Labor Disputes Increase in Garment Industry

Despite an intimidating police presence, hundreds of workers from four garment factories marched through the streets in Phnom Penh last week, complaining about poor labor conditions.

The demonstrations reflect a growing trend in Cambodia: Collective labor disputes and demonstrations rose from 44 cases in 1998 to 120 in 1999,  according to Labor Ministry figures. Individual labor disputes have increased at an even faster rate—sevenfold to 500 in 1999.

Opinions differ on whether the increase in labor unrest reflects growing problems in the industry or merely the growing number of factories or—most likely—a combination of factors.

“The increase doesn’t necessarily mean that workers’ labor conditions have gotten worse,” said Keo Borentr, deputy director of the Labor Ministry’s labor inspection department. He noted that workers are more educated on labor rights and have become more vocal as a result.

But a union official disagreed. “Em­ployers’ violation of the labor law is increasing and the working conditions at factories are still bad,” said Chea Vichea, president of the Free Trade Union of Workers of the Kingdom of Cam­bo­dia.

Regardless of the reason, the trend is troubling to the industry and government alike, which fear investors will shy away from Cambodia.

“Workers are now feeling very confident, so that they hold demonstrations and strikes to protest on only small things,” complained Roger Tan, secretary-general for the Garment Manufacturers Association in Cambodia. “No foreign investors will be willing to come to invest in Cambodia where workers [unions] are strong.”

Said Commerce Minister Cham Prasidh: “There are some trouble-makers who make things bad…It’s unfortunate for Cambodia.”

Labor disputes have become a touchy issue because of what is at stake financially.

According to the Ministry of Commerce, the number of garment factories has soared from 20 in 1995 to 186 in 1999 employing about 90,000 people.

The garment industry is easily the single leading industry in Cambodia, generating more than 90 percent of Cambodia’s exports. In the past three years alone, export volume has tripled from $227 million to $640 million, three-quarters of it to the US.

Under a landmark labor agreement for the US, garment export quotas to the US are tied to labor conditions in Cambodia. In December, the US announced only a 5 percent bonus quota for this year, saying that more progress was needed. Cambodia was hoping and still is hoping, according to Cham Prasidh, for a full 14-percent bonus in addition to its automatic 6 percent increase.

Van Sou Ieng, president of the Garment Manufacturers Association, maintained the increase in labor disputes merely reflects the industry’s growth. “The increase is mainly because of the increase of employers and workers,” he said.

And to be sure, workers are better educated. The International Labor Organization, the government and NGOs have organized a series of workshops on the labor law, ILO’s conventions, collective bargaining and occupational safety.

The ILO workers’ education project alone has trained 107 union officials, 29 union educators, 259 union representatives and nearly 2,500 factory workers in the last year, said Noun Rithy, national project coordinator.

“We have seen the increased membership of unions and more active labor movement in workers’ rights,” he said.

But union officials also say workers simply do not have any other choice but to bring their grievances to the public view.

“Problems cannot be solved at the factory level,” said Mom Neam, president of the National Independent Federation Textile Union of Cambodia and an organizer of last week’s demonstration. “A demonstration is the only way to get good results.”

Katja Hemmerich, a Western adviser to the Free Trade Union, however, said that’s because workers still have not seen much improvement in their daily working conditions.

“On the surface, there have been considerable positive changes in the Cambodian labor movement,” said Hemmerich, citing better cooperation between unions and the Ministry of Labor, the creation of a national labor advisory committee and the government’s efforts to create a labor court. “But many basic labor code violations are still happening.”

Some of the most frequent violations are forced overtime work, late or partial payment of salaries and unfair dismissal of union activists, according to union officials.

And in perhaps the most extreme case yet, police raided G T Garment 10 days ago to rescue 51 Vietnamese and Chinese workers alleged to have been detained and partially paid.

Businesses and government officials counter that workers themselves need to respect the procedures to solve labor issues, instead of holding “unnecessary” demonstrations and strikes.

And industry officials argue that conditions in Cambodia are better than in neighboring countries.

“Cambodia has the better labor law, an established guideline that employers and workers should abide by,” said Van Sou Ieng. “We have made tremendous efforts….Improvement should be appreciated.”

But labor experts say that comparing Cambodia to other developing countries shouldn’t be used as an excuse for violations that occur. And, they note, the labor movement in Cambodia is still focusing on basic compliance to the labor law, unlike in industrialized countries where much of the effort is on collective bargaining to improve contracts.

“Just because Cambodia is a developing country, it doesn’t mean that investors can come in and exploit Cambodian workers,” said Janet King, in-country director for the University of San Francisco Cambodia Law and Democracy Project. “Investors should follow international and domestic laws.”

She said Cambodia still needs to establish mechanisms for handling disputes through mediation and the legal process.

“Once you have such mechanisms, there would be fewer disputes and better labor conditions,” she said.



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