HCMC LABOR OFFICIAL IN HOT WATER OVER TALK TO U.S. BUSINESS

C O N F I D E N T I A L HO CHI MINH CITY 001386

SIPDIS

SIPDIS

E.O. 12958: DECL: 12/12/2016
TAGS: ELAB PREL ECON PGOV VM
SUBJECT: HCMC LABOR OFFICIAL IN HOT WATER OVER TALK TO U.S. BUSINESS
AND CONTACTS WITH USG


CLASSIFIED BY: Kenneth S. Chern, Deputy Principal Officer,
CONGEN HCMC, State Department.
REASON: 1.4 (b),(d)



CLASSIFIED BY: Kenneth S. Chern, Deputy Principal Officer,
CONGEN HCMC, State Department.
REASON: 1.4 (b),(d)


1. (C) Nguyen Thi Thanh Mai (protect),Vice Director for Labor
Affairs at HCMC's Department of Labor, Invalids and Social
Affairs, ConGen HCMC's best government contact on labor issues,
told us on December 12 that she faces Party disciplinary action
following a speech she gave to the HCMC American Chamber of
Commerce (AMCHAM) and her overall "close relationship" with the
USG. Mai said her troubles with the Party crystallized
following a December 1 speech she gave at an AMCHAM seminar on
"Post-WTO Challenges for the Apparel Industry and Workers."


2. (C) At the event, Mai discussed frankly and openly the causes
of the wave of strikes that occurred in the HCMC area in early

2006. Mai started out by blaming foreign employers and the low
wages they paid workers, mostly at garment factories, for the
2006 unrest. She said employers violated wage laws by using the
GVN-mandated minimum wage as a worker's final salary, not by
using the minimum wage as a base salary to which benefits and
allowances were added. She noted that the worst abuses were
found in Korean, Taiwanese, and Japanese factories, most of
which were apparel manufacturers. Companies that had fewer labor
relations problems were those that attempted to comply with
labor regulations and that had robust corporate and social
responsibility programs. These companies tend to be American or
European.


3. (SBU) Perhaps the most controversial elements of Ms. Mai's
presentation centered on the role and effectiveness of
Party-controlled trade unions. Most labor union representatives
are not well educated and can lose their jobs if they complain
about problems to company managers. Rank-and-file workers know
this and therefore do not trust their labor union
representatives. Unions also have failed to educate workers
about their responsibilities towards their employers under
Vietnamese law, she observed. Management also has failed
workers in this regard: Mai noted that the International Labor
Organization (ILO) translated Vietnam's labor code into Korean
and Chinese and then invited company managers to a training
session; very few company representatives took advantage of this
opportunity.


4. (SBU) Problems are not helped by murky government rules and
by government's failure to come up with lasting labor relations
solutions, Ms. Mai noted in her speech. She complained publicly
that HCMC DOLISA is so busy mediating disputes with its limited
human resources that it does not have time to develop mechanisms
that will keep things running smoothly in the long-term.


5. (C) Following the speech -- and coverage that it received on
the BBC Vietnam News Service website -- Mai told us that she
faced disciplinary action from the Party. She is in "deep
trouble," not only because of the speech, but also because of
her overall "close" association with the USG. Her Party cell
superiors pointed to her participation in a 2006 International
Visitors program on "civil society" as well as her decision to
meet with Consulate and visiting USG officials. She said that
Party officials also chided her for meeting with visitors from
the National Endowment for Democracy in mid-2006, a visit ConGen
had supported. The Party cell told her that she was in danger
of being labeled a "collaborator" and asked her to limit our
contact with us.


6. (C) Comment: While Mai's comments were frank they also were
accurate and helpful to U.S. businesses seeking to develop their
operations in Vietnam. However helpful Mai's guidance may have
been, her criticism of the labor system -- particularly the
ineffectiveness of GVN-controlled unions -- was too much for the
local Party bosses to bear. Neither she, nor other members of
her staff, will likely be as forthcoming again in the near
future, to the detriment of business and labor development in
Vietnam. More troubling is the fact that Ms. Mai is being
called to task for her professional relationship with the USG.
We will examine whether other ConGen official contacts now face
tougher scrutiny. End Comment.

WINNICK