Businesses opting for migrant workers to keep their costs low

Due to gaps in the law, many Myanmar workers in Mae Sot have relocated to cities in central areas, while hundreds of millions of baht has circulated in the underground system.

Chaiwat Praserttum, president of the Entrepreneur Association in five districts of Tak province, said factories in the cities were now looking to replace Thai workers with migrants because of the Bt300 minimum daily wage policy for local workers – to cut labour costs.

This trafficking is generally known in Mae Sot, one of the five border districts, which 90 per cent of registered and unregistered workers from Myanmar come through in Thailand. 

An agent will gather workers in border areas to meet the demands of city factories. He or she will receive Bt15,000 to Bt18,000 per worker from city employers, who are prepared to hire workers that flee from other employers. This leads to illegal employment and more loopholes for government officers to gain profit.

The five districts are Mae Sot, Phop Phra, Umphang, Mae Ramat and Tha Song Yang. 

A source in Mae Sot, who asked not to be named, said 40-50 recruitment agencies have set up offices in the district.

Chaiwat noted the failure of government officers to protect employers and stop migrant workers from travelling to inner provinces even though they are still under contract with employers in border areas.

“The process of labour trafficking is different from what it was in the past. The problem has become more severe because traffickers of migrant workers bring hundreds out of designated areas each day without having to do so discreetly, in disguise or by travelling through forests,” Chaiwat said.

“Nowadays, traffickers can openly bring migrant workers to inner areas – profiting from their holding passports. The passport is a loophole in the law and a government system that the workers take advantage of,” he said.

Workers claim their passport permit allows them to travel freely across the country. As a result, the police make no attempt to stop their travel. However, working in areas outside of that named on a work permit violates Section 27 of the Immigrant Worker Act, Chaiwat said.

Employers in border areas put up around Bt10,000 per migrant worker to make their employment legal, he said. So, when workers run off or are led by agents to work in other cities, employers lose their money as well as their workforce.

The association agreed with the policy of registering migrant workers. Nevertheless, it felt the state overlooks other difficulties that entrepreneurs in border areas have to face.

Warapan Sae Khow, a construction business owner, said companies have to face debt problems and cannot complete work for customers due to the shortage of labourers. They also worry that workers will run off to the cities for higher pay.

Chaiwat said another problem for employers was the month-long process of acquiring a passport and visa for migrant workers through the Department of Employment, as opposed to the more convenient but much more expensive way of doing this via private companies. He claimed employers were forced to use private companies to avoid the delay, even though they have to pay two or three times more.

Employers agreed to pay Bt5,500 to private companies for the ‘nationality verification’ of a worker compared to the Bt1,050 fee that would be paid directly to the government agency, he said.

The source in Mae Sot pointed out similar problems with state officials, loopholes in the law and the nationality identification process.

Some private companies benefit greatly from the nationality verification process. Some firms in Myanmar cooperate with those in Thailand to send workers across the border. Later, companies contact and persuade migrants to work in inner areas of Thailand.

The incompetence of state officials and the costly process of legal migrant employment leads some factories to a policy of having a workforce that is half-legal and half-illegal. Employers were willing to pay a middleman for mutual benefit, the source said.