By Marjuice DestinadoBulatlat.com

CEBU – Garment workers in Cebu face possible unemployment after Pan-Phil Sportswear Inc., a factory inside the Mactan Export Processing Zone (MEPZ), ceased operations on Saturday, March 14, 2026.

The factory, which employs hundreds of workers, operates as a subcontractor of Sports City International and manufactures sports apparel for the international brand Nike, according to labor monitors and worker accounts.

The closure comes months after labor groups raised concerns about precarious employment practices within the same subcontracting network in MEPZ. Earlier, over 1,500 workers at Metro Wear — another factory operated under Sports City International — were placed on forced leave and given only a P125 daily subsidy while under “floating” status, according to the Center for Trade Union and Human Rights (CTUHR).

Read: Garments factory imposed forced leave, early retirement scheme – labor rights monitor

Several Pan-Phil employees said they were not informed beforehand of any serious structural or operational problems that would justify the sudden closure. For many workers, the announcement came abruptly, heightening fears of job loss and financial instability.

Management reportedly told workers they might be transferred to Alston Apparel Inc., another factory in the area. However, employees said the company has not presented any written agreement guaranteeing their absorption, leaving the possibility uncertain.

According to Cebu-based Visayas Human Development Agency, Inc. (VIHDA), workers also alleged that some employees were advised not to discuss their situation publicly and were warned that doing so might affect their chances of being accepted by the other factory. Labor advocates said such warnings could “discourage workers from seeking advice, asserting their rights, or organizing collectively.”

“The closure of Pan-Phil Sportswear Inc. reflects broader labor precarity within subcontracting networks operating in the Mactan Export Processing Zone,” VIHDA said in a statement.

“Under labor-flexibility schemes practiced by large subcontracting conglomerates such as Sports City International, production is frequently shifted across factories depending on global orders and buyer demands. While this system allows corporations to maintain profitability within global supply chains, it leaves workers bearing the burden of instability,” the group said.

In recent years, thousands of garment workers in MEPZ have reportedly experienced similar disruptions as supplier factories reduced operations, relocated production, or shut down entirely.

“This situation requires urgent scrutiny and accountability. Global brands, subcontracting conglomerates, and factory management must ensure transparency about the closure, provide legally binding commitments to absorb or transfer workers, and guarantee the full protection of workers’ rights and benefits,” VIHDA added. (RVO)

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