Labour dispute resolved between contractor and workers on Myanmar’s US$600 million Yoma Central mixed development project in Yangon

Construction News Myanmar
Workers on March 31 gather at the entrance of the Yoma Central construction site in downtown Yangon to demand a halt in construction work amid the rising number of COVID-19 positive cases in Myanmar. Photo: Shin Moe Myint/The Myanmar Times

Labour dispute resolved between contractor and workers on Myanmar’s US$600 million Yoma Central mixed development project in Yangon

SEE ALSO: Workers Protest At Yoma Central Construction Site To Demand Paid Leave During The Myanmar Thingyan Holiday (Songkran)

A labour dispute between the contractor and construction workers of the US$600 million Yoma Central mixed development project in downtown Yangon has been resolved, with all workers paid in full and issues regarding social security clarified with the authorities, Serge Pun, chair of Yoma Group, told the Myanmar Times.

Around 2000 construction workers took to the streets to protest salary and compensation-related grievances on January 19.

Mr Pun said the problem arose as a result of a one-off adjustment in the payment system that was poorly communicated and consequently misunderstood. “In fact, none of the workers were short- changed and we have made sure they have been fully paid by the contractor,” he said.

One of the contractors of the project is BYMA Myanmar, which is a joint venture between Bouyuges Batiment International, a member of Bouyuges Construction, and Yoma Strategic, which is listed in Singapore. Yoma Strategic holds a passive, minority stake in BYMA Myanmar.

Under BYMA Myanmar’s new pay cycle, wages are now calculated based on the actual number of working days whereas the old pay cycle had calculated and paid wages in advance. This adjustment was not adequately communicated to the workers, resulting in Tuesday’s protest.

Meanwhile, separate issues regarding social security benefits (SSB) payments were clarified in a meeting between BYMA Myanmar, its workers, SSB officials and government officials, and the procedural delays of the SSB refunds have also been resolved with a payment timeline in the coming days agreed between respective parties.

The workers were protesting over a list of grievances, including not receiving social security benefits despite having contributed to the scheme, salary cuts, discrimination between regular workers, foreign workers and labour foremen and not having received pay increments each quarter.

Mr Pun clarified that there were no pay cuts implemented other than those necessary when workers were unable to go to work during lockdown. He said social security entitlements are beyond the control of the contractors, as this is dictated by the Social Security Board.

He added that the perception of workers discrimination arose after several foremen were paid before the rest of the workforce. “This was due to bad judgement and not discrimination. It would be foolish for us to discriminate against local labourers, who make up 90 percent of the workforce at the Yoma Central site,” he said.

However, Mr Pun said pay raises every three months are “unthinkable” at this time.

Mr Pun also clarified that as developer of the project, Yoma Group is not involved in distributing payments to workers. This is done by the contractors.

BYMA-Taisei Joint Venture (BTJV), which is a joint venture between Dragages Singapore Pte Ltd, a subsidiary of global firm Bouygues Construction, and Japanese builder Taisei Corporation, is the main contractor for the Yoma Central project.

BYMA Myanmar is the builder of The Peninsula Yangon and has been operating in Myanmar in partnership with the Yoma Group for around eight years.

The Yoma Central project is a mixed development project consisting of high-end residences, five-star hotels, serviced apartments and offices as well as luxury hotel The Peninsula Yangon. The project is being developed within the former Myanma Railways headquarters at the corner of Sule Pagoda road and Bogyoke Aung San.

Mr Pun said shareholders of the Yoma Central project have fully paid up all capital commitments to date. “The developers have also kept current payments due to the project’s contractors,” he said.

Shareholders of the mixed used development part of the project include Yoma Strategic, FMI, Mitsubishi as well as the IFC and Asian Development Bank.

Meanwhile, shareholders of The Peninsula Yangon component of Yoma Central are Yoma Strategic, FMI and Hongkong and Shanghai Hotels.

The entire project is now expected to be complete in June 2022 from December 2021 before, due to the pandemic, Mr Pun said. “Everything is going according to plan after factoring in the delays as a result of site closures during COVID-19 lockdowns,” he said.

The project, which involves US$600 million in capital, is being funded by US$135 million in debt and the remainder by equity.