Overcoming a History of Violence: Intervention with Collegiate Supplier in Guatemala Secures Rapid Remediation

Last month, after engagement by the WRC with the factory’s owners, a collegiate apparel supplier in Guatemala, Centexsa, SA, offered reinstatement with back pay to nine workers who, only a week earlier, had all been fired for exercising their associational rights. The Centexsa factory produces collegiate apparel for Gear for Sports (Hanesbrands) under the Under Armour Performance Apparel brand and the College Vault by Under Armour brand.
 
This is one of the most rapid examples we have seen of an unlawful mass firing of garment workers being reversed. As we explain below, this quick corrective action was made possible, in part, by the WRC’s previous engagement, one year ago, with the factory’s owner, SAE-A Trading, addressing violent incidents at another of its facilities in Guatemala. SAE-A, a Korea-based multinational, is one of the world’s largest garment manufacturers.
 
On January 12, the WRC was notified by the Solidarity Center, a nongovernmental labor rights organization, that Centexsa retaliatorily fired nine workers who, only days before, had attended an offsite meeting to form a union, in an effort to improve working conditions at the plant. The workers stated that they were forming a union to address abusive treatment and intimidation by management, the factory’s failure to provide paid leave for medical visits, low production bonuses, and use of short-term contracts to deny employee benefits.

When local worker rights advocates informed the WRC of these firings, we contacted SAE-A, as the factory owner, concerning this violation of university codes of conduct, and recommended immediate reinstatement with back pay, along with other remedial measures.
 
On January 17, SAE-A’s local management at Centexsa offered all nine terminated workers reinstatement with back pay. Seven of the nine workers chose to return to the factory (the remaining two workers chose to receive their back wages but not return). SAE-A has also agreed to take additional corrective actions recommended by the WRC, including issuing a statement pledging to respect freedom of association going forward, refraining from further interference with workers’ formation of a union, and recognizing a union when one is officially registered with the government.
 
We believe SAE-A’s prompt response concerning the firings of worker activists at the Centexsa factory was, in good part, the result of previous extensive engagement by the WRC with the company last year, concerning even more severe violations at another SAE-A factory in Guatemala, Winners, SA, which produces non-collegiate apparel for Walmart and Gap. As we detail in our report, a WRC investigation in late 2020 found that local management at the Winners factory had incited mob violence and death threats by employees who headed a company-sponsored union at the plant, one that targeted other workers for their participation in an independent labor organization.
 
After being pressed by the WRC and Gap, SAE-A terminated the human resources manager and 12 other employees involved in the violence and death threats and paid roughly $200,000 to the workers they targeted. SAE-A resisted taking these corrective measures, however, until several months later, with the result that nearly all of the targeted workers, who had been violently driven out of the plant, ultimately chose to receive compensation but not return.
 
Clearly, in the case of both factories, the local management should not have retaliated against workers for their associational activities in the first place. However, the much faster and more cooperative response of SAE-A concerning the recent violations at the collegiate Centexsa factory is a hopeful sign that SAE-A, at the corporate level, is improving its respect for freedom of association.
 
The WRC will continue to monitor this situation and report further developments. As always, please let us know if you have any questions.