Jaqalanka garment factories close, 1,400 workers on the street

Jaqalanka Ltd and Jaqalanka International Garment factories, manufacturing the world renowned Nike brand apparel at Katunayake Free Trade Zone have been closed down throwing around 1,400 workers onto the street.

The Managing Director of the company H. Fernando said that this decision was taken due to a financial crisis and trade union problems. Both factories were closed down with effect from February 7 and the shareholders have decided to liquidate both companies.

The Colombo District court has appointed a temporary liquidator to settle the liabilities of the company after assessing their assets. General Secretary of the Free Trade Zone Workers Union (FTZWU) Anton Marcus told The Sunday Times FT that the company has paid only 60% of the salaries for the month of January 2008 to workers of Jaqalanka International and 75% for the workers of Jaqalanka Ltd.

He added that the real reason for the closure of the two factories was a conflict between the factory management and the directors of the company over alleged fraud and corrupt practices.

Marcus disclosed that the trade union has agreed to the earlier suggestion of the management to close down Jaqalanka Ltd and to absorb its workers to Jaqalanka international without breaking services as well as under the same terms and conditions. But he said the management has deviated from this agreement and closed down both factories placing workers in dire strait.