SMT Philippines Inc., a Japanese company producing and supplying USB for Toshiba and motherboard for EPSON printers closes operation without notice last, October 1, 2018,  in what the workers’ union says is an apparent move to stop their collective bargaining agreement (CBA) negotiation and to bust their union.

SMT management denied entry of the morning shift workers reporting to work at 6:00 in the morning on October 1, simultaneous to announcing to the workers’ shock that they are ceasing operations, effective immediately allegedly due to losses.

Though aghast by the announcement, Sylvia Lescano, union president quickly and publicly asked the workers to stay put in the manufacturing plant in protest. The afternoon shift workers (2^nd shift of 2pm-10pm) were also informed later and insisted to go in to get the notice of closure given by the SMT Phils management but they were not allowed to enter. Workers remain in the factory premises until the time of this writing.

About 100 kept their vigil in the factory in an attempt to preempt SMT Philippines from completely running away. Rumors had circulated that the company might be transferring all machines in other factories while completed products were brought to new EPSON manufacturing plant in LIMA Technology located in Batangas province.

However, food supplies are running out as police and Light Industry Science Park II authorities blocked the entry of outside food support right at the economic zone gate . On October 2, riot police started lining up face to face with the protesting women workers at the factory site. Zone authorities also threatened to cut the electricity and water supply to the factory.

On October 3 and 5, the Department of Labor and Employment (DOLE) intervened to facilitate a dialogue between the union and SMT management and zone authorities. It was agreed that the police and zone authorities will allow food entry into the zone and the company will not bring machines and products out from SMT plant. Despite the agreement, it was extremely difficult for people and food supplies to get inside the economic enclave and takes a lot of strategizing to pass through several layers of police lines.

On October 8, unionists and supporters from Fuji Electric Workers Union, Optodev Workers Union and Nexperia Workers Union bringing food support to the picketing workers were harassed, and some were beaten by combined members of Philippine National Police (PNP) and company and economic zone guards. Both SMT and Fuji Electric Union claimed that several workers were hurt.  The SMT Workers union in turn, ensure that order is observed in the factory vicinity but authorities barred food and water assistance sending them to hunger.

SMT Phils. Inc. is owned by Mr Hitoshi Ikeda and located at the Light Industry Science Park 2 (LISP1) – a special economic zone in Calamba, Laguna, south of Manila. It employs 462 mostly women workers, 398 of whom are covered by the collective bargaining unit. The workers are members of SMT Workers Union affiliated with National Federation of Labor Union- Kilusang Mayo Uno (SMTWU-NAFLU-KMU).

Calibrated union busting

“Reviewing what had happened since last year, we now realized that the management has been planning the shut-down to eliminate the union all along,” says Sylvia Lescano. The company did not file losses, nor closure. What it filed at the Department of Labor and Employment (DOLE) was transferring the manufacturing plant 2 to plant 1 and change in work schedule. “We have actually started the CBA negotiation,” Lescano added.

The union seems to have reason to think that everything was planned. As early as September 2017, the management calibrated all the machines and speeded the production.  It ordered the workers to produce 3.6 million USB in a month, a departure from the 1.2 million per month average output.

By November 2017, the SMT Philippines management implemented a ‘no-work schedule,’ allegedly due to low volume order from EPSON. A month later, the union held a dialogue with the management and they were told that they will retrench a number of workers. The union began their protest action and by March 2018, when their collective action reached to its peak, the company took back the idea of retrenchment. It instead offered an early CBA negotiation.

In August this year, the negotiation started, where the union proposed P50/P50/P50 (US$0.92/$0.92/$0.92) wage increase per day for three years. The company counter –proposed P3/P2/P1 (US$.055/0.037/$0.018) instead, noting that they were losing. The workers receive an average of P448.00 (USD 8.29) for a 8/hour workday.

In mid-August, workers were asked to work overtime to increase the production volume of both Toshiba USB and EPSON motherboard. After a month (September 25) of continuous overtime work, the SMT management again suspended the work. The union observed that in the same period, SMT started taking out the production machines and completed from the plant. The union had no idea where those machines were brought.

Three days later (September 28) the SMT management told the union that they are closing operations beginning November 1 as advised by Yokote Precision Industry Co.-Japan due to losses.  The union did their investigation and found out that SMT Phils. did not actually file a required notice of closure, rather, just a notice of manufacturing plant transfer.

SMT manufacturing plants are capable of producing 324,000 Toshiba and 130,000 Epson motherboards per month (8-hr workdays).

Work and CBA negotiation, not separation pay

Even at the start of the negotiation, the union reiterated their demand for the resumption of work and  the CBA negotiation, but SMT Phils management insisted that  the closure is final. The company is offering 75% of their current wage or P336.00(US$6.22) separation pay per year of service. 

The union also calls for support from other workers, brands and buyers. The workers emphasized that they need work, not separation pay. They also demanded that police who is actually causing tension and harassing workers and supporters out of LISP 2. Yesterday (October 8), combined elements of police and econozone guards harassed workers from other factories who brought food support to the picketing workers. “They (PEZA authority and police) are so concerned about the image of the economic zone, but our concern is our job and the union that we had painstakingly organized. Many of us have served the company for as long as 25 years. With the soaring commodity prices, how can our families survive?” Lescano ended. ###