Case 2# Short Term Contracts

Blossom Century Factory is located  in Takeo Province, Cambodia, outside Phnom Penh. The factory employs around 1200 workers and the main buyer is H&M. A worker organiser from the factory reported to the tribunal that around 90% of the workers are employed on fixed duration contracts in this factory, which are renewed on a regular basis. This is a problem for a number of reasons.

Any workers who are active in union work or join as union members often find that their contracts are not renewed. As a result of this workers fear union leaders or activists, and even fear that if they are seen talking to union representatives, their contracts will not be renewed.

Workers who are on fixed duration contracts are not entitled to maternity leave with 50% pay and are not eligible for seniority bonus.

Workers furthermore do not dare to not work overtime, for they fear that if they refuse the shifts that are offered, their contracts will not be renewed.

“There are many more government and shoe factories that are now utilising fixed durations contracts, which is a big barrier to protection of workers rights under Cambodian law. I request that employers stop using Fixed duration contracts from now on and give workers a basic living wage,” he said.

M&V International Manufacturing Ltd, is 70km away from Phnom Penh and employs around 4652 workers most of whom are young women between the ages of 18-30 years.

A worker and union organiser from this factory presented her understanding of the problematic use of short term or fixed term contracts at this factory.

Over 90% of the workers are on contracts which are 3-6 months in length. What happens is that workers’ contracts are renewed until they have been employed for 11 months. The employer then arranges for the workers to take a break in employment for a period of one week or so before calling them back to sign new contract. The previous contract is not renewed and instead a new contract is given with a new ID number as a new worker. Firstly factory owners must pay workers a $2 seniority bonus if they have been employed for over a year, but more importantly, workers who have been employed for over a year are entitled to maternity pay of 50% for up to a year. Many workers who fall pregant do not have their contracts renewed.

Yet, for the reasons stated above, workers on short term contracts, are afraid to protest about this as they fear that their contracts will not be renewed.

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