Cablegate: Update On Labor Export in Vietnam

This record is a partial extract of the original cable. The full text of the original cable is not available.





E.O. 12958: N/A

Reftel: Hanoi 336

1. (SBU) Summary: According to Vietnamese Ministry of Labor,
Invalids, and Social Affairs (MOLISA) officials and
Vietnamese press reports, increasing labor exports from
Vietnam have created new demands for services and
protections for overseas workers. While not yet complete,
the process of turning intention into action in the area of
labor export reform is underway. MOLISA is pushing for a
new, separate law exclusively on labor export to codify and
validate existing practice, and to coalesce the current
collection of decrees and circulars implementing the 2002
labor code covering the issue of labor export, and the
agency-specific directives governing interagency cooperation
and responsibilities. GVN efforts to punish labor export
regulation violators and protect workers in trouble have had
well-publicized success. End Summary.

Growing numbers of export laborers

2. (SBU) Labor migration from Vietnam is rapidly increasing,
with around 400,000 workers currently overseas. According
to MOLISA, approximately 75,000 workers went abroad in 2003
compared with 21,000 in 1999. While in the first ten months
of 2004 only 55,600 workers were exported, indicating a
possible drop off in numbers this year, MOLISA anticipates
the number of overseas workers to double by 2010. Vietnam's
expansion of labor export, both to release unemployment
pressure at home and to generate inflows of foreign
exchange, has heightened concerns for protecting labor
migrants from abuses. The growing number of Vietnamese
laborers going overseas, their vulnerability due to poor
knowledge and awareness of their labor rights, and reports
in the Vietnamese press have encouraged the protection and
education of migrant workers prior to their departure and
have motivated the GVN to create support mechanisms for them
in receiving countries.

Legal reform and oversight

3. (SBU) In order to address the challenges created by the
increase in labor exports, Vietnam included updated
legislation on overseas workers in its 2002 amendments to
the Labor Code. These documents attempt to rectify some of
the weaknesses in the labor export system by clarifying the
rights and obligations of Vietnamese workers, enterprises,
and government agencies involved in this arena, and
providing a mechanism for MOLISA to revoke licenses of labor
export companies (including state-owned enterprises) that
violate worker rights. These amendments were followed in
2003 by Decree 81, which provided detailed implementing
regulations (Reftel).

4. (SBU) Since the reforms of 2002 and 2003, the GVN has
continued to demonstrate its commitment to ensuring the
rights and welfare of temporary overseas workers, and to
increase its efforts to monitor and enforce those
protections and safeguards. In the past year there have
been a number of instances where the GVN has worked to
improve conditions for export workers or to protect them
from fraud or other mistreatment. According to the
Department of Overseas Labor (DOLAB) of MOLISA, in 2003, a
Middle Eastern shipping company approached four export labor
companies in Vietnam for laborers to work on tourist ocean
liners. Preliminary investigation by MOLISA discovered
signs of fraud, so the GVN delayed the sending of workers
and intervened to stop the contract signing with shipping
company. Through the International Maritime Association,
MOLISA confirmed other instances of fraud by this shipping
company. The GVN has also worked directly with governments
of receiving countries to improve the rights and conditions
of laborers overseas. In March 2004, the GVN signed an MOU
with the Labor Ministry of the Republic of Korea (ROK) to
include Vietnam in ROK's Overseas Labor Licensing Law.
Representatives from the Vietnamese Embassy in ROK said that
after the law took effect in August 2004, laborers from
Vietnam would then hold equivalent salaries, interests and
obligations as Korean employees. This status includes the
right to minimum wage, accident insurance and the right to
join labor unions. In a current case involving allegations
of Vietnamese workers being mistreated in Malaysia after
being charged with illegal immigration, the Prime Minister
instructed the Ministry of Foreign Affairs (MFA) in
coordination with MOLISA to work with the Malaysian
government to protect the legitimate rights of the workers,
according to press reports and MOLISA sources.

5. (SBU) We have identified other concrete examples of the
GVN's recent efforts at oversight of the export labor
system, to protect workers abroad and to ensure workers
rights are respected after returning home. One case
involving a Taiwan shipping company is currently pending.
In the fall of 2004, Vietnamese workers on the Taiwan ship
asked for protection at the Vietnam Embassy in Libya upon
docking in Libya, complaining of poor working conditions on
their ship. The GVN, through its representatives in Taiwan,
are currently working with the Taiwan authorities to make
the Taiwanese ship owners terminate the workers' contracts,
pay full salaries and pay for the safe return of the workers
to Vietnam. In another case in May 2004, Vietnamese workers
who had been sent to work in the construction sector in
Malaysia were not given jobs or paid their contracted
salaries as a result of shocks in the Malaysian economy.
According to the labor law, export labor companies are
supposed to pay compensation for damages to the laborer
caused by a breach of contract. However, the company in
question - Binh Phuoc Trading, Import-Export and Tourist
Company (Bitocimex) - was experiencing financial
difficulties. Mr. Nguyen Van Thoa, Deputy Director of Binh
Phuoc People's Committee stated that he instructed all
relevant provincial agencies to find a way to deal with the
dispute. He asked the company "to terminate the contract
based on the law in the light of ensuring fully legitimate
rights of the workers, bearing the risk by itself and not
passing the risk over to the worker." Ultimately, DOLAB
officials worked with the Binh Phuoc People's Committee to
loan the company money to officially terminate worker
contracts and ensure that the workers were satisfactorily
compensated. This case was widely covered in the (state
controlled) Vietnamese press.

6. (SBU) In an extension of the Bitocimex case, the Binh
Phuoc People's Committee inspectors found that the amount of
USD 678,350 collected in fees and deposits from 629 workers
to Malaysia was completely spent by the Ho Chi Minh City
Bitocimex branch. The company is suspected of swindling
workers sent to both Malaysia and Taiwan. The Binh Phuoc
police arrested and are investigating four other Bitocimex
staff, Thoa confirmed.

New labor export law

7. (SBU) To strengthen further Decree 81, the GVN has
officially proposed to include a Law on Labor Export in the
National Assembly's law making program for 2005. This long-
term proposal reflects Vietnam's determination to create a
more organized formal legal framework for export labor.
Currently, several provisions of the Labor Code and other
legal documents, such as decrees and circulars, cover labor
export regulations but there is no comprehensive coverage in
law. If it is incorporated into the 2005 law-making
program, such a law could be approved by the National
Assembly as of early 2006. MOLISA is preparing all
necessary information, documents and references, and is
ready to draft the law.

Interagency cooperation

8. (SBU) According to MOLISA officials, while MOLISA defines
the scope of activities and responsibilities for labor
export, the Ministry actively cooperates with the MFA and
the Ministry of Public Security (MPS) to support labor
export regulation and enforcement. Through the MFA, MOLISA
has maintained close relations with Vietnam's embassies
abroad, which are charged with intervening on behalf of
workers on consular and legal affairs. According to Mr. Vu
Dinh Toan, Deputy Director General of DOLAB, recent MFA
internal directives support these responsibilities in
practice, requiring new Vietnamese ambassadors to meet with
MOLISA to better understand the export labor system and
worker protections. Because MOLISA is not a law-enforcing
agency, the Ministry cooperates with MPS to identify
criminal and administrative violations of the labor export
system to "solve problems and eliminate violations of the
labor export system that could lead to trafficking in
persons". This includes working with local authorities in
provinces to combat fraud and other abuses.

9. (SBU) The GVN is further strengthening inter-agency
coordination and cooperation in a couple of key areas.
MOLISA, the Ministry of Justice (MOJ), the Supreme People's
Court and the Supreme People's Procuracy are currently
drafting an inter-agency circular providing guidance on the
settlement of disputes between labor export enterprises and
workers. MOJ is the lead drafting agency in collaboration
with the other agencies' experts. In addition, MOLISA and
MPS are waiting for approval of a draft inter-agency
circular on preventive measures and punishments for labor
export violation.

10. (SBU) In addition to cooperation across government
ministries and agencies, both MOLISA Minister Nguyen Thi
Hang and DOLAB have welcomed comments and feedback from the
U.S. Embassy or other experts from the United States on how
Vietnam's labor code can be better brought into conformity
with international codes of practice, particularly in the
area of export labor.

Targeted training

11. (SBU) Before departing Vietnam, workers receive training
in a wide range of subjects geared toward their destination,
including the language, culture, and basic legal system of
both Vietnam and the destination country, DOLAB experts
confirm. Labor export companies, provincial governments,
and employment service centers run courses to train many
laborers in the specific skills necessary for their overseas
jobs because "very few are qualified for the work that they
seek," said DOLAB DDG Vu Dinh Toan. The GVN recognizes the
need for more and more relevant training, both on job
specific skills, on customs, laws and regulations of
receiving countries, and workers' rights and
responsibilities under Vietnam and receiving country laws.
MOLISA has recently announced plans to establish three major
training centers - in the North, Center and South - to
improve the quality of pre-departure training and
orientation. They have proposed a budget of $170 million
from a variety of sources for training and development to
train up to 70 percent of the Vietnamese migrant workforce
before sending them abroad between now and 2010.


12. (SBU) The GVN effort to address labor export problems
has some weaknesses, according to interlocutors from the
International Organization for Migration. The new labor
attaches at SRV Embassies in labor export consuming
countries are "stretched thin" and cannot meet all the
demands for assistance in countries which themselves have
limited capacity to protect worker rights, IOM Chief of
Mission Andre Bruce told Poloff September 14. In addition,
the GVN has not yet identified funding sources for all of
its additional training programs, and typical human resource
problems hamper labor export law enforcement efforts.
Still, Bruce said, the GVN appeared "serious" about
addressing the problems inherent in labor export as well as
reaping its benefits.


13. (SBU) Vietnam's labor export regulation is evolving as
the GVN responds to growing needs and demands. There is
increasing definition of agency roles and responsibilities.
A unified law has been proposed, but is still pending. The
increase in the number of Vietnamese laborers sent overseas,
with the potential for an accompanying increase in the
number of cases of fraud and abuse of would-be workers, is a
public relations and public policy concern which the GVN
recognizes it must address. The result has been a
significant increase in the attention and resources the GVN
has devoted to the issue across a number of agencies both
here and abroad, from GVN representatives in SRV Embassies
in labor export receiving countries to MPS investigators
working with local officials to prosecute corrupt executives
at labor export companies.

14. (SBU) As Vietnam's dependence on export labor grows,
both as a means to relieve labor market pressure at home and
to generate foreign currency, an issue competing with that
of protection of workers is Vietnam's interest in
maintaining its position as an attractive supplier of export
labor. This requires the GVN to work with key labor
consuming countries such as the ROK, Malaysia, and Taiwan to
address the problem of Vietnamese workers who do not fulfill
their contracts and disappear into the local economy,
violating the terms of their visas. The role of labor
export companies in ensuring that workers respect their
contracts, and the role of the GVN in enforcing those
contracts, can at times create contradictions with the GVN's
mandate to protect workers. In balancing the responsibility
to protect workers from abusive situations with the
responsibility to enforce contracts (and the sensitive issue
of maintaining Vietnam's attractiveness as a source of
export labor), Vietnam must take care not to be seen as
compromising on ensuring workers' rights and protections.
On the positive side, current GVN efforts to strengthen the
labor export system, both through increased attention to and
oversight of labor export companies and activities, and
cultivating cooperative relationships with receiving country
governments, can help enforce contractual obligations while
at the same time protecting the workers' rights to terminate
contracts on legitimate grounds.

15. (SBU) There have been no cases of labor export-related
trafficking reported by any source since the passage of the
2002 labor law and the implementation of Decree 81. There
have, however, been numerous cases where labor export
companies have been sanctioned and/or corrupt executives
jailed for crimes or abuses defrauding laborers. The GVN
has also stepped in on several occasions to support
Vietnamese workers who have found themselves in difficult
circumstances in foreign countries. This represents a
significant shift from the situation that prevailed in 2000
during the events that led to the Kil Soo Lee case. The
message the GVN has been sending is that a) it will not
tolerate abuses of workers by labor export companies, and b)
it will, through intervention with third country governments
or through holding labor export companies to their
obligations to workers, come to the assistance of workers in
trouble abroad.


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