Seasonal workers getting short end of stick

Hua Van Tai, 23, traveled from Binh Phuoc Province to Ho Chi Minh City, more than three hours away, to look for a job four months earlier. He later got one at a factory of Japanese electrical component firm Nidec in Thu Duc City as a seasonal employee, thanks to the help of a labor agency. There was no CV involved.

Tai said the firm only required an ID card, which the labor agency would keep for seven days before returning. There was no labor contract. Tai’s income consists of a basic salary of around VND4.7 million ($204), along with travel, accommodation support and social insurance payments, among others. They all add up to around VND10 million a month for 22 days of work, 12 hours a day.

“I’m working for a while to help with expenses for my siblings to study,” said Tai, adding that he knew a seasonal job would not entail full benefits like a full-time worker, like sick pay. But he chose to do it regardless thanks to the extra income as the company does not have to cut his salary for monthly social insurance contributions, he said.

Tai is only one among around 2,700 seasonal workers at Nidec Vietnam, who make up half the factory’s workforce. These seasonal workers were supplied to the factory by 20 labor agencies, said Luu Kim Hong, chairman of the company’s labor union.

Besides Nidec Vietnam, certain other factories at the hi-tech area in Thu Duc also hire seasonal workers. In July last year, Thu Duc authorities reported that the actual number of seasonal workers in 17 factories in the area was 20,000 more than official workforce.

Hong said seasonal workers are hired because factories find it difficult to hire full-time employees. Some employees don’t want to become official employees as they want their monthly social insurance contributions included in their salaries as well, which would make their monthly income higher. They can also quit at any time, not having to report to management about their departure 30-45 days prior as per usual.

An HR director of a tech firm in the hi-tech area said several factories in Vietnam are restricted by the main companies when it comes to the number of official workers they can hire, so they had to resort to seasonal workers. Hiring seasonal workers also helps factories cut costs, for example training and benefits, the director added.

Seasonal workers can also be let go or fired at any time, without all the documents, procedures and compensations needed if they were official employees, the director said.

Pham Thi Thu Lan, deputy head of the Institute for Workers and Trade Unions, said the fact that factories cooperate with labor agencies to get workers without informing authorities or paying their social insurance has made them all unofficial workers.

“It is a away to evade the law, but it has been overlooked by labor inspectors,” she said.

Measures to protect the rights of unofficial workers are still lacking in Vietnamese law, Lan said. When unofficial workers quit, they would have no unemployment benefits; they don’t get sick pay and may not get any support if they have work accidents. Even governmental support for workers is geared to prioritize official workers who contribute to social insurance, not unofficial workers.

If factories continue to hire seasonal workers, the labor market would be “distorted”, said Lan. Workers’ basic rights would not be ensured, tipping the scale of balance between employers and employees, she added.

Hong said that even with the social insurance payment added to their monthly incomes, seasonal workers would still get the short end of the stick due to the nature of contracts signed between companies and labor agencies.

Nguyen Quoc Thanh, deputy director of HCMC Social Security, said businesses must pay social insurance for all workers who’ve worked for at least a month, even for those who don’t have a labor contract. The fact that companies add social insurance payments to workers’ income is wrong and show signs of evading social insurance payments.

Ho Xuan Lam, deputy head of the HCMC Confederation of Labor, said there are only 20 jobs where businesses may hire workers from labor agencies or other third parties, like assistants or receptionists. But many companies still hire seasonal workers all the time anyway and relegate all responsibilities regarding contracts or social insurance payments to third-parties.