The Ministry of Labour, Employment and Social Security has initiated legal action against officials from a South Korean shoe factory in Hlaing Tharyar township that closed abruptly at the end of June and has refused to compensate laid-off workers, a deputy minister says.

Deputy Minister Daw Win Maw Tun said the owners of the Master Sports have been deliberately stalling in the face of ministry efforts to resolve the conflict with its workers.

She said that the ministry is also doing what it can to place them in other jobs. Another shoe factory has already said it will soon take 1000 workers, while 11 other factories collectively requested more than 600 workers.

“This is more than the number of people who have lost their jobs at Master Sports so I am sure that all of those workers can get new jobs soon,” she said at a July 25 conference.

Master Sports has been accused of pressuring workers to sign agreements waiving their right to compensation from the company. Under Myanmar law, they would receive compensation of an additional one month’s wages.

U Win Shein, director general of the Factories and General Labour Laws Inspection Department, said the factory’s managers had told the 755 workers they would only be paid their June salary if they waived their right to the additional month’s salary.

Only 58 workers signed the agreement. The 755 workers are collectively owed more than K130 million (US$134,000) in salary and compensation, according to the ministry.

“Forcing workers to sign a pledge not to ask for any compensation for losing their jobs is not in accordance with the law. We have charged two officials from the factory,” U Win Shein said, adding that one South Korean and one Myanmar citizen have been charged.

The ministry has asked the company’s South Korean managing director come to Myanmar to resolve the problem and also held talks with the South Korean ambassador in Nay Pyi Taw on July 12. However, it has “not seen any progress until now”, he said.

However, a lawyer for the Master Sports workers, U Htay, said the Ministry of Labour had not done enough to include workers in negotiations.

“If [the government] invited and discussed the dispute with the factory’s 13 labour representatives then I think it would be reconciled much more quickly,” he said. “From the workers’ side, they hope to solve the problem through negotiation rather than going to the court.”

At the July 25 meeting, Daw Win Maw Oo told U Htay that she wanted to meet the 13 labour representatives and would arrange talks as soon as possible.