Friday, September 14, 2007

Vietnam cosidering removing limit on foreign workers in firms

Vietnam is considering removing the limitation on the number of foreign employees in enterprises, which is now capped at 3% of total labourers.

The Ministry of Labour, War Invalids and Social Affairs (MOLISA) is compiling a draft decree on recruitment and management over foreign labourers in Vietnam, which is expected to replace the currently applied Decree 105 on the same issue. The draft decree compilers plan to make a breakthrough by removing the cap on the number of foreign labourers in enterprises.

In fact, the attempt to limit the number of foreign labourers has not brought the expected effects in preventing the clearer tendency of increased number of foreign labourers in Vietnam.

According to the reports by 38 local departments of labour, war invalids and social affairs and 20 industrial zones’ management boards, by the end of 2006, Vietnam had 34,117 foreign labourers. The number of foreign labourers has been increasing rapidly in the last three years, by 61% in 2006 over 2005 (12,900 labourers). In 2005, the number of foreign labourers represented the increase of 68.4% over 2004, or 8,615 persons.

In theory, Vietnam does not open its doors to low qualification labourers, it only welcomes the labourers for the posts that cannot be filled by domestic labourers. However, the statistics show that among the present 34,117 labourers in Vietnam, 31.8% hold management posts, 41.2% are technical experts, while 27% are other labourers. Those who have college degrees and experience amount to 50% of total foreign labourers now in Vietnam.

In fact, Vietnam is facing a lack of qualified managers and high grade labour force. Jos Lagens from Navigos Group said that the use of foreign labourers for high positions in enterprises was still the choice of many enterprises, some of which even set the requirements on the nationality for staffs.

As Vietnam has joined the WTO, it has to fulfill the commitments it has made to the organisation, including the commitments relating to the presence of foreign individuals. The foreigners moving inside enterprises, the foreigners offering to sell services or provide services under contracts, will have the right to work in Vietnam. This means that the number of foreign labourers will increase considerably in Vietnam when the country integrates more deeply into the world’s economy.

Nguyen Thanh Hoa, Deputy Minister of MOLISA, said that Vietnam would not manage foreign labourers by limiting the number any more, but would keep control over quality. He said that Vietnam would only licence foreign labourers who could meet the requirements for the posts which could not be fulfilled by domestic labourers.

The compilers plan to set stricter procedures in order to manage foreign labourers. Under the current regulations, foreign labourers working for institutions and agencies and coming to Vietnam to implement contracts with domestic institutions and organisations do not have to get licences. However, the draft decree says that all labourers coming to Vietnam to work must get licences, except the ones who work less than three months, owners of enterprises and labourers offering to sell services. Foreign labourers will have to show working licences when making entry and exit formalities.