Tuaran: Some 230 employees of a clothing factory here and a shoe factory in Papar, owned by Koperasi Serbaguna Sanya Berhad (Kosan), have been laid off following the closure of both factories due to a lack of business since the end of last year.
Tuaran MP Datuk Seri Wilfred Madius Tangau said in a Facebook post that 134 workers from the Tuaran factory and 69 from the Papar factory, including Kosan headquarters staff, were dismissed via notices issued on Oct 14, 2024.
“The termination of Kosan’s contract with the State Government to supply school uniforms and shoes in April 2024 forced both factories to cease operations,” he said.
Madius said the shutdown resulted from the loss of business after the State Government ended the contract, leaving Kosan without buyers for its products.
“Recently, a former worker from the Kosan Tuaran factory wrote to me, urging intervention to address the plight of the 230 dismissed employees,” he said.
He said the worker claimed that no compensations were provided to the employees, despite standard practice under the Voluntary Separation Scheme (VSS).
“As a result, the Labour Department has stepped in to protect workers’ rights, and Kosan is now required to pay compensation, along with Perkeso benefits.
“The former employees are now demanding urgent payment due to mounting financial pressures, including the coming Aidilfitri and Pesta Kaamatan celebrations, school expenses and overdue utility and car bills.
“Unfortunately, Kosan’s cash flow is insufficient to fulfil its obligation to pay the workers’ compensation,” he added.
Madius said he met with current and former Kosan Board members to discuss the matter.
He asked stakeholders to find out why an Extraordinary General Meeting (EGM) was not held to discuss and find a solution to the crisis.
He was informed that Kosan lacks the financial resources to cover the costs of organising the meeting.
Madius affirmed his commitment to working towards a resolution for the affected workers.
The Kosan factories had been in operation for over four decades, with the Government purchasing their school uniforms and shoes to be distributed free to students across the State.
