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### Viewing cable 06PHNOMPENH1757, CORRUPT CAMBODIAN UNION UNDER INVESTIGATION

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
06PHNOMPENH1757 | 2006-09-27 08:56 | 2011-07-11 00:00 | CONFIDENTIAL | Embassy Phnom Penh

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    VZCZCXRO1535
    PP RUEHCHI RUEHDT RUEHHM RUEHNH
    DE RUEHPF #1757/01 2700856
    ZNY CCCCC ZZH
    P 270856Z SEP 06
    FM AMEMBASSY PHNOM PENH
    TO RUEHC/SECSTATE WASHDC PRIORITY 7383
    INFO RUCNASE/ASEAN MEMBER COLLECTIVE PRIORITY
    RUEHXI/LABOR COLLECTIVE PRIORITY

` `

    C O N F I D E N T I A L SECTION 01 OF 02 PHNOM PENH 001757

    SIPDIS

    SIPDIS

    STATE FOR EAP/MLS, DRL/IL--MARK MITTELHAUSER

    E.O. 12958: DECL: PUBLIC ANNOUNCEMENT OF ACTION AGAINST KYFTU
    TAGS: ELAB KCOR PGOV CB
    SUBJECT: CORRUPT CAMBODIAN UNION UNDER INVESTIGATION

    Classified By: Poleconoff Jennifer Spande for reason 1.4(b).

    ¶1.  (C) SUMMARY.  The Cambodian government has formed a
    commission to investigate the Khmer Youth Free Trade Union
    (KYFTU), a labor union notorious for extorting garment
    factory management and beating rival union leaders.  If the
    commission can find sufficient evidence of illegal
    activities, the union is likely to be dissolved and may be
    fined as well.  The Ministry of Labor is worried that such a
    move may be misconstrued as an attack on freedom of
    association.  In conversations with Ministry of Labor
    officials, Poleconoff stressed the need for the government to
    emphasize that it was cracking down on one highly corrupt
    labor union and not the labor movement as a whole, and has
    offered to provide background information about KYFTU
    activities.  END SUMMARY.

    Khmer Youth Union Under Investigation
    --------------------------------------

    ¶2.  (C) During a Sept. 12 meeting, Prak Chantha, Secretary of
    State at the Ministry of Labor and Vocational Training, told
    Poleconoff and Labor Assistant that Ith Sam Heng, Minister of
    Social Affairs, Veterans, and Youth and chair of the National
    Strike and Demonstration Commission, had recently formed a
    sub-committee to investigate the Khmer Youth Free Trade Union
    (KYFTU).  The sub-committee, which includes representatives
    from the Ministries of Justice, Labor, Social Affairs, and
    Interior, as well as the municipality of Phnom Penh, was
    currently gathering evidence against the union.  While union
    leaders could be subject to criminal charges for suspected
    cases of arson, property damage, and other offenses, Prak
    Chantha thought it was most likely that the union would
    simply be dissolved and perhaps fined in accordance with
    Cambodian labor law.  No other unions are under investigation
    or expected to be investigated.

    ¶3. (C) Despite receiving complaints about KYFTU activities
    from the Ambassador, senior Gap officials, and the Garment
    Manufacturers Association, Prak Chantha remained concerned
    about the potential diplomatic and international reaction to
    such a move.  Poleconoff assured her that the Embassy was
    well aware of the KYFTU's corrupt activities and the damaging
    effect that they had on the garment sector and the reputation
    of other unions, but said that the Ministry would have to
    make it clear that it was cracing down on one extremely
    corrupt union, and not the labor movement as a whole.

    The Notorious KYFTU
    -------------------

    ¶4. (SBU) In a country where corruption is endemic and even
    the most credible labor unions are thought to have occasional
    cases of bribery, the KYFTU has a well-earned reputation as
    the nation's most corrupt union.  Distrusted by employers,
    government officials, other unions, and international
    observers, the KYFTU operates as an extortionist gang, using
    a small number of members at large factories to create labor
    unrest unless they are paid off by factory management.  In
    the first eight months of 2006, the KYFTU was responsible for
    22 garment sector strikes--more than any other union.
    Several of these strikes involved less than 20% of the
    workforce, but still managed to bring production to a halt.
    In a recent case, two KYFTU supporters falsely claimed to
    represent workers who had signed a petition with 14 demands
    about working conditions.  In fact, most of the demands had
    already been resolved, the petition had been altered after
    signatures were gathered, and KYFTU had just five supporters
    in a factory employing 4,000 workers.

    ¶5. (SBU) The KYFTU has also been accused of being "thugs for
    hire" utilized by unscrupulous garment factory management to
    harass legitimate unions.  During a recent meeting with
    Poleconoff, the presidents of the Coalition of Cambodian
    Apparel Workers Democratic Union (CCAWDU) and the Free Trade
    Union (FTU) accused management at four garment
    factories--Bright Sky, Suntex, Rainbow, and Yung Wah--of
    hiring the KYFTU to beat CCAWDU and FTU factory-level union
    leaders at those factories. Several other union presidents
    reported KYFTU members threatening factory-level leaders of
    rival unions.

    ¶6. (C) COMMENT.  The government is taking a step in the right
    direction by starting an investigation that is likely to lead
    to the dissolution of the KYFTU.  Combined with
    garment-sector wide labor negotiations currently underway,
    dismantling this extortionist gang could go a long way
    towards quieting the excessive labor unrest in the garment
    industry.  However, the government's concerns about how such
    a move will be perceived are well-founded, as KYFTU leaders

    PHNOM PENH 00001757  002 OF 002

    are likely to raise loud objections to buyers, international
    press, and corporate social responsibility groups who may not
    be familiar with the KYFTU's illegal activities.  Poleconoff
    has offered to provide background on alleged KYFTU activities
    and its reputation.  END COMMENT.
    MUSSOMELI

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