Thousands go on strike after Nike supplier scraps Tet bonus

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Thousands of workers at Taiwan-owned shoemaker Pouchen Vietnam, a contract manufacturer with Nike, went on strike Friday, demanding the same Tet bonus as last year.

They refused to return to work after finishing their lunch in protest at the company’s policy of paying less in bonuses than last year for the upcoming Tet (Lunar New Year) festival. Tet, the most important Vietnamese holiday, falls in early February this year. Workers stood on National Road 1K outside the entrance to their factory, causing traffic jams for hours. The strike affected others and the 14,000 factory workers in Bien Hoa town in southern Dong Nai province stopped work.

A mobile police team was dispatched to maintain order in the area. A worker said the company announced on Thursday that employees who have worked for it a full year or more will receive Tet bonuses of 1 to 1.54 months’ salary – around VND5 million ($217) to nearly 20 million VND.

The highest bonus in 2021 was 1.87 months of salary and in previous years 2.2 months. “With this (coefficient), the workers’ Tet premium in 2022 will be lower than before,” she added.

A Pouchen representative said that in 2021, the company encountered production and business difficulties. When the fourth wave of Covid-19 broke out, the factory had to stop operating from July 12 to September 30, 2021. On October 5, 2021, it resumed production, but at 60% capacity.

Due to the failure to achieve the production plan, the profits fell, so the Tet bonus, the most important and expected reward for the workers, could not be the same as the last year. The representative also said that under the collective labor agreement, the company would pay a Tet bonus to employees based on their business performance.

Nguyen Thi Nhu Y, head of the Dong Nai Provincial Labor Confederation, said the union was coordinating with authorities to resolve the situation. She noted that Pouchen’s Tet bonus was above the local industry average. Nguyen Huu Nguyen, chairman of the Bien Hoa People’s Committee, said relevant agencies are trying to negotiate with Pouchen’s board to increase the Tet bonus. “However, employees must share in the difficulties of the business, as Covid-19 has forced businesses to suspend operations for months,” he said.

Pouchen Vietnam, part of the Taiwanese Pouchen Group, has an additional factory in Dong Nai and six others in HCMC and the three southern provinces of Tien Giang, Tay Ninh and Ba Ria – Vung Tau for a total of 130,000 employees. The group is expected to spend more than 1.2 trillion dong on Tet bounties this year.

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