Myanmar labor law and practiceKaung Htet Zaw

The republic of the union of Myanmar (labor profile)Population 52.8 millionsLabor force 37 millionsLabor force participation rate 78.60 % (Dec 2013)Public holiday per year 22-27 DaysMembership of ILO since 1948Employment by sectorsAgriculture 56.4%Trade (Include Hotel & Tourism) 15.8%Manufacturing 14.4%Public and social service7.7%Construction service 2.7% 2

Existing Myanmar labor laws1) The Employment and Skill Development Law, 20132) The Employment Restriction Act, 1959 (amending)3) The Dock Workers (Regulation of Employment) Act, 1948

(amending)4) The Dock Labourers Act, 1934 (amending)5) The Oilfields (Labourers and Welfare)Act, 1951(amending)6) The Factories Act, 1951(amending)7) The Payments of Wages Act, 1936 (amending)8) Minimum Wages Law, 20139) The Leave and Holiday Act, 1951(amending)10) The Employment Statistics Act, 1948 (amending) 3

Existing Myanmar labor laws

11) The Shops and Establishments Act, 1951(drafting new law)12) The Workmen’s Compensation Act, 1923 (drafting new law)13) Oversea Employment Act, 1999 (drafting new law)14) The Social Security Act, 201215) The Law Relating to Overseas Employment,199916) The Labour Organization Law (11.10.2011)17) The Settlement of Labour Dispute Law (28.3.2012)18) Foreign Worker Act (upcoming new law)19) Health and Safety at Workplace Act (upcoming new law)

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Drafting & Promulgation Process for a Labour Law

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Ratified by Parliament(Pyidaungsu Hluttaw)Office of the President

Discussion and Debate by Bill Committees in Parliament

Submission to the Parliament

Cabinet of the Union Government

Request the Legal Advise of the Office of Attorney General

Consultation Meetings:-Other Ministries-Domestic Legal experts and ILO legal Experts-Employers’ Organization / Labour Organization

Concerned Ministry

The President signed the Law

Promulgation of the Law

Ministry of labour, employment and social security

• The Ministry is focal center regarding all labour relating matters and is formally called as Ministry of Labour.

• There are five main departments under the Ministry as follow; - Department of Labour - Social Security Board - Central Inland Freight Handling Committee - Factories General Labour Laws Inspection Department - Department of Labour Relations

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Department of Labour • The Department of Labour ensures that workers enjoy their

legal rights and privileges and at the same time encourage fair labour practices with a view to establishing cordial relations between employers and workers to maintain industrial peace.

• The duty and function of the Department are as follow;

Industrial Peace.

Registration and placement for job seekers both inland and overseas.

Conducting Vocational Training Courses for workers

Research for Labour Affairs and collection of labour and employment statistics

To ensure the legitimate rights of workers.

Matters pertaining to international and regional affairs. 7

Social Security Board & Social Security Act 2012• The objective of the Board are; - To improve the health of the insured workers, to

enhance their working ability and to boost productivity;To provide effective benefits in times of Social contingencies such as sickness, maternity, employment injury, unemployment, old-age and death etc;To support the insured workers and family members for

living when the former are unable to work;To make the Social Security Sccheme concern the entire people

• According to the Social Security Act, the entities and organizations which have at lease 5 workers must have social security contribution system. 8

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employer employeetotal

1 Health and Social Care Insurance +

2Family Support Insurance

(Education and Natural Disaster)

3 Pension 3% 3% 6%4 Out of Job (Jobless) 1% 1% 2%5 Others (eg. Housing) 25%6 Enployment Injury Benefit Insurance 1% 0% 1%

Contribution (estimate)Type of Security

2% 2% 4%

Social Security System and ContributionContribution

Central Inland Freight Handling Committee

• In 1988, the Central Inland Freight Handling Committee was formed for the following purposes. There are four zonal offices and 65 township offices under CIFHC.(a) To speed up the freight handling activities correctly;(b) To utilize the labour force of the laborers systematically

and beneficially;(c) To ensure fair and regular wages in line with the labour

exercised;(d) To provide laborers with welfare facilities; and(e) To improve the working conditions of the laborers.

The employer and employees who wants to do as freight handers in above mentioned four zones are required to be registered at township office.

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Factories General Labour Laws Inspection Department

• The main function of this Department is enforcement of labour laws, provision of occupational safety and health training and advisory services.

• The officers of the Department will visit to the factories and work place occasionally to inspect the working conditions and whether the workers are enjoying their rights under the labour laws.

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Department of Labour Relations

• The main objectives of this Department are as follow;- to make the employer and workers manage and work in

good discipline for the respective factory and establishment- to make peaceful work place- to obtain the legitimate right of the workers- to ensure fair workplace relationship among employer, workers and their respective organizations

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Features of Labour Organization Law (2011)Formation

Myanmar Labour Confederation

Labour Federation

Region /State Labour Organization

Township Labour Organization

Basic Labour OrganizationSupport by not less

than (10) percent of all workers

30 workers and more

10% TLOs

10% , 2 BLOs

10% R/S LOs

20% LFs

Relevant Counterparts

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Section 8 The employers may organize in parallel structure under this law.

Labour Federation Employers’ Federation

Labour Organization Employers’ Organization

workers Employers

Region/State/Township

Basic

Myanmar Labour Confederation

Myanmar Employers’ confederation

Rights of Labour Organization Section 19 The labour organizations have the right

to send representatives to the Conciliation Body in settling a dispute between the employer and the worker. Similarly, they have the right to send representatives to the Conciliation Tribunals formed with the representatives from the various levels of labour organizations.

Section 20 In discussing with the Government, the employer and the complaining workers in respect of worker's rights or interests contained in the labour laws, the representatives of the labour organization also have the right to participate and discuss.

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• Section 21 The labour organizations have the right to participate in solving the collective bargains of the workers in accord with the labour laws.

• Section 29 The employer shall recognize the labour organizations of his trade as the organizations representing the workers.

• Section 37,38,39 Right to Lock-out and Right to Strike• The workers organization (Labour Organization) has the

right to strike but it must be done with the stipulations.• The employer has also the right to proceed lock-out.

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Right to Collective Bargaining

Services Industrial ActionLock-out

Strike Public Utility Services 14 days 14 days Services other than 14 days 3 days Public Utility Services Essential Services X X(ex. Electricity, Health Care, Telecom etc.)

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Advance Notification Period for Lock-out & Strike

Section 41 Illegal Lock-out or illegal Strike- Essential services- Without permission of the relevant

labour federation - Failing to inform in advance- Not being relevant to labour affair- Not in conformity with submission in

advance (date, place, time, period, number of participants)

Section 42 If it is an illegal lock-out or illegal strike, it may be prohibited in accord with the existing law. (Especially when it is likely that threat to the law and order or acute national crisis can happen).

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As of 28.08.2014, the registered labour organization and employers’ organization are as follows;

- No. of labour organizations (1260)[One Myanmar Seamen’s Federation + 34 township labour organizations + 1,225 basic labour organizations.]

- No. of Employers’ Organizations (25) [One Myanmar Seamen’s

Federation + one township employer organization + 23 basic employer organizations] 19

The Settlement of Labour Dispute Law 2012

• The President of the Republic of the Union of Myanmar signed the Law on 28th , March 2012.

• The Trade Disputes Act, 1929 was also repealed.

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Types of labour disputes

Individual Dispute (Rights Dispute) Parties - The employer and worker or some

workers. Subject - The employment contract

- The collective Agreement- Existing Labour Laws & Rules,

Regulations, Notification, ..etc.

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Subject

Parties

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Collective Dispute (rights dispute or interest dispute)

The employer or

employers or employer’s organization

(Collective Labour) workers or worker’s

organization

working conditions the recognition of organizations the exercise of the recognized right of their organizations relations between employer and workers

• Section 3 In any trade in which more than 30 workers are employed, the employer shall establish the Workplace Coordinating Committee.• The Committee will comprise of 2

representatives of workers and 2 representatives of the employer.• If the dispute has not been settled in The

Committee, he employer or worker may complain to the relevant Conciliation Body.

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Workplace Conflict Management

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Labour Dispute Resolution System (Flowchart)

Labour Dispute

Individual Dispute Collective Dispute

Township Conciliation Body

Region/State ArbitrationBody

AG3 days

Industrial Action(strike& lock out)

Arbitration Council

7 days

Tribunal

7 days14days

Township Conciliation Body

Competent Court EssentialServices

7 days

Decision

• Township level• Tripartite structure (11 Persons)• The secretary is the Township Labour Officer (TLO).• Time to conciliate 3 days.• Extension is also possible if both parties agree.

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Section 10 Formation of Conciliation Body

Rules• Rule10. The member of a Conciliation Body:• (a) shall have attained 21 years of age;• (b) shall have experience in labour affairs;• (c) shall have good character.• Section 14 Township Special Conciliation Body can

be established for Special Economic Zones (SEZ).

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Qualification of members of Conciliation Body

Tripartite Formation ( 11 person ) - Government Representatives/ Public Interest - 3 Employers’ Representatives - 3 Workers’ Representatives Self- administered Division Self- administered Zone

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Region/ State Dispute Settlement Arbitration Body

15 qualified person of Good Standing from legal experts and experts in labour affairs (Section 19)

3 PANELS(a) The first panel submitted by the Ministry

of Labour (5 persons)(b) The second panel submitted by the

Employers’ Organizations (5 persons)(c) The third panel submitted by the Labour Organizations (5 persons)

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Arbitration Council

Requirements in Employment Contract• Employment and Skill Development Law 2013 provides with the following

facts which are required to be mentioned in the employment contract.

• (1) Type of Work (2) Probation Period

• (3) Salary (4) Place of Work

• (5) Term of Contract (6) Working Hours

• (7) Leave and Holiday (8) Overtime

• (9) Meal Arrangement (10) accommodation

• (11) Medication (12) Ferry

• (13) Discipline for Workers(14) Training

• (15) Resignation/Dismissal(16) Termination

• (17) Liabilities (18) Amendment

• (19) Other Conditions (20) Miscellaneous

• Employment Contract must be made within 30 Days of employment. 29

Employment Requirement under Foreign Investment Law

• Chapter 11 of Foreign Investment Law and Chapter 13 of Foreign Investment Rules mention the employment provisions for the investors.

• Section 24 (a) In appointing skilled citizen workers, technicians and staff for skilled jobs, citizens shall have been appointed at least 25 percent within the first two‐year, at least 50 percent within the second two year and at ‐least 75 percent within the third two year from the year of ‐commencement of the business. However, for the knowledge based entities, the Investment Commission can adjust the appropriate timeframe for employment.

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Minimum Wages• Minimum Wages Law is enacted at 22 March 2013.

• Wage mean the fees, wage or salary which are entitled to obtain by the worker for carrying out of hourly, daily, weekly, monthly or any other part time work or any piece work of the employer. Overtime fees, bonus and any other remuneration are included.

• The following fees are not included in the meaning of wage.

• (1) travelling allowance

• (2) pension salary and gratuity for service

• (3) social security cash benefit

• (4) allowance for accommodation and meal, electricity charges, water service charges and duty and taxes

• (5) medical treatment allowances and recreation allowances

• (6) damages for dismal from work and gratuities

• (7) other fees stipulated by the Ministry that does not apply to the wages

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Minimum Wages

• Under this law, National Committee will be the central authority to determine minimum wages and, Union Government will form this Committee with the representatives of relevant government organization, labor organization and employer organization and other persons who are experts in minimum wage matters. In practice, minimum wages has not been decided yet facing with lot of conflicts.

• As a MIC permitted company, MIC used to ask the investors to pay around US 60 to 80 as the minimum wages.

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Working Hours• Factories Act 1951 (Amending), Shop and Establishment Act

1951 (drafting new) and The Oilfield Act 1951 (Amending) provide working hours as follow.

• - 44 hours per week

• - 48 hours per week for special nature work (non-stop work)

• - 6 working days per week

• - at least 30 minutes rest time for 5 working hours

• - prior approval from respective labor office or monthly report to the labor office for over time work.

• - 2 times payment of base wage for overtime work

• Child labour under 13 can’t be employed at work. Child labour above 13 can work with the recommendation of the doctor for 4 hours per day. However, this 4 hours must not be within 6 Am to 6 Pm of the day.

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