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Vietnam Gambles on Workers’ Rights

In a desperate effort to tame rebellious workers, Vietnam is now building a collective bargaining regime. But empowering independent trade unions could backfire for the country’s authoritarian government — and allow workers to fight back against multinational capital.

Workers unload fish from the boat before transporting to a fish market on August 31, 2016 in Danang, Vietnam. (Getty Images)

A rubber-stamp parliament approving an arcane international convention might not seem like something that has the potential to create huge changes in Vietnamese society. On Friday, June 14, however, the country’s National Assembly ratified the International Labour Organisation’s (ILO) Convention 98 on collective bargaining and the right to organize. This is big news — by ratifying the Convention, Vietnam has put a number of antagonisms and tensions in motion.

The ILO is the UN agency for labor standards. Two of its conventions — Convention 87, on freedom of association and protection of the right to organize, and Convention 98, on the right to organize and collective bargaining — are seen as fundamental to the basic ability of independent trade unions to function and operate freely without state or employer interference. Convention 98 allows for workers to be protected against anti-union discrimination, and for workers’ and employers’ organizations to operate without interference from each other. Convention 87 allows workers to establish and join unions of their own choosing without prior authorization.

At present Vietnam has only one legal, state-led trade union federation, the Vietnam General Confederation of Labour (VGCL), which is neither independent of the ruling Communist Party nor of employers. Independent unions are currently forbidden. At the national level, the VGCL is subordinated to the party, while at the enterprise level it is dominated by managers. It is not uncommon for a workplace union representative to be the company’s human resources director or similar.

The recently ratified Convention 98 should help break this employer dominance of trade unions at the company level, requiring as it does that workers’ and employers’ organizations be free of interference from each other. Convention 87 — which Vietnam plans to ratify by 2023 — will legalize independent labor organizations, and therefore allow them to operate without being subordinated to the Communist Party. It is unprecedented for a one-party “socialist” state to actively promote reforms that significantly increase the ability of trade unions to operate independently.

But Vietnamese workers have never demanded such reforms. Instead they engage in wildcat strikes — strikes that are self-organized among workers rather than being led by trade unions. There are hundreds each year, and they are often successful at achieving wage increases and improved conditions. This form of labor organizing — “collective bargaining by riot,” to use Eric Hobsbawm’s coinage — is effective, and workers are happy to continue employing it. Beyond immediate bread and butter gains, wildcat activism has also had some significant broader impacts, such as contributing to Vietnam being one of the few countries where wage growth has been faster than productivity growth, and reversing a major change to the social security law in 2015.

In addition, wildcat worker militancy has, over the past two decades or so, forced the state to undertake many initiatives in an effort to reduce strikes and build “harmonious labor relations” (quan hệ lao động hài hoà) in order to ensure the smooth functioning of capitalist production. These have included establishing a mechanism of annual minimum wage negotiations, collective bargaining experiments within the existing system, and attempts to reform the VGCL. Such projects have largely failed to achieve the aim of significantly reducing strike numbers. As a result, sections of the state and employers, in a desperate attempt to stem the flow of strikes and realizing that the state-led union is unable to do so, began pushing for trade union independence, arguing that genuinely representative unions would allow for dialogue between workers and employers that could help preempt and stop strikes.

Concurrently, Vietnam’s entry into global markets and production networks has involved signing a number of international trade agreements, many of which include provisions on labor rights. Consequently, the two pressures of needing to reduce strikes and needing to sign treaties for capitalist integration have combined to make elements of the Vietnamese state and capital — including the Ministry of Labor, certain parts of the VGCL, and some sections of the industrial bourgeoisie — receptive to ideas of freedom of association.

This became especially visible during the Trans-Pacific Partnership (TPP) negotiations, where labor reforms were a significant factor. The original TPP contained a fairly detailed side agreement between the United States and Vietnam, explaining how Freedom of Association would be implemented (although this was not without criticism). After the United States withdrew from the TPP, however, the side agreement died.

The revived Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), now in force and involving the original signatories of the TPP minus the United States, has much weaker provisions for labor reform. The EU-Vietnam Free Trade Agreement also contains a similar labor rights chapter. Despite the vagueness of the labor commitments, however, Vietnam is still taking reforms seriously. This path has led to the ratification of Convention 98 and will lead to the ratification of Convention 87.

There is a complication. Ironically, the very trade deals that have contributed to persuading the Vietnamese state to allow greater trade union freedom are also embedding structures that, in the West, have served to totally undermine trade unionism and workplace collective bargaining. Where these strategies seemingly succeeded in bringing real material gains to workers for a time in Europe and the United States, they were eventually eroded by neoliberal reforms, which greatly increased capital flexibility and labor precarity. Consequently, trade unions and collective bargaining structures, based on sustained negotiations between employers and employees and predicated on secure long-term employment, were rendered increasingly ineffective and dysfunctional.

This created a crisis in unions and labor movements from which they have yet to recover. The primary purpose of the trade agreements Vietnam is joining is to allow international capital much more freedom to move around the world in search of profits. The deals serve, therefore, to embed neoliberal flows of capital and the same flexibility that contributed to the destruction of stable industrial relations systems in the West.

Furthermore, while discussions over Conventions 87 and 98 have been in progress over the past few years, Vietnam has simultaneously been increasingly cracking down on activists and civil society organizations, including labor activists. Even researchers investigating topics not normally considered especially controversial, such as workers’ health, have been subjected to harassment from the authorities. The free operation of trade unions without employer or state interference is antithetical to an authoritarian state that shows no signs of relinquishing power.

Through ratifying Convention 98, Vietnam has set a number of contradictory tendencies onto a collision course with one another. First, the government is enacting reforms to create an industrial relations system that is supposedly the basis of stable employment, workplace health and safety, and higher wages — while simultaneously promoting neoliberal flows of capital, the very thing that destroyed such industrial relations systems in places where they had been somewhat successful. Second, while legislating to allow trade unions more independence, the authorities have also been clamping down on civil society space. Add to this mix the significant numbers of wildcat strikes that continue regardless, and we have a potent situation in which something will have to give. Nobody yet knows what.