SALEWA, DYNAFIT & Wild Country, Complaint 356

Payment of a living wage Legally binding employment relationship

The complainant worked at the factory for approximately 2 years. She took maternity leave for 6 months from July to December 2017. The complainant does not know whether she has a fixed or permanent labour contract. She returned to work in the beginning of January 2018. That first day back at work, the HR officer informed her that her labour contract had expired and was not going to be renewed. Therefore, she should leave the factory and come back to get her social insurance book in 1 month.
Her complaints are:
1. The factory did not give any advance notice. She wants to know the reason why the factory did not renew her labour contract.
2. She did not receive the year end bonus of 2017.
3. She did not receive her social insurance book.
4. She did not receive medical benefits including 5 days off to take care her child in June 2017, or any benefits while recovering after childbirth.

Findings and conclusions

FWF's complaints handler in Vietnam received a complaint from a former factory worker, who claimed that: 1. the factory had terminated her contract without giving advanced notice; 2. she had not received the end of year bonus; 3. she had not received her social insurance book; 4. she did not receive medical benefits to take care of her child nor did she receive any benefits while recovering from childbirth. FWF declared the complain admissible and informed Salewa, the FWF member brand sourcing at this factory. Salewa reached out to factory management, who agreed to meet to discuss the complaint on 19 March. Through reviewing the factory's relevant policies and discussing with management it became clear that the factory had not clearly explained the contract termination or end of year bonus policies to the workers and that the factory still owed the complainant certain medical benefits. Furthermore, management explained why the complainant's contract was not extended. Management agreed to pay the outstanding medical benefits and to make the social insurance book available for the complainant to pick up within 20-30 days of the contract's termination. Management also agreed to develop a written policy and procedure for managing termination and actively inform workers of these procedures. The complainant confirmed she had received the social insurance book and outstanding medical benefits. The complainant was satisfied with the outcome.

Overview of the complaint investigation

2018-03-14 Investigation

Salewa informed factory management of the complaint who replied within one week. Together with the complaint, the FWF member sent the relevant legal references as investigated by FWF's complaint handler.

2018-03-15 Conclusion of the investigation

Factory confirmed the case and the complaint was found grounded.

2018-03-27 Remediation

Factory management met with the complainant on 19 March and settled on the following agreements:
1. The factory did not give any advance notice. Complainant wishes to know the reason factory did not renew her labour contract.
According to the HR manager, factory management has been trying to reach out to the complainant to notify her of the expiry date of the fixed-term labour contract. An attachment was sent with the factory's comments, including the complainant's signature underneath the reason not to renew the contract.

2. She did not receive year end bonus of 2017.
According to the factory bonus policy, which was set up in agreement with the labour union and sent to the brand and FWF to review, workers who resigned or had their contract terminated before the year-end, would not receive a bonus. FWF's complaints handler confirmed the bonus is voluntary and up to the factory to apply its own bonus-policy (as long as it is communicated clearly to the employees and approved by the labour union).

3. She did not receive her social insurance book.
According to factory management the social insurance book will be provided 20~30 days after the contracted is terminated. Management informed the complainant that she could collect the social insurance book, which she did on the 10th of March. An attachment was sent confirming the signature of the employee for receipt of the social insurance book.

4. She did not receive medical benefits including 5 days off to take care her child in June 2017, benefits for recovering after childbirth.
According to factory management, medical benefits will be issued together with the insurance book and the medical benefits including 5 days off to take care her child were paid to the employee. Enclosed attachments showed the signature of employee acknowledging the receipt of the medical benefits.

The meeting was conducted by the HR officer. The outcome of the meeting was put in writing and the complainant signed as acknowledgement.

FWF provided two recommendations before closing this complaint:
1. For further cases, FWF recommends the labour union representative to be present during such meetings.
2. Factory should develop a written policy and procedures for managing termination and actively inform workers of these procedures. Only after the employee called the FWF hotline, were these issues explained to her.

2018-03-27 Verification

FWF's complaint handler reviewed the evidence sent by the factory and contacted the complainant for verification.
1. According to the complainant, she did receive the incentive/productivity bonus every month which she would not have received if she would have low performance. However, she accepts factory's decision and indeed signed the form for dismissal.
2. Attachment 2: year-end bonus announcement.
The complainant now understands the factory's policy of workers not receiving year-end bonus when contract is terminated, by the factory or the worker, before the end of the year.
3. Complainant confirms she received the insurance book on 19 March 2018.
4. Complainant confirmed she received the medical benefits, including benefits for recovering after childbirth.

Regarding the 2 recommendations made by FWF:
The union chairwomen was present during the meeting. The minutes and attendance records were sent and verified by FWF's complaints handler.

Factory indicated that for future procedures of managing the termination of workers' contracts, they will have a written notice sent to workers explaining the reasons for terminating in case in case the employee cannot be reached. The policy for managing termination was sent to and verified by FWF's complaints handler.

2018-04-24 Evaluation of the complaint

FWF's complaint handler spoke to the complainant again who said that she would have never received her remaining salary if it werent for the FWF hotline. She indicated the FWF hotline was very helpful to her and other workers who do not have knowledge of their labour rights. She mentioned to have participated in the WEP training and she hopes more workers are able to attend such a training. As a last remark she mentioned the process took a bit long and would have been more effectively resolved if the complaint handler would have attended the meeting between her and factory management.

2018-04-26 Resolved

The complaint is resolved.