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WRC Factory Investigation

Thai Garment Export 1/3

Factory: Thai Garment Export 1/3

Key Buyers: 5.11 Tactical, Ashworth, Cutter & Buck, Nike

Year: 2010

Case Summary

The WRC has investigated allegations of anti-union discrimination in a major lay-off last year at the Thai Garment Export factory in Samut Sakhorn, Thailand. Thai Garment is a factory where a 2007 WRC investigation secured significant improvements in respect for women’s rights and freedom of association. While our investigation this time did not find that anti-union discrimination was a significant factor in the recent layoff, the WRC did conclude that the process by which the layoff was conducted – particularly with regard to consultations with worker representatives – failed to meet accepted international standards of good practice for economic retrenchments.

As is too often the case in such situations, factory management, by neglecting to communicate or consult adequately with workers and their representatives prior to and during the layoff, fueled speculation that the retrenchment was motivated by anti-union animus. Although the WRC did not find that the layoff deliberately targeted union members, it was clear that the process by which it was conducted was highly subjective and prone to abuse. To the factory’s credit, however, the WRC also found that the severance benefits that Thai Garment offered to affected workers exceeded the minimum requirements under Thai labor law.

To promote greater fairness in the retrenchment process, the WRC recommended, and Thai Garment agreed to, a process by which workers chosen for layoff could appeal their selections. While only a small number of laid-off workers ultimately elected to pursue such an appeal, the few who did were all successfully reinstated at the factory. On a further positive note, as orders have increased in recent months, the factory has recalled a significant number of the laid-off employees. Union members make up a sizeable portion of the workers who have been rehired, and there have been no allegations of anti-union discrimination in this process.

These developments, significant among them, the appeal process implemented at the recommendation of the WRC, have begun to restore the factory’s previously-strained labor relations. The WRC will continue to monitor developments at Thai Garment and, if needed, to report further on this case to the university community.

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