US embassy cable - 04HANOI3021

UNCLAS SECTION 01 OF 04 HANOI 003021 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR G/TIP, EAP/BCLTV, EAP/RSP, INL/AAE 
 
E.O. 12958: N/A 
TAGS: PHUM, KWMN, KCRM, ELAB, VM, OMIG, LABOR 
SUBJECT:  UPDATE ON LABOR EXPORT IN VIETNAM 
 
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. 
 
Weaknesses 
---------- 
 
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. 
 
Comment 
------- 
 
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. 
 
MARINE