Phnom Penh (FN), March 18 – Cambodian Prime Minister Hun Sen urged president of the Coalition of Cambodian Apparel Workers’ Democratic Union Ath Thun to stop pushing workers to demand employers the seniority indemnity as a lump sum for one year, addressing at the graduation ceremony of Institute of New Khmer Generation at National Institute of Education on Monday.
The amendments of the labor law stated that employers shall pay worker’s seniority indemnity every six months. The amendment aims to prevent the issue of bankrupt-and-run. It is a violation of labor law to demand that seniority indemnity be paid to workers on an annual basis.
“You [Ath Thun] are demanding illegally; we could not address such concern,” the Premier stated.
According to Prime Minister, about 2,000 workers from W & D (Cambodia) Co., Ltd. went on strike on 24 December 2018 to demand the company to pay the seniority indemnity as a lump sum per annum. Today, the figure decreased to less than 100.
Prime Minister explained that if seniority indemnity to be paid as a lump sum in a single time, employers need to spend USD 2 billion immediately.
“Employers require USD 2 billion at a single time to pay for seniority indemnity. Is it possible? Those factories will bankrupt and workers will lose jobs,” the Premier warned.
“GMAC strongly hopes that this very important and invaluable explanation [from Prime Minister] will make workers/employees understand clearly about the financial condition of factories and understand clearly about the soon-to-be implemented laws to avoid inappropriate demands incited by a handful of crafty unions and activists. This explanation promotes the spirit and confidence of workers/employees in their job, in their factory owners as well as the Royal Government,” Garment Manufacturers Association in Cambodia wrote in the letter dated early January 2019.
Prime Minister informed the public that the government used to pay USD 22 million for workers’ salary when nine factories bankrupted last year in May. A compensatory budget of $4.6 million was paid to 4,000 garment workers at a factory, and each person received approximately $1,000.
He reassured garment workers from bankrupted factories not to worry about their salaries, as the government has reserved a budget for everyone.