Pou Chen Corp (寶成), one of the nation’s largest contract shoemakers, said it would end its unpaid leave program next month, as its business shows signs of rebounding amid the COVID-19 pandemic.
Pou Chen, which works with many international footwear brands, such as Nike, Adidas, New Balance, Puma, Reebok, Timberland and Converse, said the furlough program would end a month ahead of schedule because of increasing orders.
Its operations were hit hard by falling global demand earlier this year, as COVID-19 spread around the world, leading it to adopt an unpaid leave program in June to cut costs.
In the plan’s initial phase from June to August, 5,300 of the company’s employees in Taiwan and managers sent to its overseas factories were asked to take six days of unpaid leave a month on a rotational basis.
Pou Chen executives also took a 10 to 30 percent pay cut.
During that time, Pou Chen closed a factory in China’s Hubei Province, laying off more than 4,000 workers. It laid off another 3,000 employees at a plant in Vietnam.
In the second stage of the plan currently under way, about 3,700 employees in Taiwan are taking four unpaid days off a month, while overseas managers have returned to their jobs.
Pou Chen had consolidated sales of NT$181.97 billion (US$6.31 billion) in the first three quarters of this year, down 22.3 percent from a year earlier.
Its net profit also dropped 64.7 percent to NT$4 billion because of the pandemic.
In its footwear manufacturing division, sales in the first nine months fell 24.9 percent from a year earlier.
However, sales have shown signs of improvement in the past two months. The company had consolidated sales of NT$21.11 billion in September and NT$22.93 billion last month, up from NT$18.61 billion in August.
Pou Chen said retail activity in China has gradually returned to normal, with offline retail sales stabilizing and online retail sales growing.
The Ministry of Labor said the number of furloughed workers has been on the decline.
As of Friday last week, the number of workers on unpaid leave had fallen to 11,317, the lowest level since late June, as the economic impact of COVID-19 wanes.
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