Compliance Still a Concern in Cambodian Garment Sector

Although there has been a slight improvement in the proper payment of wages and benefits within Cambodia’s garment and footwear industry, non-compliance in areas related to worker health and safety and fainting remains significant, a new study has found.

The International Labor Organization’s (ILO) Better Factories Cambodia’s (BFC) 31st Synthesis Report looks at working conditions and respect for worker rights in 362 garment factories and nine footwear factories from May 1 2013 to April 30 2014.

“The report captures a year of ups and downs for the Cambodian garment industry: huge growth, punctuated by mass strikes over the minimum wage, and few notable improvements in working conditions,” said Jill Tucker, chief technical advisor of ILO-Better Factories Cambodia.

Wages: According to the report, there was a slight increase in the correct payment of wages. 

Cambodia’s garment industry has seen two minimum wage increases in a nine-month period. Following a $15 per month rise in the sector’s minimum wage to $80 in May last year, the Labor Advisory Committee — a government-led tripartite group — announced an increase to $95 per month in December. Cambodia’s labor ministry then raised this to $100 per month in February.

The report shows that of the total 371 factories, 98% “consistently pay the correct minimum wage to regular workers,” up from 97% in the previous report.

However, 15% of casual workers and 8% of piece-rate workers are not paid the minimum wage, and compliance with their overtime payment is also lower than for regular workers, the reports reveals. 

Fundamental rights: Although the report points to “historically high levels of compliance on fundamental rights,” it notes several changes within the category.

These include a 1% increase in the number of factories with confirmed child labour cases (under 15 years of age) to 4%, and a rise in the number of factories where strikes have taken place — now 24%, up from 19% in the July 2013 report and 8% in the November 2011 report.

Of the 108 strikes in the monitored factories during the reporting period, 100% of them failed to comply with all legal requirements — broadly unchanged over the last four years.

The data also reveals an increase in the number of factories engaged in discrimination against workers — to 20% from 16% in the last report.

Having said that, it also highlights growth in the number of factories offering short-term rotating contracts to men and longer-term, more secure contracts to women workers.

Worker health and safety: In terms of worker health and safety, the report notes declines in compliance with legal requirements, including the dust levels deemed acceptable (-13.9%), hearing protection for workers (-8%), fewer factories providing cups for drinking water (-7.3%), and a fall in the number of factories labelling chemicals in Khmer (-5.5%).

Declines in the number of factories with access paths that are wide enough (-9.9%) and unobstructed (-9.2%) may be due to the increase in orders coming to Cambodia over the last year, the report says, but notes that these declines raise concerns about fire safety.

As a key fainting related-issue, the report reveals there were also high levels of non-compliance on heat levels (65%). Having said that, there was an 8% increase over the previous report in the number of factories which have taken steps to reduce heat levels.

Equally, the worker health and safety category also saw positive change. The workers who were provided protective equipment increased by 6.8%, while adequate ventilation and air circulation grew by 7.3%.

Footwear factories: As the Cambodian footwear industry is considerably younger than the garment industry and the sample size in this report is considerably smaller, BFC also details data from the footwear factories separately.

The report notes two of the nine footwear factories employed children under 15 years old. In addition, discrimination against workers on the basis of sex was found in three of the nine factories.

In terms of fire safety, eight of the nine footwear factories complied with requirements for clearly marked emergency exits and escape routes, but only 56% of factories conducted emergency drills every six months, and only 44% kept emergency exits unlocked during working hours.

Eight out the nine factories also had excessive heat levels and 67% exceeded the two-hour per day limit on overtime. And 22% of the factories assessed failed to provide safe drinking water workers.

Yet despite these failings, Ministry of Commerce data shows that garment and footwear exports from Cambodia grew by 12% — or $560 million — in 2013.

What more needs to be done? Addressing the root causes of the Cambodian industry’s “tumultuous” year is beyond the brief of the Better Factories Cambodia project, the report says.

But it points out that the government can make effective use of numerous enforcement mechanisms to uphold provisions in the labor law, especially in factories with low compliance.

Employers, meanwhile, have an obligation to improve working conditions even in the absence of effective enforcement of legal requirements. The Garment Manufacturers Association in Cambodia (GMAC) can foster a culture of compliance among their members, the report suggests.

Trade unions should strengthen their understanding of, and commitment to, the responsibilities of unions — including following strike procedures.

And international buyers sourcing from Cambodia wield considerable influence in the factories they use. Their willingness to engage suppliers using this report and data from the project’s Transparency database, it says, can help drive improvements in factories and improve working conditions and the industry’s reputation globally.

Click here to view the 31st Synthesis Report on Working Conditions in Cambodia’s garment sector.

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