Cambodia postpones indemnity pay in garment-footwear units

06 Jun '20

1 min read

Pic: Shutterstock

The Cambodian labour ministry recently announced postponing the biannual indemnity payments to workers in the garment and footwear sector to provide some relief to employers and factory owners affected by the COVID-19 pandemic. A ministry statement said all seniority indemnity payments would be pushed back to 2021 to help business owners.

Workers and trade union leaders, however, criticised the move, saying they are already facing a loss of salary because of several factories suspending production and need these indemnity payments to try and sustain their households.

Clarity is yet to come whether the indemnity payments for 2020 will be paid alongside the payments for 2021, according to a Cambodian newspaper report.

Starting 2019, Cambodia amended its labour regulations to introduce a biannual seniority payment based on the experience and number of years worked. This did away with severance payments, also called dismissal indemnity, which was applicable only if an employee was unilaterally terminated.

Ken Loo, secretary general of the Garment Manufacturers Association in Cambodia, said he did not know if employers had made the request.

Fibre2Fashion News Desk (DS)

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