Factory workers need legal help to save them from exploitation by subcontracting firms, a Thailand Development Research Institute (TDRI) researcher says.
Subcontracting firms serve as brokers that find labourers for factories and at the same time act as “employers” who pay the salaries to these workers.
Job seekers view this system as an easier way to work in factories as it is a shortcut that does away with many requirements.
But they end up receiving lower welfare benefits than those who apply directly to factory owners, Suwanna Tulayawasinphong, who has conducted a study of the system, said.
Labourers hired by subcontracting firms often have to spend their own money to buy factory uniforms and equipment that boost work safety, when these should be paid for by factories.
According to Ms Suwanna’s findings,the monthly income and fringe benefits of subcontracting workers, including financial support for travel expenses and house rentals, is 1,624 baht less than for directly employed workers.
Part of their wage is also taken by the subcontracting firms as their “operation fees and profit”, she said.
The TDRI researcher has also found many such workers are subjected to unfair treatment when they are laid off.
Factory workers are usually entitled to compensation if they are laid off, but employees of subcontracting firms get nothing because they are not considered employees of the factory under the law,Ms Suwanna said.
Some factory owners favour the subcontractor system because they bear no responsibility for firing costs when they dismiss their workers, she said.
She has suggested two legal measures to improve the welfare of these workers.
She has asked the Labour Ministry to register subcontracting firms to better regulate them. She also wants the government to amend the 1998 Labour Protection Act, requiring factories to ensure adequate welfare for these workers.
First published in Bangkok Post, 24th May 2013.