Industrial relations practices in Southeast Asia's NICs: IR practices in China, Malaysia and Thailand
In: http://hdl.handle.net/1885/13698
Australia is currently in free trade negotiations with China and Malaysia and has a FTA with Thailand. Australia is becoming more integrated into the Asia-Pacific economic region through bilateral trade agreements. It is within this context that a report of this nature is relevant. It outlines industrial relations (IR) practices in these countries, and highlights some implications for multinational companies (MNCs) and governments, specifically in regards to labour rights and standards. Why China, Malaysia and Thailand? These three countries have been described as the new 'Asian Tigers'. They have experienced massive industrialisation in the last two decades, and have opened their economies up to increasing amounts of foreign investment. China, for example, is Australia's second largest trading partner behind Japan. In 2003-2004, merchandise export trade to China was worth A$9.9 billion. Similarly, Malaysia has also opened up its economy to foreign direct investment. It is the fourth most open economy in the world and Australia's FTA negotiations further strengthen the ties between the two countries. Australia and Thailand have a current FT A (T AFTA) which also strengthens regional ties. All three countries have an IR infrastructure heavily controlled by the government through policy and legislation. Each government has played a substantial role in the industrialisation process. China has, in the last two decades, initiated economic reforms aimed at establishing a socialist market economy. These reforms have had a massive impact on state-owned enterprises (SOEs ). The Malaysian Government is highly motivated and committed to being declared an industrialised nation. A number of conditions have been established by the Government to make the IR enviromnent more attractive for MNCs, including skills training for employees and the repression of the union movement. Thailand has experienced turbulent industrialisation due to the nation's previous political instability. However it has in recent years played a significant role in IR through SOEs, although they are now beginning to privatise some of them. Legislation allows the Thai Government to control the relatively new union movement. Trade unions in China, Malaysia and Thailand are fairly weak. This is largely due to government intervention into the formation, registration, management and membership of unions. China has only one trade union federation which acts as an umbrella for unions at national, local and primary level. It performs a dualistic function, acting as a vehicle for party policy and as a representative of workers. Malaysia has a number of trade unions under four main federations. Trade unions are separated by public and private sector, trade, occupation and industry and furthermore by region. The Thai labour movement is fairly new, given they were banned for over a decade. The Government aided the re-establishment of a weakened trade labour movement and continues to heavily qualify their dealings. Unions in all three countries have very little bargaining power. The issue of government and coiJ>orate responsibility is an issue not reserved for IR studies. It is an idea that has in recent years emerged and taken hold as economic globalisation continues. Specifically government and coiJ>orate responsibility refers to_ the safeguarding and promoting of core labour rights and standards by MNCs. Some MNCs have accepted this responsibility as the formation of the Free Labour Associations illustrates. The idea also has ramifications for the Australian government in their trade negotiations with other countries. Despite the fact the WTO does not consider labour a trade issue, do governments have a responsibility to abide by the same rules as MNCs and uphold and promote core labour rights and standards? The ACTU believes so and has developed a draft language to be included into FTAs regarding trading governments andMNCs. X