Poor Working Condition in Cambodia - Case Study Example

POOR WORKING CONDITION IN CAMBODIA By Name Course Instructor Institution City/State Date Table of Contents POOR WORKING CONDITION IN CAMBODIA 1 Table of Contents 2 1.0 Executive Summary 3 2.0 Introduction 4 3.0 Discussion 5 3.1 Labour Conditions 6 3.2 Gender Discrimination and Child Labour 8 4.0 Trade Unions 9 5.0 FDI in Cambodia 10 6.0 Conclusion 11 7.0 References 12 Poor working condition in Cambodia 1.0 Executive Summary Long working hours, low wages, excessive noise, corruption, abuse, unsanitary conditions, as well as poor air quality in Cambodia’s manufacturing facilities have continuously been mentioned as factors that characterize production in the country. There has been a growing public concern about the working conditions in Cambodia, and both employers and governments have been equally pressurized to improve the situation. Exposure of the public to workplace agitation appears to be improving the working conditions progressively in the global supply chains. Anti-sweatshop activities in Cambodia have imposed constraints on the factories that, particularly in environments that are very competitive; thus, survival has become challenging. Some of the improvements like plumbing, air conditioning, or safety equipment need capital investments, which are very costly. Additionally, companies in Cambodia are finding hard to comply with the laws that set out the minimum wage as well as rarely offer additional compensation like overtime and paid leave. When firms are operating resourcefully in markets deemed competitive, escalations of the costs will certainly result in the exit of the marginal firms. Many companies in Cambodia pay their workers poorly, especially in the garment industry. Cambodia being a developing country does not have adequate resources that can justify the appeal of standard economic model to private and public enforcement. Although some regulations in Cambodia seem to be protecting workers from poor working conditions, inadequate resources to enforce these regulations is challenging. Lack of resources to enforce such regulations is mainly attributed to corruption. In this report, the focus will be on the poor working condition in Cambodia. 2.0 Introduction Cambodia industries, especially the garment industry have contributed enormously to poverty reduction by means of employing the poor (Yamagata, 2006, p.1). Although there is evidence that employment in different industries have resulted in poverty reduction across Cambodia, poor working conditions have remained to be a burning issue. The number of Cambodians employed in the garment industry alone as of 2014 was between 400, 000 and 650 000 employees. For years, there has been an on-going controversy about minimum wage: Together with NGOs and trade unions, workers at the Cambodian garment have been lobbying for higher wages. This has resulted in the increase of the minimum wage from $80 to approximately $100, but this is still little considering that the living wage at the country stands at $283. Campaigners and workers have been pushing for $177 minimum wage, but the government raised it to $128 in 2014 (Kane, 2015, p.1). Cambodia is widely known for its poor working conditions that have resulted in mass fainting; for instance, over 2000 employees fainted in 2012. Reports about the trade union rights violations, women discrimination and child labour have increased tremendously. Poor working conditions have resulted in walkouts, strikes as well as other forms of industrial civil disobedience. This can be attributed mainly to corruption and poor governance, whereby the government has continually sided by the employers leaving the employees defenceless. On the other hand, NGOs have been lobbying for reforms Cambodia industries, especially the garment industry and the increase of the minimum wage to help reduce poverty, discrimination, and child labour. When employees go to the street to protest against the poor working conditions they are often met with heavy response from the police, which includes use of live ammunition and detention. 3.0 Discussion Basically, inequality within and between countries is growing instead of decreasing; therefore, most households in developing economies such as Cambodia are surviving in a society where income is distributed unequally. For this reason, rich countries are becoming richer while the poor countries remain poorer. Some countries have espoused the neo-liberal economic agenda that seeks to eliminate inflation and deficits in the government, reducing government spending, deregulating both the financial and labour markets as well as opening the national economies to multinational capital investments and free trade. Without a doubt, this can help protect the poor, and not the rich. For instance: regulations can force the companies to pay living wages as well as make sure the working conditions are sustainable. Blame avoidance and cost shifting is prevalent in most developing countries (Menz, 2011, p.119). As commerce, business has been defined as the process through which goods and services are produces, produce, exchanged as well as traded. Imperatively, the business role is creating wealth for society at large and also for customers and employees. For this reason, companies have started adding social and environmental indicators to their financial as well as economic results in their sustainability or social reports. In Cambodia, civil servants are aligned with the Cambodian People's Party (CPP), which is the ruling party. Opposition party and NGOs demonstrations have been suppressed violently by security forces on a number of occasions. For instance, CPP/Government cleared Cambodia National Rescue Party (CNRP) protesters by force from the Freedom Park (Moniroth, 2014). This was followed by a fierce suppression by the police on the garment factory workers who were striking that led to deaths and injuries. Most factories do not update their record keeping resulting in lack of reliable data. This often resulted in inconsistencies with regard to lost wages in case a worker loses his/her job. International Labour Organisation’s (ILO) introduced a project known as Better Factories Cambodia (BFC) with the goal of improving such practices, whereby factories are monitored to make sure they abide by the comprehensive list of international as well as national labour standards. The project particularly monitors employees’ contracts, wages, as well as the general working conditions in the factories. Regrettably, globalization effects have been ambiguous: in reality, the expansion of the global marketplace has extended the poverty gap and has resulted in the abuse of the disadvantaged and vulnerable. According to Hoshi et al. (2010, p.10), the economic-centred approach towards globalization seems hazardous since it marginalises the concerns of human rights, generates conditions that allow the human rights to be violated persistently, and cannot identify the complex factors of globalization and the panoply of participants as well as stakeholders. 3.1 Labour Conditions The working conditions in Cambodia are in a sorry state, and this is despite the existence of the international trade agreements and progressive labour regulations. Cambodian workers are continually exposed to unfavourable working conditions (Robertson et al., 2011, p.2). The labour monitoring programme that was launched by ILO because of the Unfair Contract Terms Act (UCTA) offer reliable information that can be used to track the performance of the labour rights for a certain period of time. In the Cambodia garment industry according to this data has experienced a steady improvement, but the remaining problems overshadow these improvements. The garments industry makes up 80% of exports in Cambodia and also accounts for 12% of the GDP (Mammoun, 2011, p.25). There are more than 400,000 individuals employed directly in the garment industry, but still many other are working in subcontracting factories that are unregistered: This, accounts for approximately 65% of the manufacturing labour force in Cambodia (Nuon et al., 2011, p.3). The garment industry has become the biggest export earner in Cambodia because of the country’s abundance of low skilled labour, low wage, and openness to FDI. Still, the number of human rights violations in this industry has increased tremendously. Most factories engage in various forms of discrimination; do not have trade union; and often interfere with the freedom of association, which is a right to every Cambodian employee. Besides that, the government has failed to protect the workers from serious labour rights abuses. For instance, most of the women employees are forced to work overtime, are discriminated if pregnant, and are not allowed to join trade unions. The CPP/Government has been reluctant to enforce the labour laws and companies are bribing authorities to prevent compliance and monitoring (Kolben, 2004, p.107). More recently, instances of wage protests, workers fainting, and burdensome procedures of union registration have exacerbated the dilemma facing Cambodia workers, especially in the garment industry. Many workers in the Cambodian garment industry have been hospitalised following incidents of mass fainting. This exhibits that the problems facing employees in this industry is critical. Garment employees have continuously protested of strong chemicals and poor ventilation. Given that corruption reigns in Cambodia, official investigations with regard to these issues have largely been inconclusive. Cambodian workers are becoming more and more stressed by the fact that they are not benefiting in any way from the spoils of their hard work (Natsuda et al., 2009, p.19). Even though government has increased the minimum wage to $128, the increment has not benefited the workers, since large percentage of their salary is swallowed up by expenses such as rent. Although the minimum wage results in poverty reduction in most developed countries, this is not the case in Cambodia because the minimum wage has failed to help employees meet their daily needs. Therefore, government effort to increase minimum wages cannot be considered consequential. According to Yildirim (2015, p.85), there is a strong connection between labour productivity and real wages; however, an increase in wage has not resulted in high productivity since their life has not yet improved. 3.2 Gender Discrimination and Child Labour Undoubtedly, gender discrimination is a case of nonconformity to the norms of human rights in Cambodia industry and beyond. Gender discrimination is very high in Cambodian factories, especially for pregnant workers who are often dismissed. Besides that, women are underrepresented in employment and their wages is very low as compared to their male counterparts. In addition, it is hard for Cambodian women to care for their family and at the same time work at the factories. Sexual harassment is also a perceptible problem that women workers face at the factories (Lipschutz & Rowe, 2006). Besides that, female workers at the factories face different forms of abuse, risky employment, and unsafe migration attributed to retrenchment as well as income loss (Walsh & Ty, 2011, p.28). Global financial crisis has resulted in compulsory unpaid leave, reduced overtime and widespread dismissals amongst female workers. As mentioned by Hoshi et al. (2010, p.47), 52% of Cambodian women do not have adequate income that can support their families. Child labour very high in the Cambodian private sector despite the fact that it is illegal. Most children are forced to work in salt production, commercial rubber plantations, brick factories, fish processing, domestic work, and many others. This has resulted in late school entry and the number of school dropouts has increased significantly. Work activities and school enrolment according to UCW (2006, p.8) are negatively related, and the negativity increases with age, especially amongst girls. The number of children working in Cambodian brick factories is very high and has been described by a number of scholars as cited by UCW (2006, p.9) as the worst forms of child labour. This is in view of the fact that these factories are dangerous, unhygienic, and do not have basic safety and health precautions: many of the brick factories have hazardous and poor working conditions because of burning and flying ash, unbearable heat, falling bricks, lack of first-aid kits, and no sanitation as well as safety regulations (Hoshi et al., 2010, p.48). Child workers in Cambodia factories normally experience itching and watering eyes because of flying ash and smoke, chest pains, backache, skin rashes, and many other health problems that are brought about by poor conditions in these factories. 4.0 Trade Unions Since late 1990s, workers in the Cambodia garment industry have been part of the new social force that emerged during the economic change, the discontented groups that took part in numerous protests (Polaski, 2006, p.5). Such protests were attributed to threats of violence or violence against Cambodian factory workers, discriminatory slurs voiced by foreign supervisors as well as forced overtime. Upon recognising the political significance of such groups, the Cambodian People’s Party decided to support or form a number of trade unions. The trade union engage in activities that promote the rights of the workers, but are repressed by some factors: (i) government that supports ‘friendly’ unions; (ii) employers as well as the Garment Manufacturers Association in Cambodia (GMAC); (iii) the increasing number of pro-capital unions; (iv), the unions owned by mafias whose goal is extorting money from both members and employers (Arnold, 2013, p.13). Therefore, in spite of high membership in the trade union, workers basic rights have continuously been abused or neglected. For instance, issues such as unpaid overtime as well as poor occupational safety have not been addressed adequately. Moreover, the prevalence of Fixed Duration Contracts (FDCs) has made workers unable or reluctant to promote their rights as members of the union or individually. The increasing number of plant-level and federations unions has made it hard for ‘genuine’ unions to represent their members. Conflict and competition between the government and unions have limited their unions’ effectiveness. Most factories in Cambodia do not have suitable protective equipment, the electrical wiring are outdate and can result to major fires, and the fire exits are have been blocked deliberately by the factory owners (European Union, 2014, p.4). Unions have failed to improve the situation. 5.0 FDI in Cambodia Full development of Cambodia is more likely to happen if it focuses on generating environments that attract foreign investment that consequently promote social development and generate economic growth. Cambodia government is turning to FDI so as to bring development in the country and to improve private investment. In the last few years, FDI inflows have exponentially grow in Cambodia because of political stability, strong macro-economic policies as well as regional economic growth. Even though foreign investment is encouraged in Cambodia, its legal system is plagued with corruption and lack of transparency; consequently, this has created obstacles to foreign investment (Johnson et al., 2014, p.38). FDI increases wages and this can consequently force the competitors to increase their employees’ wages (Warren & Robertson, 2011, p.4). Evidently, Cambodia has gained from technological and structural transformations of globalisation. Foreign investment in Cambodia is substantial, but the country is relying on foreign sources to improve its economy and protects its social development. But failure to emulate know-how as well as to adopt new technologies has left many Cambodian workers in deplorable state attributed to the poor working conditions. As mentioned by Saarelainen et al. (2011, p.2), good working conditions can enable the companies in Cambodia to improve their productivity as well as the overall competitiveness. 6.0 Conclusion In conclusion, the report has focussed on the poor working condition in Cambodia. Even though the UCTA has resulted in some improvements in the Cambodian business sector, some industries especially the garment and brick sector are plagued with issues such as forced overtime, gender discrimination, child labour, as well as utilisation of FDCs to evade labour regulations. Besides that, debatable the minimum wage set by government is not sufficient and cannot help workers meet the adequate living standards. There are widespread cases of discrimination, labour rights violations and health problems in the Cambodian business sector. Even though some internationalised companies have tried to respect human rights by upholding union rights, other businesses should utilise their leverage so as to encourage them to comply with the labour rights. Evidently, the modern-day discourse on human rights and business sources from the rapid globalization whereby innovations, technology as well as liberalization within the corporate structure integrate to broaden the prior limits on how and where businesses should internationalise. Clearly, globalization can result in sustainable global models of social justice as well as development that simultaneously offer protection to human rights and equitable growth of the economy. As Cambodia continues to develop its education system and infrastructure, they should invest more on strengthening the labour force quality that can lead to healthy supply of labour. 7.0 References Arnold, D., 2013. Workers’ agency and re-working power relations in Cambodia’s garment industry. Working Paper. 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