Illegal Vietnamese workers flood delta factories

He Huifeng
23 April 2010

Thousands of illegal Vietnamese workers have found work in the Pearl River Delta’s factories, thanks to a severe labour shortage and unintended side effects of the mainland’s two-year-old Labour Contract Law.

Chen Mingdong said his Vietnamese friend, “Sing Lung”, was deported this month, along with about 10 other Vietnamese labourers, for working illegally in Guangdong.

He said he had no idea what Sing Lung’s real name was, but they struck up a friendship two years ago and were workmates at a fan factory in Foshan.

“I named him Sing Lung because, when we first met, at an internet bar two years ago, he was listening to a Jackie Chan song beside me,” Chen said. “I was impressed because the song was in Vietnamese. Since then, I’ve been aware that there have been Vietnamese workers in the factory.

“I appreciate them. They don’t talk much, work hard and can endure hardship. They do heavy manual jobs, which we Chinese are reluctant to do now.”

Workers at the factory say that the Vietnamese have often comprised 10 per cent of its 1,000-strong workforce. They are part of a growing but illegal foreign labour force in the delta, mainly from Vietnam and other neighbouring countries.

Guangdong government statistics show that police investigated 7,940 cases involving foreigners suspected of illegal immigration, residence, employment and trading in 2007 – a substantial rise on the 4,055 in 2006.

Guangdong police uncovered 13 cases involving the illegal hiring of foreign workers last year and deported 180 foreigners for failing to have work permits, Xinhua reported. In the first three months of this year, there were six cases and 154 people detained.

In February, 53 people from Vietnam were intercepted on a bus on a highway in Guangxi on their way to find work in Guangdong. On March 19, 31 illegal foreign workers were found in a shoe factory in Dongguan. On March 2, 66 Vietnamese passengers without valid passports were intercepted on a bus in Zhuhai, and on April 15, 24 Vietnamese workers were taken from a plastics factory in Qingyuan.

The rising number of cases is partially the result of a labour shortage in the manufacturing hub of Guangdong, which has seen some employers resort to hiring cheap, foreign workers from people smugglers.

The People’s Daily reported in February, just after the Lunar New Year holiday, that there were more than 2 million vacancies for migrant workers in the delta – including more than a million in Dongguan and more than 800,000 in Shenzhen. To encourage more workers to come to Guangdong, the province’s party secretary, Wang Yang, announced last month that its minimum wages would be raised by an average 21.1 per cent from May 1.

Yao Shibo, a trader with close links to delta factories, said the hiring of illegal foreign workers was an open secret and rampant in most delta cities, including Zhuhai, Dongguan, Yunfu, Foshan, Qingyuan, Shunde and Zhaoqing.

“Vietnamese labourers are favoured by factory bosses because they look the same as Guangdong or Guangxi natives; they work overtime and demand lower salaries than their Chinese counterparts; and, most importantly, bosses can fire them at anytime without having to worry about China’s labour laws,” Yao said.

“I know many bosses, especially those from small furniture and processing plants, like hiring such ‘black’ workers. They mainly use them for assembly-line work, which is not technical and requires no particular skills. The wages are not that high, between 1,000 and 1,500 yuan [HK$1,135 and HK$1,700].”

The labour shortage has driven up Chinese workers’ wages, with an inexperienced labourer from a rural area able to earn a basic salary of 1,400 yuan a month in a Dongguan factory. Under the Labour Contract Law, introduced in January 2008 to protect workers’ rights – most significantly it includes double overtime pay after eight hours and triple pay on statutory holidays – their monthly income rises to 1,800 yuan or more.

The law has greatly increased employers’ labour costs across the mainland. Besides making basic benefits such as medical care and social security insurance, and setting a minimum salary level mandatory, the law also prevents employers from revoking contracts unless an employee seriously violates company rules or causes major losses. That means bosses must pay workers the same salary, even in the off-season.

“They [illegal foreign workers] would be most welcome during the peak season to meet orders,” Yao said. “Bosses can let them go anytime if the orders are done or dropped.

“But if you want to fire Chinese workers in the low season, you have to pay them compensation. I have heard that many factories have dropped a few orders instead of hiring new workers. The cost of maintaining workers is becoming higher and higher in Guangdong. Vietnamese workers are illegal but they are also much more affordable.”

Some mainland academics have suggested that foreign labourers should be allowed to work legally on the mainland because of the demand for their services.

Mainland media quoted Chen Tiejun, from the Yunnan Academy of Social Sciences’ Institute of Southeast Asian Studies, as saying: “I don’t think it is a cause for concern for domestic workers. Reasonable entry of foreign labour would increase competitiveness in the region and help improve the market.

“But all the entry procedures should be legal because it’s essential to maintain sound social order and a sound working environment.”

However, some old Vietnam hands doubt that foreign workers will be able to ease Guangdong’s labour shortage, even if their hiring becomes legal. And if foreign workers were made legal and protected by the Labour Contract Law, they would lose their cost advantage.

“Vietnamese people working in Guangdong and Guangxi are all from rural or border areas in northern Vietnam, close to China,” said Ma Wenlong, a human resources expert who has worked in Ho Chi Minh City, Vietnam’s economic centre, for years. “These rural labourers from northern Vietnam are not skilled, are poor, and finding a job in Guangdong or Guangxi is easier and closer for them than in Ho Chi Minh City.

“Actually, China, a low-paid, labour-intensive country, is not very attractive to workers in developed parts of southern Vietnam. Workers here can earn about 900 yuan a month and there are many job vacancies as foreign factories set up operations in Vietnam. On the other hand, Taiwan is a better choice for skilled and educated people because they can demand a monthly minimum wage of more than 4,000 yuan. There are now 2 million Vietnamese brides in Taiwan and they are trying their best to get jobs – legally or illegally.”

Ma said China would be attractive to skilled Vietnamese workers if the factories offered monthly salaries of around 2,000 yuan. “But why would a Chinese boss hire the foreign workers if they asked for the same pay as Chinese workers?” he said.

Nguyen Van Huy, an overseas Chinese living in Pingxiang, a border town in Guangxi, said it was not too difficult for illegal workers to cross the border. Some Vietnamese entered China legally but stayed on after their visas expired; some sneaked across the border at Dongxing in Guangxi with the help of people smugglers.

“The people smugglers are Guangxi natives with relatives in Vietnam. They used to work in Guangdong factories, and introduce their Vietnamese friends or relatives to Guangdong,” Nguyen said.

“One of my friends in Guangxi once asked me to look for some Vietnamese people to go with him to Guangdong. He said he could get 100 yuan if he introduced one new worker to his boss’ factory.”

While Guangdong police attribute the increase in illegal workers to the economic boom and the resulting labour shortage, it would appear that the penalties are not high enough to deter either illegal foreign workers or their employers.

In Guangdong, an employer faces a fine of between 5,000 yuan and 50,000 yuan for hiring an illegal foreign worker. Employers will also have to bear the cost of repatriating illegal workers, some of whom sneak back soon after they are deported.

In Chen’s factory, workers said there were dozens of Vietnamese but the police only found and deported about 10. “I bet the rest are all hiding somewhere nearby,” Chen said. “They won’t go back home. They would soon find another factory in another part of Guangdong.”

And some industry insiders say cracking down on illegal workers is likely to get more difficult as they learn to blend in better. “You won’t be able to detect them any more if they learn Chinese in future and have fake identity cards,” Yao Shibo said.

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