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PHNOM PENH – Apparel Insider understands that Cambodia is set to lose huge swathes of garment production orders after Western brands became concerned the country will soon be stripped of its EU trading benefits. The EU is currently considering whether to remove Cambodia’s GSP trade benefits over ongoing and seemingly endemic human and labour rights infringements. However, our sources suggest a number of brands have already decided to begin pulling orders from the beleaguered country, while many garment exporters are struggling to covered costs following an increase in the minimum wage.

Just this week, there was further evidence of the labour and social unrest issues in the country when more than 1,200 workers were unceremoniously sacked from the W&D garment factory. The workers initially went on strike to demand the payment of seniority indemnity and severance benefits. The company gave the workers a 48-hour ultimatum for them to return to work – backed by Phnom Penh Municipal Court – within 48 hours or lose their jobs. Labour Ministry spokesman Heng Sour backed the decision by the company to issue the 48-hour ultimatum. When the workers refused to return to work, W&D garment company terminated about1,200 workers. This is one of numerous examples of factories in the country using the country’s court system to effectively quash labour rights, and officials from the EU will doubtless be monitoring the situation.

Factory representative and defence lawyer Taing Meng has since claimed that the termination is legal because the workers had not followed the court’s order. In addition, the workers face financial hardship as the factory does not plan to provide seniority indemnity and is only responsible for the workers’ final month’s salary.

Collective Union of Movement of Workers (CUMW) president Pav Sina told local reporters he was disappointed that the company has decided to not re-employ the workers or pay proper compensation.

Sina said violation of workers’ rights is a serious issue, while private companies’ use of the court system to pressure workers is just as serious, and other factories may follow suit if the practice is not stopped.

W&D employs a total of 1,600 workers.


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