A recent increase in "illegal" strikes is hurting Cambodias garment and footwear sector

A recent increase in "illegal" strikes is hurting Cambodia's garment and footwear sector

Cambodia's garment and footwear manufacturers have been warned that a recent increase in "illegal" strikes is hurting the sector and could lead to a loss of confidence from buyers, at a time when the country risks losing the European Union (EU) 'Everything But Arms' (EBA) trade benefits.

A notice from the Garment Manufacturers Association in Cambodia (GMAC), which represents more than 600 factories, says the actions led by some ill-intentioned unions is affecting the investment climate. 

GMAC cites the strike that has been taking place at Bowker Garment Factory (Cambodia) since 10 July, which it says fails to comply with legal procedures.

"Both parties had negotiated and the unresolved points had also been sent to the Arbitration Council since 11 July 2019. However, some workers continued to strike in violation of the law as well as the return to work order of the Arbitration Council."

GMAC "condemns all such illegal behaviour related to any non-procedural strike, which could lead to the loss of confidence from buyers and loss of benefits for both parties."

The Association adds: "In order to maintain the stability of the garment, footwear and travel goods industry, harmonised industrial relations is of vital importance. GMAC would like to request and appeal to all unions and workers to respect the laws and related regulations, including the labour dispute resolution procedures.

One current area of contention is recently introduced seniority payments, with factories accused of dismissing experienced workers without paying due compensation – as reported on just-style earlier this month

Export concerns

Foreign apparel and footwear receipts account for nearly 80% of Cambodia's total exports, with the country exporting US$8.5bn worth of garment and footwear exports to Europe and the US last year, according to data from the National Union Alliance Chamber of Cambodia.

However, European and international business associations representing apparel and footwear buyers have been closely watching the labour and human rights situation in Cambodia, after the European Union in February started the process that could temporarily suspend Cambodia's duty-free trade benefits under the Everything But Arms (EBA) trade scheme

Separately, Cambodian unions earlier this year wrote to global clothing firms urging them to sign up to the ACT (Action, Collaboration, Transformation) living wage initiative and collectively link their international purchasing practices to the development of national industry-wide collective agreements.

However, Cambodia's garment and footwear industry has seen an improvement in labour standards, according to a recent assessment from the International Labor Organization (ILO), with violations falling and compliance on the rise. In addition, the country's new minimum monthly wage of US$182 took effect on 1 January this year, although garment and textile sector unions remain unhappy, saying this is well below their goal of US$200 per month.