Safety net for workers left in the lurch

Absconding employers, including foreign ones, were increasingly commonplace these days amid a hostile business climate, according to National Assembly’s Committee for Social Affairs deputy chairman Bui Sy Loi.

“In southern Dong Nai province alone, around 40 businesses have owed salaries and various sorts of social allowances to employees, but they have employers who have absconded, driving the lives of several thousand labourers into a predicament,” said Loi.

Loi said a specific mechanism tackling the case was not in place at present. As a result, Vietnam Social Security could not pay social insurance benefits and relevant allowances to labourers falling into the case.

Minister of Finance Vuong Dinh Hue assumed policies dealing with the benefits of labourers working in foreign direct investment businesses having absconding directors were regulated in the Law on Social Insurance and the Law on Bankruptcy.

“Usually, employers absconded when their businesses went bust. In this case, state competent agencies liquidated assets of these businesses and used part of the sum to ensure labourer benefits. In case enterprise’s asset has yet to be liquidated, local governments in these areas shall use provincial budget to shield laborer interests,” said Hue.

Minister of Labour, Invalids and Social Affairs Pham Thi Hai Chuyen said concrete regulations protecting the interests of the labourers working at firms with absconding employers which still owed salary, social insurance and unemployment benefit payments to labourers were not in place.

In 2009, the economic recession made firms going dissolved massively and a great many laboures became jobless. To aid labourers, the prime minister enacted Decision 30/2009/QD-TTg regulating taking provincial budget to pay unpaid salary for labourers working at businesses having absconding employers.

The decision, however, is invalid at this time and how to protect labourers’ interests in this case reaches an impasse.

Chuyen said the Ministry of Labour, Invalids and Social Affairs (MoLISA) had worked with the Ministry of Finance (MoF) to propose the government enact policies to support labourers at businesses with absconding employers losing job but not meeting conditions to get unemployment benefits.

Accordingly, provincial people’s committees in areas hosting businesses would pay unpaid salaries to labourers having absconding directors sourcing capital from provincial budgets. This advanced sum will be paid using the sum raised from liquidating enterprise assets as per existing laws. In case the raised sum was not sufficient to cover all these expenses, a further report must be sent to the premier for further guidance.

Hue said this was only a stopgap solution and in the long term the MoF would propose the government deduct part of the fund to support enterprises’ renovation  and development to shield the interests of labourers working at enterprises having absconding directors.