Is COVID-19 a smokescreen for labour abuses?

Labour activists say they are being dragged unjustly before the courts and that factory owners are exploiting the disruption caused by the pandemic to purge union leaders.


The COVID-19 pandemic has put one of Myanmar’s biggest economic success stories into a tailspin. Dramatic growth over the past decade has catapulted the garment sector above natural gas as Myanmar’s biggest export earner – drawing in US$4.6 billion during the last fiscal year – and it employs more than half a million workers, 90 percent of whom are women. The first signs of looming catastrophe came in February, when raw materials from China began to dry up. This was followed in March by the mass cancellation of orders from the pandemic’s new epicentre, Europe, where most Myanmar garment exports are sent.

These shocks have resulted in large-scale layoffs as well as fewer opportunities for overtime pay, which is often crucial for making ends meet. In several cases, factory owners have fled without paying workers their salary, let alone compensation for losing their jobs. U Nyunt Win, director general of the Factories and General Labour Laws Inspection Department, told Frontier that, by the end of April, more than 60,000 factory workers were out of work and 175 factories had stopped operating, mostly in the garment sector.

Meanwhile, at factories that have tried to maintain normal operations, there have been tense standoffs between managers and workers who have demanded the temporary closure of factories on full pay because of the risk that COVID-19 could spread quickly on the shop floor. National-level negotiations between labour representatives, employers and the government over a shutdown for all of April with paid leave for workers failed to produce a result. After the 10-day Thingyan holiday, which ended on April 19, the government ordered all factories to close pending inspections to ensure compliance with COVID-19 prevention measures, and the Social Security Board said it would pay 40pc of workers’ salaries during this time. When factories resumed operations in late April or May, many of the workplace disputes flared up again.

Protests since early April in Yangon, where most of Myanmar’s garment industry is based, have been supported by a variety of labour rights organisations and have been fuelled by deep distrust towards factory bosses. A spate of arrests, followed by hasty prison sentences given to protest organisers, have led union leaders to accuse factory owners of colluding with the authorities to exploit the pandemic in a bid to rid their workplaces of activist workers, who have previously been targeted in alleged crackdowns.

One of the largest worker protests in Yangon in support of temporary closures with paid leave began on April 3 at the No 1 Industrial Zone in Dagon Seikkan Township. It involved 1,500 workers from four bag and garment factories in the zone. However, negotiations over the workers’ demands for an April closure with the management of the Blue Diamond, Brightberg Enterprises, Rainwear House and Mayfair Myanmar factories were not concluded before the start of the Thingyan traditional new year holiday on April 10.

When the Blue Diamond bag factory, which has about 300 workers, resumed production on May 2, 102 members of the basic labour union (as unions within a particular workplace are formally known) were told that, if they wanted to keep their jobs, they had to sign a pledge not to protest again.

Ma Nwe Zin, 26, who began working at the Blue Diamond factory after moving to Yangon from Sagaing Region two years ago, said that she and the other targeted members of the basic labour union refused to sign the pledge and began a fresh protest.

“About 100 union members, including our chairwoman, Ma Zar Zar Tun, and the protest leader, Ma Lay Lay Mar, believe the document is a violation of our labour rights and we have refused to sign it,” she told Frontier.

Forming a picket line at the factory gates, they also renewed their demand for full pay for all of April, and were joined by workers from the other three factories the following day.

Ko Nay Lin, an executive member of the All Burma Federation of Trade Unions, an unregistered activist group that supported the Dagon Seikkan protests, said the workers were moved to protest in April because they “were afraid of the virus but had to keep working because factory owners did not want to grant paid leave”. He and Nwe Zin also said workers had received nothing from their factories to cover the Thingyan holiday or the government-ordered closure that followed, and workers who refused to sign the pledge remain fired. The workers were also still waiting for the compensation promised by the Social Security Board, amounting to 40pc of their basic salary over the forced closure period, ABFTU spokesperson Ma Thet Htar Swe told Frontier on May 26.

Blue Diamond World Company Ltd declined to comment on the workers’ grievances, and the management of the other three factories could not be reached.

Despite the resumption of protests on May 2 that continued for two more days, with the workers camping overnight at the factory gates, hopes of government intervention in the workers’ favour were soon dashed. “Instead of supporting the needs of workers, the government responded with oppressive laws,” Nay Lin said.

Police swept in and dispersed the protest on May 4, arresting eight leaders of basic labour unions. The following day, police arrested three ABFTU members who had taken part, as well as one member of the Social Democratic United Front, a political activist group allied to ABFTU.

Six of the basic labour union leaders were released on May 5, but for the other six who were arrested, punishment was delivered swiftly. That evening, Dagon Seikkan Township Court sentenced the four men from ABFTU and SDUF, and the two remaining basic labour union leaders – mothers aged 31 and 34 – to three months’ imprisonment for three criminal offences: wrongful restraint under section 341 of the Penal Code, for obstructing the entrance to the factory; “wilful failure to comply” with government directives for “natural disaster management” under section 30a of the Natural Disaster Management Law, for defying the governemnt ban on gatherings of five people or more; and section 188 of the Penal Code, for violating a night-time curfew by camping overnight at the factories. The six were taken immediately to Insein Prison.

But the police weren’t finished. Legal action was taken against a further 27 people who were involved in the Dagon Seikkan protests under the same three offences. The curfew and ban on gatherings, in place since April 17 and 18 respectively, are measures aimed at curbing the spread of COVID-19. Their use against protesting workers – and the speed with which they were sentenced, in a criminal justice system where cases can drag on for months, if not years – has fed suspicions among labour activists that the pandemic is being used as a smokescreen for labour abuses and a crackdown on unions.

Ma Nwe Zin, member of the basic labour union at the Blue Diamond Bag factory, was told at the start of May that she couldn’t return to work unless she signed a pledge not to protest again. She refused. (Kyaw Lin Htoon | Frontier)

Ma Nwe Zin, member of the basic labour union at the Blue Diamond Bag factory, was told at the start of May that she couldn’t return to work unless she signed a pledge not to protest again. She refused. (Kyaw Lin Htoon | Frontier)

Rights and benefits

U Myo Aung, permanent secretary of the Ministry of Labour, Immigration and Population, said demands made by workers fall into two categories: those calling for rights to which employees are automatically entitled by law, and those calling for added benefits. The pursuit of the latter, he said, needed to go through the official arbitration bodies that have been established at different administrative levels to resolve workplace disputes.

“The demand to close a factory for the entire month of April and continue to pay full salaries goes beyond their rights as outlined in law,” Myo Aung told Frontier. “Workers need to negotiate with factory owners peacefully and they should not be inflexible about their demands.”

Ko Wai Yan Phyo Moe, 21, vice president of the All Burma Federation of Student Unions, a group closely allied to the ABFTU that also supported the Dagon Seikkan protests, disagreed with Myo Aung’s view.

Wai Yan Phyo Moe said the government needed to understand that protests and strikes are the last resort of workers to press demands. The workers at the Dagon Seikkan industrial zone had followed all the required steps for workplace disputes, including reporting to the township-level labour office and General Administration Department. However, factory owners had failed to attend arbitration meetings to discuss the workers’ demands, he said.

“The arbitration process is so prolonged and in this time of COVID-19, action needs to be taken immediately,” he said. “That’s why the workers resorted to protest to help the government understand their suffering.”

Asked about the arrests at Dagon Seikkan industrial zone, Daw Phyo Sandar Soe, assistant general secretary of the Confederation of Trade Unions Myanmar, which unlike the ABFTU is legally registered, said the law needs to be applied equally.

“If the government takes action against workers and activists for breaching the law, it must also take action against business owners who breach the law,” she said.

However, for labour activists like Phyo Sandar Soe and Wai Yan Phyo Moe, the law is part of the problem. Union members have complained for years that the cash fines under the 2012 Settlement of Labour Dispute Law that are levied at factory bosses who refuse to cooperate with arbitration bodies or abide by their rulings were not an effective deterrent: many bosses prefer to ignore rulings and pay the fines instead of engaging with workers’ demands. Unions and some members of parliament lobbied hard to have prison terms for uncooperative bosses included in the law, but amendments passed last year merely increased the fines after counter-lobbying from business groups who argued that prison terms would deter foreign investment.

“If the government really wants to create good workplaces in the country, it has to change that dispute settlement law first,” said Phyo Sandar Soe. “Under the current law […] it is still hard to effectively take action against employers. If we keep going with this law, the relationship between labourers and employers will only get worse.”

Phyo Sandar Soe told Frontier on May 15 that after the government ordered factories to close from April 20 for inspections, union members at more than 70 workplaces had told CTUM that the owners had not followed the shutdown order and none had so far faced legal action.

“In a country based on the rule of law, every citizen has to follow the law. When it comes to labour issues, the government rarely takes action against factory owners but often takes action against unionists and activists,” she said.

However, owners do not always avoid legal action. The Voice newspaper reported on May 19 that the Factories and General Labour Laws Inspection Department is preparing to file charges against the owner of the Eurogate Sportswear garment factory in No 3 Industrial Zone in Yangon’s South Dagon Township for failing to pay salaries. Workers at the factory said the owner had not paid about 700 workers for March and April and that the factory remains closed, despite the owner saying it would reopen on May 15.

Workers at the Blue Diamond bag factory in Yangon’s Dagon Seikkan Township walk home on May 12. (Kyaw Lin Htoon | Frontier)

Workers at the Blue Diamond bag factory in Yangon’s Dagon Seikkan Township walk home on May 12. (Kyaw Lin Htoon | Frontier)

Laws and other threats

As well as the threat of legal action for organising protests or obstructing access to factories, union members and labour activists also risk losing their jobs for expressing themselves in less confrontational ways than protests.

Ma Zin Mar Lwin, 33, has been working for more than 10 years at the Unilever EAC factory in an industrial zone at Yangon’s Hlaing Tharyar Township. She became chair of the factory’s basic labour union after trade unions were legalised in 2011 under the Labour Organisation Law.

In early April, Zin Mar Lwin and other workers – both union and non-union members – organised a social media campaign advocating for temporary closures of factories with paid leave to curb COVID-19. Workers from several other factories soon joined in. In photos uploaded to Facebook, factory workers were pictured holding hand-written signboards, one of which read, “Crowds happen every time we eat, work and commute, so please temporarily close the factories”.

Zin Mar Lwin, who is single and supports parents living in Mawlamyinegyun Township in Ayeyarwady Region, said no factories were named on the posters. “We organised this campaign simply to raise awareness about our concerns as workers,” she said.

Despite several dozen workers from the Unilever EAC factory being involved in the campaign, the management only targeted Zin Mar Lwin. In a letter dated May 13, management told her she was being sacked for breaching a clause in her employment contract. The letter alleged that Zin Mar Lwin had leaked company secrets.

She told Frontier that what she posted on Facebook was “completely unrelated to any so-called secret information about the factory.”

Zin Mar Lwin was dismissed without negotiations involving the workplace coordinating committee – the lowest rung of the dispute settlement system established under the Settlement of Labour Dispute Law – and her case has since been heard by the township arbitration council. A ruling is pending.

Unilever EAC Myanmar Company Ltd, which is a joint venture between the global consumer goods giant Unilever and local firm Europe & Asia Commercial, told Frontier it would not respond to media requests for comment.

In early April, workers at the Unilever EAC factory in Yangon’s Hlaing Tharyar Township led a social media campaign in favour of temporary factory shutdowns with paid leave to curb COVID-19. (Facebook)

In early April, workers at the Unilever EAC factory in Yangon’s Hlaing Tharyar Township led a social media campaign in favour of temporary factory shutdowns with paid leave to curb COVID-19. (Facebook)

The runaway factory owner

While laid-off workers in Yangon are struggling to feed themselves, efforts by labour rights and charitable groups to support them have been hampered by the at-times inflexible enforcement of social distancing measures by authorities. A case in point is an incident in April in Yangon’s Shwepyithar Township.

In the township’s Thar Du Kan industrial zone, more than 300 women were made jobless after the South Korean owner of the World Jin garment factory absconded. The factory owner paid salaries for March on April 3 and told employees the factory would re-open after the Thingyan holiday, on April 20, when returning workers were told operations would not resume until May 5. But when workers returned that day, they learned that the owner had disappeared.

“We had suspicions that something was wrong because the owner was not paying social security contributions properly and she was selling the clothes [to local traders],” said Ma Hnin Nwe Oo, 33, secretary of the factory’s basic labour union. The local selling of clothes was considered suspicious, and a sign of financial stress, because garment factories like World Jin normally sell all their clothes to overseas buyers who have pre-ordered them.

“We reported our concerns to the government’s labour offices but they did not inspect the factory,” she told Frontier.

World Jin Garment Company Ltd told Frontier they would not comment on the matter.

The more than 300 women left jobless because of the absconding factory owner have been supported by a labour rights group called Yaung Chi Oo as well as Solidarity Trade Union Myanmar, a legally registered group based in Shwepyithar.

On May 10, STUM invited the jobless workers to its centre in Shwepyithar’s seventh ward to receive a food donation from the We Love Yangon charitable group, which is helping to feed people suffering because of the economic fallout accompanying the pandemic. The group is chaired by Daw Than Myint Aung, who is a co-founder of the Free Funeral Service Society-Yangon and member of Yangon City Development Committee, the city’s municipal authority

STUM asked the workers to arrive separately in groups of 10 and to practise social distancing, but the ward administrator intervened to block the event from being held at the group’s centre, forcing the organisers to move at the last minute to a nearby football field.

They arrived at the football field at about the same time as two truckloads of heavily armed riot police.

“We were in a very difficult and tense situation, but when the people from We Love Yangon arrived, the police and officials relented and allowed the donations to the jobless women to proceed,” said Daw Myo Myo Aye, a STUM founder, who said she was herself at risk of arrest for involvement in a gathering that exceeded four people.

Under the gaze of the armed riot police, each of the women received seven kilogrammes of rice, a dozen eggs and three tins of canned fish.

A garment factory in Hlaing Tharyar Township seen before the COVID-19 pandemic, which has put the formerly thriving industry into a tailspin and caused mass layoffs. (Nyein Su Wai Kyaw Soe | Frontier)

A garment factory in Hlaing Tharyar Township seen before the COVID-19 pandemic, which has put the formerly thriving industry into a tailspin and caused mass layoffs. (Nyein Su Wai Kyaw Soe | Frontier)

‘The government wants to send us a warning’

“Sending unionists and activists to jail will not help to solve disputes,” said Myo Myo Aye, referring to two ABFTU members, Ko Kyaw Myo and Ko Myo Gyi, who were sentenced over the Dagon Seikkan protest. “Other Kyaw Myos and Myo Gyis who stand for oppressed workers will continue to emerge in industrial zones.”

One long-standing case in Hlaing Tharyar illustrates how labour activists can be penalised for playing even a supporting role in workers pursuing disputes against their employers.

On October 4 last year, Daw Moe Sandar Myint, acting head of the Federation of Garment Workers Myanmar, arranged transport for workers of the Kai Cheng Garment (Myanmar) factory to attend an arbitration meeting at the office of the Department of Labour Relations in Hlaing Tharyar Township. The workers were locked in a dispute with the factory owners over unpaid salaries for the previous month.

At the last minute, the owners refused to sign the dispute settlement agreement that had been reached at the meeting and left the office. A group of workers then surrounded their vehicle in a failed attempt to stop them from leaving the compound. Four workers were hit by the car and injured. Moe Sandar Myint told Frontier that the workers did not try to damage the car or hurt its occupants, and added that those who were injured chose not to pursue legal action against the factory owners because they did not want to jeopardise the negotiations, which have not since been resolved

More than seven months later, on May 12, the Department of Labour Relations launched legal proceedings against Moe Sandar Myint, two other members of FGWM, and a basic labour union leader at the Kai Cheng factory, for wrongful restraint, assault or using force without grave provocation, and mischief causing more than K5,000 in damage, under sections 341, 352, and 427 of the Penal Code. Moe Sandar Myint said she and her FGWN colleagues who were present at the October 4 arbitration meeting were targeted despite the fact that they had not been involved in the workers’ attempt to stop the factory leaders from leaving the meeting prematurely.

Frontier went to the Hlaing Tharyar Township offices of the Factories and General Labour Laws Inspection Department and the Department of Labour Relations on 15 May but the departmental heads were not available. Frontier was given the number of the head of the labour relations department, U Thein Myint, and called him the next day. Asked to comment, he said he was busy and promised to call back. Frontier is still waiting to hear from him.

Moe Sandar Myint wants to know why the labour relations department has taken legal action against her and others but has not launched a case against the Kai Cheng factory owners for allegedly breaching employment contracts and for the incident in which four workers were run over and injured.

“I have a feeling that the government wants to send us a warning to stay quiet while it is dealing with COVID-19,” she said. “But we have to continue standing on the side of the workers because they have no one else to rely on.”

Top photo: Daw Moe Sandar Myint, acting head of the Federation of Garment Workers Myanmar, stands next to the flag of the federation. (Kyaw Lin Htoon | Frontier)

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