Siam News

Author: Vikram Nehru, Carnegie Endowment Electioneering in Malaysia has been at a fever pitch for many months now as Prime Minister Najib Razak prepares to call a general election. Yet away from the election’s sound and fury, the Malaysian government has been implementing some remarkable economic and institutional reforms that will stand the country in [...]

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Exploitation, corporate greed, authoritarian hangovers characterize too many labor relationships throughout Asia, but it may be changing The draconian action taken by the Singapore government against striking bus drivers a week ago, expelling 29 of them and charging another five, is emblematic of the treatment foreign labor can expect in most of Asia’s countries, not just the island republic. Another was charged with inciting by posting comments on a Chinese social network site and was jailed for six months after pleading guilty.Some 171 Chinese national bus drivers employed by the Singapore government-controlled transit company SMRT walked off their jobs, claiming they were underpaid relative to other foreign workers doing the same job and forced to live in poorly sanitized barracks, in what has been called the first strike in Singapore since 1986.

The dispute had its origins in a new work contract imposed on the workers in July, which raised the weekly wage of drivers by S$25 but at the same time it also raised the hours of work.

The recalculated ratio of pay to wages actually cut the rate per hour.The SMRT case is no surprise for those who know how the foreign labor industry works in the island republic and in fact across much of Southeast Asia.

The dispute is indicative of a much larger chronic problem.

The pay and conditions of foreign workers throughout the region have been poor to say the least.To date, foreign worker supply has generally been plentiful and workers are seen as a resource where the maximum should be extracted out of them for the minimum expenditure possible.

This is extremely common within local companies. Many stories abound of harsh treatment, poor management, abuse, and generally poor working conditions.Most foreign workers have already paid agents up to US$10,000, mostly borrowed for the privilege of working abroad.

There are many cases of workers being cheated out of their salaries by greedy and unscrupulous employers. Just within the last few days the Indonesian embassy in Kuala Lumpur warned its nationals not to work as maids in Malaysia due to the abuses many have endured over the years with very few rights of recourse.In fact under Malaysian immigration law, any misuse of workers outside of their visa conditions renders the workers liable, rather than the employers.

There are cases where foreign workers have been jailed and caned over employer misdeeds.The trauma facing many foreign workers starts not with the employers but with recruitment agents who extract as much as they can before the workers ever leave their home countries. Many deposits are taken from villagers in northeastern Thailand, Laos and Cambodia with the promise of foreign work that never comes. Some agents even issue false documents, as happened in Nepal a few years ago where a recruitment agent sent workers to Malaysia on false visas.

The culprits couldn’t be caught and prosecuted as they were “operating outside the jurisdiction of Malaysian authorities.” However the workers themselves were arrested for possessing forged visas. Very few of these recruiting agents are ever prosecuted.The recruitment business is so lucrative and generally outside the taxation system that it has attracted officers of government agencies and even members of parliament. Just recently labor activist Abdul Aziz Ismail accused the Malaysian Attorney-General’s chambers of colluding with the Bangladesh High Commission in aiding foreign labor recruitment agencies.In addition a former minister, Mohd Radzi Sheikh Ahmad and a sitting MP, is listed in Companies Commission of Malaysia (CCM) records as a company director of SNT Universal Corporation Sdn. Bhd., which has been accused of exploiting Bangladeshi workers.

The former inspector-general of the Royal Malaysian Police Force has also criticized the way the government handles foreign labor as little more than human trafficking.This brings up the next issue of old authoritarian hangovers in the practices and processes of handling foreign workers. Foreign workers travelling to Malaysia, Singapore and now Thailand specifically come to work for an employer on a short term basis and return home after a specific contracted period.Until very recently, most workers were poorly educated and subservient to their employers, just wanting to make as much money as possible and return home. Foreign labor was seen as a necessity of nation building, particularly when the Asian economies were rapidly growing with construction and manufacturing. Foreign labor also took up the jobs that locals didn’t want and thus performed a specific service, enabling national growth and development.Governments have viewed foreign workers as cheap labor in their country for the greater good.

This can be seen in the neo-Confucian nature of the Singapore government in doing things for the greater good while forsaking individual rights. Foreign workers are at the bottom of a feudal pecking order, the lowest in society to do what others don’t want to do. Consequently governments have given them very few rights, as there until recently has been little pressure to do so.In Thailand, where there are an estimated 2 million-plus foreign workers, mainly unskilled workers from Burma and Cambodia, some provincial officials will not even allow them to celebrate certain cultural activities.The embassies of supplier countries seem to be involved in the supply chain and the issue has not been highlighted to human rights forums internationally, although Phil Robertson, Deputy Asia Director of Human Rights Watch, criticizes Singapore for defying basic human rights for criminalizing migrant workers actions by taking industrial action. He adds that Singapore discriminates between different races when it comes to workers pay and conditions. Foreign workers have few, if any reasonable legal rights in any of the countries within the region, and often suffer the penalties dished out from mistakes their employers and recruiters make.The demographics of the workers themselves are changing. Foreign workers today are much more educated than their counterparts of just a few years ago.

They are more likely to come from farther afield than traditional sources like Indonesia and Thailand. And as with the Chinese bus drivers in Singapore, they are capable of using technology – the ubiquitous Internet – to warn their peers both in the host country and at home, and are becoming more aggressive about their rights than before, as domestic helpers in Hong Kong have led the way with demonstrations, caucuses and lawsuits.It is unknown whether Filipina maids, who have been in Hong Kong for decades, are the harbingers of change. But it may be that somewhere down the road a more professional approach will be required on the part of employing companies, which must realize that their bargaining power over foreign workers will weaken. Malaysia and Singapore have already lost attractiveness as places to work.Foreign labor practices are an embarrassment to the region.

They show that many local firms still have immature management, particularly in the HR area and have a long way to go until they can claim to be run as well as those in developed countries, making a mockery of any CSR in the region and if not attended to soon could become a deep impediment to the region’s competitive advantage in international trade.The foreign worker issue shows the world the ugly side of Asia as a region of deep exploitation. Yet the foreign recruitment agencies have been of great advantage to governments.

This issue is rarely brought up at international forums, and all parties seem to prefer to sweep these injustices under the carpet. Southeast Asian governments are very hesitant to regulate and control the sector.The SMRT strike has brought these matters into the public arena. Further cases of worker exploitation surfacing in the press can be expected to affect the reputations of governments, officials, and firms involved in these rackets. Southeast Asian governments and employers must learn that nothing is forever and move from the 19th to the 21st century.   Rights:Copyright © 2005 – 2012 Asia Sentinel.

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Author: Miguel Alberto Gomez, DLSU In the wake of recent cyber attacks launched against the Republic of the Philippines, and in response to the formalisation of cyber-crime legislation, the Armed Forces of the Philippines (AFP) have recently announced plans to establish an operations centre to address the rising incidence of cyber attacks. Categorised as a [...]

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Authors: Djisman S. Simandjuntak, Indonesia, and Lee Sun-Jin, South Korea Recently, sales of Korean-made cars have surged in China while Japanese-made cars have sharply reduced. Korea and Japan agreed in October not to extend their currency swap agreements when they expire at the end of the month. These new developments may be attributed to the [...]

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Author: Tobias Basuki, CSIS, Jakarta The first round of Jakarta’s 2012 gubernatorial election may indicate that the electorate is moving away from voting along ethnic and religious lines. As Jakarta is a diverse, cosmopolitan capital city representing the country’s heterogeneity, its gubernatorial election may be a gauge for the voting behaviour of the whole Indonesian [...]

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Japan abandon lifetime employment for its workers overseas – globalized price wars lead to reliance on cheap, non-permanent labor and wages that are time bombsContract labour – or “non-permanent workers” as they are called in Japan—is today a way of life for most Japanese companies, especially those in manufacturing.

The age-old, contentious issue that played a key role in the violence at Maruti Suzuki’s Manesar plant has also caused serious problems for Japanese companies within their own country and elsewhere. For instance, Japanese firms have been facing labour protests at regular intervals in China, where there are over 10,000 Japanese enterprises, and also, as recently as a few weeks back, in Indonesia. A Japanese diplomat who visited Jakarta recently said a large number of workers had demonstrated before the Japanese embassy there early this month demanding pay hikes.

The rising income disparity, due to the separated categories of permanent and non-permanent workers, is acknowledged by the Japanese government and its industrialists. For several years now, sections of Japanese society have been debating the issue. A report by Japan’s Research Institute of Economy, Trade and Industry (RIETI) highlighted it in September 2010.

There has been a “rapid increase in the proportion of non-permanent workers in the workforce since the ’90s,” it points out, and observes that “Japanese manufacturers, up against fierce price competition in the international market, are becoming more dependent upon these workers in order to achieve a reduction in labour cost.” But it argues that “it is crucial for an institutional mechanism to be put in place to ensure that the risk the non-permanent workers have to bear is efficiently distributed.” The report warned, “Otherwise, the labour market could become extremely polarised, resulting in further social division.” Much of the problem stems from Japan’s industries’ attempt to strike a balance between their unique work culture and to keep that relevant inthe teeth of stiff competition in a globalised economy.

Till a few decades back, Japanese firms were known for their work ethics, where workers were well looked after.

There were no separate canteens for workers and executives, and “discipline, punctuality and harmony” were key words defining the work culture. Economic disparity between permanent and    non-permanent workers is acute in Japan itself. Most of those who joined these companiessaw it as a life-time employment and grew within the organisation, effectivelytying their personal ambitions with that of the corporate body with a profitmotive. But things started changing since the 1990s, with increasinglycut-throat international competition, and with the opening up of the Japaneseeconomy to foreign investors and companies.

The new entrants, especially theAmerican firms, brought in “performance-related” pay hikes andbenefits—something that was absent from Japanese work culture earlier. Somecritics say that in order to protect a small section of their permanentemployees and to face fresh challenges brought on by new competitors, Japanesecompanies started bringing more and more non-permanent workers into their fold.

Though there are different categories of non-permanent workers with varyingcontracts, the economic disparity between them and permanent workers hascreated serious social and economic problems for Japan. “Though large numbers ofpeople in Japan would stillconsider themselves middle income group, these policies have led Japan to have one of the largest sections ofpoor people among the OECD countries,” Tamaki Tsukada, minister (economic) ofthe Japanese embassy in New Delhi,told Outlook.

This, coupled with an ageing workforce, led many Japanese firms to lookelsewhere and set up shop in neighbouring Asian countries where the cheap costof labour—since most recruits are non-permanent workers—would continue to keepthe companies competitive and bring in profits. While India’s South Blockmandarins are predictably upset about the potential impact of Manesar, theJapanese have shown great restraint in their criticism about the industrialclimate in India.This is a significant departure from the sharpness with which Japan reactedduring the violence at Hero Honda’s Manesar plant in 2005. In the past fewyears, Japan’s footprint in India hasincreased rapidly, and it is in the midst of negotiations with the Indiangovernment on quite a few mega projects.

There’s a lot at stake.  

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Thailands National Disaster Warning Centre has issued an evacuation order for residents and tourists along the Andaman coast after a huge earthquake struck off Indonesian Sumatra on Wednesday. Read more here: Indonesia quake triggers tsunami alert in Thailand Thailand’s open and tightly integrated into global trade economy experienced a V-shape contraction and recovery from late [...]

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This week’s strong earthquake that shook Japan, one of the best prepared Asian countries for natural disasters, was a stark reminder of the value of readiness in a region disproportionately targeted by the forces of nature. While Japan continues to dig out from last year’s triple disaster, Thailand is scrambling to avert a repeat of [...]

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