Alerts

Alert--Situation Worsens at Fribo Guatemala

October, 21 2007 Share

  

A Factory Where There Appeared to be Hope
Turns into Another CAFTA Sweatshop Disaster in Guatemala

October 2007


The Fribo factory, exporting duty-free to the U.S. under the Central America Free Trade Agreement, continues to violate every law in Guatemala, as the Guatemalan Ministry of Labor appears paralyzed and unable to move.

 

National Labor Committee   
75 Varick Street, Suite 1500   
New York, NY 10013
www.nlcnet.org   
Tel: (212) 242-3002
nlc@nlcnet.org

 

 

CEADEL
1ra. Av. 4-76 Zona 4
Chimaltenango, Guatemala.
Tel. (502) 7839-3349
      (502) 2424-6122
ceadel@intelnet.net.gt  
director01@intelnett.com

 

Fribo, Guatemala Report

Fribo, Guatemala Campaign

On July 5, 2007, Fribo factory management—under pressure not only from the workers and CEADEL, a human rights NGO, but also from Daisy Fuentes (Kohl's), Wet Seal and Maurices/Dress Barn, whose labels they produced at the time, signed an unprecedented agreement to clean up the factory and guarantee and end to all sweatshop abuses.

To guarantee improvements, Fribo management committed to opening its plant to independent verification by the highly respected local NGO, CEADEL, the Center for the Study and Support for Local Development.  All the workers were to be immediately inscribed in the mandatory Guatemalan Social Security Institute, restoring their legal right to health care for themselves and their children.

However, it soon became apparent that signing this agreement was just another facet of the ongoing scam by Mr. Cha, the Korean owner of the Fribo factory.  He had decided to continue playing with Guatemalan law and the Ministry of Labor—like a violin.  After all, he had gotten away with the gross violation of the workers' rights for years with complete impunity, so why should he change his ways now?

Far from improving, conditions have only gotten worse at Fribo.  Mr. Cha has not paid one cent of the over $200,000 he owes to the Guatemalan Social Security Institute, not to mention the million dollars or so he owes for the last several years.  (It is mandatory in Guatemala for all employers to inscribe their workers in the national Social Security system which, among other things, covers health care.  Far from opening the factory to CEADEL to guarantee the agreed upon improvements, management is now not even returning CEADEL's phone calls. 

As of August 13, half the workers have been sent out on their annual 15-day vacations, illegally without pay.  This "vacation" period has been indefinitely extended.  In short, the workers have been laid off without being told.  Not a single worker has been fully paid their legal summer "14th Month" bonus, which was supposed to be paid no later than mid-July.  Just two production lines remain in the factory with no more than 150 to 200 workers total.

Management continues to threaten and intimidate the workers.  Fribo's chief of human resources, Irma Yolanda Arias Bomayo, is telling the workers:  "The company is in bankruptcy because of CEADEL speaking badly of Fribo.  You should go look for other work and resign from Fribo, because this is going to fall."  Of course, if workers resign, they forfeit their legal right to back wages, benefits and severance pay.  Fribo's manager Mynor Garcia is walking around with a large wad of cash telling the workers he will pay them their legal 14th Month bonus on the spot, but only if they resign.  In desperation, to support their families, many workers have taken the $90.79 bonus, forfeiting their severance and other legal benefits.

Throughout this whole process, Fribo has continued to stiff the Guatemalan Ministry of Labor.  On two occasions, on September 5 and again on the 12th, Ministry of Labor inspectors Rosa Lidia Sitan and Juan Jose Villatoro Garcia were turned away from the factory when the chief of personnel, Yolanda Arias, came to the gate explaining that Fribo's legal representative was not present, so she could not unlock the gate.  Meanwhile, everyone could clearly see that Fribo's owner, Mr. Cha, was inside the factory.

Unable to have any effect whatsoever, the Ministry of Labor has washed its hands of the case, informing the workers that they could go ahead with their legal suit in the courts against Fribo and its owner, Mr. Cha to win their back wages and benefits.  Of course, such a legal suit could drag on for many months, if not years—and where are the laid-off workers going to find the money to hire a lawyer in the first place?

Apparently—how else can his behavior b e  explained?—Mr. Cha has double-mortgaged the property, factory and machinery and it getting ready to skip town without paying the workers or the government a single cent of what he owes them.

CEADEL and the FESTRAS labor federation are working together to assist and organize the Fribo workers.


The Guatemalan Ministry of Labor Must Finally Act
To Regain Control of the Deteriorating Situation at the Fribo Factory

  • Fribo must be made to pay its debt to the Guatemalan Social Security Institute and immediately inscribe its workers under Social Security's health coverage.
  • Restore respect for legal worker rights standards, including:  Overtime must be voluntary and paid correctly; all back wages and benefits owed the workers must be paid; the workers' legal right to freedom of association and to organize a union must be guaranteed.
  • If Fribo management refuses to comply, the factory should be shut down with all factory assets seized, and Mr. Cha should be detained until all back wages, benefits and severance are paid to the workers.