Textiles Opico, El Salvador

On February 10, 2017, the Fair Labor Association (FLA) received a Third Party Complaint from the Sindicato de Trabajadoras, Trabajadores, Sastres, Costureras y Similares (SITRASACOSI) at the factory Textiles Opico S.A. de C.V. (hereinafter TEXOPS) in El Salvador. TEXOPS has been a Participating Supplier of the FLA since June 2012.

The complaint alleged that TEXOPS breached policies and procedures agreed with the SITRASACOSI union to address potential retrenchments as well as other compliance benchmarks of the FLA Workplace Code of Conduct. The complaint specifically raised issues regarding implementation of the mentioned policies and procedures regarding terminations and retrenchments, lack of union representation of workers at the time of dismissal, changes to the bonus system, and dismissal of categories of employees that enjoy certain employment protections.  The allegations raised by the SITRASACOSI union appeared to be in conflict with FLA compliance benchmarks regarding the Employment Relationship and Compensation Code elements.

The complaint lodged by the SITRASACOSI union against TEXOPS was, to a significant extent, related to the application of the increase in the national minimum wage approved by El Salvador’s Minimum Wage Council in December 2016, effective January 1, 2017. The increase, the largest minimum wage increase in the country’s history, raised the minimum wage for apparel sector workers by about 39 percent, from $210.90 per month to $295.20 per month.  The FLA has prepared a brief stressing this new legal requirement and the imperative that suppliers based in El Salvador comply with this new minimum wage level.

The FLA is pleased that this Third Party Complaint led to the relaunching of a broad labor-management dialogue at TEXOPS, guided by an ombudsperson/mediator who has the respect of all parties.  Management and the SITRASACOSI union, skillfully guided by the mediator, were able to reach agreements on the range of difficult issues that arose from management’s decision to retrench workers in January 2017.  The FLA recognizes the goodwill evidenced by management and the union in the negotiations and calls on both parties to continue and strengthen the dialogue at the factory. 

The FLA points out that there is some unfinished business related to finalizing factory policies and procedures governing retrenchment, compensation, and workers’ job performance that should be tackled by the parties as soon as possible in order to avoid the repetition of some of the issues that arose earlier in the year.  The dialogue table is the appropriate vehicle to make progress on these matters.

Note: Textiles Opico ended its affiliation with the Fair Labor Association in July 2020.