid in full, although the workers are still waiting for a proposal in relation to their claims for unpaid legal minimum wages for the period prior to April 2014.
The Yuan Jiou factory had not paid minimum wages to the Burmese migrant floor workers, and also deducted excessively high costs for the use of the dormitory, electricity, food and water. The factory operated for up to 14 hours a day, 7 days a week, and workers had only one day off per month. In addition to being forced to work overtime, workers also did not receive the overtime pay required by law. In March 2014 all the employees of Yuan Jiou engaged in a strike that lasted half a day.
Mae Sot, a border town in the North-West of Thailand neighbouring Burma that is scheduled to become one of the government’s 'Special Economic Zones', has many garment factories that thrive on the cheap labour of migrant workers. Migrant workers have no legal right to form a union in Thailand, and those without official working documents, which are the majority, are vulnerable to exploitation.
The strike in March resulted in a verbal agreement with factory management to increase wages and reduce working hours. The involvement of the German buyer Jack Wolfskin and the Fair Wear Foundation resulted in further promises to pay the standard Thai minimum wage of 300 Baht (around 7 Euros) per day for an 8-hour working day, including the offer of voluntary overtime at premium pay, and to immediately start the process to provide passports and work permits to all workers employed.
Although the workers received 300 Baht per day in the following months, no overtime was provided to the workers, and the process to provide a contract to the workers and start the legalisation procedure was constantly delayed by the Yuan Jiou factory management. As a result, some of the leaders who represented the workers since the strike in March quit the factory in frustration in July, while the remaining migrant workers’ leaders were dismissed in July and August.
CCC appreciates the efforts of Jack Wolfskin to ensure that workers received the legal severance payment and wages at the time of closure. CCC expects Jack Wolfskin to reach an equally satisfactory settlement with the workers on the unpaid wages prior to April 2014. In addition, CCC hopes that Jack Wolfskin will continue to work with watchdog organisations to monitor the situation of workers in production factories to ensure compliance with labour laws and standards, and provide workers with a living wage.