The issue of back wages sparked a heated discussion at Daewoosa Samoa last Thursday morning during a meeting after Governor Tauese Sunia’s tour of the Tafuna-based garment factory.
The discussion revolved around two questions:
Does Daewoosa owe back wages to its Vietnamese workers?
What payroll scheme is Daewoosa using to pay its workers?
Daewoosa owner-president Kil-Soo Lee says "no" to the first question.
The workers say "yes" and their response is backed up by a class action suit that is set to go to trial in the High Court next month.
The visiting officials from the Vietnamese government-owned Tourism Company 12, Daewoosa’s labor recruiter and contractor, also say "yes" to the question of back wages.
Initially, the workers targeted Daewoosa and Mr. Lee as defendants but the High Court last Tuesday added Tourism Company 12 and another Vietnamese entity known as IMS as co-defendants for breach of contract.
In the meantime, the issue is being investigated by the local Attorney General’s Office at the request of the US Department of Labor.
The AG’s Office has already asked the company to provide all payroll records covering the last four months. That information was to be submitted to the AG’s Office by last Friday.
Tauese initially asked Mr. Lee the question of back wages, acknowledging at the same time that the issue is an internal matter between Daewoosa and Tourism Company 12. However, he wanted to help resolve the differences between Daewoosa and its foreign workers.
Workers attorney Christa Lin declared that Daewoosa owed its Vietnamese workers more than the $325,000 previously reported by the Samoa News.
Miss Mai, leader of the visiting delegation, told the meeting
that Tourism Company 12 estimates that Daewoosa owes the workers at least
three months worth of full-time pay plus any applicable overtime.
The three months owed are May, October and November of 2000.
It became apparent during the meeting that each side had its own interpretation of the contracts between Tourism Company 12 and the workers, and between Tourism Company 12 and Daewoosa.
Miss Mai suggested that the company pay out a certain amount of money to cover a certain amount of back wages, and maybe this would also guarantee the return of all Vietnamese workers to the Daewoosa production line.
But Miss Mai could not convince Mr. Lee about the alleged accuracy of her figures of what is owed the workers. This left it open to further legal wrangling.
At one point during the discussion, Miss Mai accused Mr. Lee of "telling lies" about the issue of back wages.
Then Mr. Lee provided a lengthy explanation about the workers’ contract as it compares to Territorial laws on labor and minimum wages.
Through his interpreter, Mr. Lee said if the Vietnamese workers
are to be paid in accordance with their contract, then the company has
But, he pointed out, if they go according to local minimum wage laws, which is accepted by the DOL, the company does not owe the Vietnamese workers anything as they have already been paid accordingly.
However, Mr. Lee admitted that the minimum wage for garment workers have gone up from $2.55 an hour to about $2.57-$2.60, that he was not aware of and he is willing to make retroactive pay.
Mr. Lee also said that workers are not paid if there is no work.
Lin, however, countered that it is not the workers fault if materials are not available for them to do their work, and the workers should still be paid then in accordance with the contract.
Mr. Lee pointed out that if the workers are not working, they are still being housed and fed by the company.
The issue prompted further heated discussion with no immediate
resolution in sight.
In their class action suit, the workers are also seeking a refund from Daewoosa of about $1,150 per plaintiff for food bill payroll deductions from last January to date.
Daewoosa Samoa manager Virginia Soli’ai later told Samoa News
that the wages issue was also discussed during their meeting with Congressman
Faleomavaega Eni Hunkin last Wednesday.
"We have all our records to prove what we have paid out," she said, noting that there were pay checks for the Vietnamese workers ready last Wednesday to pick up but none of them showed up to collect their pay.
According to Soli’ai, the Vietnamese government contract was not
honored by the U.S. Department of Labor last year. Therefore, there is
actually no official contract now between the Vietnamese workers and Daewoosa,
except that the company is following local minimum wage and tax laws in
paying its workers.
For the second time in almost two years, the US Department of Labor has labeled garments manufactured by Daewoosa Samoa as "hot goods" and placed an "embargo" on all these goods.
The DOL action was prompted by its investigation into Daewoosa’s possible non-compliance with the Fair Labor Standards Act (FLSA) for allegedly not paying its workers according to minimum wage and/or overtime pay requirements.
(See separate story on Daewoosa and back wages.)
In June of last year (1999), the federal agency embargoed the company’s products while it investigated alleged FLSA violations primarily of wage requirements. The investigation resulted in a severe fine against the company.
DOL’s Employment Standards Administration-Wage and Hour Division informed Daewoosa owner Mr. Kil-Soo Lee last Friday about the new embargo.
The Samoa News over the weekend obtained a copy of the letter from Wage and Hour investigator Astor L. Bruhier to Mr. Lee about the ongoing investigation based on federal labor laws.
"We have found apparent FLSA violations" during the period of Jan. 1, 2000 to Dec. 8, 2000 "that resulted in the goods of your firm being made ‘hot goods’ for purposes of the FLSA," Bruhier advised Mr. Lee.
Placing an embargo on Daewoosa’s garment based on FLSA provisions of the labor law, deals another blow to the financially strapped company by prohibiting "any person including any firm from selling, shipping, etc., in interstate or foreign commerce any goods that have been worked on in violation of FLSA minimum wage and/or overtime pay requirements," the DOL agent explained.
"Your firm has assured this Department that it will comply with these ‘hot goods’ provisions of the FLSA," he continued, noting that department representatives will contact Mr. Lee to further discuss the investigative findings, "in hopes of reaching an agreed-upon resolution."
According to Bruhier’s letter, Daewoosa has also given assurance that, pending such a resolution, it will not sell or ship any of the affected goods without giving the federal agency actual notice in writing not less than three full business days in advance.
Although Daewoosa has been given a chance to respond to the agency’s findings, the company has also been asked to provide records for the past 12 months.
Such records includes the company’s customers that have received any goods from Daewoosa; invoices and purchase orders dealing with manufacturers, wholesalers, retailers; reports and/or documentation regarding monitoring at the company; payroll and time records and records recording any deductions from employees wages and the basis for such deduction.
Daewoosa officials could not be reached by telephone over the weekend for comments on the impact of this embargo.
Responding to Samoa News inquiries about the embargo, Vietnamese workers attorney Virginia Sudbury said this is "wonderful news".
"Basically, I applaud the efforts of the Department of Labor in taking steps in this matter, taking a more global watchdog stand," she said in a weekend telephone interview.
"The federal government in this matter is indicating that it stands
behind the mis-use of workers no matter what their nationalities are,"