Decree No.39/2003/ND-CP dated April 14, 2003 on employment (Replacing Decree No.72/CP)

Decree No.02/2001/ND-CP of January 9, 2001 detailing the implementation of the Labor law and the education law regarding job training.

Decree No.44/2003/ND-CP dated May 9, 2003 on labor contract (Replacing Decree No.198/CP)

Circular No.12/2003/TT-BLDTBXH dated May 30, 2003 on wages for laborers working in State enterprises.

Circular No.13/2003/TT-BLDTBXH dated May 30, 2003 on wages for laborers working in enterprises operating under the Enterprise Law.

Circular No 14/2002/TT-BLDTBXH dated May 30, 2003 on wages of workers employed in foreign-invested enterprises and foreign or international agencies and organizations in Vietnam (Replacing Circular No.11/BLDTBXH-TT dated May 3, 1995)

Circular No. 15/2003/TT-BLDTBXH of June 3, 2003 guiding implementation of the provisions on overtime working in the Government’s Decree no. 109/2003/ND-CP of December 27, 2002

Circular No. 16/2003/TT-BLDTBXH of June 3, 2003 guiding implementation on working hours and rest time for workers doing seasonal jobs or processing export goods on orders.

Decree No.33/2003/ND-CP dated April 2, 2003 amending and adding to Decree No.41/CP on labor discipline and material responsibility.

Circular No. 10/2003/TT-BLDTBXH of April 18, 2003 guiding implementation of compensation and allowance regimes for workers subject to labor accidents or occupational diseases (Replacing circular no.19/LDTBXH-TT)

Circular No. 07/2003/TT-BLDTBXH of March 12, 2003 guiding the implementation of a number of articles of the government’s decree no. 01/2003/ND-CP of January 9, 2003 amending and supplementing a number of articles of the social insurance regulation promulgated together with the Government’s decree no. 12/CP of January 26, 1995 (Replacing circular no.02/1999/TT-BLDTBXH)

Circular No.08/2003/TT-BLDTBXH of April 8, 2003 guiding the implementation of convalescence and health restoration regime prescribed in the government’s degree no. 01/2003/ND-CP of January 9,1003 (Replacing circular no.11/2001/BLDTBXH-TT)

For more information, please send us an email at Laws@Global-Standards.com. 

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Vietnam Investment Review

Workers laid off due to lack of contracts

Nearly 2,000 workers, mostly in the garment and footwear industries, were laid off after export contracts dried up, reports the Federation of Labor and Business Club in HCM City.

More than 700 employees at the Lan Huong Footwear Company and Youg Shen Limited Company in Hoc Mon District lost jobs because their State-issued export quotas were exhausted.

Three clothing enterprises, Quoc Te Garment Co, Woowang Vina Enterprise and Binh Minh Garment Co, laid off 200 workers, and at Thai Duong and Huy Hoang Garment firms, 50 workers were sent home.

Idled workers are normally entitled to 70 per cent of their salaries during a work stoppage.

Nguoi Lao Dong (The Laborer)

About 200 workers at Kimanson Company Limited, a Korean-owned electronics company based in HCM City’s District 9, walked off their jobs on Wednesday morning to protest an alleged breach of contract by management.

Employees say the company’s newly appointed general manager refused to give bonuses to workers for Vietnam’s National Day on September 2, as stated in an agreement signed by the Manager’s predecessor and the company’s trade union.

The Labor Federation and Bureau of Labor, Invalids and Social Affairs in District 9 tried in vain to meet with the management to settle the dispute, which remains unresolved.

Lao Dong (Labor)

The Vietnam Textile and Garment Corporation and the HCM City Confederation of Labor’s Social Activities Center organized a workshop for preventing and fighting HIV/AIDS. It was attended by workers from 50 textile and garment enterprises.

Surveys show that 80 per cent of workers in the textile and garment industry are from the provinces, live in boarding houses or private homes and are at risk of contracting the virus. Of the 70,000 HIV-positive cases so far reported, 15,000 are in HCM City and 70 per cent are among young people between the ages of 20 and 29.

Tuoi Tre (Youth)

More than 200 workers at the Trang Nguyen Company Limited in Binh Chanh District, HCM City went on strike to demand that management abide by the Labor Code on work hours and contracts.

The company, which produces handbags for export, employs over 250 laborers but has signed three-month labor contracts with only 79 workers.

Frequent unpaid overtime has been demanded of workers, including night shifts and Sunday work.

Meeting with officials at the District Labor Federation, the managers of Trang Nguyen Co admitted their mistakes and vowed to abide by the law. After a two-day strike, the strikers returned to work.

Nguoi Lao Dong (The Laborer)

A labor dispute that led to a wildcat strike of 250 workers at Top-One Garment Company has been settled, says the Department of Labor, Invalids and Social Affairs of Go Vap District, HCM City.

In August the Taiwanese-owned company dismissed 202 workers without warning. No compensation was paid, and company management said the cutbacks were due to export order shortages.

They pledged to pay compensation for the lay-offs, including all allowances and social security.

Go Vap District’s Labor Federation and DoLISA also settled another dispute, convincing the management of Uyen Ninh Son Garment Factory to immediately pay July salaries to 250 workers. Delayed payment of salaries had led to a wildcat strike on August 20.

Nguoi Lao Dong (The Laborer)

A list of occupations considered "strenuous and dangerous" has been released by the Ministry of Labor, Invalids and Social Affairs.

Jobs added to the list are in the fields of: mining, metallurgy and engineering; electricity services; chemicals; confectioneries; textiles and garments; cigarette manufacturing; communication infrastructure; warehouses and docking parks; post and telecommunications; science and technology; agriculture; fisheries; and health services.

Lao Dong (Labor)

Direct negotiations and reconciliation are the most cost-effective ways for businesses to resolve their labor problems, vice president of the HCM City Federation of Labor, Nguyen Huy Can, told a seminar on labor disputes.

Can said that, in order to be effective, solutions should be implemented through labor unions and need to balance the rights of both employers and employees.

Employers, trade union representatives and other officials at the seminar said greater clarity in labor agreements, more union representation, as well as further training for union leaders in negotiating skills and labor law would help to reduce the number and seriousness of disputes.

A member of the Go Vap District Party Committee, Do Van Tanh, said "establishing good relations between employees and employers is vital to help businesses minimize unnecessary labor disputes and thus create better conditions for their development."

Many businesses do not have a code of ethics or fail to inform employees of labor rules, resulting in conflicts and discipline violations. This was a factor in the labor strikes at both the South Korea–Vietnam Garment Company and the Hue Phong Leather Shoe Company.

The director of the Hue Phong Leather Shoe Company, Nguyen Kim Quat, said "regardless of the causes, conflicts between employers and employees only result in the company’s decreased credibility within the business community and a lower level of commitment from disheartened workers."

Only around 40 per cent of all private and foreign-invested enterprises throughout the country currently have trade unions.

VNS

VIR

VNS

VNS, VIR

VNS

VNS

A revised quota allocation for US garment exports in 2004 has been announced by the ministries of trade and industry.

The new system gives preference to companies, which have a proven export track record in the US, with 75 per cent of the quota going to these established producers, 5 per cent more than this year’s ratio.

Companies which have large, long-term contracts for the US market will get 5 per cent of the quota, up from 3 per cent, and companies which use substantial local materials will receive 7 per cent, up from 3 per cent.

Some 12 per cent will go to new-entrants or companies with strong production in non-quota categories, expanding production capacity, modern equipment, or located in remote areas.

Meanwhile, the Vietnam Textile and Apparel Association plans to explore new markets, improve personnel training and raise its profile on the web, as part of its trade promotion strategy for the coming year.

"The strategy plays a significant role in helping the industry’s businesses carry out their trade promotion plans," said Le Quoc An, association chairman.

Key projects include: setting up a Vietnam training center for industry personnel; implementing phase two of a web portal for garment exports; and surveying new markets in Africa and elsewhere, while re-evaluating existing markets in Russia and Eastern Europe.

In the first nine months of this year, Vietnam’s clothing and textiles industry is forecast to earn US$2.9 billion, more than 50 per cent higher than the same period last year, according to the trade ministry.

VNS

Asia's remarkable growth has lifted millions from poverty. But economic success has come at a heavy cost. Environmental degradation in the region is now "pervasive, accelerating and unabated," according to the Asian Development Bank.

In the past four decades Asia has lost half its forest cover and half its fish stocks. China, the region's biggest economy, has suffered chronic air pollution from burning coal, water pollution from untreated waste and soil erosion from deforestation. 

The environmental implications of Asia's growth could reverberate around the world. "With 1.3bn people and an official goal to quadruple economic growth by 2020, China's environmental performance will not only determine the well-being of its own people but will have consequences for the whole planet," says Klaus Toepfer, executive director of the United Nations' Environment Programme.

There is also a wider lesson to be learned from the development challenges facing Asia. Is pollution simply the price of development? Does this generation have to endure an environmental tragedy for the sake of future generations?

Not in the opinion of a World Bank report on "Greening Industry". In what it described as "an intriguing and hopeful story", it said that many developing countries have already turned the corner in the fight against industrial pollution.

Factories are cleaner than a decade ago and total emissions are starting to fall even in areas where industry continues to grow rapidly. "The clean-up has begun because developing countries have decided that the benefits of pollution control outweigh the costs," says the report.

A similar point is made by the Association for Sustainable and Responsible Investment in Asia, a Hong Kong-based not-for-profit group: "Only 10 years ago, corporations and investors would have seen China as a pollution haven where environmental standards were allowed to 'let slip' and of secondary importance to rapid economic growth.

"However, the authorities have tightened their grip and businesses setting up in China can expect growing levels of scrutiny."

Foreign investors can play an important role. "Stronger enforcement of these regulations is needed by government and market forces can reinforce government action," says ASRIA.

The pressure on companies to adopt higher environmental and social standards is being applied through supply-chain initiatives and the growth of "socially responsible" investment funds.

Shareholder activists are targeting companies operating in developing countries. In the US, more than 300 shareholder resolutions were filed last year, up from 223 in 1999.

Calls for companies to produce sustainability reports received more than 20 per cent of the votes on average, while resolutions about climate change, human rights and labor standards attracted more than 10 per cent of votes.

The International Finance Corporation argues that championing environmental and social issues serves companies' own interests. It can help them save costs, increase revenues, reduce risk, build their reputation and improve access to financing.

"There are compelling commercial reasons to take action, despite a common assumption that sustainability is a luxury which emerging markets cannot afford," it concludes.

But the question of how far companies should take responsibility for social and environmental problems remains hugely controversial. At last year's World Summit on Sustainable Development, partnerships between business, governments and non-governmental organizations (or NGOs - often the most effective voices for the concerns of ordinary people in the international arena), were hailed as the most promising approach to turning good intentions into practical action.

Already, private provision of health, education and water has increased in poor countries over the last two decades, as a result of a lack of government funds, poor quality public provision and pressure to liberalize the economy, according to the UN's recently-published Human Development Report.

But the growing role of the private sector has often met with fierce opposition from local communities and NGOs. This year's Kyoto water summit, which was meant to focus on how access to water and sanitation could be improved, was dogged by bitter arguments over the implications for poor communities of entrusting water provision to large private-sector companies.

Many NGOs and community groups also distrust attempts by multinationals to reduce the damage they inflict on the environment through their operations. These attempts have continued to gather pace this year, most recently in a decision by Shell and 15 leading mining companies to treat World Heritage Sites as "no go" areas for exploration.

But environmental initiatives of this sort are criticized as inadequate by many observers in academia and NGOs. "In the absence of stronger forms of regulation and more concerted civil society pressure, the process of greening business in developing countries will remain lukewarm," says a report on The Greening of Business in Developing Countries, sponsored by the United Nations Research Institute for Social Development.

This report also criticized companies for failing to promote sustainable consumption. "Initiatives associated with corporate environmentalism rarely encourage consumers to adopt very different consumption patterns that would significantly reduce environmental degradation," it said.

This criticism highlights a central concern about the gap between the efforts of businesses to reduce their impact on the environment and the worsening state of the planet. This partly stems from the relatively small number of businesses that are integrating social and environmental factors into business decisions.

But in addition, environmental improvements are being overtaken by economic growth and increased demand for goods and services.

A growing world population and increasing affluence will pile on the pressure. The biggest aspect of the problem is global warming, which is likely to result in more extreme storms, floods and droughts that will, in turn, pose a threat to development. "Climate change will further reduce access to drinking water and negatively affect the health and food security of poor people in many countries of Africa, Asia and Latin America," according to a recent reports by the World Bank and other multilateral development-oriented institutions.

Here, once again, the remarkable growth of the Asian economies underlines the seriousness of the challenges. If car ownership in China, India and Indonesia reached the global average, 200m vehicles would be added to the global fleet, twice the number of all cars in the US today, according to UNEP.
It argues that the earth's ecosystems could not cope with the widespread adoption of the consumption and production patterns found in developed countries. Environmental degradation could undermine future economic growth and pose a substantial obstacle to poverty reduction.

Clean production processes and sustainable consumption patterns must become a crucial component of the development agenda, according to UNEP's Mr. Toepfer. "We must delink economic growth and environmental degradation."

Financial Times

http://www.wbcsd.org/plugins/DocSearch/details.asp?type=DocDet&DocId=2705

The banking sector's new social and environmental issue management framework raises the stakes in project finance, says Belinda Howell.

The International Finance Corporation (IFC), the private sector investment arm of the World Bank has recently been working with a dozen or so other international banks from nine countries to create a framework for revolutionizing project finance.

Signatories to the principles will commit to a framework that ensures all projects financed will demonstrate a socially responsible approach and reflect sound environmental management practices. These are known as the Equator Principles. 

The banks that have signed up account for almost a third of the international project finance community - US$25 billion in 2002 alone. It seems a viable proposition, but now the banks must roll up their sleeves and really get serious about implementation. After all, the only alternative is a minefield of very real deal breakers in terms of future liabilities.

Why now?

In 2000, an accident at a minerals reprocessing facility in central Europe led to a catastrophic release of dangerous chemicals from a waste pond into the Danube. This caused devastation to a large section of the river. The operating company was in compliance with its permit conditions and had been trying to act responsibly. However, a chain of events - none in themselves catastrophic - led to the accident and the placement of the company into administration to protect it from lawsuits being filed by the Hungarian government for more than US$100 million. 

The lesson here for international investors is to do more than simply rely on local procedures and minimum requirements but also to implement and monitor international best practice while taking an integrated risk control strategy.

Compliance to the letter of the World Bank / IFC standards or legislation is achievable, but their real value to investors will only be realized with appropriate stakeholder consultation and accurate and timely assessment of the social, environmental and economic impacts. 

Does it have teeth?

So what happens if the Equator Principles are judged to have been contravened? To meet the spirit as well as the letter of the Equator Principles will present great challenges. The bankers will want to ask themselves how meaningful specific consultations really are, how concerns raised are dealt with and communicated and how much and in what form local employment and compensation transpires. They’ll also need look at how effectively social and environmental management systems are implemented in practice and how the economy was affected and developed in both the long- and short-term. To do all this costs time and effort but it is a worthwhile investment if ultimately it protects society, the environment, the local economy and the bank's reputation. 

The banks may have to accept that the 'soft' social, environmental or economic issues can break a deal, just as technical and financial issues can. 

While signing up to the Equator Principles alone will not protect the signatory banks or their reputations, the banks should be congratulated for making public their commitment to these principles - not only by the corporate responsibility community, but also by their own investors. As Jane Fuller, the Financial Times' finance editor, wrote in June, "Companies which are less exposed to social and environmental risks are more highly valued by the market." Ms Fuller argues for companies to take a rational cost-benefit approach to corporate responsibility rather than sign up for tick-box approaches.

The driver for some banks to sign up to the Equator Principles was their continued ability to attract, recruit and retain the best workforce. 

According to Peter Woicke, executive vice president of the IFC, "[The banks] realized that without the best graduates they cannot compete, and the best people want to work for companies which pay attention to environmental and social issues."

To succeed in protecting their reputation with investors, employees and other stakeholders will require more than the bank chief executive's copperplate signature. It will demand integrating social, environmental and economic risks and issues into the process - right from the beginning of project financing. This will need to be continued throughout impact assessment, permitting and construction, the life of the operation, closure and rehabilitation of the local community, restoration of the environment and the long term development of the economy. A tough challenge, but one the banks must be prepared to commit to. 

EthicalCorp

http://www.ethicalcorp.com/content.asp?ContentID=1184