‘Any Labor Dispute Will Only Be Resolved By the Parties Sitting Together’

By Paul Vrieze 6 March 2015

In recent weeks, some 2,000 workers of the E-Land Myanmar, COSTEC and Ford Glory garment factories in Rangoon’s Shwepyithar Industrial Zone went on strike to demand a raise in monthly wages from 80,000 kyats [US$78], up from 50,000 kyats.

Protests dragged as workers and factory owners failed to come to a resolution. Authorities stepped up pressure on workers, whose number eventually dwindled to a hundred, before police arrested the last remaining protestors on Wednesday.

When President Thein Sein’s nominally-civilian government took office it lifted junta-era restrictions on unionization and striking, and created laws that are supposed to regulate dispute resolution. In January, a committee began conducting research to determine an appropriate minimum wage level for Burma, which lacks a minimum wage and has some of the lowest wages in Asia.

The Irrawaddy recently spoke to Steve Marshall, long-time liaison officer for the International Labor Organization (ILO) in Rangoon, about the protests, the state of labor dispute resolution and setting the minimum wage.

Question: What caused the labor dispute at Shwepyithar Industrial Zone and is the ILO helping to resolve it?

Answer: The ILO anywhere in the world does not get involved in resolving individual disputes. …

The ILO’s advice to anybody in this sort of situation is that disputes are driven largely at this stage by emotions, but at some stage the parties are going to need to sit down and need to talk to each other and start using proper procedures that are provided for in the Law on the Settlement of Disputes.

Q: But is there perhaps also a labor problem because of a lack of progress regarding laws for resolving labor disputes?

A: There is a new law that is been in place since 2012 [Law on the Settlement of Disputes]. But the reality is that, as with all issues in Myanmar, it is at an evolving level of capacity and there is a level of distrust that exists between the parties as to these sort of official proceedings.

But the fact of the matter is, in any dispute, doesn’t matter in which country it is, eventually a dispute, which may or may not involve strike action, will only be resolved by the parties sitting together negotiating.

A failure on agreeing will result in parties agreeing they will either part company permanently, or put the dispute into a regulated dispute resolution process, which would mean arbitration.

Q: What about the threats authorities against the workers and arrests of some protest leaders, are you concerned about that?

A: We get concerned about all disputes. We are very firm believers in the fact that these issues should be resolved through negotiations and dialogue. But there will be occasions where in fact the use of strike of action, the use of lockout, is a legitimate tool to push one’s position…

The critical thing for us is that in exercising these rights, both parties need to be adopting behavior recognizing the responsibilities that go with it. If you are striking, or locking out, there are certain procedures that you need to be taking.

Whilst we accept that rule of law continues to be a serious problem in the country, this is mechanism that has been designed by the new government, and we would recommend that the parties try to work within the framework of this law.

Q: What is the status of the process for determining the appropriate minimum wage level?

A: That is in the hands of a national tripartite minimum wage setting committee. The [Minimum Wage] law has been passed [in 2013] and there has been established a nationwide committee with government, employer and workers representation. My understanding is that this committee has now commissioned research that would inform the decision… as to what the actual minimum wage is for.

Q: What are the considerations for determining the minimum wage level?

A: The national committee … is undertaking research so that the decision is something which does support the most vulnerable in society in terms of their basic living standards, but also supports the growth of the economy and that the country remains competitive. That is not an easy decision for them to take. …

For example, the decision needs to be made on whether there will be a single minimum wage for the country, or whether there will be multiple minimum wages. Whether it will be done by sector or industry, or by region or state, this decision is yet to be taken.

Q: How will the new minimum wage impact Burma’s society?

A: A minimum wage is a social protection policy that is put in place to say what the basic wage is that somebody should be receiving under the law for working the normal 44-48 hours per week, without overtime. This allows them to have an income, not one that allows them to live a life of luxury, but gives them a life with basic dignity. …

Many people are confused about what is the minimum wage is and relate the minimum wage to the actual amount of money that someone receives at the end of the month.

The actual paid [monthly] wages should be set and resolved between the employer and employees. This is done through contract negotiation and collective bargaining. This takes into account things such as the skill level of workers concerned, productivity of the operation, the geographical location… So that is different from a minimum wage.