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Uniqlo under pressure to pay compensation to Indonesian workers

Following the actions on International Women's Day in Hong Kong, two Indonesian unions protested at the Japanese Embassy in Jakarta on March 23. Their protest was to demand justice for workers at the closed factory PT Jaba Garmindo in Indonesia which supplied Japanese retailer Uniqlo.

The Indonesian factory closed down without providing workers with US$10.8 million in legally required compensation. The company ended in bankruptcy in April 2015 without providing final wages and severance benefits to 4,000 workers at multiple locations.

The actions are supported by Clean Clothes Campaign, War on Want, People and Planet, SACOM, Globalization Monitor and Yokohama Action Research. Last week protests took place in Japan, targeting Uniqlo stores.

As this report leaked out, the buyers have, to date, refused to pay up the workers in full. Failure to provide legally required severance pay is a very common form of wage theft in the garment industry.

Often owners just abandon factories leaving the country without making any arrangement for workers’ severance or payment to other creditors.

In the last five years, an increasing number of international apparel brands have taken responsibility for ensuring that these workers are paid, often by directly providing funds to workers. In the last decade, student and consumer pressure has successfully pushed international apparel brands to take responsibility for funds denied workers when their factories close.

In a landmark case in 2013, after significant pressure from the CCC network, United Students Against Sweatshops, U.S. universities and SumOfUs, adidas directly compensated workers for legally required severance owed by a supplier factory in Indonesia.

Since then, in response to demands by workers and international advocacy organisations, Disney, Fruit of the Loom, Hanesbrands, Adidas, Nike, H&M, and Walmart have either directly compensated workers denied severance or advised their supply chain partners to do so in Honduras, El Salvador, Indonesia, and Cambodia.