1.
LABOUR FLOWS AND
ECONOMIC FAULT LINES
WITHIN THE ASEAN
REGION:
LIVELIHOOD IN THE AGE
OF NEO-LIBERALISM
- CHARLES HECTOR

2.
‘…Neo-liberalism - an ideology and a political
philosophy 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 of utilities essential for public
good general welfare, such as water, power, public
transport, health and other services, irrespective of
services
whether they were efficient or not whilst under the control
of the State...’ Neo-liberalism encouraged low
taxation, mobility of labour to keep wages low,
unrestrained mobility of finance, and the rise of
the stock/commodity/share/currency markets as
a means of financialization which also became the
indicator of economic welfare that is used by States.

3.
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 wellbeing of the
state, or is it not really
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.

4.
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

5.
Labour flow? – 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

6.
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,

7.
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,

8.
DIFFERENT ATTITUDE TOWARDS
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….

9.
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…

10.
LEVY
Malaysian 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.


11.
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 2
million migrant workers

12.
Remittance

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

13.
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…

14.
BEST if we can just use LABOUR
without all the other
obligations that come with an
employment relationship….
Like the obligation to look after
the welfare of the worker,
ensure that worker rights are
protected….permanent
employment until retirement,
domestic inquiry & right to be
heard when we want to fire
workers, trade union &
collective agreements, Last In
First Out(LIFO) policy when it
comes to retrenchment…..

15.
Permanent to Short-Term Employment
Permanent Employees Short-Term Contracts
Wage increments, annual Easier termination,
leave/medical leave Avoid wage/annual
entitlement increases, leave/sick leave
maternity leave & increments, Avoid
benefits, maternity leave, Lay-Off
termination/lay-off Benefits, etc
benefits, termination More compliant less
difficult – domestic demanding worker –
inquiry, right to be worried about ‘contract
heard…., unions & renewal’ – hence also no
collective agreements union problems..

16.
Local Workers –vs- Migrant Workers
Local workers Migrant Workers
More demanding of Easily ‘controlled’ –
rights and benefits easily cheated
Will leave if dissatisfied No choice about
with employment leaving as can only
work for 1 employer -
condition bonded
Can utilize and pursue Rights in law – but NO
claims in Labour Court, effective access to
etc avenues of justice

17.
No employment relationship – no
employer’s obligations
Employee Not Employee
Can come together as No right to make claim
UNION and make for better wages, working
conditions, benefits
demands – for better Can be gotten rid off
rights, wages, etc easily by just picking up
Cannot be gotten rid the phone & asking
off easily – due process supplier to take worker
away
 Obligation to ensure
No worries about worker
rights and welfare of rights or welfare – just
worker use them

18.
End result…
Factories/Workplaces get the required labour –
with NO obligations with regard to worker rights
and entitlements, and certainly NO RISK of
Unions or strike or having to sit down and work
out Collective Agreements
Own employee numbers can slowly be reduced –
and thus their UNION’s powers of negotiation…
bargaining powers erodes away.. Threat of even a
strike – no need to worry as we have the
‘outsourced workers’ who could ensure business
continues as usual…PROFITS without
responsibilities to worker rights and welfare –
IDEAL for MNCs and businesses…

19.
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

20.
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?

21.
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, …