Myanmar: Union alleges garment workers 'in agony' after receiving no compensation following factory fire; incl. co . response
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Workers at the Sunview 2 factory in Myanmar, owned by Chinese apparel company Solamoda Group, were left in limbo after a fire at the factory in March 2021 halted operations. Approximately 1,300 factory employees are entitled to wages, severance and related terminal benefits amounting to 2.409 billion Myanmar kyat (MMK) (approximately US $1.1 million). Solamoda has refused to pay this, citing financial hardship.
Arbitration bodies have sided with Solamoda over the workers, who have each received only a token payment of MMK 77,000 (US $37) as a “compassionate grant” - less than 5% of what they are legally due. Rights groups have criticised the arbitral bodies’ decisions as lacking in legal basis and protecting the interests of businesses and foreign investors.
In June 2022, Business & Human Rights Resource Centre invited Fast Retailing, parent company of UNIQLO and GU, to respond. Fast Retailing said it had verified that the factory completed workers' payments in accordance with the ruling of the supreme arbitration tribunal, which ruled that the factory should pay half of a month's salary to workers.
In a rejoinder, Solidarity Trade Union of Myanmar (STUM) alleged that Fast Retailing's claims did not reflect the real circumstances of the situation, in particular, claims regarding: reports from workers via Fast Retailing's hotline complaint program; the factory’s fire insurance payout; Fast Retailing’s receipt of compensation; and Fast Retailing’s reference to decisions made by the Arbitration Council. Fast Retailing said it was aware of the additional points raised by STUM. Solamoda Group did not respond.
"Fast Retailing, by referencing the review of Arbitration Council’s decisions which lack understanding of international labor standards and is based on biased and unfair decisions without grounding in the law, is demonstrating a serious failure to carry out human rights due diligence which should be done even more carefully now due to the political situation in the country."STUM rejoinder, November 2022
Myanmar garment worker allegations tracker
Myanmar’s military illegally seized power on 1 February 2021. Through collaboration with partners and allies inside and outside Myanmar, we're monitoring the significant increase in labour and human rights abuses of garment workers across the country since the military takeover.