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Striking a balance in labor strikes: the key issues

Striking a balance in labor strikes: the key issues

Unpaid. Mandatory overtime. Low wages. Long working hours. Poor working conditions.

These are the main complaints raised by the striking garment workers - and the unions

that sponsor them - since the end of 1996. This week's column will examine the Rule

of Law on these key labor issues, and compare these rules in Cambodia with regulations

in the region and elsewhere.

Conflicts arising out of the employment relationship are as old as human history.

They burden economic efficiency in even the most developed countries. Such, employment

conflicts inevitably involve politics. In most countries, political parties can be

categorized as pro-worker or pro-employer. Since most workers vote, political parties

often target labor issues as election issues.

However, in countries with an efficient labor system, employment conflicts can be

effectively resolved through the judicious application of the Rule of Law by administrative

and judicial bodies. Politics is, for the most part, relegated to the stage of lawmaking,

rather than interpretation and implementation of the law. Respect of the Rule of

Law by all sides in a labor dispute is key to the positive resolution of such disputes.

Only when the existing dispute resolution mechanism fails should "politics"

have a role.

As Cambodia develops its labor policy, it must balance workers' rights with economic

development. As one of the poorest countries in the world, Cambodia simply cannot

afford to get this balance wrong. There is a long line of developing countries around

the world vigorously competing for labor intensive investment. The reality is that

to be successful in this global competition, Cambodia's labor policy must provide

employers with benefits equal to or better than its competitors.

Of course, a pro-development, pro-investment labor policy should not mean that worker

rights suffer. As all employers know, the most efficient workers are happy workers.

The key is striking a balance between the interests of the two sides so that growth

is promoted. Unionists should keep in mind that in a market economy, an unemployed

worker has no labor rights at all.

The chart above presents a list of the rules regarding overtime, working hours and

labor strikes in Cambodia and various other countries. The chart, and the discussion

below, refers to Cambodia's existing labor law, which was enacted in 1992, and the

new draft labor law. The draft law was passed by the National Assembly in January

of this year, but has not been signed by the King.

Standard Work Hours

Most labor laws establish standard maximum working hours. Any work beyond this limit

is usually voluntary and paid at higher wages. It is common to allow for mandatory

overtime in certain situations. Some countries also set maximum overtime hours as

well.

Under Cambodia's current labor law, the standard working hours are 48 hours per week

and 8 per day. The new draft labor law is the same. Other countries are similar.

Thailand is 48-54/week (8 per day), Singapore is 44/week (8 per day) and France at

39/week (10 per day). Recent strikes in France are attempting to lower this to 36,

in spite of double digit unemployment!

Overtime

Overtime is the work performed beyond the standard working hours. In most countries,

such work is usually voluntary and almost always compensated at a rate higher than

the normal salary. However, most countries also allow employers to require overtime

in certain situations or types of jobs.

Under Cambodia's current labor law, overtime can be mandatory and no special compensation

is required. In fact, it is not clear whether any additional compensation must be

given at all.

The new draft labor law will change all of this. Overtime will be voluntary in most

cases, and must be compensated at 1.5 to 2.0 times the normal wage. This is in line

with requirements in other countries. Thailand and Singapore require overtime to

be paid at 1.5 times the normal wage. France is 1.25 to 1.5 times the normal wage,

depending on the situation.

Minimum Wage

Most countries have a minimum wage. Both the existing labor law and draft labor law

authorize the Ministry of Labor to set a minimum wage in Cambodia. At present, however,

none has been officially set to our knowledge.

Working Conditions

Both the existing and new draft labor laws contain provisions designed to ensure

good, safe and sanitary working conditions. However, implementation of the law by

labor inspectors is the key to enforcement of this issue.

Unions and the Right to Strike

Permitting unions and enforcing the right to strike are important labor and human

rights issues. Most countries permit unions, but require some sort of licensing or

registration. Most countries also permit strikes. Most countries examined require

certain procedures to be followed before a strike can legally occur. Such procedures

include notice, negotiation between the parties, mediation and arbitration.

Cambodia's current labor law does not specifically permit unions or the right to

strike. However, it does require employers to hold elections for a "labor representative"

to represent employees before the employer. Moreover, the Constitution does clearly

protect the right for workers to strike.

The new draft labor law sets in place the right to unionize and strike. Unions are

permitted, but must be registered. Workers may strike, but must go through certain

procedures. For example, workers must use peaceful means prior to striking, and must

give seven days notice before any such strike. We will examine this issue, on a comparative

basis, in our next column.

- This column is for informational purposes only and should not be used by any

readers as legal advice. There are numerous exceptions and variances to the rules

discussed above. This week's column was written by David D. Doran and Ratha

L. Panh of Dirksen Flipse Doran & Le, a law firm with offices or affiliates

in Laos, Cambodia and Vietnam.

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