International labour standards

Viet Nam considers ratifying ILO’s convention to boost collective bargaining

Collective bargaining is a fundamental right. Effective collective bargaining can reduce wildcat strikes and build harmonious industrial relations.

News | 08 November 2018
HANOI (ILO News) – Viet Nam is considering the ratification of ILO Convention 98 on the Right to Organize and Collective Bargaining by 2019 as part of its ongoing labour reform.

Collective bargaining is a fundamental right. It is a key means through which employers and their organizations and trade unions can establish fair wages and working conditions.

Addressing the consultation workshop on the draft proposal for ratifying Convention 98 organized in Hanoi on 8 November, Vice Minister of Ministry of Labour, Invalids and Social Affairs (MoLISA), Doan Mau Diep said that the roles of ILO core conventions, including Convention 98, are increasingly important in the context of Viet Nam’s deepening global integration and its real need for establishing modern labour market.

The two-day workshop was organized by MoLISA and ILO within the framework of the project “Promoting ILO Fundamental Conventions towards ratification of Conventions 87, 98, 105, and actions to eliminate discrimination and forced labour in Viet Nam” funded by the European Union.

Together with Convention 87 on Freedom of Association and Protection of the Right to Organize, Convention 98 forms an integral part of the 1998 ILO Declaration on Fundamental Principles and Rights at Work, which are embedded in the new generation of FTAs as a corner stone to ensure fair globalization.

Both the EU-Viet Nam FTA and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) require their member States to adopt and maintain the rights as set out in the 1998 ILO Declaration in their laws, institutions and practices.

“Convention 98 and 87 provide universal principles for effective industrial relations in a modern market economy,” said ILO Viet Nam Director Chang-Hee Lee.

“Wildcat strikes have been a major industrial relations challenge in Viet Nam since mid 1990s. Effective collective bargaining can help to reduce wildcat strikes and build harmonious industrial relations as it facilitates the cooperation and predictability in the labour market, which is important for economic development and political stability.”

Typical issues on the bargaining agenda include wages, working time, training, occupational health and safety and equal treatment. The objective of these negotiations is to arrive at a collective agreement that regulates terms and conditions of employment.

Enhancing the inclusiveness of collective bargaining and collective agreements is a key means for reducing inequality and extending labour protection.

“It is important to recognize positive economic contribution of collective bargaining system,” said the head of ILO Viet Nam. “With effective collective bargaining, workers are able to have fairer share of economic growth and productivity gains. This is significant, because growing inequalities are at the heart of political instability in many countries.”

For collective bargaining to work effectively, trade unions should be the real representative of workers. Convention 98 stipulates that workers should enjoy adequate protection against acts of anti-union discrimination in employment.

It also requires workers' and employers' organizations to enjoy adequate protection against interference by each other in their establishment, functioning or administration.

In Viet Nam, it is not uncommon that trade unions leaders at grassroots level are companies’ senior managers. This is not acceptable under Convention 98.

According to Vice Minister Diep, the consideration of ratifying Convention 98 is important as the result of the need to improve Viet Nam’s industrial relations system and is in line with the country’s economic integration policies.

The modernization of industrial relations towards ILO standards was emphasized in the Party Resolution No 6 on international integration in November 2016, while the Government Decision No 2528/QD-TTg in December 2015 gave clear instructions for the ratification of ILO core conventions.

Last May, Party Resolution 27-NQ/TW, one of the two important documents issued as the result of the Central Party, paved the way for the wage reforms, which was closely linked to Convention 98.

While noting that roles of trade unions in collective bargaining is still limited in today’s Viet Nam and also recognizing that “the State does not directly intervene in the wage policies of businesses”, the Resolution emphasizes that “negotiation and agreements between employers, workers and their representatives” should become a basis for wage fixing at the enterprise level. In this respect, the Resolution highlights the need to “enhance the role and capacity of trade union organization, which is representative organization of workers, in labour relations in line with the socialist-oriented market economy and international integration”.

Viet Nam has ratified 5 out of 8 ILO fundamental conventions. The remaining non-ratified conventions include Convention 98 on the Right to Organize and Collective Bargaining, Convention 87 on Freedom of Association and Protection of the Right to Organize and Convention 105 on Abolition of Forced Labour.

* This story is a product of the European Union-funded project on Promoting ILO fundamental conventions towards ratification of Conventions 87, 98, 105, and actions to eliminate discrimination and forced labour in Viet Nam. Its contents do not necessarily reflect the views of the European Union.