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Hundreds of Saitex Workers Strike Over Paycheck Deductions

More than 300 workers at Saitex International’s factory in the Vietnamese province of Dong Nai went on strike for more than six hours on Monday to protest the denim manufacturer’s policy of penalizing employees for mistakes that lead to product defects, a move that a union leader said was inappropriate and illegal but is allowable under national law.

The demonstration at Amata Industrial Park, which was first reported by Vn Express, took place after workers discovered deductions of between 200,000 to 1 million Vietnamese dong ($8.53 to $42.65) on their March paychecks.

A representative from the Dong Nai Labor Confederation told the outlet that the B Corp, which makes Fair Trade-certified jeans for brands such as Everlane and J.Crew, complained of higher rejection levels of products in that month, which Saitex confirmed to Sourcing Journal. The company docked their paychecks for products with defectiveness rates of between 15 and 25 percent.

Saitex, which says it pays workers a living wage, said that workers went back to work after discussions with the union led to the deducted amounts being returned to workers. The company’s CSR department also reported the incident to Better Work, the International Labour Organization-backed initiative that promotes decent working conditions in several garment-producing countries, including Vietnam.

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The “Best for the World” award winner said that such protests are a rare occurrence for the company, which has built its name on ethics and sustainability. The “disruption,” as Saitex characterized the strike, was minimal. Protestors represented roughly 10 percent of the factory’s 2,800-strong workforce, which churns out 18,000 pairs of jeans a day, it said.

“As a Fair Trade facility committed to paying living wages, workers’ well-being is at the cornerstone of Saitex’s operations globally,” a spokesperson told Sourcing Journal.” The recent employee-led disruption at one of our facilities in Vietnam is something Saitex strives to prevent. However, disagreements and issues do arise.”

The Dong Nai Labor Confederation could not be reached for comment. According to Vietnamese law, employers can deduct wages for workers’ mistakes that lead to defects or damage of products, tools or equipment; absenteeism without justification or employer approval; and tardiness or early departure from work without justification or employer approval. Deductions cannot exceed 30 percent of the worker’s monthly paycheck. Employees must also be told in writing how much money is to be taken out and why.

Saitex, which also operates a LEED-certified denim mill in Dong Nai and a “Factory of the Future” in Los Angeles, said that the furor was more of a “communication problem” than anything else and that it’s looking into specific training for its middle managers.

“We are grateful for the company’s leadership and employee understanding in order to promptly resolve the circumstances that took place,” the spokesperson said.