Agreement Imposes Unlawful Six-Month Suspension on Workers at E Garment

To:WRC Affiliate Universities and Colleges
From:Scott Nova and Ben Hensler
Date:April 2, 2013
Re:Agreement Imposes Unlawful Six-Month Suspension on Workers at E Garment

We write to update you on the case of E Garment in Cambodia, where, on February 21, factory workers and leaders of the C.CAWDU union were violently attacked, in the midst of a peaceful strike, by thugs acting in collusion with factory management. The WRC has urged VF Corporation, the collegiate licensee at the factory, to intervene at E Garment, where illegal repression of the C.CAWDU union dates back more than five years. We also initiated communications on this case with the FLA, since Yee Tung, the parent company of E Garment, is an FLA member.

As we reported to you last week, after repeated efforts by the WRC to persuade VF to act, and after a number of universities communicated their concerns to VF, we received from VF assurances that Yee Tung had agreed that significant corrective actions would be taken, including reinstatement of workers who were illegally fired. We reported that these assurances, while encouraging, lacked specificity and did not include all necessary remedial measures. More detail was subsequently provided in the form of an agreement signed by E Garment, the officers of the C.CAWDU national union federation, and the FLA.

We were initially encouraged by the announcement that Yee Tung had signed an agreement. However, upon review of the agreement’s contents, and after consultation with the union’s leadership at both the factory and national level, it is clear that the agreement is seriously deficient. It contains provisions that violate Cambodian law and university codes of conduct and that are damaging to the rights and interests of the E Garment workers and their union.

Most importantly, the agreement unlawfully strips more than a hundred currently striking E Garment workers and union members of their legal right to return to work at the factory when the strike ends. Under the terms of the agreement, 136 of 156 striking workers will have to wait roughly six months to be eligible to return to E Garment. These workers represent the core of the union’s membership; without their presence in the factory for the next six months, the survival of the union would be very much in question. Moreover, facing six months of unemployment, most of these workers would seek jobs elsewhere and would likely never return to E Garment. 

It is important to understand that denying these workers the right to return immediately to their jobs violates Cambodian law, which prohibits employers from punishing workers for exercising the right to strike. Absent a determination by a Cambodian court that the E Garment workers’ strike is illegal – and there has been no such determination – these workers have an unquestionable legal right to return to their jobs as soon as they choose to do so. When VF reported to the WRC last week that E Garment had renewed its earlier promises to reinstate the workers it had illegally terminated, VF gave no indication that this was being made contingent on E Garment imposing, in effect, an illegal six-month suspension on 136 other workers.

The agreement, like similar commitments made (and broken) by E Garment in the past, does include offers of near-term reinstatement to a group of workers fired in 2007 and 2008, as well as substantial back pay to various groups of workers. However, these commitments are muddled by discrepancies in the text of the agreement. For example, the deadline given for workers to accept or reject offers of reinstatement is the same date on which the offers are supposed to have been made – and this date, March 25, is one day prior to the date the agreement was signed, a point in time when none of these workers even knew an agreement was being discussed. Thus, according to the official language of the agreement, the workers were supposed to have communicated their acceptance of the reinstatement offers before they knew the offers existed. It is not clear whether this defect in the agreement was inserted intentionally by E Garment or is merely a product of careless drafting; if the latter is the case, the existence of such language is still problematic, because it technically absolves the company of the obligation to follow through on the reinstatement offers. On the issue of back pay, the language of the agreement does not include any date or deadline for the payments to be made to the workers fired in 2007 and 2008. 

The agreement also has other significant deficiencies: seven key leaders of the E Garment union, who were illegally fired in 2010 and whose immediate reinstatement the WRC has called for, must, like the striking workers, also wait six months to go back to the factory, a delay that compounds the illegality of those firings. The agreement also includes no provision for disciplinary action against the individuals responsible for assaulting members and leaders of C.CAWDU – who currently remain on E Garment’s payroll – nor against the factory managers who colluded with them. Instead, the agreement creates a “Social Dialogue Committee” in which a company-sponsored union with a history of thuggery and violence is granted equal representation to that of the legitimate union. 

Each one of these is a flaw which must be rectified. However, denying the striking C.CAWDU members’ right to return to work is the most damaging aspect of the agreement. 

At the end of last week, the WRC learned from the leaders of the E Garment union that they were not aware that an agreement was being negotiated until after it was signed and that they view a six month delay before the strikers can return as devastating to their union. The national leaders of C.CAWDU, which signed the agreement, have told us that they felt great pressure to sign, despite strong discomfort with some of its provisions, because they feared that it would be their only chance to obtain anything for the workers who had been illegally fired so long ago. They report that they were pressed by representatives of E Garment to sign quickly and that this is why they did not consult with the E Garment local union leaders and members.

The solution going forward is clear: E Garment must immediately reinstate all illegally fired workers and accept without delay the return of all currently striking workers. 

After consultations with leaders of the E Garment union, and after reviewing the contents of the agreement with the WRC, the C.CAWDU national leadership had further discussions with E Garment this past weekend. The leaders report that E Garment made a verbal promise that they will, notwithstanding the terms of the written agreement, allow all of the workers in question to return to the factory on May 2. The C.CAWDU national leadership tells us that they are cautiously optimistic that the company will honor this new verbal promise. Given the long saga of this case, this triumph of hope over experience on the part of the national leadership is understandable; however, it is impossible, from a code of conduct standpoint, to credit verbal promises from factory managers to reinstate workers in a timely fashion when those same managers have demanded and obtained a written agreement that states the opposite. 

If E Garment is prepared to accept all of the workers back at the factory, without delay, then the company should make this commitment clear in writing – and VF should confirm to all stakeholders that it will hold E Garment, and its parent, Yee Tung, accountable to this commitment.

We have outlined the problems with the agreement in a communication to VF and recommended that the company act urgently to ensure that E Garment makes an enforceable commitment to reinstate all illegally fired workers immediately, with back pay, and to respect the right of all currently striking workers to return to the factory without delay. And we have reiterated our recommendation that appropriate disciplinary action be taken against managers and workers responsible for acts of violence. We have also shared our analysis of the agreement with the FLA.

We will continue to update you on this case.

Scott Nova 
Worker Rights Consortium 
5 Thomas Circle NW, 5th Floor 
Washington DC 20005 
ph  202 387 4884 
fax 202 387 3292