Haglofs AB, Schoffel Sportbekleidung GmbH, Complaint 717

CONCERNING LABOUR STANDARDS
Payment of a living wage Legally binding employment relationship
STATUS
Resolved
DATE
2019-05-22

The first complainant worked at the factory from 2011 to January 2018 when he/she resigned without notice. He/she complained that did not receive his/her social insurance book. The complainant had to pay a fine of about two months' salary for illegally terminating the contract. FWF complaint handler advised the worker to contact the factory and enquire about the social insurance book again. On 7 June 2019, the complainant contacted the factory. The HR officer told the worker that before receiving his/her insurance book, he/she had to pay a fine. This was an unlawful request on the part of the factory.

The second complainant worked at the factory from 1 December 2006 to March 2018 when he/she resigned without notice. He/she complained that did not receive his/her social insurance book and called the FWF helpline for help. FWF complaint handler advised the worker to contact the factory and enquire about the social insurance book again.
On 4 June 2019, the complainant informed FWF that he/she had contacted the HR officer. The complainant was told that he/she had to pay a fine of approximately 7 million VND before receiving his/her social insurance book. This was an unlawful request on the part of the factory.

Overview of the complaint investigation

2019-06-11 Investigation

The member informed the factory about the new complaint case.

2019-06-20 Investigation

The factory answered that they follow the Vietnamese legislation, namely the article 37.3 about contract termination.

Vietnamese law:.

1) Article 47 of Labour Code
> Obligations of the employer when terminating the labour contract

- Within seven working days from terminating the labour contract, both parties are responsible to fully pay the amounts related to each party’s interests. This time limit may be longer if necessary but must not exceed 30 days.
- The employer is responsible to complete the procedures for certifying and returning the social insurance book and other papers of the employee that have been kept by the employer.

2) Article 21.5 of the law of social insurance
[5. To coordinate with social insurance agencies in returning social insurance books and certifying periods of social insurance premium payment for employees who terminate labour contracts or working contracts or cease working in accordance with law.]
> Article 43. Obligations of the employee when illegally unilaterally terminating the labour contract

1. Being ineligible for severance pay and paying compensation equivalent to the half-month salary under the labour contract to the employee.
2. For violations of the advance notice time, the employer must be paid a compensation equivalent to the employee’s salary of the unnoticed days.
3. The training cost must be returned to the employer as prescribed in Article 62 of this Code.

2019-08-21 Investigation

Regarding the social insurance book:
A lawyer was consulted and agreed with FWF complaint handler on the interpretation of the law. The factory is obliged to settle and return the social insurance books to the resigned workers whether they end their jobs legally or not. The factory can request the labour mediator or the court to resolve their claims. However, in these cases, the factory may not be able to claim to the labour mediator or the court due to the expiration of limitation as mention in Article 202 of the labour code.

It was agreed that this complaint would be investigated on-site together with another complaint case.

2019-09-19 Investigation

An on-site investigation was conducted by Fair Wear team for this case and another complaint case where workers had resigned lawfully.
It was found that the factory did not understand clearly the difference of procedure between unlawful and lawful resignation cases. The factory did not know why they had to return the insurance books to workers who resigned unlawfully.

2019-10-18 Remediation

Fair Wear members asked Fair Wear to organise a meeting at the factory together with a lawyer in order to be able to clarify the law, and discuss remediation of the issues linked to severance payments and other benefits of resigned workers.

2019-10-19 Verification

One worker confirmed that (s)he had received his/her social insurance book at the Social Insurance office without having to pay a fine.

The other worker has to pay a fine of 6,5 million VND and received his/her social insurance book in June 2019.

2019-11-05 Remediation

The mediation meeting took place on November 5th 2019.
25 people attended the meeting, including; the country representative of FWF, a lawyer, representatives of member brands, Directors of two factories owned by the same owner, workers and Union leader, other staff of both factories and translators.

On the day of remediation meeting, both complainants received their social insurance book; The factory sent all social insurance books to workers who resigned unilaterally before April 2018 to the Social Insurance Office of the local Province. The resigned workers will be able to pick up Social insurance books from Social Insurance Office of of the Province.

2020-02-03 Resolved

This complaint case has been resolved.