GENERAL APPEAL (Philippines): Labor office fails to ensure factory pays back wages to workers

Dear friends,

The Asian Human Rights Commission (AHRC) has been informed of the continued failure of the Department of Labor and Employment (DoLE) to implement the order by their regional office requiring a Korean-owned garment factory to pay their workers the back wages and benefits due to them. They have also failed to have the employers held to account for depriving them of adequate working conditions and denying them the right to collectively bargain and to freely associate.

CASE DETAILS: (According to information received from the Center for Trade Union and Human Rights (CTUHR))

On January 22 of this year, the Department of Labor and Employment (DoLE) in Region 4-A, after conducting a thorough investigation and determining that the workers of the K&Y Apparel Corporation has since been receiving salaries far below the required minimum wage, issued a writ of execution ordering the employer to pay all the workers their back wages.

Since then, however, the employer have not been able to pay their 901 workers, at least 800 of them are casual (non regular) workers back wages amounting to Php 21 million in total.

It is learned that when the workers were first employed, they were forced into signing a waiver/document stating they were receiving the minimum wage from the company. The regional wage board of the DoLE in Region 4-A, which cover the provinces of Cavite, Laguna, Batangas, Rizal, and Quezon (CALABARZON) has been requiring a minimum wage of Php 287 (USD 6.57). However, the company’s casual (non regular) workers only receive Php 110 (USD 2.52) per day and even those regular workers, who had been with the company for ten years, receives only Php 237 (USD 5.43) per day.

Apart from that, although the DoLE had been requiring a mandatory salary increase by implementing wage orders, the company has not complied this order. What they do instead is to increase wages on their own prerogative and decide upon themselves how much the cost of the increase should be. One employee reported that the last salary increase they had was Php 2 (0.45USD) sometime in 2006.

Not only did the company pay their workers below to what is required, they are also making questionable deductions from their salary. For example, if a worker is unable to reach the target quota for the month, a deduction for “percentage” would be taken from their salary. The company, however, does not provide any explanations and neither how do they compute the amount to be deducted from the worker’s salary and the reasons for the deductions.

On May 1 of this year, though the employer paid some of their workers, but it was done purposely to use them to coerce their fellow workers into signing a quitclaim or motion to quash, which states that they are no longer interested in claiming their back wages in exchange for their continued employment with the company. Also, it states that once the workers sign they wanted to nullify the writ of execution the DoLE has issued.

Some of the workers were forced to sign the said document; however, they later filed an appeal with the DoLE Region 4-A seeking to nullify their signatures. These workers said that had they not been forced and threatened with dismissal they would have not signed it.

On June 7 also, some 400 workers held a picket outside the factory, not only for their demands for payment of their back wages, but to claim their salaries for the service they had rendered for the month of May. However, instead of paying them, their employer called on some police reinforcements to intervene. For instance, the police escorted Jae Dong Kim, vice-president of the company as he exited from the factory premises while the workers were holding their picket demanding from him payment of their salary. At the time of this writing, the workers have not been able to receive their salaries for month of May.

Also in May of this year, the workers who are under the Luckyline Cooperative, which is also under the same company, has received a letter from the company stating that the contract between K & Y and Luckyline has already expired thus they need not to continue working with the company.

The workers filed a complaint with the National Labor Relations Commission (NLRC) for illegally dismissing them arguing that they are not members of the Luckyline or any other cooperative. They, too, argued that the Luckyline has since been declared “non-operating” since 2006, which is according to the records shown by the Cooperative Development Authority; thus, the company should have had full responsibility on them and that they should be able to continue working because they are their employees.

The workers there has since been forced to work for 12 hours, which is contrary to the required eight working hours, and work for seven days in a week. It is said that the company is implementing a policy requiring workers to reach their own quota thus depriving them of any rest days. They had to work as early as 6am until 9pm daily purposely to reach their quota. And even if the workers are able to reach their own quota within eight hours, they are prevented from leaving the factory. Instead, when they finish on time they are taken to another operation to help their fellow workers.

Also, on occasions that the company had to deliver products the following day, the factory owners have had to make their own arrangement which forced the workers to continue working even after having worked for 12 to 15 hours. The company also does not follow the required payment for overtime to workers. The required computation should have been (RW (regular wage) +10 percent + 25 percent); however, the factory calculates the overtime pay payment only by (RW +10 percent).

The workers have also had to endure poor working condition making them vulnerable to sickness since they themselves are overworked. The factory has no proper ventilation facilities which results to workers becoming overly exhausted. When a worker fell unconscious, the line supervisor would simply give her ammonia to inhale in order to regain consciousness. If accidents occur, regardless of the gravity of their injuries, a worker is only given Php 1,000. They are not allowed to demand more financial assistance.

Though the factory has a clinic, it is too small to accommodate the number of workers which requires their service in giving the needed medical assistance. According to the workers, not only did their company doctor visits irregular he only performs medical examination to Korean proprietors and some of their selected employees.

There were also no proper working arrangement for pregnant workers and those who are breastfeeding child. Once a worker fell sick, they had to work as long as they can carry on. They may be allowed to go home but would not be able to receive any salary because the management implement a “No work, no pay” policy. Thus, this situation forced workers to continue working even if they are not feeling well. The salaries the workers are getting are based on the actual output or quota they had reached.

Also, the workers routinely experiences being scolded and publicly humiliated should they commit mistakes, or even on instance with no clear reasons at all. They are also not allowed to make any complaints or air their grievances. They are always told in warning them that there are “hundreds of workers available to replace anyone who intends to leave.”

ADDITIONAL INFORMATION:

The K & Y Apparel Corporation (Kyung Sung Apparel Corporation) is a Korean owned garment company, established and registered in July 1991, which produced various kinds of signature apparels. The products and labels they are producing include that of GAP, Ralph Lauren, Hallmark, Hanes, Danzen and others.

K & Y exports to different countries in Asia and the US. Their finished products are shipped twice a week or more abroad in an 18-wheeler cargo trucks.  Each shipment contains 2,900 to 3,000 boxes x 9-12 pieces of garb in each box. They are transported through OOCL, Evergreen or EPL Cargo Shipping Company.

The company employs 101 rank-and-file regular workers under the union KMKYAC (Kilusang Manggagawa K & Y Apparel Corporation) and more or less than 800 employees working under three service cooperatives, namely the Lucky Line Multi-Purpose Coop., KS Textile Multi-Purpose Coop., and the Friendship Multi-Purpose Coop.

All the workers of this three service cooperatives are under the same company. When these cooperatives were formed, some 800 workers were forced to join. Under these cooperatives, workers are considered as casual employees that effectively deprived them from joining unions and it also excuse the company from any financial liabilities to the workers.

The company recently opened its new factory in Cambodia. Some of its workers in the Philippines were also brought there.

Because of unfair labor practices mentioned above, some of the workers organized and eventually formed a union, Kilusang Manggagawa ng Kyung Sung Apparel Corporation, sometime in 2003. They later changed its name to Kilusang Manggagawa ng K & Y Apparel Corporation. The management however illegally dismissed all of the union members who in turn responded by holding a strike.

SUGGESTED ACTION:
Please write letters to the concerned authorities, particularly the Department of Labor and Employment (DoLE), for them to ensure that the order requiring the company to pay the workers of their back wages due to them is acted upon without delay. They should also commence a thorough investigation into the working condition of these workers and allegations of violations under the labor code.

The AHRC has also written to the UN Special Representative of the Secretary General on human rights and transnational corporations and other business enterprises calling for an intervention in this matter.

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