The retrenchment of 1,450 jobs at Swaziland’s largest textile manufacturer Tex Ray draws attention to the continuing exploitation of workers in the kingdom.
Tex Ray is one of a number of textile companies from Taiwan which set up factories in Swaziland to exploit cheap labour, government subsidies, tax breaks and the kingdom’s status under the Africa Growth Opportunities Act (AGOA), which allowed manufactured goods to be exported to the United States tariff free.
But, as Swaziland is set to lose its AGOA status on 1 January 2015 because of its poor record on worker rights, in particular protecting freedom of association and the right to organize, Tex Ray is to massively down-size and other Taiwanese-owned textile factories in the kingdom are expected to follow.
Tex Ray told local media in Swaziland it would retrench its workforce because it would make a financial loss when AGOA benefits were removed. Only 250 workers will remain at the company.
In a letter, to the Swaziland Manufacturing and Allied Workers Union (SMAWU) and Labour Commissioner Khabonina Dlamini, factory manager Lisa Chang said, ‘The company exports 100 per cent of its products to the United States of America market and due to the country’s exclusion [from AGOA], we have been unable to secure any further orders from our clients.’
Human Resource Manager Jackie Xu said, ‘All clothing produced within the Tex Ray Swaziland Factory was destined for the United States. So when there were no orders coming in and workers were idle, we decided to send them home while we figured out on what steps to take next.’
The Taiwanese companies have caused concern among labour union leaders and non-government organisations for years because of the way they exploit their workers.
In July 2014 a survey of the Swaziland textile industry undertaken by the Trades Union Congress of Swaziland (TUCOSWA) revealed workers in the textile sector were subjected to harsh and sometimes abusive conditions, many of the kingdom’s labour laws were routinely violated by employers, and union activists were targeted by employers for punishment.
More than 90 percent of workers surveyed reported being punished by management for making errors, not meeting quotas or missing shifts. More than 70 percent of survey respondents reported witnessing verbal and physical abuse in their workplace by supervisors.
Commenting on the survey, the American labour federation AFL-CIO said, ‘Some workers reported that supervisors slap or hit workers with impunity. In one example, a worker knocked to the ground by a line manager was suspended during an investigation of the incident while the line manager continued in her job.
‘Women reported instances of sexual harassment, as well. Several workers said they or other contract (temporary) workers were offered a permanent job in exchange for sex.’
Mistreatment of workers in the textile industry in Swaziland has been known for many years and workers have staged strikes and other protests to draw attention to the situation.
In its report on human rights in Swaziland in 2013, the US State Department said wage arrears, particularly in the garment industry, were a problem. It said, ‘workers complained that wages were low and that procedures for getting sick leave approved were cumbersome in some factories. The minimum monthly wage for a skilled employee in the industry - including sewing machinists and quality checkers - was emalangeni 1,128 (US$113). Minimum wage laws did not apply to the informal sector, where many workers were employed.
‘The garment sector also has a standard 48-hour workweek, but workers alleged that working overtime was compulsory because they had to meet unattainable daily and monthly production quotas.’
A damning report on Swaziland’s textile industry called Footloose Investors, Investing in the Garment Industry in Africa, was published in 2007 by SOMO – Centre for Research on Multinational Corporations, in Amsterdam, The Netherlands.
It said the Swaziland Government gave companies a large number of incentives such as tax exemptions and duty free importation of raw materials. The Government also allowed companies to take all profits and dividends outside of Swaziland, which in effect meant that there was little or no investment within Swaziland from the companies.
With a change of world trading conditions, Swaziland became less attractive to foreign companies. In order to maintain profits the companies began to lobby the Government for changes in the law. The companies especially wanted laws and regulations regarding labour loosened.
SOMO concluded, ‘It seems that the public spending on building shells and infrastructure aimed at attracting foreign investment in the garment industry has not brought about much economic benefit so far.’
The report stated, ‘Companies have been asking for certain “incentives” in exchange for their continued production in the country, implying that the country owes them something for their presence.
‘One of the companies in Swaziland, for example, Tex Ray, announced its willingness to set up a textile mill but asked in return for less stringent labour laws and laws on the environment, and for the prices of electricity and water to be halved. They also felt that government should subsidise the wages.’
In September 2014 hundreds of workers at Tex Ray were affected by poisonous chemical fumes at the factory in Matsapha. Many needed hospital treatment and the factory was closed for several days.
The Swazi Observer newspaper reported allegations from workers that retrenchment was a way for the company to avoid liability. The newspaper reported that other textile factories, including Kartat Investments, Kasumi and Union Industrial Washing, continued to operate.
The 1,450 workers retrenched at Tex Ray will receive terminal benefits ranging between E915 (US$90) and E18,000 (US$1,800).
Amalgamated Trade Unions of Swaziland (ATUSWA) Secretary General Wonder Mkhonza told local media, ‘The benefits being calculated for them are too little to even survive for two months. For those of us close to the situation on the ground it’s really painful. Honestly, those who are far removed from the situation are happy because they don’t have to witness the misery that has become characteristic at the textile companies.’
The Swazi Observer reported there were at least 17,289 people employed by the textile companies in Swaziland and all these could lose their jobs should the kingdom lose its AGOA eligibility.
Amongst these companies, Tex Ray has one of the highest number of employees at 6,000, Zheng Yong in Nhlangano has 2,000, FTM Garments employs 1,480, Leo Garments has 800, the Great Spring has 600 and HO’s Enterprise has 750.
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