ILO Better Factories Cambodia 22nd synthesis report: Garment factory working conditions generally remain good, despite continuing pressure due to the global economic slowdown

The International Labour Organization’s (ILO) Better Factories Cambodia today releases its “22nd Synthesis Report on Working Conditions in Cambodia’s Garment Sector,” which assesses compliance with Cambodian labour law and international labour standards in garment factories.

Press release | BANGKOK | 26 August 2009

PHNOM PENH, Cambodia – The International Labour Organization’s (ILO) Better Factories Cambodia today releases its “22nd Synthesis Report on Working Conditions in Cambodia’s Garment Sector,” which assesses compliance with Cambodian labour law and international labour standards in garment factories.

The 22nd Synthesis Report is the sixth synthesis report to be issued using the automated Information Management System (IMS) for collecting and storing monitoring data and producing reports.

The Synthesis Report contains a wealth of information, including findings on compliance with fundamental rights and selected working conditions. Data is displayed in easy-to-read tables and graphs.

The synthesis report confirms that the joint efforts by the Royal Government of Cambodia through its Ministries of Labour and Commerce, the Garment Manufacturers’ Association in Cambodia (GMAC) and Trade Unions to progressively improve working conditions in the garment sector continue to positively impact labour standards.

Although some areas of concern remain, particularly regarding freedom of association and discrimination, for several years now there has been consistent improvement in working conditions.

The garment sector’s economic outlook is currently overshadowed by the global economic slowdown, and the industry faces multiple challenges to preserve its market share and to survive a period of reduced orders. Since November 1st of last year, the number of active factories had dropped nearly 17 per cent (as of 30 April 2009), resulting in approximately 60,000 lost jobs.

Industry representatives have voiced their concerns about the price of doing business, while workers in some cases have been terminated without receiving proper severance pay.

It is clear that industry actors must work together to increase productivity and preserve industrial peace, if the Cambodian garment industry can hope to ride out the economic storm without significant negative impacts on its business performance or the work force.

The ILO and its Better Factories Cambodia programme will continue to work with their partners during this difficult period in order to assist the industry to preserve the gains it has made over the past several years in improving working conditions. Greater emphasis will be placed on dispute prevention, workplace cooperation, and capacity building, while also working with the Government, buyers, unions and manufacturers in promoting better productivity and appropriate cost saving measures.

Better Factories Cambodia and other UN agencies also are working to better understand the impacts of the crisis and develop sound policy responses and measures to help those affected. In cooperation with UNDP, Better Factories Cambodia is overseeing a study that will look at the social and economic impacts of the crisis on a group of 2000 garment workers, including both employed and unemployed workers. The goal of the study is to gather data on the impacts of the crisis on employed and laid off garment workers, and to develop recommendations that will effectively address their needs.

The ILO also is assisting the Ministry of Labour and Vocational Training in the creation of regional job centers to provide vocational training and assist unemployed workers in finding new work. Nine job centers are expected to be opened by the end of 2010.

Better Factories Cambodia, along with Garment Industry Productivity Center (GIPC), the government, industry associations, and other UN agency partners, also recently launched the second “I am precious” campaign, which seeks to promote Cambodian garment workers, emphasize the value of the work they do, and enable them to show their talents through a dress and T-shirt design competition. Particularly in the face of the economic crisis, it is important to promote the industry’s positive image.

The 22nd Synthesis Report shows compliance figures that are based on monitoring data contained in 175 factory reports completed between November 1, 2008 and April 30, 2009.

Among the key findings in the report are the following:

  • The global financial crisis has significantly impacted Cambodia’s garment industry, resulting in lay-offs and a number of factory closures. The impact has been mitigated somewhat by new factories opening. Based on information collected during monitoring visits, the number of workers employed currently has decreased by approximately 45,000 over the past year.
  • 84 per cent of the factories monitored have less than 2000 employees.
  • 84 per cent of the factories monitored have at least one union, up 7 per cent from the 21st Synthesis Report.
  • Compliance with requirements relating to fundamental rights has not changed by more than 2 per cent when compared to the prior report.
  • There was one confirmed underage worker.
  • 14 per cent of the factories monitored had strikes.
  • Compliance with minimum wage requirements for regular workers improved slightly from the previous report, to 99 per cent; compliance with minimum wage payments for casual workers increased significantly, by 12 per cent, to 89 per cent in factories employing casual workers.
  • Compliance with basic annual and sick leave requirements remained steady, although full maternity leave payments were made in 15 per cent fewer factories.
  • Compliance with limits on the frequency and duration of overtime increased by 7 per cent and 17 per cent, respectively, and overtime was voluntary in 5 per cent more factories. These increases may be due in part to reduced orders and a corresponding decrease in overtime work.
  • Compliance with requirements to provide personal protective equipment and install needle guards on sewing machines has improved by 12 per cent and 7 per cent, respectively.
  • Nine out of ten of the top non-compliance issues in the 22nd Synthesis Report also appeared in the previous report. However, the non-compliance levels are lower than the levels reported in the prior report, signaling improvement on all nine of these issues.

The “22nd Synthesis Report on Working Conditions in Cambodia’s Garment Sector” is available in Khmer, English and Chinese and can be downloaded from the Better Factories website.

For further information please contact:

Ny You
Communications Officer – Better Factories Cambodia
Tel: +855 12 373 877