• Society

Factory Owner on Run as Workers Chase Salaries 

• By Lay Sopheavotey
• and Meng Seavmey
• March 14, 2024 3:15 PM

PHNOM PENH – A Chinese factory owner is on the run after the closure of the Y&W Garment Company in Phnom Penh left workers owed thousands of dollars.

The Ministry of Labour and Vocational Training on Mar. 12 ordered the arrest of Yuen Po Fai and is considering selling properties for payment and compensation.

In February, the ministry and authorities, suspecting that Yuen had run away, inspected the factory and set up the accountant to pay the workers for the first phase. Yuen could not be reached. 

Workers were protesting and blocking a part of Samdech Monireth Blvd (217) in Khan Dangkao, Phnom Penh. Photo_ Moeurn Makthong

The ministry said as many as 4,500 workers out of 4,849 had agreed to a legal resolution. There were two choices. One was based on the Law on Bankruptcy, which would require a lengthy procedure. 

The ministry carried out the second choice, which was to request a warrant to seize the company’s properties for sale, using the money for payment and compensation. On March 11 the ministry sought the warrant at the Phnom Penh Municipal Court and received the seizure order on Mar. 12.

The workers can still use the National Social Security Fund membership card for healthcare and get pregnancy and childbirth benefits as usual for the next three months, ministry spokesperson Katta Orn said.

All property and material in the factory will be kept in accordance with the warrant to compensate the workers. The ministry will tell the workers when the sale day is announced. 

Local authorities called on rental house owners to postpone rental payments while workers are waiting for their salary and compensation. 

“The ministry has been notifying the Commerce Ministry, the Council for the Development of Cambodia, General Commissariat of National Police, and the General Department of Customs and Excise to take legal actions based on their authorization to find more information of the factory owner, and to arrest them if found in Cambodia,” the ministry said.

The ministry is also notifying China about the court order for the Y&W company. This aims to demand China urge Yuen to take responsibility in Cambodia. 

The ministry called on all workers to remain calm and apply at the National Employment Agency for a new job.

Katta Orn said the ministry is working with union representatives so that such cases will be notified to the ministry in a timely manner, seeking legal procedures and regulations.

Workers were protesting and blocking a part of Samdech Monireth Blvd (217) in Khan Dangkao, Phnom Penh. Photo_ Moeurn Makthong

The ministry ends disputes through the Department of Labor Dispute Resolution’s facilitation. If there is no agreement, the case is transferred to the Arbitration Council and filed to the court if the parties do not carry out council decisions. 

Learn from the past and try a new approach

Say Sokny, the vice president of Federation of Free Trade Union of Workers of the Kingdom of Cambodia, said the ministry has been doing well to resolve disputes of abandoned factories, including this case. 

However, the officials should try a new approach, not just to take actions against runaway owners but also to provide urgent support for the workers who cannot wait until the solution is found or the owner is arrested.

Sokny suggested a miscellaneous expense response to help the workers until compensation was finalised.  Demanding the runaway owner turn themselves in would be challenging and take time.

“They must have already planned the escape,” Sokny said. “Transferring valued materials along with them and leaving only old machines and some tools that are not expensive can be also the plan. 

“For the land, they usually rent it with a contract.” Workers previously used to sleep in the areas around factories to prevent such escapes.

Sokny believes that demanding factory owners install a reserved budget at the National Bank of Cambodia before operating in the country should be considered. 

“Unionists have suggested this solution to the ministry for a long time because it would reduce the risk and help compensate the workers later in runaway cases or bankruptcy.”