Egyptian companies hit by boycott for Gaza 'illegally' pass cost to workers

Thousands of Egyptian workers are currently at risk of losing their jobs as a result of an ongoing boycott campaign against Western brands and franchises perceived to support Israel's war on the Gaza Strip, which has so far claimed the lives of thousands of Palestinian civilians, mostly women and children. 

The Boycott, Divestment, Sanctions (BDS), a Palestinian-led movement, which calls for boycotting Israeli brands and others supporting Israel, has recently published a blacklist of companies operating in a variety of sectors.

Boycott campaigns in Egypt and elsewhere in the region adopted the blacklist posted by the BDS and started focusing on major brands like Starbucks, McDonald's, H&M and others. 

Last month, local Media Maroc Hebdo reported that the local stores of Starbucks and H&M would shut down permanently in Morocco before the end of 2023 due to low sales from the boycott. Al-Shaya, the Kuwaiti franchise owner of these brands, denies these claims. 

An unpopular opinion argues that the boycott has inflicted grave losses on Egypt's already ailing national economy and employment market, as all Western franchises in the country employ a local workforce, use locally manufactured materials, and pay taxes to the government.

In Egypt, several companies in recent weeks have downsised their workforce, reportedly denying workers legal financial rights. Others, meanwhile, have reduced the benefits of employees such as meals and overtime. 

The New Arab spoke to several workers with US companies who requested to remain anonymous as per the advice of their lawyers.

A cashier at Starbucks Egypt told TNA that the boycott of the franchise has taken a toll on the company's profit at branches across the country, which then impacted the benefits workers once enjoyed.

"At first, the company decreased the number of daily shifts from three to two then to one shift, which saved them cash but cost dozens of workers their jobs, laying off many employees and giving open unpaid leave to others," the cashier said. 

"Starbucks Egypt has not paid the workers it laid off any compensation, which violates the Egyptian labour law," the cashier added.

A cook at a local branch of Kentucky Fried Chicken (KFC) told TNA that the salaries of the local staff had been cut after the management informed them of the financial hardships the company had been undergoing due to declining sales.

"We tried to launch a counter-campaign online to acquaint people with the harm inflicted on us but the boycott calls of any company supporting Israel have proven to be more influential than our attempts," the chef said.  

"The company punished the workers over the boycott even though it's garnering massive profit, literally billions of [pounds], and never granted the staff profit share or even employment contracts that legally guarantee their rights," the chef added.

"Many of the colleagues who had been laid off or obligated to leave due to the current pressures sought jobs at local restaurants, but the payment scale is not as good as it used to be at KFC," he said.

A PepsiCo Egypt factory worker, who confirmed their support to the Palestinian cause, however, described the boycott campaign as a "double-edged sword" and called for considering the local workforce, one of the main groups impacted by this campaign.

Even though the New York-based company's local branch in Egypt has not laid off any workers yet, like the case with many other businesses, the management has reduced the advantages the local staff used to be granted as part of their employment packages including meal allowance and overtime payment.

"Rumor has it that the local management is considering calling off the annual profit share we are entitled to amid the declining sales," the worker told TNA.

The most effected so far at the once-popular soda firm have been the distribution workers and sales representatives, "whose income is directly linked to their commission derived from the distribution."

Shaaban Khalifa, head of the Private Sector Workers Syndicate, deems the measures taken by local franchises and branches of foreign companies as "illegal."

The Egyptian labour law stipulates that in case an employer intends to reduce the staff for financial reasons, the company is legally required to submit a request for downsising the establishment before a committee formed by the local labour bureau, especially for this purpose.

"Any financial losses facing these companies have not impacted their capital as they claim. Their shares on the stock exchange have witnessed from 10 -15 percent rise after they had received a capital injection from the mother companies," Khalifa told TNA.