from GLOBAL STANDARDS
June 24, 2002 Vol. 2:2002
Labor unrest linked to ineffective unions
Vietnam General Confederation of Labor (VGCL) reports that workers initiated 459
strikes from 1995 through the end of March this year. Ho Chi Minh City, the country’s industrial center, recorded
251 strikes during the period, while neighboring Binh Duong ranked second with
98 stoppages. Some 21 strikes were recorded during the first quarter of 2002
far all these strikes have been illegal in terms of how they were organised, but
most petitions presented by the strikers have been reasonable," says Dung
of VGCL, adding that workers’ demands were generally met by employers.
Thi Hau, President of VGCL, stated that strikes should be a measure of last
resort for trade unions seeking to resolve labor disputes. "The first
weapon used is negotiations, based on which the rights of employees are
protected and production activities are maintained. However, trade unions have
to launch strikes if the employers continue to violate [workers' rights] after
In fact, no formal strikes have been initiated by trade union organizations to date. Most strikes were initiated by small groups of workers, and none of these strikes complied with legal procedures.
at a general meeting of the VGCL in Hanoi this month, acknowledged that the
local trade unions have not lived up to their responsibilities.
Only 27.5% of a total of the over 10,100 trade unions were judged to be
active and effective in carrying out their duties.
a result, many unions have come to be viewed as ineffective both by
management and the workers they are intended to represent.
Factory managements often resist establishment of the trade union,
seeking to avoid conflict. Workers
meanwhile show little interest in union activities, lacking understanding of
their rights and the role of trade unions, while wanting to avoid paying monthly fees
out of their limited salaries.
leaders who depend on management for their salary are often complacent and
reluctant to defend workers, even in cases where workers’ rights are violated
or they are illegally terminated. Most
trade union leaders lack adequate experience and training.
VGCL attributes many problems and legal violations to the ineffectiveness of the
trade unions, including growing issues with salary, social insurance, and labor
contracts for workers. According to
VGCL, workers in only 40% of non-State enterprises have signed labor contracts
and of these almost two-thirds were only short-term.
Only 40% of foreign-invested firms have collective labor agreements and the figure at other companies is even lower, at only 15-20%. In Ho Chi Minh City, 33% of such firms have not bought social insurance for their workers, local media reported.
Labor, The Laborer]
Local enterprises neglect health and safety
local firms continue to neglect health and safety issues, viewing workplace
safety training as time consuming, costly and unnecessary, according to a local
media report. Many companies fail to implement preventative measures to protect
workers from accidents and occupational diseases.
Service of Labor, Invalids and Social Affairs (SoLISA), the Service of Health (SoH)
and the Labor Federation (LF) of HCM City lack the resources to enforce existing
workplace health and safety regulations.
year, SoLISA investigated only 65 cases, while SoH and LF investigated 413 and
1,414 respectively. Such
inspections cover only a small fraction of the total of 10,000 enterprises and
60,000 small production establishments in the City.
investigations netted only three violators, who received fines ranging from
VND400,000 ($26.3) to VND2 million ($131.5).
However such small fines are unable to deter continued violations,
according to Tran Trung Mau, chairman of the Labor Federation of District 10.
recorded 18 fatal work-related accidents resulting in 18 fatalities since
January, triple the figure from a year earlier. These accidents included eight
deaths from electric shock, six from falls and one from the inhalation of
poisonous gases. The majority of reported incidents occurred at private enterprises.
In all, official statistics recorded over 3,600 workplace accidents last year
nationwide, many of which resulted from poor safety practices and inadequate
also show an increasing number of workers infected with gynecological, muscular,
ophthalmologic and ear, nose and throat diseases. Around 1,250 out of 14,000
workers undergoing regular health checks displayed symptoms of occupational
diseases, mainly occupational deafness, silica and cotton pneumoconiosis and
on unemployment insurance discussed
labor experts are asking the Ministry of Labor, Invalids and Social Affairs (MoLISA)
to ensure fair treatment for laborers in the draft on unemployment insurance,
which was put to discussion at a joint seminar held in Ho Chi Minh City by the
Ministry and the International Labor Organization (ILO) at the end of May.
the draft, laborers with indefinite term or one to three year term contracts
will be eligible for unemployment insurance. The draft makes no mention of
seasonal workers or workers in craft villages and cooperatives, who often do not
sign labor contracts.
also proposed raising employers’ contributions in the draft from 1% to 2% of
total monthly salary paid.
to Dr Kenneth Thompson from the ILO, Vietnam should pay attention to building
vocational training and job service centers capable of meeting the labor
market's demand, as they would ease the burden on unemployment insurance funds.
draft is due to be submitted to the Government for approval this October.
The current unemployment rate in urban areas is 6.28%. The program on
State-owned enterprises' and cooperatives' restructure may make an additional
500,000 laborers redundant over the next three to five years.
delegation wins US support for WTO bid
Commerce Department officials expressed support for Viet Nam’s bid to enter
the World Trade Organisation (WTO) and committed to provide technical assistance
to Viet Nam in carrying out the Viet Nam-US bilateral trade agreement (BTA),
Deputy Trade Minister Luong Van Tu told the VNA.
led the first official delegation of the Vietnamese Trade Ministry to explore
the US market since the BTA came into effect, from May 19-31.
During Tu’s meetings with US trade officials, he pressed for a
quota-free period for Vietnamese garments.
a result of the trip, Vietnamese businesses won export contracts worth more than
US$10 million, including orders for textiles and apparel valued at $4 million,
according to VNA reports.
and textile industry growth plan
garment and textile industry has targeted exports of $4 billion a year by 2005,
as part of an official growth plan for the industry.
state Vietnam Textile and Garment Corporation, together with regulatory agencies
has launched an initiative to lower production costs and boost exports by
slashing the cost of electricity, telecommunications and shipping to increase
is concerned about increasing competitive pressures from China and ASEAN in its
domestic market as well as the need to increase the competitiveness of its
exports to EU, Japan and the US.
Vietnam's garment and textile exports have grown by an average 26 per cent a year over the last decade, topping US$2 billion last year. In the first five months of this year, exports climbed 7.7 per cent to $820 million from the same period one year ago, VNA reported.
garment companies face shortage of skilled labor
garment makers, especially in Ho Chi Minh City, are facing a labor shortage as
they expand production to meet demand for exports.
garment workers are in short supply, with some HCM City companies recruiting
workers from distant provinces in central regions of the country.
training centers, both public and private, have been hard pressed to keep up
with demand. The official industry
forecast to 2005, foresees the need for over 800,000 workers and 6,000
technicians, VNA reported.
the shortage of skilled workers in the apparel industry, general unemployment
remains high nationwide.
A recent report from the Fund for Reconciliation and Development in Washington makes the case that Vietnam’s garment agreement with the US will likely follow the Cambodia model, whereby quota allocation for garment exports to the US will be linked with labor standards. The follwing is an excerpt of this report:
Politics of Textiles and Labor in Vietnam by Andrew Wells-Dang
is the likely outcome as Congress and the executive branch consider a textile
agreement for Vietnam along Cambodian lines? The potential economic benefits to
Vietnam are beyond dispute. Before the BTA was passed, Vietnam exported only $47
million worth of textiles to the U.S. in 2001 and faced tariff rates ranging
from 48-90%. With NTR garment tariffs averaging closer to 10-12%, trade analysts
estimate overall Vietnamese exports to the U.S. will double within one or two
years. Vietnam’s Ministry of Industry hopes to export as much as $400 million
in garments to the U.S. in 2002.
textile agreement has yet to be formally negotiated or signed, but the main
components of it are already known to both sides, a product of the long delays
in approval and implementation of the U.S.-Vietnam BTA. Unlike NTR, a textile
agreement does not require congressional approval; the USTR has standing
authority to negotiate such agreements, but Congress can play a significant role
in shaping their contents.
the pro-agreement side are longtime congressional supporters of normalization
with Vietnam (notably Senators John Kerry (D-MA) and John McCain (R-AZ)), the
Bush administration, and Vietnam’s ministries of Foreign Affairs, Trade, and
Planning & Investment. Some congressional Democrats who opposed the BTA,
such as Senator Russell Feingold (D-WI), might look more favorably on a textile
agreement that includes labor incentives. Vietnam may also become a test case or
carrot to attract support for other items in President Bush’s trade agenda.
of a textile accord with labor provisions include certain critics of human
rights in Vietnam, the Vietnamese Communist Party-sponsored trade union, and
both Vietnam’s Ministry of Labor, Invalids and Social Affairs (MOLISA), and
its Ministry of Public Security. Many U.S. corporations are also opposed. In
March 2001 testimony before the Senate, U.S. Chamber of Commerce President
Thomas Donohue used economic-nationalist arguments: “Handing foreign
governments the means to sanction U.S. companies under the guise of labor or
environmental concerns will prove disastrous to American interests.” Donohue
emphasized that U.S. business should support trade agreements only if they do
not include “blue/green” linkages. Indeed, according to one source, Western
companies pressured the Vietnamese government to weaken the power of trade
unions, which had began to criticize labor practices in foreign-owned garment
and shoe factories.
is interesting to note how hard-liners on both sides often end up taking similar
positions, as if Leninist party bureaucrats and their most strident U.S.
opponents were actually working together. Conservative nationalists in Hanoi
will view U.S. demands for labor standards both as an encroachment on
Vietnam’s sovereignty and as hypocritical given the past U.S. role in Vietnam.
The fact that labor provisions apply specifically to the garment sector may also
raise fears of trade wars and protectionism.
of nationalistic principle aside, Vietnam should have little to fear from the
labor-related incentives that might be included in a textile agreement. Though
less open than Cambodia in terms of freedom of association, labor conditions in
Vietnam are arguably no worse overall. Vietnam’s unions are centralized under
the Vietnam General Confederation of Labor (VGCL). The VGCL is viewed by labor
experts as well-intentioned but ineffective, at best, although less restrictive
in practice than the similarly structured labor regime in China. Strikes are
permitted, in theory, and unions are given some freedom to organize,
particularly in foreign-owned enterprises. Vietnam has ratified three of the
eight core ILO conventions to date (on child labor, nondiscrimination, and equal
pay for equal work), and it reportedly has plans to ratify others over the next
several years. (The U.S. has only ratified two—on child labor and forced
to now, the Vietnamese government has resisted negotiation of a textile
agreement, with or without a labor clause. Exporters would understandably prefer
to operate without any quota restrictions. Unlike Cambodia, which may have
benefited from quota allotments as it started up its garment industry,
Vietnam’s export sector is already well-established. In the absence of a
textile agreement, however, exports could still be subject to unilateral quota
restrictions, which the Vietnamese would prefer to avoid. In the longer view,
Vietnam also needs American support to join the WTO and take advantage of the
more open ATC rules beginning in 2005.
this mixed picture, Vietnam’s record of pragmatism in economic policy matters
suggests that the government will accept a textile agreement as an intermediate
step toward WTO membership. It is difficult to imagine the ILO taking the same
sort of active role in Vietnam that it has in Cambodia, however, and decisions
about compliance or noncompliance with labor standards will not be easy…
report from which this excerpt is drawn may be found at http://www.fpif.org/papers/txt-labor.html
The ILO held its International Labor Conference in Geneva in the month of June, focusing on the eradication of Child Labor as its major theme for the year.
Several papers and reports were published on the global state of Child Labor which are available online.
A Future Without Child Labour
Every Child Counts, New Global Estimates on Child Labor
Also on the ILO web site are several useful introductory publications on Health and Safety Management, which are available for free download.
Guidelines on Occupational Safety and Health Management Systems
Fundamental Principles of Occupational Health and Safety
Links to other reports and resources are available from the Global Standards web site at http://www.global-standards.com/Links.htm.
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