According to Nova.rs, the workers are demanding severance pay because they do not believe that they will be able to find employment in the coming months, despite the fact that the state leadership promised them new jobs.
The workers also demanded (in vain) that the bankruptcy trustee address them, expressing dissatisfaction that none of the company’s managers had addressed them personally.
After several weeks of speculation, the Geox company announced yesterday that it would liquidate its plant in Vranje. In the announcement, which turned up on the bulletin board and the factory porter’s office yesterday morning, the workers were informed that they would receive formal dismissals on the day when the initiation of the liquidation procedure is registered with the Serbian Business Registers Agency. Until then, the workers will be on paid leave.
The stated reason for closing the factory is “continuous reduction of production at the level of the Geox Group, starting from 2018 until today, which was further reduced during 2020 and 2021 due to the Covid 19 pandemic”, and the loss of customer interest in classic leather shoes.
Commenting on the developments, Serbian Prime Minister Ana Brnabic said yesterday that companies like Geox are leaving Serbia because they cannot “keep up” with the salary increase in the republic, adding that the departure of investors like Geox is “a process that happens naturally when you have such economic growth and development”.
According to the Prime Minister, the average salary in Serbia is 65,000 dinars, and the minimum wage is planned to increase above 35,000 dinars. According to her, some investors therefore go to countries where they can pay workers less.
Stefan Aleksić from the Clean Clothes Campaign (CCC) commented for Mašina that the key problem is that Geox is not the only such company and that such a business model represents the practice of all major fashion brands. He adds that in the coming days, CCC will once again inform the foreign public about the business practices of Geox.
According to the daily newspaper Danas, the Geox company has received twice as many subsidies from Serbia in the last five years than it paid taxes in the same period. After signing a contract with the Government of Serbia in 2012, Geox collected 11.25 million euros, or 9,000 euros for each worker, in return committing to employ 1,250 people. Most workers received minimal compensation. As much as 40% of labor costs (for about 1,200 workers Geox in fact hired, and who will soon lose their jobs) are covered thanks to subsidies, according to Danas.
In addition to low salaries, employment in the Geox factory in Vranje was characterized by terrible working conditions, which Mašina reported on several times.
Translation: Iskra Krstić