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Malaysia Rejects Nike's Factory Worker Abuse Claims

Government rejected reports that foreign workers at a local garment factory contracted by Nike were mistreated and had their wages garnisheed.

KUALA LUMPUR, Malaysia (AP) -- Malaysia's government Tuesday rejected reports that foreign workers at a local garment factory contracted by Nike Inc. were mistreated and had their wages garnisheed.

Human Resources Minister S. Subramaniam said an initial probe showed that the Hytex Group -- which has produced garments for Nike for 14 years -- remunerated their foreign workers according to their seniority and performance.

The 1,145 workers from Bangladesh, Vietnam and Myanmar are each paid between 840 and 1,500 ringgit ($262 and $469) a month, with only 100 ringgit ($32) deducted for an immigration levy, he said.

"From our investigations ... the employer didn't breach any labor laws," he told reporters. "The deduction they have made is ... allowed legally."

His comments countered allegations by Nike on Friday of major workers violations at Hytex.

Nike said many of the migrant labors paid a fee to agents in their home country to get the jobs, but once in Malaysia, the factory took their passports and withheld their wages to repay a government levy.

The workers were also forced to live in cramped, filthy housing, Nike said.

Subramaniam said the ministry was told by the Hytex management that the workers were housed in three-bedroom flats, with four people to a room.

He said he has instructed his officers to conduct checks on the workers' living conditions.

He confirmed that Hytex did keep the workers' passports but said it has given the laborers an employment card in return and was obliged to return the passports upon demand.

"It has been a policy in this country for quite a number of employers to keep the passports for safety reasons," he said.

The ministry did not receive any reports of abuse from the Hytex workers but Subramaniam pledged the government would take stern action against any errant employers.

"We view this seriously. Unless and until we maintain an appearance that we are a conducive place to do such business, our conditions of work and employment are meeting up to international standards, then we might lose out in the long run," he said.

"The government will do everything to ensure that we are internationally competitive."

Hytex officials couldn't be immediately reached for comments.

Nike has said it has taken immediate steps to protect the workers, including transferring them to Nike-inspected and approved housing, reimbursing them and providing airfares for those who wishes to return home.

Nike also said it was reviewing its entire Malaysian contract factory base.

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