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Primark Working to Ensure That Workers of Shuttered Myanmar Factories Will Be Paid

Primark says that 2,200 workers who were left in limbo after two of its former suppliers in Myanmar suddenly shuttered will be paid what they are owed, including wages and severance pay, “no later than this week.”

“We take our responsibility to the workers who make our clothes very seriously and are extremely concerned to hear about these allegations, which go against our own code of conduct and the guiding principles by which we’re responsibly exiting Myanmar,” a spokesperson said. “While both factories have been suspended due to a breach of our code of conduct for some time, we’re working closely with them to understand that their responsibilities to the workers they employed are being upheld, including the payment of all wages and compensation owed to them.”

The Ireland-based retailer was responding to reports earlier this month that GTIG Huasheng and the GY Sen-operated Primseng Guo, both located in Shwepyitha Township’s Wartayar Industrial Zone in the city of Yangon, had shut down without informing their employees of their closure plans in advance.

Myo Myo Aye, director of the Solidarity Trade Union Of Myanmar, told Sourcing Journal at the time that many workers were caught out without compensation, leaving them economically untethered as inflation continues to skyrocket and the military-controlled country plunges further into chaos.

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Asked about Primark’s update, the union leader said that the settlement “has not yet been concluded” and that there are “financial discrepancies and illegality” in the payment calculations. “We are still negotiating,” she said.

Primark, which says that it is “responsibly exiting” Myanmar following an Ethical Trading Initiative assessment’s conclusion that it “wasn’t possible” for responsible businesses to apply normal human rights due diligence in the beleaguered nation, told Sourcing Journal that it does not own the factories in question but is working to resolve the matter alongside the suppliers and other stakeholders with the aid of its on-the-ground ethical team. ” There are also some discussions on ensuring rehiring agreements are being signed with GTIG Huasheng, it said.

“As we work to exit the country responsibly, we’ve enhanced our due diligence on the ground by doubling the size of our local ethical trade team,” the spokesperson added. “This enables us to visit the approved supplier factories we work with more regularly, giving us greater visibility to working conditions and allowing us to engage with the workers and stakeholders more frequently.”

The chain store is “actively engaging” with IndustriALL Global Union under its framework for responsible business disengagement from Myanmar, which it published in February, said Christina Hajagos-Clausen, director, textile and garment industry, at the global union federation.

In particular, she said, Primark is following its guidance to facilitate the provision of access to remedy for workers in its supply chain, and insofar as is possible, continue to ensure that supplier factories do not engage in labor violations. This includes collaborating with relevant stakeholders, including IndustriALL Global Union, to design “applicable supportive measures” for affected workers in its Myanmar supply chain.

“Due to the impossibility of doing due diligence in a country without freedom of association, more and more brands are concluding their business in the country,” Hajagos-Clausen previously told Sourcing Journal. “We call on brands who still have a presence in the country to use this framework to disengage responsibly. In the case of this closure, the responsibility of Primark is, among other things, to ensure that workers receive adequate severance pay, and that any outstanding cases of workers’ rights violations are resolved.”