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Six-month protest shuts down Oji Paper’s Cambodian plant

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Protest at Oji's Harta Packaging plant
CAMBODIA –
Production at Japanese paper giant Oji Holdings Corporation’s Cambodian plant, Harta Packaging Industries (Cambodia) Limited, has been halted since 20 June as a six-month protest over unpaid bonuses continues.

Former employees at Harta Packaging - which produces corrugated containers, corrugated sheets and plastic bags in Por Sen Chey district's Choam Chao in Phnom Penh - started barricading the factory gates on 17 June and preventing shipments, resulting in the plant’s shutdown three days later.

The protest stems from a long-standing conflict between the Japanese management and former senior employees over payouts which the latter say should have been made when the factory changed ownership in 2012.

In June 2011, Oji’s paper business unit Oji Paper Co Ltd bought over the then-Malaysian owned HPI Resources Bhd, a holding company of Harta Packaging. The acquisition gave Oji one paper mail, three box plants and one plastic bag plant in Malaysia, as well as the box plant in Cambodia that is now shut.

Following the takeover, Oji changed the sign at the Harta building to ‘Oji Paper Asia’. It dismissed about 200 people from Harta Packaging and paid them seniority payments and other benefits. However, an additional 285 workers eligible for seniority bonuses at dismissal insisted the new owners pay those benefits up front.

Most of those workers have been fired by Oji since February 2014 for protesting about the payments. While some 80 have found new employment, more than 200 have kept vigil in front of the factory,

According to Cambodian law, if a company changes ownership, it is required to pay seniority bonuses at the time of purchase if the name is changed. If the company name remains the same, the new owners are only required to respect prior agreements made to senior employees.

While the sign at the Harta building is now ‘Oji Paper Asia’, the factory is still officially listed with the Ministry of Commerce as Harta Packaging Industries (Cambodia) Limited, according to the company’s administrative manager So Pheakdey.

Despite this, the Cambodian Arbitration Council ruled on 31 May in favour of the employees and ordered Oji to pay the bonuses. Harta Packaging has rejected the decision, leading to the possibility of the case now being heard by a Phnom Penh Municipal Judge.

Pheakdey said, “The Arbitration Council did not correctly rule on this case, which is why we can’t accept its decision. The workers are demanding the company pay out bonuses because the name was changed, but we did not actually change the name.”

During the factory closure, Harta Packaging will continue to pay its approximately 500 current employees, according to Pheakdey.



PACKAGING BUSINESS INSIGHT ASIA

1 PBIA May2015 web

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