Workers at Zhen Tai Garment Cambodia Co Ltd in Phnom Penh accused the company owner of embezzling workers’ pensions. They have been waiting for 11 months for a settlement.
Mech Sienghai, 38, told CamboJA News that she has been working at Zhen Tai for 12 years, earning $250 a month. The Chinese-owned factory employs 1,300 workers.
Between October 2022 and August 2023, the company deducted $5 to $6 from each worker’s salary as a contribution to the National Social Security Fund (NSSF), but it was alleged that only $2 was paid to the fund.
She explained that the workers complained to the company because they noticed that their NSSF showed insufficient contributions although they earned between $250 and $300. They later learned that the company declared that their salary was 300,000 riel (around $75) to 400,000 riel (around $100).
Sienghai, who worked in the sewing station, said at first, they did not know the company was paying less into the fund than required.
“I didn’t know that some workers who got sick or gave birth received only 70% of the benefits. It was a small amount. They were surprised and asked other workers [about it], who then asked the NSSF. The NSSF advised them to check the NSSF app and found that the [salary contribution] was low,” she related.
She felt that the company had not paid enough money to the NSSF, causing her and other workers to lose a lot of the benefits, such as during childbirth or compensation in the event of an accident at work. Only 70% of the benefits are not sufficient, she remarked.
“I request the relevant ministries, including the NSSF, which is an official under Prime Minister Hun Manet, to pay attention to the workers. I think the workers have been treated unfairly. It will take months to resolve the matter,” she said.
Kem Sophen, president of Cambodian Workers’ Spirit Union at the garment factory, said he submitted a letter to the NSSF under the Ministry of Labor and Vocational Training at the end of 2023 to look into the matter. But no solution was offered.
He said irregularities of pension payment to the NSSF was discovered following a check on the NSSF app.
After waiting for three months, they decided to lodge a complaint with the Labor Ministry on July 11, 2024 to resolve the matter. On July 31, 2024, the ministry invited workers and company representatives to discuss, but no agreement was reached.
Sophen said the workers demanded that the company resolve 13 issues, one of them being the speeding up of the NSSF payment deficit.
“The Labor Ministry wanted to mediate negotiations, but the company did not negotiate. The ministry asked the workers for time to raise the [issue] next time and push this case to the upper level, but they don’t know when that would happen.”
“The company refused to settle because the workers’ representatives [in filing this complaint] placed an ‘unusual thumbprint’ in support of this case, with the company claiming that there were more than 10 workers who refused to settle,” he said.
He urged the leadership, especially the Labor Ministry and Hun Manet, to look into other cases too. The fund is for the benefit of workers, especially pregnant women who may have lost their benefits. With regards to future pension, workers will experience similar losses if this continues.
Meanwhile, Zhen Tai administrative director Bo Bunly said the factory was acting in accordance with the labor law and procedures. It includes the meeting at the ministry on July 31 with the workers’ representatives.
“There was no solution for the meeting on the day because we will wait to see how the Labor Ministry will resolve it,” he said.
Ministry spokesperson Katta Orn told CamboJA News that the Zhen Tai factory case was within the jurisdiction of the court.
“The case is a lawsuit,” he wrote, adding that the court was following the procedure.
Katta Orn did not respond to how the ministry will resolve the irregular payment, why it was taking time to solve the problem, at what stage the investigation was at, whether any legal measures had been put in place and if there were similar problems involving the company in the past.
Chan Rom, an official with the Khmer Union Federation of Workers Spirit (KUFWS) , said if factories do not pay their workers’ pensions, it would affect workers when they retire at the age of 60. When they do not pay enough, the pension will be small.
“I request the relevant institutions to expedite the settlement of workers with full pension as some workers have been working in this factory for 10 to 15 years and maybe getting older. They will need their pension when they turn 60 as they will not be able to make a living in old age,” he said.
NSSF spokesperson Heng Sophannarith told CamboJA News that they are investigating the company. According to him, the company must contribute “enough” amount to the fund. Failure to pay contributions to workers will lead to legal action.
Cambodia implemented a pension scheme on October 1, 2022, where workers are required to make a two percent contribution of their wages while employers pay another two percent to the fund.
“We went to investigate the factory and spoke to the factory administration and relevant stakeholders. We asked them to pay the full amount to the NSSF. If there is no payment, we will send the documents to court. However, a complaint has already been sent to court,“ Sophannarith said.
