The AEC and Labour – will you be able to find those elu­sive em­ploy­ees?

Norway-Asia Business Review - - Contents - By Andrew Durieux

It is well known that the ASEAN Eco­nomic Com­mu­nity (AEC) is due to com­mence full op­er­a­tions at the end of 2015. What is not so well known is a num­ber of the de­tails of what the AEC im­ple­men­ta­tion ac­tu­ally means for com­pany own­ers, em­ploy­ees and nor­mal cit­i­zens in Thai­land. There are high hopes for gen­eral im­prove­ments, but along with this ex­pec­ta­tion there is a lack of knowl­edge and much con­fu­sion about how the AEC will op­er­ate. This is due to many in­ac­cu­ra­cies re­ported in the me­dia, of­ten stem­ming from in­for­ma­tion pro­vided by var­i­ous politi­cians and min­istry em­ploy­ees in speeches and pre­sen­ta­tions, who them­selves are not well in­formed or whose de­part­ments have not yet made the fi­nal One the key ar­eas that causes most con­cern is the area of labour – or more tech­ni­cally cor­rect “Free move­ment of Skilled Labour”. The use of the word Skilled is very im­por­tant, and it should not be mis­taken for free move­ment of people, which is a more cor­rect de­scrip­tion of the sit­u­a­tion in Europe where borders have mostly been re­moved, pur­chas­ing of land per­mit­ted for cit­i­zens of any coun­try in any coun­try, and even so­cial se­cu­rity pay­ments can be pro­vided to cit­i­zens of other coun­tries that base them­selves in a host coun­try. Within the AEC agree­ments, and de­spite news ar­ti­cles and some speeches to the con­trary, there is no in­ten­tion to do away with borders within ASEAN, or to al­low gen­eral wide­spread move­ment of in­di­vid­u­als, and there is no agree­ment for one govern­ment to make pay­ments to cit­i­zens of other coun­tries for such things as health care, un­em­ploy­ment or re­tire­ment ben­e­fits. Thais should not fear an in­va­sion of for­eign­ers from the neigh­bour­ing coun­tries, or need­ing to sup­port any such work­ers – any more than they should to­day. The Skilled con­cept within the AEC is re­ally aimed at sup­port­ing trade, and specif­i­cally the Free move­ment of Ser­vices con­cept cov­ered un­der the AFAS agree­ment. Where ASEAN ser­vices providers wish to op­er­ate or pro­vide their ser­vices in an­other ASEAN coun­try, they need to use one of the four modes of oper­a­tion. These are shown be­low in the ta­ble and are ac­cepted by the WTO and within the ASEAN con­text: For Mode 3 and Mode 4 ser­vices the ta­ble shows that an in­di­vid­ual or com­pany may need to be lo­cated in the host coun­try to be able to deliver the ser­vice. An ex­am­ple of this would be hair­dress­ing which needs to be de­liv­ered in-per­son, whereas a call cen­tre op­er­a­tor could pro­vide a ser­vice from a home coun­try via a telecom­mu­ni­ca­tions link.

Thais should not fear an in­va­sion of for­eign­ers from the neigh­bour­ing coun­tries.

The Free Move­ment of Skilled Labour is there­fore aimed at al­low­ing ser­vice providers to move in­di­vid­u­als with the needed skills from one coun­try to an­other as needed for their cus­tomers, and to al­low in­di­vid­u­als to pro­vide their skills in lo­ca­tions where they are needed for the high­est price they can ob­tain.

It is cur­rently not in­tended as a so­lu­tion to the needs of fac­tory and white col­lar em­ploy­ers strug­gling to fill many va­can­cies.

Within the AEC Con­cept the Free Move­ment of Skilled Labour takes the forms of Mu­tual Recog­ni­tion Agree­ments (MRA’s). Cur­rently there are 8 MRA’s cov­er­ing Ac­coun­tants, En­gi­neers, Sur­vey­ors, Ar­chi­tects, Doc­tors, Den­tists, Nurses and a Tourism MRA that ac­tu­ally cov­ers more than 30 types of work within the Tourism sec­tor. It is im­por­tant to un­der­stand that the MRA’s are all dif­fer­ent, and all also al­low host coun­tries to ap­ply their own rules and lim­i­ta­tions. It is also only ap­plies to cit­i­zens of ASEAN coun­tries work­ing with other ASEAN coun­tries. Within the MRA’s are also a se­ries of tools by which coun­tries can limit or con­trol the skills or in­di­vid­u­als, and which can clearly be used to pro­tect such things as home em­ploy­ment and na­tional se­cu­rity. The MRA’s also al­low each host coun­try to en­force any visa and work per­mit rules, and may still use tools such as the Thai sys­tem of lim­it­ing the num­ber of “farang” work­ers per lo­cal em­ployee. Crit­i­cally the MRA’s also al­low for each coun­try to ap­ply their own in­ter­nal tests, and this means that a host coun­try may choose to ad­min­is­ter such a test in their own lan­guage. There are other lim­i­ta­tions or con­trols also, such as the re­quire­ments to have been a reg­is­tered mem­ber of a home coun­try’s in­dus­try body for a pe­riod of time be­fore ap­ply­ing to move un­der the MRA’s. The ef­fect of the sys­tems es­tab­lished in the MRA’ is that, in re­al­ity, there will be very few changes from the num­ber of for­eign En­gi­neers em­ployed in a coun­try like Thai­land, so the fear that many Thais have to­day about Thai­land be­ing inun­dated by for­eign­ers is com­pletely un­founded. Equally, the lim­i­ta­tions mean that em­ploy­ers or in­di­vid­u­als look­ing to ben­e­fit from this con­cept are likely to be dis­ap­pointed given the cur­rent im­ple­men­ta­tion de­scribed. The Joint For­eign Cham­bers is try­ing to ob­tain fur­ther in­for­ma­tion from the Thai govern­ment in re­la­tion to the im­ple­men­ta­tion de­tails (i.e. how will an em­ployer in Thai­land ac­tu­ally goes about bring­ing in an ASEAN En­gi­neer, and how will an ASEAN cit­i­zen com­plete pa­per­work for their work per­mits and visas). The JFCCT is also look­ing to hear from mem­bers of the cham­bers in re­la­tion to what other skills our mem­bers are look­ing for. We would like to high­light or re­quest ad­di­tions to the cur­rent list of eight MRA’s be made as soon as pos­si­ble. Please let the Thai-Nor­we­gian Cham­ber of Com­merce know what skills you are look­ing for and how other ASEAN na­tions might fill these gaps. We are also mak­ing rec­om­men­da­tions sug­gest­ing that work per­mits be not re­quired for these in­di­vid­u­als, or that these in­di­vid­u­als are counted as “Thai” for the 4-to-1 rule and cap­i­tal­i­sa­tion fig­ures which re­main prob­lems for many of our mem­ber com­pa­nies. We will keep you in­formed as we find out more de­tails.

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