Swiss shoe giant falls into disrepute: Dismissals instead of pay rise at former Bata supplier in Sri Lanka

published 05-12-2014 09:00, last modified 30-04-2015 14:48
A year ago today, close to 200 workers were dismissed at the Sri Lankan shoe factory Palla & Co following union activities and protests over outstanding wage increments. At that time, the factory had mainly been producing for Bata. Instead of engaging in the resolution of the labor rights conflict, the formerly Czech enterprise now head-quartered in Switzerland is shirking its responsibility.

In August 2012, shoe giant Bata which operates in 60 countries and employs more than 34,000 people worldwide, was the main buyer of Palla & Co., a factory located in Sri Lanka’s Free Trade Zone. At that time, the shoe factory first allegedly refused to pay its workers the agreed-upon, half-yearly wage increments. One year later, in July 2013, the workers went on strike to demand their pay increase. Subsequently, 15 union officials and 179 workers were dismissed. Some were later reinstated under the intolerable condition that they refrain from any future union activities. More than 100 workers are still fighting for reinstatement. They are facing severe problems to find other jobs because the management of Palla & Co allegedly asked other factories not to recruit their former workers.

The grandson of Bata’s founder, Thomas G. Bata, lives on the banks of Lake Geneva. According to Swiss business magazine Bilanz, his wealth is estimated at 3 to 4 billion Swiss Francs, making him one of the wealthiest people in Switzerland. Confronted with the labor rights conflict, the formerly Czech family enterprise admitted its Sri Lankan supplier had violated the Bata Code of Conduct. Nevertheless, the company has to date refused to engage meaningfully in the resolution of the labor rights conflict. At the end of 2013, one and a half years after the start of the labor rights conflict, Bata ended its commercial relationship with Palla & Co. Bata’s „cut and run“ approach represents a clear violation of the business responsibility to respect human rights and is even more reprehensible in light of the dire situation of the dismissed workers.

The Clean Clothes Campaign is urging Bata to live up to its responsibility and contact the local union representing the dismissed workers to engage in the resolution of the conflict.

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