LABOUR FLOWS AND ECONOMIC FAULT

LINES WITHIN THE ASEAN REGION:

LIVELIHOOD IN THE AGE OF NEO-LIBERALISM- CHARLES HECTOR

‘…Neo-liberalism - an ideologyan ideology and a political a political philosophy with its own valuesphilosophy with its own values of public responsibility. It had a very precise view of what economic systems should be and what kind of supporting financial system should underpin it. The distinguishing feature was the privatization privatization of utilities essential for public good general of utilities essential for public good general welfare, such as water, power, public welfare, such as water, power, public transport, health and other servicestransport, health and other services, irrespective of whether they were efficient or not whilst under the control of the State...’ Neo-liberalism encouraged low taxation, mobility of encouraged low taxation, mobility of labour to keep wages low, unrestrained labour to keep wages low, unrestrained mobility of finance, and the rise of the mobility of finance, and the rise of the stock/commodity/share/currency markets as a stock/commodity/share/currency markets as a means of financialization means of financialization which also became the indicator of economic welfare that is used by States.

well being of individual persons LOW priority

With the advent of neo-liberalization, traditional indicators like the general well being of persons and their families took a second place to the general general wellbeing of the state, or wellbeing of the state, or is it not really is it not really businesses? businesses? Matters like equitable distribution of wealth and opportunities amongst individual persons and their families, or access to basic amenities and rights took second place.

The Human Resources Ministry's study of 1.3 million Malaysian workers has found that a shocking 34 percent earn below the poverty line of RM720 monthly. - Malaysiakini, 5/8/2010, Study: 34% of workers earning below poverty line

Labour flow? Labour flow? – WHY NOT Human labour movement? – WHY NOT Human labour movement?

So much easier to talk about LABOUR as commodity – ignoring the fact that we are really talking about the human worker and their families/dependents

MIGRATION AND LABOUR FLOWS ALWAYS EXISTED – NOT A NEW PHENOMENON AT ALL

* Moving from rural to urban centres, within countries and across borders in search of a better life

• Migrants even now form the majority & rule – US, Australia, New Zealand,…

• ASEAN - many of its people are descendants of migrants

• Malaysia – In peninsular, only remain couple of hundred thousand of indigenous people, 55% of Malays, and the remaining are descendants of migrants from China, India, Sri Lanka,

MIGRATION AND LABOUR FLOWS ALWAYS EXISTED – NOT A NEW PHENOMENON AT ALL

* Moving from rural to urban centres, within countries and across borders in search of a better life

• Migrants even now form the majority & rule – US, Australia, New Zealand,…

• ASEAN - many of its people are descendants of migrants

• Malaysia – In peninsular, only remain couple of hundred thousand of indigenous people, 55% of Malays, and the remaining are descendants of migrants from China, India, Sri Lanka,

DIFFERENT ATTITUDE TOWARDS DIFFERENT ATTITUDE TOWARDS MIGRATION – PROFITS?MIGRATION – PROFITS?

But today nation States seems to be adopting a different attitude towards migration of people, wanting not just to control this movement but to also profit from this movement.

The control today seems to be motivated by reasons of income generation or profit making by both countries of origin and host countries.

various kinds of fees, levies, compulsory medical testing, insurances – including medical insurances, remittance fees….

WHY?WHY?

Old sources of income and benefits – erased by WTO, Free Trade Agreements….free market

NO more import/export duties, trade barriers, conditions of ‘transfer of technology’ … ‘need to use percentage of local products’ – quotas for locals in management/supervisory positions…

NEW sources of income ---- and the answer was Human Labour Migration…

LEVYMalaysian government makes about RM2 billion per year from levy. Employers of migrant workers are required to pay an annual levy for each worker whereby the rates depend on the sector employed in – manufacturing(RM1,200), construction(RM1,200), plantation (RM540), agriculture (RM360), domestic help (RM360), services – welfare homes (RM600), services – island resorts (RM1,200), services –others (RM1,800). – Migrants in Malaysia – An Overview by Charles Hector, part 1 was published in Praxis, the Chronicle of the Malaysian Bar, Jan-March 2012, and the 2nd and last part to be published in the upcoming issue.

 

Income from Insurance & compulsory medical check-ups

In Malaysia, employers need to buy insurance from certain companies under The Workmen's Compensation (Foreign Workers' Compensation Scheme) (Insurance) Order 1998, and now we have that new Foreign Workers Hospitalization and Surgical Insurance Scheme (RM120 per year), and in some sectors, it is the workers that have to pay for this new Insurance – not the employers.

Just the new insurance scheme – RM120 X Just the new insurance scheme – RM120 X 2 million migrant workers2 million migrant workers

RemittanceRemittance

income income  

“…Remittance flows are the second largest source of external funding for developing countries, and in Malaysian more and more companies are getting into this business, and now there are 62 and all over the country there are about 1,800 places where one can transfer money. The estimated total remittance was RM36.5bil in 2009 and recorded a further 12% increase in the first three quarters of 2010

And to ensure continued profits And to ensure continued profits

Still woo as many MNCs to set up factories, businesses - with promises of cheap problem-free labour - and today with the added promise of ‘no employer obligations’

No local workers – no problem we will get you migrant workers , who are more easily managed with even lesser chances of creating problems…

* There are also other factors for trying to get MNCs in…

BEST if we can just use BEST if we can just use LABOUR LABOUR without all the without all the other obligations that come other obligations that come with an employment with an employment relationship…. relationship…. Like the Like the obligation to look after the obligation to look after the welfare of the worker, ensure welfare of the worker, ensure that worker rights are that worker rights are protected….permanent protected….permanent employment until retirement, employment until retirement, domestic inquiry & right to domestic inquiry & right to be heard when we want to be heard when we want to fire workers, fire workers, trade uniontrade union & & collective agreements, Last collective agreements, Last In First Out(LIFO) policy In First Out(LIFO) policy when it comes to when it comes to retrenchment…..retrenchment…..

Permanent EmployeesPermanent Employees Short-Term ContractsShort-Term Contracts

Wage increments, annual leave/medical leave entitlement increases, maternity leave & benefits, termination/lay-off benefits, termination difficult – domestic inquiry, right to be heard…., unions & collective agreements

Easier termination, Avoid wage/annual leave/sick leave increments, Avoid maternity leave, Lay-Off Benefits, etc

More compliant less demanding worker – worried about ‘contract renewal’ – hence also no union problems..

Permanent to Short-Term EmploymentPermanent to Short-Term Employment

Local workersLocal workers Migrant WorkersMigrant Workers

More demanding of rights and benefits

Will leave if dissatisfied with employment condition

Can utilize and pursue claims in Labour Court, etc

Easily ‘controlled’ – easily cheated

No choice about leaving as can only work for 1 employer - bonded

Rights in law – but NO effective access to avenues of justice

Local Workers –vs- Migrant Workers

EmployeeEmployee Not EmployeeNot Employee

Can come together as UNION and make demands – for better rights, wages, etc

Cannot be gotten rid off easily – due process

Obligation to ensure rights and welfare of worker

No right to make claim for better wages, working conditions, benefits

Can be gotten rid off easily by just picking up the phone & asking supplier to take worker away

No worries about worker rights or welfare – just use them

No employment relationship – no No employment relationship – no employer’s obligationsemployer’s obligations

End result…

Factories/Workplaces get the required Factories/Workplaces get the required labour – with NO obligations with regard to labour – with NO obligations with regard to worker rights and entitlements, and worker rights and entitlements, and certainly NO RISK of Unions or strike or certainly NO RISK of Unions or strike or having to sit down and work out Collective having to sit down and work out Collective AgreementsAgreements

Own employee numbers can slowly be Own employee numbers can slowly be reduced – and thus their UNION’s powers of reduced – and thus their UNION’s powers of negotiation…bargaining powers erodes negotiation…bargaining powers erodes away.. Threat of even a strike – no need to away.. Threat of even a strike – no need to worry as we have the ‘outsourced workers’ worry as we have the ‘outsourced workers’ who could ensure business continues as who could ensure business continues as usual…PROFITS without responsibilities to usual…PROFITS without responsibilities to worker rights and welfare – IDEAL for MNCs worker rights and welfare – IDEAL for MNCs and businesses…and businesses…

Profits without risks

Workers work for the factory, factory pays RM50 to the ‘outsourcing agent’ for normal hours of work for 1 worker, and agent pays worker RM20, making about RM30 per day per worker.

1,000 such workers - RM30,000 per day, per month RM780,000-00, per year RM9.35 million.

With 2 million migrant workers -RM1.9 billion

UN, ILO, Multi-National Bodies(OECD), ASEAN

What can they really do even if they have their Standards, Declarations, Conventions, ….? NOTHING but make recommendations to governments and/or businesses to protect rights, …blah…blah – but there is NO way for them to compel – or even ensure justice is done to victimized workers…

* Also the victims have no direct access – to make complaints or claim rights… so why should the oppressor MNC or governments worry?

ASEAN – What Road Shall We Take?

Follow the river of neo-liberalism OR go another direction?

Continue to be governed by speculations and threats – or revert to traditional, cultural and religious values of the ASEAN people – where human dignity, rights, livelihood of individual persons and families is the most important priority of governments…

Take back control from private companies what a government should be doing for the people – healthcare, education, basic amenities, employment security, social security, public transport, …