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Cambodia in fashion supply chain spotlight after violent protests

February 2014

Lawsuits are piling up against the Cambodian trade unions that called garment workers out on strike over low wages.

Tens of thousands of union members had downed tools on 24 December 2013. When they returned to work on 10 January 2014, demonstrations of support were staged at embassies and other locations worldwide.

The employers have reacted with lawsuits accusing the unions of inciting strikes, damaging property and assets and coercing and threatening employees who wished to work. More than 150 factories are already taking action and more cases are being prepared, said Khieu Sambo, a lawyer for the employers.

Cambodia’s garment industry employs more than 500,000 and is worth €3.38bn ($4.62bn, £2.8bn) a year, representing about 95% of the country’s exports. One reason for the legal action is that the Garment Manufacturers’ Association calculates the strike cost the industry $200m (£121m, €146m) and fears it could lose Western customers, including Adidas, Gap, H&M Hennes & Mauritz, Nike and Puma, through lack of competitiveness.

Chea Mony, president of one of the defendant unions, insisted the cases would be contested. He said: “They sued us because they want to intimidate us so that we won’t strike any more and we won’t help the workers. We are not afraid.”

The unions’ demonstrations backing demands for a doubling of the $80 monthly minimum wage had been crushed violently by the police and the military. Estimates of the number killed ranged from three to five, and up to 40 were hurt. At least 23 demonstrators were reported detained in an isolated prison.

This month the minimum wage was raised to $100 – and the government has banned workers’ demonstrations.
The regime’s crackdown on the demonstrations has been met with protest from labour rights groups, unions and the fashion industry worldwide.

Sam Rainsy, the opposition leader in Cambodia’s parliament, urged Western clothing companies to be responsible when buying. He said: “Check if there is any drop of blood in the garment they intend to buy.”

Gap responded: “We strongly oppose any form of violence and urge the government of Cambodia to drive negotiations among stakeholders to peacefully resolve this dispute.”

Jeroen Merk, an official of the Clean Clothes Campaign, the Netherlands-based alliance working for responsible conduct in the garment sector, said: “Whilst our primary concern is the safety and well-being of those workers who have been detained, we are also calling on brands to look at the long-term implications of their purchasing practices.

“Until brands recognise that these practices contribute to the poverty wages received by workers in Cambodia, and in turn the demonstrations we are witnessing, then no brand sourcing from Cambodia can claim to be acting fairly or decently.”

Seven Western companies have voiced their condemnation of the violence in an open letter to the Cambodian government, but the Clean Clothes Campaign has urged them to add demands for the detainees’ release, the restoration of workers’ rights and substantial wage rises, and to pay fair prices for goods.

However, Douglas Clayton, founder and chief executive of Leopard Capital, a private equity company that invests in frontier markets, said pessimistically: “There will always be another low-cost labour source somewhere.

“Western brands will do the minimum response required to avoid negative publicity. They know that most Western shoppers care more about value than values.”

 

Picture credit: © Maxsaf | Dreamstime.com



 




Global | supply chain

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