Free trade agreements help labourers' rights reform

July 18, 2019 - 09:38
With the EU – Việt Nam Free Trade Agreement (EVFTA) signed late last month, Việt Nam will have the opportunity to gain further access to the market of 28 European Union member countries as well as global markets.

Thu Vân

With the EU – Việt Nam Free Trade Agreement (EVFTA) signed late last month, Việt Nam will have the opportunity to gain further access to the market of 28 European Union member countries as well as global markets.

As one of the ‘new generation’ bilateral agreements, the EVFTA trade deal includes commitments to implement International Labour Organisation core standards.

The Vietnamese Government is now revising the Labour Code, which, if adopted, will represent major progress towards alignment with the International Labor Organisation (ILO) 1988 Declaration on Fundamental Principles and Rights at Work.

In parallel, the Government has ratified one of the three remaining ILO core conventions – Convention 98 on collective bargaining – earlier this year. It is working towards the ratification of Convention 105 on forced labour in 2020, and Convention 87 on freedom of association by 2023. 

In the revised Labour Code that has been put up for public review, the drafters have added three provisions on the establishment of workers’ associations. In particular, workers have the right to join or form a representative organisation of their choosing, and the law also introduces clearer processes and encouragement for collective bargaining.

Looking back more than 10 years ago, when the terms ‘freedom of association’ and ‘collective bargaining’ were still taboo, it’s clear the country has come a long way.

But of course the future is always unpredictable, and the real implementation of such commitments will prove the goodwill of the Government.

It might be a long road, given the current situation.

Hard life and weak protection

According to a recently-published Oxfam study on Vietnamese garment workers' wages and living conditions, 99 per cent of Vietnamese garment workers surveyed earn below Asia's living wage proposed by the Asian Floor Wage and 74 per cent of them earn below the global living wage proposed by the Global Living Wage Coalition.

A living wage, according to Oxfam, is the minimum wage paid to a full-time worker that can cover basic needs of food, housing, healthcare, clothing, transportation, utilities, childcare, education, future savings and savings for future and unexpected events.

According to the study, Việt Nam’s statutory minimum wage is far below what a person needs to cover the essentials. Even the wages most garment workers earn on top of the minimum wage fall short of what is considered a living wage. The national average minimum wage in Việt Nam is VNĐ3.34 million, which is around 37 per cent of the Asia Floor Wage and 64 per cent of the Global Living Wage Coalition benchmark.

Competitiveness is among factors blamed for this distressing situation.

Workers’ wages are being kept low, so manufacturers can reduce prices for international buyers, who always seek the cheapest option.

The priority of profit over workers’ livelihoods causes many factories to cut costs by not conducting enough health checks and reducing the cost of their employees' meals, the report said.

At a meeting last week held by the Việt Nam General Confederation of Labour, Vũ Quang Thọ, former head of the Union Institute and a former member of the National Salary Council, said when he himself visited workers, he heard of female workers who agreed to commercial surrogacy at a rate of US$10,000-12,000.

“They have to do so to make ends meet, because the salary was too low to cover their daily needs, let alone savings for the future,” he said.

When it comes to legal protection, the country falls short.

Trade unions’ lack of bargaining skills and power, as well as exhaustion and potential loss of jobs, are the hindrances for the workers to raise their voices and fight for their rights.

Ironically, all workers asked said they aspire to have higher wages but are wary of pushing too hard as it could put their livelihoods at risk. Two workers in Ninh Bình Province told researchers of the Oxfam study that even though they had disagreements with their working conditions, no one dared lead a strike – even the union president.

Earlier ratification?

Given these issues, maybe the Government should consider earlier ratification of ILO Convention 87 on freedom of association rather than by 2023.

Currently in Việt Nam, there is only one legally recognised system of trade unions. The organisation of trade unions is prescribed by the Charter of Vietnamese Trade Unions adopted by the Việt Nam General Confederation of Labour (VGCL).

ILO international labor standards require that trade unions must be independent of authorities in both organisational operation and financial issues; and trade unions must also be independent of employers in carrying out their activities.

In Việt Nam, trade unions are defined in the Constitution 2013 as socio-political organisations of the working class, and in reality are strongly reliant on the state in terms of both financial support and personnel management.

That, somehow, explains the shortcomings of trade unions in protecting workers’ rights.

For a better future, trade unions in Việt Nam, either working independently or under the labour confederation, should always work to ensure labourers’ rights are met. They should work to make sure more efforts are put into lifting employees' earnings to the living wage standard, social protection for all workers is guaranteed and to foster a friendly environment for collective bargaining.

In order to do this, Việt Nam’s current trade unions have much to do to renew themselves aggressively. Free trade agreements like the EVFTA, together with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), are thus very important to encourage the country’s leaders and policymakers to stay on the course of effective reform.

Although domestic law – the revised Labour Code – might already be in conformity with the ILO’s substantive provisions, actual procedural provisions of the ILO’s Conventions will require employers to seriously carry out certain obligations provided by the supervisory mechanism of the ILO.

Incorporating and implementing ILO Convention 87 in Việt Nam will contribute to making the country more reliable and respected in international trade relations. Doing this would also ensure the security of employment relationships, which play an important role in maintaining socio-political stability, fostering economic growth, and attracting FDI to the country.

There are many reasons for Việt Nam to continue its employment relationship reform, and do it soon, because it would only bring about benefits for all. --VNS