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In 2023, the market environment was challenging, characterized by geopolitical conflicts, volatile currencies, macroeconomic headwinds, and muted consumer sentiments as well as elevated inventory levels in the marketplace led to a decrease in our order book for footwear. Consequently, Eastcrown set up a downsizing plan (employment contract not renewed for more than 300 workers, including 13 union leaders and founders), due to reduced orders. The factory obtained an approval letter from the Ministry Of Labour for their downsizing plan. PUMA has asked Eastcrown to reinstate those 13 union leaders.

Between October 2023 to March 2024, PUMA facilitated mediation meetings between factory management and union. As a result, an agreement was reached to re-instate the 13 union leaders on April 1, 2024, with 50% of backpay from the last working day to the date of reinstatement. All 13 workers received the compensation, and 9 of them have returned to work on April 1st, one came back early May, other 3 decided not to come back.

The factory management at Eastcrown has joined the International Labour Organization’s Better Factories Cambodia program and a program on industrial relations, both of which will help the management improve the social dialogue at the factory.

In 2021 and 2023, PUMA partnered with Better Factory Cambodia to provide a customized workshop to all PUMA factories, including Eastcrown, and invited factory managements, shop stewards and union representatives. These trainings included topics such as the rights and obligations of employers, unions and worker representatives and workplace relations.

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