Takko Holding GmbH, Complaint 217

CONCERNING LABOUR STANDARDS
Freedom of association and the right to collective bargaining Legally binding employment relationship
STATUS
Resolved
DATE
2016-12-07

On 7 December 2016, FWF received a message from CTUM which indicated that there was a dismissal case at a supplier producing for a FWF member company. The message indicated that CTUM was organizing workers at the supplier and assisted these to register a factory union at the township labor office. The factory thendismissed 11 workers, including the union President, Secretary, and some other Executive Committeemembers and active union members without any advance notice or reasonsgiven. The workers subsequently submitted acomplaint letter to Township ConciliationBody

Findings and conclusions

On 7 December 2016, FWF received a message from CTUM which indicated that there was a dismissal case at a supplier producing for a FWF member company. The message indicated that CTUM was organizing workers at the supplier and assisted these to register a factory union at the township labor office. The factory thendismissed 11 workers, including the union President, Secretary, and some other Executive Committeemembers and active union members without any advance notice or reasonsgiven. The workers subsequently submitted acomplaint letter to Township ConciliationBody

On 22 December a meeting was facilitated by FWF in order to seek solutions. There were totally 17 participants: 3 from FWF, 1 from Takko, 1 from CTUM, 1 from IWFN, 6 workers and union members and 6 from the factory.Workers, CTUM and IWFM were asked to present the case and demands.

As no solution was found at Township conciliation body, the case moved to the regional/state arbitration body. The Arbitration Body made the following ruling:a)The employer does not need to reinstatethe workerthat received 3 warning letters, no compensation is required. b)The employer must reinstate the other four workers with the original position, seniority, job department(location) and salary together c)Full compensation from the date of dismissal to the date of return without Overtime payment. d)All the payment to workers must be done within 30 days

Takko and FWF following up with the five dismissed workers:•2 workersreceived compensationand have taken up jobs in other garment factories.•1 workerreceived compensationand is studyingtailoring as she has the plan to start her own tailoring business in future.•1 worker has been reinstated in the factory and indicated that she is workinghappy and peacefully. •1 worker did not receive compensation. He has a new job in a building construction company.
CTUM indicated that it is not satisfiedwith the outcome, as workers were put under pressure to accept compensation. CTUM furthermore indicated that it will continue to pursue the case of the worker who received 3 warning letter and who was not reinstated, nor receive compensation. It indicated that it contacted another (non-FWF) brand and has made an appointment with the brand and factory to discuss the case

Overview of the complaint investigation

2016-12-22 Investigation

FWF informed the case to Takko on 7 December 2016, which immediately got in touch with the factory management to get their response.CTUM/IWFM informed FWF thata union was being formed at the factory. The factory union enrolled 200 members. They registered the union for the first time on 8 October at the township labour office. The labour registration office asked for some corrections. The factory union re-submitted again on 8 November. They are waiting for a response since. On 16 October the union selected 2 workers to nominate for the WCC on 16 October. They submitted a letter to the factory on 29 November informing the factory of the nomination of the 2 workers for the WCC. Factory replied that they do not recognize the union, not the nomination of workers for the WCC.The factory then asked for a letter of support from the factory workers for the nomination of 2 workers for the WCC. Union asked to have 20 minutes to collect the required signatures from workers. The HR manager indicated she needs a letter in which union requests the 20 minutes timeframe to collect signatures from workers. On 6 December, the factory indicated that it will not recognize the WCC and will not allow the union 20 minutes to collect signature. On the same day, five minutes before end of the working day, the 11 workers were dismissed. The workers did not have any opportunity to ask questions to the HR Manager at that time. The following day, on 7 December, they went to the factory and requested to see the manager. The HR manager did not respond and did not want to see them. The security guards did not allow them to enter and had photos posted at the guard’s station to make certain they did not enter.The 11dismissed workers are all union members, 3 were part of the Executive Committee (EC) of the union. 1 was elected by the worker representatives for the WCC as elected by the union.The supplier informed Takko that the contract of said 11 workers have been terminated due to their dissatisfying performance. The supervisors complained that these workers always work carelessly, walking around talking to different people and often disagree to the arrangement of their supervisors. Further the supplier claimed that the products they produced are with lower quality and often need repairing. Apparently the factory has never been informed that these workers are representatives of any organization.13 December, the dismissed workers will have a meeting at the township labour department to explain their case.In the meanwhile, 6 workers have collected the compensation. However, we have also been informed they were pressured to do so. Pictures of the dismissed workers are posted at the security guards post and workers aretold that they will be put on the blacklist to be shared with other factories. Workers informed CTUM that some decided to collect compensation as they are afraid that they would not be able to find any job otherwise.

2017-01-15 Conclusion of the investigation

On 22 December a meeting was facilitated by FWF in order to seek solutions. There were totally 17 participants: 3 from FWF, 1 from Takko, 1 from CTUM, 1 from IWFN, 6 workers and union members and 6 from the factory.Workers, CTUM and IWFM were asked to present the case and demands which are the following:a)Reinstate 5 of the dismissed workers who did not accept the compensation (6 workers have collected compensation already) from the factory with the same seniority and position. b)Pay full compensation to 5 workers since the date of termination till the date of reinstatement.c)Management does not interfere with the union formation process and let them establish the union freely.d)EC contract is reviewed to ensure it complies with the law and signed by both workers and management.e)Once the union is formed, the union is to select two members of WCC to replace the current ones (in accordance with the law). The discussion started from the topic of EC contract. The union and workers indicated that they should have received the opportunity to review the EC contract and clearly be informed about its contents before signing. Workers indicated that, instead of this, they were asked to sign 3 blank pages for the extension of the employment contract, which was the reason why workers refused to sign. The management denied that this ever happened. Workers confirmed that the factory has ‘spread the word’ that workers may be blacklisted if they do not accept compensation. CTUM furthermore pointed out that the factory breached article 14b of the employment contract, as it did not follow a formal process of issuing warning letters to workers before deciding to dismiss the 11 workers concerned. The management acknowledged that they only gave verbal warnings and may thus lack proper disciplinary systems in this regard.Factory management respondedthe following:Factory did neither pressure workers tocollect compensation nor send their names and pictures to other factories for blacklisting. Factory disagreed to reinstate five workers as workers are said to be difficult to manage and made mistakes. The factory will not interfere with the union process.The factory has done several activities to improve the lives of workers including the creation of a social group and suggestion box.FWF considers that the factory lacks (or did not follow) good HR practices, and it is credible that mistakes may have been made by the factory that led to the dismissal of workers concerned. Based on this, Takko is kindly requested to urgently encouragethe factory to carefully consider the demands of the union and workers and make every effort to find a timely, fair and compassionate solution for the 5 workers concerned.
As no solution was found at Township conciliation body, the case moved to the regional/state arbitration body. After hearing the evidence from both sideson 17 January 2017, the Arbitration Body made the following decision: a)Five workers were fired for the reasons of not following supervisors’ directives, lack of interest in working (job), taking more unpaid leaves and arriving late to work. b)One worker (out of five)has signed warning letter for three times in the period from May 2016 to September, 2016.c)One worker hassigned the warning letter once in November, 2016. The other three workerswere verbally warned for the reasons such as taking unpaid leaves, absence (leave) and late arrivals to work. Based on this, the Arbitration Body made the following ruling:a)The employer does not need to reinstatethe workerthat received 3 warning letters, no compensation is required. b)The employer must reinstate the other four workers with the original position, seniority, job department(location) and salary together c)Full compensation from the date of dismissal to the date of return without Overtime payment. d)All the payment to workers must be done within 30 days.

2017-01-24 Remediation

On 24 January, the factory informed Takkothat they will respect the decision of the arbitration body.•3 of the 4 workers will be reinstated. •The other worker accepted the compensation.•The 5th worker(who received the 3 warning letters) will not be reinstated and will not receive compensation, as per the arbitration body’s decision.Contrary to the above, FWF was informed later that 3 workers separately negotiated and agreed on a higher compensation. Hence they have left the factory.CTUM, however, indicated that thefactory management went to the residences of the workers and put pressureon them to accept the compensation. One worker came back to the factory and is now working at her original position, starting 1 February 2017.

2018-01-15 Verification

Takko and FWF following up with the five dismissed workers:•2 workersreceived compensationand have taken up jobs in other garment factories.•1 workerreceived compensationand is studyingtailoring as she has the plan to start her own tailoring business in future.•1 worker has been reinstated in the factory and indicated that she is workinghappy and peacefully. •1 worker did not receive compensation. He has a new job in a building construction company.

2018-01-15 Evaluation of the complaint

CTUM indicated that it is not satisfiedwith the outcome, as workers were put under pressure to accept compensation. CTUM furthermore indicated that it will continue to pursue the case of the worker who received 3 warning letter and who was not reinstated, nor receive compensation. It indicated that it contacted another (non-FWF) brand and has made an appointment with the brand and factory to discuss the case.

2018-01-15 Resolved

This complaint is partially resolved.