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Thai Garment Factories Ordered to Compensate Workers for Illegal Underpayment

Thai police raided garment factories that supply aprons to Starbucks and clothing to Bauer Hockey on Thursday after a Thomson Reuters Foundation exposé published last week found workers were being illegally underpaid.

Investigators from the foundation, which is the charitable arm of new organization Thomson Reuters, interviewed 26 workers—all migrants from neighboring Myanmar—who were employed at four factories in Thailand’s Mae Sot region for less than the daily minimum wage of 310 Thai baht ($10.15).

Located 310 miles from the capital of Bangkok, and the main entry point into western Thailand, Mae Sot is littered with hundreds of factories filled with migrant workers looking to make money to send home to their families. It has also been described as a “black hole” in terms of labor compliance.

“We have to admit Mae Sot is a black hole because there are many garment factories that are very hard to inspect,” Somboon Trisilanun, deputy director-general of Thailand’s Department of Labor Protection and Welfare, told the Thomson Reuters Foundation.

Thursday’s raids, which were conducted by Thailand’s anti-trafficking task force, government officials and police, targeted two factories. The owners of both have admitted to paying workers less than the minimum wage, according to Police Lieutenant General Jaruvat Vaisaya. They have also been ordered to compensate workers for the back wages they owe. Under the country’s laws, failing to pay the minimum wage is punishable by up to six months in jail and a 100,000 baht ($3,281) fine.

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Cortina Eiger, whose clients include Bauer Hockey, had not given is workers the minimum wage, holiday pay or sick leave, Vaisaya told the Thomson Reuters Foundation. The owners have been given 30 days to pay an estimated 45 million baht ($1.47 million) to roughly 600 workers.

Authorities are still calculating how much Kalayanee Ruengrit, which supplies to Starbucks, should pay 11 workers, police said. Trisilanun said a task force will be investigating a further four factories, though no specific timeline was given.

“Both factories have promised they would not lay off any of the workers,” Vaisaya told the Thomson Reuters Foundation, noting that any company that fired workers without just cause would incur heavy fines.

Thailand is home to 4.9 million migrants, who account for more than 10 percent of the Southeast Asian country’s workforce and contribute up to 6.6 percent of its gross domestic product, according to the United Nations (UN). Hailing mostly from neighboring nations such as Cambodia, Myanmar, Laos and Vietnam, migrant workers have few protections and are vulnerable to exploitation, the UN said in January.

The government has taken some steps, however. Last June, Thailand became the first country in Asia to ratify the forced labor protocol of the International Labour Organization to prevent all forms of modern slavery, protect victims and ensure their access to remedies and compensation.