After Months, Hundreds of Garment Workers Receive Overdue Pay

By Nobel Zaw 17 October 2014

RANGOON — Some 750 laid-off workers of the closed down South Korean Master Sports factory in Rangoon received their unpaid salaries and severance pay from the Ministry of Labor on Friday, after it auctioned off the property of the factory last week.

The workers, mostly young women, gathered at the factory in Rangoon’s Hlaing Thar Yar Industrial Zone on Friday to receive the payments on which they had waited since July.

“I received one month salary and three months’ severance pay totaling over 300,000 kyats [about US$300],” San Thida, one of the labor leaders, told The Irrawaddy. “Today all the workers are happy.”

The footwear factory opened last year but closed abruptly in late June and workers were dismissed without receiving their salaries for that month. Hundreds then marched to protest in front of the South Korean Embassy on July 17 to demand their pay.

In August, the Rangoon Division Labor Tribunal decided that the factory should provide a severance pay and outstanding salaries to the workers by Sept 16, but the Korean factory owner had left the country.

The Labor Ministry seized his property and auctioned it off in order to pay the workers. On Friday, the workers were given their outstanding salary for June and severance pay.

The severance pay was equal to three months of salary for those who worked at the factory for more than a year, while those who worked there for more than three months received two months of salary. Those who worked there less than three months received one month salary as severance pay.

At Master Sports, workers earned an hourly wage of between 150 kyats and 170 kyats (about $0.15-$0.17), and were paid a monthly allowance of about $20. They could earn overtime payment at 300 kyats per hour.

Moe Wai, a member of auction committee, said the sale of factory properties had raised about $290,000, while the workers were owed about $210,000. Asked about the remainder of the funds, she said, “The costs of [renting an auction] room and running auction advertisements were subtracted, the rest was put in a bank.”

Although the workers finally received their overdue payments, their futures remain uncertain, said San Thida, as other garment factories are hesitant to hire them because of their protests against Master Sports.

“Everyone is trying to get a job. [But] the leaders of the workers have appeared in the media so the employers don’t want to hire us or the other workers,” she said.

According to U Htay, a labor rights lawyer, only 200 out of 750 women have found work again, despite requests by the Labor Ministry that they be offered jobs by other garment factories.

“Those who found work again can’t let the factory owners know that they previously worked at Master Sports because in some factories there were cases where they fired those workers when they found out,” he said.

U Htay said he believed it was the first time that the government had intervened in a labor dispute and provided for laborers’ payment by seizing and selling off a factory’s property.

He said the Labor Ministry should draft a law that would require foreign investors to deposit a certain amount of money with the ministry, so that it can pay workers in case the factory suddenly closes.

Minister of Labor, Employment and Social Security Aye Myint said the government would try to better scrutinize foreign investments to ensure that short-lived investments, such the Master Sports, and their impact on the labor force would be avoided in the future.

“The Myanmar Investment Commission and other related departments should be cooperating in order to avoid issues like Master Sports in the investment process,” he said, while speaking at a ceremony where the payments were handed out.

He told managers of other factories who attended the ceremony that they should offer jobs to the former Master Sports workers as they had not been at fault.

Tens of thousands of workers are employed in labor-intensive industries at 14 industrial zones around Burma’s commercial capital. Garment and footwear factories are the biggest industrial employers, with about 100,000 workers total.