Authorities visit garment workers protesting for compensation from Y&W Factory on March 12. Ministry of Labor
The Phnom Penh Municipal Court has temporarily seized all properties and materials belonging to Y and W Garment Co Ltd and ordered the owner and co-creditors of the company to pay over $3.295 million in penalties.
In a directive signed by judge Chhun Davy on March 12, the court provisionally confiscated shares of the company and its commercial certificate issued by the Ministry of Commerce, dated February 15, 2012.
The situation arose following the abrupt departure of company owner Yuen Po Faito, who absconded without fulfilling salary and compensation obligations to workers.
The directive noted that the forfeiture would be overturned if the fines were paid by the company, located on St 217 in Spean Thma commune’s Prek Chrey village, in Phnom Penh’s Dangkor district.
Ath Thorn, president of the Cambodian Labour Confederation (CLC), explained on March 13 that in principle, workers are provided money and compensation when a company declares the closure of its operations.
“In particular, if the company refuses to accept responsibility, it sets a bad example. Therefore, when the court decides to suspend or seize properties, allowing the owner to step forward and take responsibility, that’s a positive step,” he said.
“This case serves as a warning to other companies and factories, ensuring they cannot make excuses to evade their responsibilities, thus leaving workers in such predicaments. The hardship isn’t just endured by the workers themselves but also impacts their families, who become a burden on the state. Therefore, I believe it’s a positive development,” he added.
The Ministry of Labour and Vocational Training stated that its specialists had collaborated with competent institutions, local authorities and worker representatives to discuss quicker and more effective procedures to address the issue.
As a result, over 4,500 out of 4,849 workers at the factory understood the situation and consented to await a legal resolution.
The ministry mentioned that five staff members may have provided false information to workers, causing around 300 to express concerns about potential loss of benefits from the National Social Security Fund (NSSF) and other entitlements.
The labour ministry and the authorities are exploring alternative procedures to ensure these workers receive benefits and protection ahead of other considerations.
To prevent misinterpretation, the ministry clarified: “Regarding the benefits of the NSSF, including healthcare, neonatal care and antenatal checks, workers can continue to access these benefits and utilise their NSSF cards as usual for up to three months”.
It also assured that workers would be notified in a public announcement when the seized assets were auctioned.
The ministry emphasised an immediate cessation of unprofessional actions intended to mislead workers about legal procedures. It reiterated that no matter where they flee, employers will still face legal consequences, even if they manage to escape to their native countries.
At the same time, it clarified that it would also not grant exemption to any individual who misinterprets labour law and encourages workers to engage in illegal activities.
