Jack Wolfskin, Schoffel Sportbekleidung GmbH, Complaint 231

Payment of a living wage Legally binding employment relationship

The complainant called the helpline to inform FWF that she resigned but did not receive her year-end bonus and social insurance book. FWF’s complaints handler advised the employee to first talk to her HR manager. On 29 March the employee called again and stated she had found a new job. She received her last salary for 8 working days in January on the 10th of February by bank transfer. She did not receive the year-end bonus or her social insurance. She did receive her social insurance book but the HR officer informed her that she cannot receive the unemployment allowance from the social department but he did not explain why.

Overview of the complaint investigation

2017-03-30 Investigation

The FWF members informed the factory management immediately and received a reply within one week. Factory management sent checklist attendance document and the resignation request from the employee. Management stated a 13th month salary is given to employees as a bonus, but is not compulsary. The payment is made to all employees that are still employed at the factory on the pay day in December. Management also stated the unemployment insurance allowance did not apply to the complainant as she has been employed by the company for less than a year.

FWF cross checked this information with the complaints handler who looked at the Vietnam labour code regulations of bonuses and social insurances and reviewed the facoty’s grievance procedure. The complaints handler also spoke to the complainant once again. From the factory’s reply and the reviewed documents it seems the policy is that only employees who are present during the pay day receive the 13th month bonus. Our complaints handler discussed this with the complainant who believed this was not fair as this policy was not explained to her when she handed in her resignation.

2017-03-30 Conclusion of the investigation

The year-end bonus or 13th month payment is not a compulsory payment in the Vietnam Labour Code (article 103). The complaint is therefore legally not grounded. However, FWF still finds it reasonable to ask the factory to pay (a portion) of the bonus given that the complainant did not have access to the correct information. Factory’s policy was not explained to the complainant when she submitted her resignation. If she would have been aware of the policy she would have waited with submitting her resignation letter.
Several recommendations can be made, mostly to improve communication between employees and management (see chapter 9).

The factory’s reply on the employment allowance is correct: the complainant has total unemployment insurance of under 12 months (9 months). Therefore, she cannot receive the unemployment allowance as specified in Article 49 of the Law on Employment. However, the 9 months that she paid unemployment premiums will not be lost as it is accumulated for next time. According to Article 54 of the law on employment, this period of unemployment premiums will be reserved for calculating the subsequent duration of receipt of unemployment allowance.

2017-03-30 Remediation

9. Remediation
FWF recommends the factory to pay the 13th month salary to the complainant. A compromise solution might be to pay the 13th month in proportion to the period of employment, which was 9 months in the case of the complainant. This can be a suggestion to factory management, but is not required by to labour law.

Secondly, FWF recommends the factory to organize an information session by HR to inform employees and supervisors of the factory’s policies and regulations in general. Factory should gather timely information and feedback from workers and trade union representative on ongoing basis. Factory can improve its grievance system by including a procedure for workers to report a complaint in case they cannot meet their supervisor/manager/trade union/HR directly or cannot write and send a letter to suggestion boxes, such as resigned workers or workers who are on maternity leave or sick leave, etc.

2017-03-30 Verification

Not applicable. Jack Wolfskin and Schöffel discussed the option to pay the year end bonus with their supplier. However, it is a voluntary benefit and factory management stated they do not want to offer it against their rules and prefer this person over the rest of the employees only because she has submitted a complaint.

2017-03-30 Evaluation of the complaint

The complainant appreciated she now has a better understanding of the legal regulations regarding the social insurance and unemployment allowance.

2017-04-27 Closed

The complainant has been closed.