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Logo of Phnom Penh Post newspaper Phnom Penh Post - Ghosts in the machine

A foreign passport and work permit forms in Phnom Penh late last week.
A foreign passport and work permit forms in Phnom Penh late last week. Hong Menea

Ghosts in the machine

Private firms say costs, delays and bureaucratic red tape have increased since an obscure private company took over the government’s work-permit application and issuance system in September.

The Ministry of Labour announced in August that it had outsourced work permit application processing to E-Solutions (Cambodia) Co Ltd in a public-private partnership aimed at making it easier for foreign workers to apply for permits – and easier for the government to track them.

The company was contracted to build and operate a new portal for the ministry, dubbed the Foreign Workers Centralised Management System (FWCMS), that handles the application, processing and distribution of foreigner work permits.

Anthony Galliano, CEO of Cambodian Investment Management and chairman of the Eurocham Tax Committee, described the FWCMS as “the worst” online registration system the government has produced to date.

He said the online portal was even a step down from the previous system, which was widely criticised for causing inordinate delays for companies and foreign workers attempting to register or obtain employment cards.

“In my experience the FWCMS is proving to be the most complex [online system], and I expect that only a small percentage of foreign workers have made it through all the steps required to date,” he said.

Galliano said that obtaining a work permit through the online application process was “a monumental task that requires extraordinary perseverance, patience and investment of time”.

The process, he explained, requires employers to upload copies of each individual foreign worker’s passport and visa, as well as immigration stamps of the employee’s initial arrival in the country. It also requires documentation, including a signed employment contract verified by the ministry, a certified health check-up and a residency letter approved by a local commune official.

“The documentation required alone is astonishingly overwhelming, and even if you have the documents required, they better be in the [correct] form and have the certifications required in order to be accepted,” he said, adding that these were just the transparent processes for registering.

Little is known of E-Solutions, which was incorporated in December 2015, and even less is known about the government’s selection process. Despite the technological innuendo of its name, the company has no corporate website or public web presence, and no track record.

E-Solutions general manager Yours Vuthy declined to provide details on the company’s background and shareholders, stating only that the web portal was supported by IT professionals from Cambodia, Malaysia and Singapore. He also declined to reveal how the company was chosen for the contract, adding only that it “had to go through a consultation process”.

“E-Solution’s duty is to build the online systems and database, and manage technical support, as a part of [its] concession,” he said in an e-mail.

Since 2014, the government has ramped up efforts to register foreign workers and penalise those that have skirted the law. Last year, some 36,000 foreign workers registered for work permits, which cost from $80 to $125 according to the worker’s visa category, plus an additional $25 mandatory health check.

According to the ministry’s release in August, E-Solutions is authorised to tack an additional $30 fee on top of the ministry’s $20 processing fee for employers and individuals registering. Vuthy said the agreement linked the company’s revenues to the number of workers it succeeded in registering.

“We receive profits based on the application processes,” he said, adding that the Labour Ministry had also contracted E-Solutions to develop other service centres and data management systems. However, the company’s current project has drawn broad criticism.

A private sector human resource director, who requested anonymity because the company was currently negotiating its foreign worker quotas and extensions, said the new online format was unclear and confusing, while the company’s lack of transparency and rumoured connections with high-ranking government officials was disconcerting.

“So far, E-Solutions makes the work permit process a bit more complex, more expensive and slower than before,” he said, adding cautiously, however, that he felt the problems were being addressed.

According to the director, the new cost structure is not clearly defined with the company charging “$15 here and $25 there”, which at face value makes the process more expensive than the old manual system, where employers relied on informal payments requested by ministry officials to streamline the process.

“It is difficult for now to say if it will in total cost much more than before, but if the registration process sticks to new fixed and official costs that replace unofficial costs, the initiative might be OK,” he said.

Sandra D’Amico, managing director for recruitment firm HRINC Cambodia, said that her company’s experience with the new registration portal has been largely positive. “I think our general feedback is that everyone has limited
experience in using the system, and generally most companies leave quotas until the last moment, which definitely can create challenges for the system,” she said.

She noted, however, that the initiative does have some problems to overcome. “What we have experienced in processing is a delay in responding to applications – it can take around a month before you get a response,” she said, adding that she was unsure whether the government or the private company was to blame for the “bottlenecks” in the process.

“I imagine it’s a capacity challenge overall with more and more companies trying to move online and to get things processed online,” she added. Labour Ministry spokesman Heng Sour vehemently defended the ministry’s decision to outsource work permit processing to E-Solutions, though he was less forthcoming about how and why it selected the company to operate the system.

“The online service run by E-Solution is a win-win strategy between the ministry and the private sector,” he said of the partnership, adding that the agreement was structured under the build-operate-transfer (BOT) model.

Sour said complaints about the complexity of the online system were unfounded, arguing that the process was as simple as registering an e-mail address.

“This is the first online system that the ministry introduced, and it requires foreigners who claim to be professionals and intellectuals to register themselves,” he said. “If they are good foreign professionals that claim to be better than Cambodians, they must prove they can overcome this simple ABC test of IT data entry processes.”

He suggested the online portal’s critics were those seeking to cheat and benefit from the old system, suggesting some problems could be “due to companies faking professional certificates for their foreign workers”.

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