A toymaker with 1,250 employees at the Hoa Khanh Industrial Park in Danang City has announced temporary closure of its factory for three months starting December 25, following talks with local and labor union authorities on salaries and bonuses payable to the laid-off workers.
The talks were held December 21 between the management of Keyhinge Toys Vietnam JSC and the Federation of Labor of Danang.
Accordingly, around 1,250 employees will be required to stop working for three months and receive salaries and social insurance as outlined in Clause 1 and Article 99 of the Labor Code. Specific details of the payment or reasons for the temporary closure were not given.
"The plant has not yet received official paperwork regarding its temporary shutdown and the company is continuing with its regular production operations. On the other hand, news of the impending closure surfaced and spread quickly among all employees, creating fear," the Labor Federation of Danang said.
The company, located at the Hoa Khanh Industrial Park in Lien Chieu district, usually announces Tet bonuses in accordance with the collective labor agreement every January, the labor confederation said, adding that bonuses are a very important remuneration that worker anticipate every year.
With the company's planned temporary closure posing the risk of not getting their annual bonuses, workers are very worried, especially with Tet, or Lunar New Year festival, Vietnam’s most important holiday, approaching early next year.
Therefore, the labor federation said it was coordinating with the Management Board of Danang Hi-Tech Park and Industrial Parks and the Lien Chieu district People's Committee, and related agencies to prepare plans to handle possible situations.
The above organizations have created forums for workers to talk with the company, reviewed the needs of all out-of-province workers in case they need to return home, support them with the cost of bus tickets, or organize trips for workers under the Tet Journey program.
In its December 22 announcement of temporary closure, the company said that it needed time to work with the industrial park management and government agencies “during the restructuring process."
It said those who have worked for a year or more will get a month’s salary as Tet bonus. Those who haven’t completed a year of employment will receive bonuses based on their actual working time, it added, but did not elaborate.