Background Kingsland Garment Cambodia Ltd

Summary as per 19.1.2013

FACTS/BACKGROUND
The factory is Chinese/Hong Kong owned, Kingsland Garment Cambodia Ltd http://www.gmaccambodia.org/members/mem_detail.php?mem_id=81&&screen=0&&RowNumber=20&&Request=Kingsland%20 Garment%20Cambodia%20Ltd. It employed around 700 workers. Please see their history of discrimination and violence against union leaders from 2008. http://www.cleanclothes.org/urgent-actions/tell-kings-land-that-union-rights-are-human-rights http://www.laborrights.org/creating-a-sweatfree-world/wal-mart-campaign/kings-land-cambodia See video from Kingsland factory http://www.youtube.com/watch?v=eB178GEDPEk&feature=youtu.be Article Phnom Penh Post: http://www.phnompenhpost.com/2013011460771/National/unpaid-wages-demanded.html CLEC is handling the case: Joel Matthew Preston, joelmatthewpreston@gmail.com.

THE CASE
Labels obtained from workers indicate the brands sourcing from the factory are Walmart (the major buyer, predominantly Simply Basic underwear), H&M, Carters (US) as well as Family Dollar (US). The current situation at Kingsland began on September 16, 2012 when the Kingsland employer met with employee team leaders to inform the entire factory that production will be suspended until October 6, 2012. The employer informed the team leaders that all employees would collect 50% of their wage for the entire time of suspended operations. On October 6, 2012 the employees went back to the factory but after a days work met another suspension. Again the team leaders spoke with the employer about the operations. The employer explained operations were again suspended and that the employees would continue to receive 50% wages during this time period. The employees were again informed that the factory would officially begin full operations soon. The employees working in the sewing sector were notified to come to the factory on November 5, 2012 and the employees working in the cutting sector were notified to come to the factory on November 1, 2012. Following 2 days work a further suspension was imposed. No suspension of operations was ever registered with the Ministry of Labor. Hence, the suspension is illegal and all workers are entitled to 100% payment for the period, in accordance with the Cambodian Labor Law. However, Kingsland factory has essentially taken a business plan to wait out the employees until they are no longer financially stable to live on 50% of their pay, which is far below a living wage in Phnom Penh. This would appear to be a ploy to void the seniority benefits and entitlements of an experienced workforce. Workers were offered around $40 for the month of December which was declined by at least 110 workers. During the suspensions the factory union, Voice of Khmer Youth Trade Union informed workers that the factory was closing. The union as well as the Ministry of Social Affairs and the Ministry of Labor, have repeatedly tried to

coerce all workers to accept payment of $46 for each year of service in exchange for termination. Workers filed a complaint with the Ministry of Labor dated 17 December, 2012, which received no response. No notification of closure was ever filed with the Ministry of Labor. Hence, the closure is illegal and all workers are entitled to full payment for months during the illegal suspension, unused benefits, indemnity, and damages for failure to provide prior notice of termination and closure, in accordance with the Cambodian Labor Law.

In summary:

Compensation being offered averages around a total of $460 per worker; Legal payment would average around $1,200 per worker; The estimated outstanding amount for workers at Kingsland is around US$800,000; Complainants represented by CLEC (approximately 145 workers and growing) are owed total outstanding amounts of around US$200,000.

Following the offer, on 3 January, 2013 around 200 workers began a 24-hour factory vigil to ensure that equipment was not removed and assets sold in lieu of legal payment. Following the vigil and the media attention it gathered, the Ministry of Labor called for conciliation amongst the parties on 16 January, 2013. The employer did not attend. The conciliator refused to send the workers claim to the Arbitration Council which is the appropriate body to hear the matter, claiming the factory was already closed hence there was nothing they could do. In response, the vigil continues. Several workers are now struggling to find financial means to pay for their rent, utilities, childrens and grandchildrens schooling, and even food for their family and themselves. Many of the workers are now in debt to other family members and their neighbours through personal loans that they have received to suffice on the minimal financial means to live. For example, Sok Mao, a former employee at Kingsland in the sewing section of the factory, is responsible for herself as well as five other members of her family. Sok initially moved to Phnom Penh seven years prior to work for Kingsland until its closing. Now that she no longer has the financial support from the her job at Kingsland she is forced to wait in hope that the Kingsland factory owner or the factorys subcontracting partners will adhere to their obligation to pay the proper salaries and fee owed. Sok Maos children are neglected medically because Sok is unable to afford medical attention. Another employee, Keo Laven, worked for Kingsland factory for eleven years in the sewing section is now in despair due to her lack of financial means now. Keo is financially responsible for her older brother, 70 years old, and her sister-in-law, 66 years old because they are both unable to work. Keo has been unable to pay her rent since the factory closed and fears that her landlord is going to kick her out of her apartment. Lastly, Lou Kalin worked for Kingsland factory for 15 years and was promoted to quality control five years after her start at the factory. She is 55 years old and is responsible for her three grandchildren. Since the factory closed, Lou is forced to clean the apartments of her neighbours when the work is available. This allows Lou to make minimal funds to suffice in her and her familys daily living. Often Lou goes without meals in order to feed her grandchildren. Even through the sacrifice of Lou for her family, her grandchildren are often forced to eat only one or two small meals a day because of the lack of monetary means. Workers and their supporting organizations demand legal payment in accordance with the Labor Law which includes: - 100% payment during suspension as per Article 71 which provides:

When the enterprise faces a serious economic or material difficulty or any particularly unusual difficulty, which leads to a suspension of the enterprise operation. This suspension shall not exceed two months and be under the control of the Labor Inspector. An employer can terminate a suspended contract provided that the reasons for the suspension have been remedied and he has given prior notice in accordance with the law.

- Indemnity as per Article 89 which provides: If the labor contract is terminated by the employer alone, except in the case of a serious offense by the worker, the employer is required to give the dismissed worker, in addition to the prior notice stipulated in the present Section, the indemnity for dismissal as explained below: * Seven days of wage and fringe benefits if the worker's length of continuous service at the enterprise is between six and twelve months. * If the worker has more than twelve months of service, an indemnity for dismissal will be equal to fifteen days of wage and fringe benefits for each year of service. The maximum of indemnity cannot exceed six months of wage and fringe benefits. If the worker's length of service is longer than one year, time fractions of service of six months or more shall be counted as an entire year. - Unpaid benefits as per Article 167 which provides: The right to use paid leave is acquired after one year of service. If the contract is terminated or expires before the worker has acquired the right to use his paid-leave, an indemnity calculated on the basis of Article 166 above is granted to the worker. - Prior Notice as per Article 77 which provides: The termination of a labor contract at will on the part of the employer alone, without prior notice or without compliance with the prior notice periods, entails the obligation of the employer to compensate the worker the amount equal to the wages and all kinds of benefits that the worker would have received during the official notice period. - Damages as per Article 91 which provides: The termination of a labor contract without valid reasons, by either party to the contract, entitles the other party to damages. These damages are not the same as the compensation in lieu of prior notice or the dismissal indemnity. The worker, however, can request to be given a lump sum equal to the dismissal indemnity. In this case, he is relieved of the obligation to provide proof of damage incurred.