ALBIRO AG, Complaint 633

Payment of a living wage

The worker from Macedonian factory sourcing for FWF member brand Albiro called the complaint helpline on 2nd April, to submit the complaint on several ongoing issues in the factory.
1. The complainant informed that in the last few months (since January 2019), there are rumours among the workers that some of the workers are doing payback from their salary in cash to the management after they receive it on their bank account.
2. During the last meeting with the workers, factory manager alerted to the workers that if they are absent from work, for even one day in the month (justified or not), the manager will start applying wage deductions in the amount of 1,350 MKD. that day is part of legally allowed annual holiday.
3. One worker resigned the job because he was hassled by the supervisor of the production line, due to submission of the complaint notes in the complaint box on behalf of all workers. The management did not protect him, but he accepted the resignation by the worker without discussion. The complainant assumed that the worker resigned due to hard times given to him.
4. Although that the management announced the increase of wage for all workers in December, the increase is not there yet, as most of the workers still receive the agreed wage (12,750 MKD) which is at this time at the level of the legal minimum wage.

Overview of the complaint investigation

2019-04-25 Investigation

The FWF member brand was informed and initiated own internal investigation to understand the reasoning behind the initial complaint.
The factory management denied the admissibility of the paybacks in cash from the workers.
With regard to the three other issues raised in the initial complaint, the factory provided a statement as per each of the claim:
- In the past months of this year, there is an increased level of workers absenteeism (with no justification) and the factory needs to prevent these cases in the future. However, until now wage deductions is not been used as a measure in the factory.
- The factory management considers that the worker resigned based on his/her own will and they disagree that there is an indication of any type of mobbing made upon him/her.
- Regarding the delayed wage increase, factory management confirmed that they have informed workers but due to the not changed prices by Albiro yet, the process will go slowly step by step.
FWF did not consider this information sufficient to conclude the complaint and an investigation filed visits by FWF was scheduled for period 1-4 June.

2019-06-04 Investigation

FWF conducted field investigation at the beginning of the month of June 2019. Three sources of information were investigated including the worker's interviews, management interviews and cross-checked information with the documents and with other local stakeholders/ including former workers.

The claim that there are back payments by the workers to the management is not clear. The management denied that claim. According to some interviewed stakeholders, it was reported that there are individual cases when workers’ payback from their wages. The process of how the payback amount was calculated by the management and it is related to the level of the legal minimum wage. In the particular case where payback was applied the worker is ensured to receive the legal minimum wage, but he/she returns only what is paid above it.
The management stated that in order to help to some of the workers to receive a higher retirement pension, on request of the workers they have supported a worker in payment of higher wages instead of the earned wage from the factory budget, which resulted in agreed payback for the amount only that is added to the top of the wage but it is not earned. The management clearly stated that there are no cases in which the factory will take back part of the wage in any other case.
In this regard, it is very difficult to confirm or to reject the claim of the workers for payback. None of the interviewed workers confirmed that they do pay back in cash to the management after they receive their salary.
The information on wage increase was announced by the management to the workers due to the expected revised contract with the buyer and the new terms for the factory to produce directly for Albiro, instead of through subcontractor. So far, this contract is still negotiated and not finalised for signing, and that is why the wages are not increased yet.

Investigation showed that the claim on wage deduction for absenteeism from work did not happen. The manager explained that this statement was said in order to reduce the worker's absence from work, as workers absence is reflecting productivity of the production process and causes delays in the delivery as agreed with the buyer.

Regarding the claim on a hassled worker who resigned it was found that the management supported the worker in his decision and helped him in administration process under in the employment agency to continue to receive a certain amount from the state as remuneration for being unemployed. At the moment the worker works in another company. From this perspective, this allegation is considered as not grounded.

2019-07-15 Remediation

Proposed recommendation for remediation based on the investigation:
- Wages from both companies need to be synchronised and for same conditions to be implemented for all workers. This means that for same working hours and piece rate should be same for all workers no matter if the worker is from Nefi or Riteks.
- The factory management need to ensure that there are no any cases of paybacks, as when and if happens this information is damaging the image of the factory and it can escalate in the future. This is extremely important as the factory need to ensure that the extra payment on the top of the legal minimum wage supported by FWF member Albiro need to go for the workers directly.
- FWF will closely monitor the situation through regular consultation with local stakeholders that are in direct communication with workers.
- FWF member brand and the factory should speed up the signing of the new agreement for cooperation as this is expecting to led to the wage increase for the workers.