On September 10th, Mr. Tola Moeun, of the Community Legal Education Center went before the Tom Lantos Human Rights Commission to discuss Cambodian labor rights issues. Upon reading his testimony, there are many points that deserve to be highlighted. Mr. Moeun’s testimony sheds light on the fact that workers rights in Cambodia are beginning to deteriorate and unless something is done, Cambodia could undercut many of the labor rights advances that have occurred in the last ten plus years.
Cambodia has the reputation of being one of the more socially responsible nations when it comes to labor rights. This is because of the passage of the 1997 labor law that was co-written by the International Labor Organization, the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), and the Cambodian Government. Additionally, in 2003 Cambodia established an independent Cambodian Arbitration Council and now receives funding from the U.S. Department of Labor to help support its Better Factories Project.
In addition to repression of unions, the Cambodian Government is trying to amend the labor law to allow for perpetual short-term labor contracts. In his testimony, Mr. Moeun states, “Many labor contracts that were once of unspecified duration have increasingly been replaced by short-term contracts that last one, two, three, or six months. While this arrangement may increase companies’ profits, it leads to job insecurity and instability.” The insecurity and instability caused by these short-term contracts offer employers the opportunity to deny workers their rights under Cambodian Law. Mr. Moeun stated in his testimony that: “Employers are systematically using short-term contracts in order to avoid key obligations and fundamental entitlements under the [Cambodian] labor code.” These obligations include maternity or annual leave, the ability for the employer to fire an employee at their behest, and the inability to join labor unions out of fear that their contracts may not be renewed. If the use of short-term contracts is expanded, with the proposed amendment to Cambodian Labor law, the rights of workers in Cambodia could be put in jeopardy.
On top of describing the many difficulties workers are experiencing in Cambodia, Mr. Moeun made recommendations to improve conditions. These recommendations include that the U.S. should urge Cambodia to fully implement domestic labor laws, that Cambodia must properly investigate unionist murders and harassment, and that the Cambodian government must pass anti corruption laws. While all of the recommendations presented by Mr. Moeun should be taken very seriously, much attention will be paid to the first recommendation that the U.S. should grant Cambodia duty-free status on its textiles and footwear. This is bound to be very controversial as this would give Cambodia greater access to the U.S. market and create greater competition for both domestic and international textile producers. Despite some objections by competitors, duty-free status would help Cambodia regain market access that it lost following the termination of the Mutli-Fibre Agreement (MFA) in 2005.
The MFA ensured nations, like Cambodia, market access for garments that they produced. Because of the MFA the garment sector of nations like Cambodia expanded rapidly. You can learn more about the MFA fallout here and here. At the same time, as stated in Mr. Moeun’s testimony, “[The MFA] provided the U.S. with leverage to persuade Cambodia to improve labor conditions and protect workers’ in line with basic international standards.” Without the MFA, Cambodia would not have been able to develop the labor standards mentioned above.
With the termination of the MFA, countries like Cambodia, which are heavily dependent on the garment industry, have to find other ways to compete in the global marketplace. This could include reducing labor standards in order to try and cut costs. Duty-free status for Cambodia would provide the same kind of market access that Cambodia enjoyed under the MFA. In fact in an article in the Phnom Phen Post, the Garment Manufactures Association of Cambodia agree with Mr. Moeun about the need for duty-free status.
But before the idea of a duty-free Cambodia gets blown out of proportion, it is important to look at what was said in the testimony following the recommendation for duty-free status. Mr. Moeun said that any trade agreement should be “conditional on Cambodia’s respect of international and national labor laws and standards.” It was because of the benefits of the MFA that the United States was able to leverage labor rights improvements. ILRF agrees fully with Mr. Moeun in saying that, if granted duty-free status, the U.S. government must set labor standard conditions. No matter what trade policies that the United States enters into with Cambodia, or any other nation for that matter, the U.S. must take into consideration the impact that these policies will have on the lives of the workers involved. Mr. Moeun should be applauded for trying to promote beneficial economic polices and at the same time making sure those policies have a positive impact on the lives of workers.