The details of a recent policy recommendation may have escaped many of us but they are details which will have an earth-shattering impact on the 330,000 migrant workers in Taiwan. The recommendation by the Council of Labor Affairs will allow employers to deduct board and lodging costs of between NT$2,500 and NT$4,000 per month from migrant workers' already minimal salaries.
The council's explanation of the decision -- based on a dormant clause in the Labor Standard Law (勞基法) -- states that salaries paid to migrants must not fall below the minimum wage but can be paid "in cash or in kind." This explanation is a political dodging of the facts. Yes, it may be true that a superficial reading of the regulation in question could be interpreted as giving the policy a legal basis.
But the council, in allowing the employers to interpret salary "in kind" as encompassing room and board, misreads the dynamics of the situation in the migrant labor market by turning a blind eye to several points.
First, the council says the decision is based on good intentions, since it is introducing transparent contracts at the same time, which will explicitly state all charges migrant workers face. Transparent contracts should reduce the fees paid to employment brokers by the migrant workers (since brokers have had a habit of introducing "false" charges), as well as lessen the costs to employers. Thus, the council says, the policy will provide a win-win situation for workers and employers. It is absolutely true that employers' costs will be reduced, but I doubt whether the scheme will reduce the brokers' fees.
The council argues that the salaries paid to migrant workers in Taiwan are considerably higher than those in Hong Kong or Singapore. It is the attraction of such high salaries, it says, that has made Taiwan a haven for migrants. If the real wage goes down, so will the broker's fee. But Taiwan is not actually quite the paradise imagined by the council.
Secondly, by further reducing employers' costs in hiring migrants, local workers' employment opportunities will be further diminished. As employers already favor the cheaper migrants, surely they will now favor them even more because their salaries have gone down. It is understandable that the council is desperate in the face of the flight of factories to China, but to adopt a strategy of downgrading employment terms and working conditions of both local and migrant workers amounts to using unprotected workers as a "last line of defense" against what appears to the council to be an insoluble situation.
Third, does this policy mean that migrant workers will have the freedom to choose their own accommodation? Will home-helpers and caregivers be exempted from this policy since they are not covered by the Labor Standards Law? If not, does this imply that caregivers and home-helpers will have the freedom to choose not to live in their employer's house, thereby buying them some freedom from their normal 24 hours per-day live-in/on-call situation?
Finally, a close look at a breakdown of necessary expenditures from the real wages of migrant workers -- approximately NT$190,000 per annum -- might make the picture a little clearer. From that NT$190,000, roughly NT$100,000 is deducted to cover the broker's fee. Next come taxes, air tickets, health insurance, physical examination payments and various certification fees, totaling about NT$20,000.
Employers operate a compulsory savings scheme, deducting approximately NT$36,000 per year. This savings scheme, as brokers readily admit, serves as a bond to prevent the worker from running away. When the individual has finished his or her three-year contract or if the contract is terminated earlier, the employer is supposed to return the total amount. But this is another possible area of manipulative profit.
Finally come the new room and board payments for which another NT$30,000 to NT$48,000 per year is to be deducted. After all these payments are taken into account, migrant workers then have to face the fact that they will work the first 12 months, effectively, without anything to show for it financially. Rather, they will have an accrued indebtedness without having spent any money.
With simple mathematics we can now foresee Oliver Twist-type slavery in Taiwan.
It is impossible for the council to be an impartial arbiter of worker-employer relations if it insists on implementing such shortsighted policies. With the present government keen to present itself as a champion of human rights, how can it not worry that its implementation of this policy -- purely for political expediency -- will besmirch its painfully earned reputation?
Bernadette Chen is a member of the Sisters of Social Service and is a PhD candidate at the University of Cambridge in the UK.
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