PHNOM PENH — The United Nations’ labor body, the International Labor Organization, said this week that it would revise its program that monitors Cambodia’s garment factories.
Beginning in January, the ILO will publicly release information on factories that fail to comply with the most important elements of the country’s labor laws. The ILO plans to start those inspections next week, but a variety of hurdles might make it difficult for monitors to carry out their duties.
Cambodia’s garment manufacturing industry has grown rapidly over the past decade. Today, it is the country’s largest foreign exchange earner and, with over 400,000 Cambodians working in the industry, the nation’s largest formal employer.
The sector’s rapid growth was largely due to a trade preferences deal that allowed duty-free access to the U.S. market. In exchange, exporting factories submitted to an ILO inspection program called Better Factories Cambodia (BFC), which assessed their compliance with Cambodia’s Labor Law and made public its recommendations.
That was part of a carrot and stick approach; Cambodia got access to US retailers, as long as factories adhered to certain working conditions. Hundreds of foreign factories took advantage of the deal.
After the trade preferences deal expired in 2005, the ILO agreed it would no longer publicize the BFC’s findings, although it did continue to inspect factories.
However, as a study by Stanford Law School found in February, without the financial incentives to comply, factories simply ignored the BFC’s recommendations. Conditions for garment workers worsened, and today they earn less in real terms than they did a decade ago.
Jason Judd, the ILO’s technical specialist on the BFC program, says inspectors at the Cambodian program have noted a worrying trend.
“In the last three years we’ve seen the factories’ compliance with the Labor Law has been declining - it’s getting worse. Working conditions are deteriorating. That’s not true in every factory, but on the whole this is what we’ve seen. And we’re returning to an old practice - something we did in the early years of the project - to create some gentle public pressure on factories to improve working conditions,” said Judd.
Judd says inspectors will focus on basic issues such as ensuring emergency exits are unlocked during working hours and workers are paid at least minimum wage.
BFC, which has a purely monitoring role and which cannot enforce compliance, checks around 450 factories. Beginning next week it says its inspectors will assess factories’ compliance with 21 key issues. Factory owners will be given three months to make the required changes, or face being named.
The news has been welcomed by trade unions, some brands, including Sweden’s H&M, and by workers’ rights groups, such as the Solidarity Center, a non-profit affiliated with the U.S.-based labor movement. Dave Welsh, the country director for the Solidarity Center, thinks making the body’s findings public could help put pressure on violators to make changes.
“It’s a step in the right direction, and the opportunities it affords trade unions and workers and worker activists is that surely it’s sort of a naming and shaming aspect to it, but also it really highlights the urgency and calls publicly on those stakeholders who have the ability to make changes, fundamental changes in the industry - namely the government, namely the brands and namely the factories - to engage in a public and proactive manner. And that’s very, very helpful,” said Welsh.
The ILO’s announcement this week drew a lukewarm response from the government. Sat Samoth, a senior official in the Ministry of Labor, told local media he feared that publicly naming factories might drive away brands and cause job losses.
The government’s reaction aside, it is the Garment Manufacturers’ Association in Cambodia (GMAC), the industry body representing the more than 400 garment exporting factories, which is most annoyed. Ken Loo, secretary-general of GMAC, says his members were caught by surprise by what he termed the ILO’s high-handed approach.
Ken Loo says GMAC is not opposed to the results of inspections being made public, but is unhappy that the ILO disregarded the industry body and failed to allow it enough time to consult its members.
As a result, GMAC will send letters to its members advising them that they are no longer obliged to let BFC’s inspectors enter their factories.
“Factories are obliged to grant access to BFC monitors when they come for the unannounced audits. What we are doing now is to inform the factories that the association has taken the decision to inform them that they are no longer obliged. Access is granted by the government - by the respective ministries - so we are not refusing access, but we are saying that if they come with the relevant government officials and/or with the official letters indicating specifically that access should be granted, of course we will comply. If they don’t have that, then what we are telling factories is that they are no longer obliged. And they take the decision themselves,” said Loo.
Ken Loo says GMAC will stand by that until it feels its concerns have been taken into account - a position that looks likely to upset the ILO’s planned launch next week.