Is the proposal to reduce working hours from 48 to 44 feasible?

by Apparel Resources

26-October-2019  |  8 mins read

Vietnam Garment Manufacturig

There’s been a lot of talk, lately, on whether the weekly working hours in Vietnam’s garment, textile and footwear sector should be reduced from 48 to 44. And, the industry seems to be having mixed views on the same.

In a workshop on draft amendments to the Labour Code, which was held on 23 August 2019 in Ho Chi Minh City, the proposal to lessen the weekly working hours was rejected outright majorly due to the lack of practicality. Majority of country’s apparel and footwear sector were of the view that if at all such a proposal gets implemented, workers will end up being big losers – especially those workers who are either paid for every product they make or those who work on an hourly basis.

While giving credence to same, Diep Thanh Kiet, Shoes and Leather Association, Ho Chi Minh City, said at the workshop, “The working hours can be reduced only when Vietnam’s income per capita amounts to at least US $ 4,000 annually, and that too with clearly devised plans that involve workers, factories and Government.” Also, one cannot deny that the regulation could also duly impact foreign investment in Vietnam. It will! Less hours is less productivity and less productive industry could keep away all foreign investors and buyers of Vietnamese apparel and leather products away from the country. It is important to note here that many of Vietnam’s neighbours including Cambodia and Laos still have working weeks of 48 hours.

Truong Van Cam, Vice President and Secretary General, VITAS
Truong Van Cam, Vice President and Secretary General, VITAS

Terming the proposal impractical, Truong Van Cam, Vice Chairman, Vietnam Textile and Apparel Association (VITAS), stated “Vietnam is following developed countries where wages are increased and working hours are reduced. But one must remember that Vietnam’s income per capita is ranked 131st in the world and, therefore, nothing is more impractical than reducing weekly working hours.”

The firms will have to recruit more workers to meet the productivity target. VITAS believes that any implementation of the proposal would minimise industry’s export value by at least US $ 3 billion annually as it is not even easy to recruit workers in today’s time. “If working hours are reduced to 44, firms will have to recruit more workers to maintain the same volume of production and export value of the textile and garment industry at present, and spend trillions more dong to pay workers’ salaries,” said Truong Van Cam.

Agreeing to what Kiet said, Nguyen Ngoc No, Head of Personnel, United Sweetheart Garment Vietnam, commented, “If working hours are brought down to 44 hours, a footwear firm with 17,000 labourers would need to ask their workers to increase productivity, creating an additional cost of VND216 billion or a 3.6 per cent increase in product costs. Also, if it decides to add more workers, it will need 1,764 more people and VND186 billion as additional funds to pay salaries, resulting in product costs increasing by 3.4 per cent.”

So where’s the gain? And then, there is no certainty that the working hours will be never be cut again in future – making it all the more difficult for firms to devise business strategies. Long Vu, Regional Sales Manager, Intelligent Solution for Apparel Textiles said, “No apparel companies or workers would be interested. They also do overtime and don’t care how many hours they work per week. The only thing they care about is how much they earn per month.” Conforming to what Long Vu said, Kirill Alferov, Chief Representative, VN, Gloria Jeans shared, “Most of our suppliers are not happy with the proposal; first of all each year it becomes more difficult to get workers, with factories having to compete with each other to get workers. Besides, if the proposal gets accepted, the factories will have to start overtime to maintain the same productivity of 48 hours.”

However, not all are against it! It’s a progressive trend of mankind

The Vietnam General Confederation of Labour, better known as VGCL, has strongly recommended cutting weekly working hours to 44, saying it would end up improving workers’ well-being, family life and relationship. In fact in an another conference held in Hanoi on 17 September 2019, Le Dinh Quang, Deputy Head, VGCL’s Department of Labour Relations highlighted that Vietnam is among countries with longest workweeks in the world, just behind Kenya and Seychelles (over 48 hours).

Ngọ Duy Hiểu, Vice President, VGCL, said at the meeting that reducing working hours is a ‘progressive trend of mankind’. He added “The need for increasing productivity has to go along with maintaining worker’s health, their ability for labour power reproduction and giving time for workers to take care of their families and to take part in social activities.”

VGCL also conducted an online survey among the workers and what was interesting about the survey was that 81 per cent of respondents voted in favour of cutting the working hours from 48 to 44. That’s a good per cent! The survey titled Reducing working hours: yes or no? saw good participation. Only 19 per cent chose to keep the current working hours of 48 hours per week or working 6 days per week. In fact, majority of the respondents said that they would prefer five-and-a-half days of work per week.

The survey was organised following Labour Federation’s proposal to give an extra holiday on 31 December this year as Vietnam, among its neighbouring countries, not only has the longest working weeks globally, but also less public holidays. So, while it is 28 holidays in Cambodia, 16 in Thailand and Indonesia, 14 in Myanmar, it is just 10 in Vietnam. Even when one talks about annual paid leaves, workers in Vietnam get only 12 days of annual paid leaves, which is yet again the lowest in the world.

There is also talk to extend overtime to facilitate production. Currently, the Government regulates overtime to be not more than 200 hours annually for general industries and 300 hours annually for specific industries like textiles, apparels and footwear.

The Government now needs to understand the pros and cons of the situation and involve factory owners and workers in the meetings, so that it arrives at a decision that is more practical and favourable for the workers and the owners.

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