KUCHING, MALAYSIA -- Malaysia's Labor Department is investigating whether Sanmina-SCI massive layoffs there comply with state laws governing compensation and retrenchment.
Minister of Industrial Development Datuk Amar Awang Tengah Ali Hasanv voiced concerns over the way the printed circuit board fabricator handled the layoff announcement, adding that government officials would meet with the company to discuss the separation agreement. Sanmina announced Wednesday that it would shutter its 250,000 sq. ft. plant here and lay off some 800 employees.
“The director of Sarawak Labour Department will meet up with Sanmina-SCI again to address the issue on compensation and retrenchment benefits,” said Awang Tengah, in a statement. “It is regrettable that Sanmina-SCI did not consider the government’s appeal and proceeded with the retrenchment exercise. Sanmina-SCI should consider giving better compensation benefits in view of the short notice given to the affected employees.”
Immediately following this week's announcement, hundreds of workers and their supporters gathered outside the plant to voice their dissatisfaction. Workers held signs with phrases such as "Compensated only 199 MYR ($65). What to do?" and "Very frustrating...not satisfied."
According to local reports, many workers received less than one month's pay as compensation, despite agreements stipulating higher severance. Some workers also alleged Sanmina-SCI paid certain employees below the state-mandated minimum wage.
Workers gather to protest mass layoffs at the Sanmina-SCI plant in Kuching.
Sanmina's move has forced government officials to backtrack on statements from last week where they reassured constituents that the EMS giant did not plan to shutter the facility.
Sanmina-SCI plans to relocate the equipment and production to its Wuxi, China, campus.
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