VIETNAM ACADEMY OF SOCIAL SCIENCES
GRADUATE ACADEMY OF SOCIAL SCIENCES

PHAM THI THU LAN

MEXICO’S IMPLEMENTATION OF NAFTA LABOUR
COMMITMENT AND LESSONS LEARNT FOR VIETNAM

Major

: International economy

Code

: 9 31 01 06

SUMMARY OF DOCTORAL DISSERTATION

HANOI - 2019


The Disertation was completed at
GRADUATE ACADEMY OF SOCIAL SCIENCES

Academic supervisors:

1. Assoc. Prof., Dr. Nguyen An Ha
2. Assoc. Prof., Dr. Dang Minh Duc

Commentator 1: Prof., Dr. Do Duc Binh
Commentator 2: Assoc. Prof., Dr. An Như Hải

Pham Thi Thu Lan (2017), "Why wildcats and will always wildcats strikes
in Vietnam?”, Global Labour Column, No. 290.
Pham Thi Thu Lan (2017), "A few thoughts on renovation of the method of
union operation in the new context ", Labour and Trade Union
Review, No. 623 and 624, pp.18-19,24.
Pham Thi Thu Lan (2017), "Bringing labour standards into FTAs:
Economic opportunities and challenges for developing countries",
Labour and Trade Union Review, No. 632 pp.10-11.
Pham Thi Thu Lan (2017), " Some typical cases on complaints of Mexico's
implementation of labour standards and lessons learnt for Vietnam",
Labour and Trade Union Review, No. 634, pp.10-11.
Pham Thi Thu Lan (2017), “Role of trade unions in socio-ecological
transformation in Vietnam””, Quỹ Rosa Luxemburg Bullentin –
South East Asia, No 1 - 2017.
Pham Thi Thu Lan (2018), "Research of labour standards in economic
development and the Mexico case ", Socio-economic Information
and Forcast Review, No. 147, pp.33-36.
Pham Thi Thu Lan (2019), “Labour regulations in the North American Free
Trade Agreement and the implementation by Mexico”, Vietnam
Social Science Magazin, No. 3/2019.
Pham Thi Thu Lan (2019), “The consequences of low wages – a look at
garment enterprises”, Labour and Trade Union Review, No. 650,
March 2019.
Pham Thi Thu Lan (2019), “Employment in the fourth industrial revolution
and challenges for Vietnamese human resources”, Labour and Trade
Union Review, No. 651, April 2019.


INTRODUCTION
1. The necessity of the Dissertation

households is still very high. The poverty rate is still high. Moreover, poverty also
means being denied basic rights, social marginalized, unsecured rights such as the
right to appropriate living standards, especially food and clothes, housing, social
security rights, access to basic services on health, education, clean water,
information, the rights to dialogue, negotiation and participation in decisionmaking on issues related to employment, salary, working conditions ...
Implementing labour standards will help Vietnam achieve its goals of sustainable
development and contribute to comprehensive, balanced and inclusive
development. With requirements of both international integration and domestic
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development needs, the Dissertation helps Vietnam envision and choose the
appropriate way to go in the coming integration period.
1. The purpose and research tasks
Purpose: The Dissertation studies the experience of the first developing
country in the world participating in FTAs with labour commitment to draw
lessons for Vietnam in implementing its commitment in CPTPP and EVFTA.
Research tasks: (i) systematizing the theoretical basis of the
implementation of labour commitment in FTA, clarifying labour standards and
comparative advantages in the framework of FTA commitment, opportunities and
challenges for developing countries; (ii) analyzing and evaluating the
implementation of the NAFTA labour commitment in Mexico, clarifying the
successes and limitations of implementation and pointing out the cause of this
situation; (iii) comparing the similarities and differences between Vietnam and
Mexico, thereby drawing lessons and recommendations for Vietnam to effectively
implement its labour commitment in CPTPP and EVFTA effectively.
Research hypothesis: The implementation of labour commitment in
NAFTA has helped Mexico develop both economically and socially during the
last 25 years and Mexico continues to benefit from NAFTA in the future.
2. The object and scope of research

secondary documents, using reliable sources of prestigious scholars; inheriting
existing studies; comparing, evaluating, systematizing arguments and problems,
analyzing Mexican cases, drawing facts and drawing scientific conclusions; (iii)
Analysis and comparison with assessing Mexican practices, comparing and
analyzing development trends, forecasting issues and drawing lessons for Vietnam
in choosing the path of development and implementing labour commitment in
FTAs; (iv) Survey and expert interviews to assess practices of Vietnam in
implementation of labour standards, combining retrospective documents with
practical surveys, interviewing labour experts and officials of Department of
Labour, industry and trade bureaus, enterprise managers, trade unionists and
workers.
Approaches: The Dissertation uses the following approaches: (i) Historical
approach: considering the origin, the rule and the trend of significance to
understand the issues of labour standards and its link to trade and economic
development; (ii) Systematic approach: analyzing and assessing the issues of
inter-sectoral interaction, finding a link of labour standards with trade
liberalization and economic development, between aspects of economics and
international economy and sociology; (iii) Interdisciplinary approach: The
Dissertation uses a combination of methods of social sciences such as economics,
international economy, sociology and others to clarify the intertwined issues
between labour and economy, and labour - economy - development.
4. New scientific contributions of the Dissertation
The Dissertation systematized theoretical basis about implementation of
labour commitment in FTAs and comparative advantages of labour standards in
the global economy; indicating the downside of economic development with low
labour standards; clarifying opportunities challenges to developing countries
joining new-aged FTAs in case of not converting to applying high labour
standards
The Dissertation analyzed and demonstrated the status of Mexico's
implementation of NAFTA labour commitments; assessing good points and bad

choosing a development model for more effective integration in the global
economy. The Dissertation helps the parties visualize the opportunities and
challenges posed by participating in FTAs with labour commitment, selecting
ways to implement labour commitment to make the most of the benefits of labour
standards and limiting challenges. The results of the Dissertation are also
documents in teaching and research. To a certain extent, the Dissertation
contributes the theoretical and practical significance related to political and
security aspects.
7. Structure of the Dissertation
In addition to the introduction, conclusions and appendices, the
Dissertation is structured in 4 chapters. Chapter 1: Overview of research works
related to the Dissertation topic; Chapter 2: Some basic theoretical and practical
issues for implementing labour commitment in FTAs; Chapter 3: Mexico's
implementation of labour commitment in NAFTA; Chapter 4: Implications and
lessons for Vietnam in implementing labour commitment of new-aged FTAs.

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Chapter 1: OVERVIEW OF RESEARCH WORKS RELATED TO
THE TOPIC OF THE DISSERTATION

1.1. Research works outside the country
1.2. Reseach works inside the country
1.3. A few comments on the research situation
Overview of reseach works inside and outside the country shows that the
research on labour standards is very rich, covering various aspects related to the
dissertation topic. Firstly, all research works affirmed the importance of labour
standards in the current global economy, asserted that trade liberalization was
bringing many benefits to the nation but also posing many social problems, and



Chapter 2: THEORETICAL BASIS ABOUT IMPLEMENTATION OF
LABOUR COMMITMENT IN FREE TRADE AGREEMENTS

2.1. Labour commitment and characteristics of labour standards as
committed in free trade agreements
2.1.1. Concepts
2.1.2. Content of labour commitment in FTAs
The core labour standards are the labour standards on four clusters of rights
defined in the eight core ILO conventions and are the main labour commitment in
FTAs, namely: (1) Convention No. 87 and 98 on the rights to organize, freedom
of association and collective bargaining; (2) Conventions No. 29 and 105 on
forced labour; (3) Convention No. 138 and 182 on minimum working age and
elimination of child labour; (4) Conventions No. 100 and 111 on nondiscrimination on employment and occupation and ensuring equal pay between
men and women.
In addition to the core labour standards, the labour commitments in FTAs
also includes the implementation of a number of other specific labour standards of
wages, occupational safety and health and working hours at "acceptable" levels.
2.1.3. Characteristics of labour standards as FTAs commitment
Labour standards promoted through FTAs are ILO's core labour standards.
These labour standards only stipulate fundamental rights, including no child
labour and no forced labour, equality at work, ensuring that the industrial relations
parties have the rights to establish their own organizations to engage in dialogue,
collective bargaining and make decision on workplace issues, thereby creating an
enabling environment for making decisions based on negotiations of specific
terms and regulations in various enterprises. In the case of an enterprise facing
difficulties, or at risk of bankruptcy, workers need to understand and share with
enterprises to overcome difficulties so as to maintain the survival of the business,
and therefore, also maintain the job of workers. In case of growth, enterprises

accidents and diseases, thereby saving compensation and remedial costs for
employers and reducing the burden on society and the medical system. Vocational
training helps workers improve their skills, change careers and helps the labour
force adapt to changing nature of work, especially during the fourth industrial
revolution (I 4.0) that is taking place. Unemployment benefits and job protection
help workers to accept the risk of losing their jobs for creativity. Active labour
market policies help create flexibility in labour supply and demand, thereby
creating opportunities for workers to work in their professional area to maximize
their capability of labour creativity. Freedom of association and collective
bargaining help reduce labour conflicts and increase coordination between the two
sides in production, work together to solve difficulties and share achievements
together, helping the economy to adjust faster to economic shocks, increasing the
competitiveness of the economy, building trust among parties in labour relations
and working together towards a common goal.
2.2.2. Advantages and disadvantages of low labour standards
Theoretical base and practice show that low labour standards mean that the
rights of workers are not guaranteed, thus resulting in low wages, poor working
conditions; labour inspections are ineffective, leading to violations of labour
standards; then many problems have arisen in the field of labour. Low labour
standard creates an only competitive advantage of low labour costs. Countries
often apply low labour standards to attract FDI and the competition by using low
labour standards takes place at the global level over the past two decades, leading
to "a race to the bottom" (cutting labour costs for competition).
Except for the unique advantage as mentioned above, low labour standards
have many disadvantages for the country, including: social consequences of high
rates of poverty when workers come out of their working age, leaving a burden for
the medical and social security system; restraining the development of human
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advantages for the country. The choice depends on the country.
2.3. Implementation of labour commitment in FTAs
2.3.1 Viewpoints on implementation of labour commitment
Currently, there are two schools of viewpoints on the development model
and its relationship with labour standards.
First, economic development priority is focused: implementing low labour
standards to prioritize economic development first. This view takes economic
development as the focus and prioritizing economic development in order to have
conditions for social and environmental development. This is the viewpoint of
most developing countries at present.
Second, comprehensive development: implementing high labour standards
for a balanced and inclusive development. This view considers development to be
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for human beings, so it is necessary to balance the interests of all groups in
society, balancing the benefits between economists and workers. This is the view
of the United Nations through the Sustainable Development Goals (SDG) and the
Guidelines Principles on Business and Human Rights (UNGP), of the
International Labour Organization (ILO) with the goal of "a peaceful working
environment is essential to prosperity”, of the Asia-Pacific Cooperation Forum
(APEC) for a world with “no one left behind”, of the Association of Southeast
Asian Nations (ASEAN) with the goals of people-centered development.
Both of these views are appropriate in certain periods of the country. Each
country needs a specific strategy and decides to choose the right development
perspective in each stage of development. The wrong choice will have
consequences, which take time, efforts and resources to overcome, leading to the
lag of the nation and many problems arise.
The selection of the development perspective will determine the viewpoints
and ways of implementing labour commitment in the FTAs: proactive or passive

The labour commitment in FTAs in the world are divided into two groups
with two different enforcement mechanisms: conditional or promotional.
Conditional mechanism is often applied in FTAs with the US involvement with
measures of fines or preferential trade cuts, while promotional mechanism is
adopted by the European Union using incentives and development aids to
encourage implementation of labour standards.
2.3.5. Contents of implemention of labour commitment
Implementing entity: the main actor is the government with building
appropriate laws and ensuring compliance of enterprises.
Implementation process: The process of implementing labour commitment
depends on the specific provisions of the FTAs for each country regarding the
roadmap to revise the law and implement the recommendations of the FTAs
parties for each labour standard. The content, level and practice of implementing
labour standards commitment of different countries are different, so the
requirements, recommendations and roadmap for implementation of labour
commitment of different countries is also different.
Specific measures: 4 points:
- Amending and supplementing the national labour law to conform to the
core labour standards (labour standards on rights) as committed in the FTAs;
- Ratifying international labour conventions according to the committed
roadmap;
- Establishing appropriate labour mechanisms and institutions to implement
labour standards;
- Ensuring labour standards are fully and effectively implemented in
practice.
2.3.6. Evaluation mechanism for implementation of labour standards
and labour commitment
Evaluation on implementation of labour standards
There are many mechanisms to evaluate the labour standards
implementation of a country whether it is good or bad: through a consultative

affected by the following factors: national political institutions, lobbying activities
and influence of interest groups during the revision of labour laws, the level of
economic development and the viewpoint of prioritizing economic development,
awareness and culture of "circumventing the law" by employers, ineffective
labour inspections and sanctions system, and corruption which impedes strict law
enforcement.
2.4. Opportunities and challenges of labour commitment
implementation
2.4.1. Some opportunities: Labour commitment in FTAs provide
opportunities for reform of domestic labour laws and institutions, development of
trade relations with developed countries, attraction of foreign investment and
expansion of exports.
2.4.2. Some challenges: If labour commitment is not complied with,
countries may face the following challenges: labour standards may be used for the
purpose of trade protection or sued for dumping; possible sanctions; risk of facing
international complaints; the challenge of transnational pressure when violating
committed labour standards.
Chapter 3: ANALYSIS AND ASSESSMENT OF MEXICO'S
IMPLEMENTATION OF NAFTA LABOUR COMMITMENT
3.1. Mexico's socio-economic context at time of NAFTA signature and
at present
Mexico in 1994 faced many problems such as foreign debt, peso
devaluation, unprecedented inflation and many seriously industries affected.
Economic problems entail political-social issues: Chiapas rebellions, assassination
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of presidential candidate of the ruling party, assassination of the Party's general
secretary, ... causing social instability.
Mexico's important decision to revive the economy is to join the North

NAFTA's labour commitment do not require contracting parties to
harmonize labour laws between member countries, nor impose laws or regulations
of one country on the another but require countries to implement the following
labour standards in accordance with national laws, including: freedom of
association, collective bargaining, right to strike; strictly prohibiting forced
labour; prohibiting the use of child labour; eliminating all employment and
occupational discrimination; equal pay between men and women; ensuring
minimum wage, working time, overtime wages... according to the national law;
prevention of occupational accidents and occupational diseases; appropriate
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compensation for workers when labour accidents and occupational diseases occur;
protecting migrant workers working abroad.
3.2.2. Mechanism for implementing labour commitment in NAFTA
The institutions are established under NAFTA to enforce labour
commitment, including:
(a) Establishing the Labour Cooperation Committee composing of the
Ministerial Council and the Secretariat, which oversees the implementation of
labour standards, conducts cooperation and technical assistance, consultations and
answers questions and disagreements that arise, ...
(b) The National Administration Office (NAO) is the focal point to contact
with the parties and provide required reports, receive and process complaints and
information about situation and progress of complaints.
(c) National committees, including the National Advisory Committee and
the Government Committee: play the role of advising the parties in the
implementation of labour commitment.
Grievance handling mechanism: Complaints about violating labour
standards lodged by an individual or organization will often be the beginning of
the case regarding the impementation of labour committments. The process for

enterprises inspected by labour inspections; (iii) establishing many Arbitral
Committees to resolve labour disputes; (iv) applying a secret ballot in all labour
issues.
Most recently, in 2016, in response to regulatory and institutional
pressures, Mexico decided to revise the law with specific revisions: (i) abolishing
existing reconciliation and arbitration committees and move the legal functions of
these committees to the judiciary, establishing a new "specialized and unbiased"
state and federal mediation center to conduct mediation before taken to court; (ii)
the administrative functions of the old reconciliation and arbitration committees,
for example, union registration, are assigned to a new, unbiased and professional
federal agency. The chairman of this agency is elected by the National Assembly.
The renegotiated NAFTA in 2018, named USCMA (also called NAFTA
2018) required Mexico to: (i) establish an "unbiased" labour court system to
resolve labour disputes; (ii) establishing an independent body in charge of
registration of collective agreements; (iii) ensuring that all workers have the right
to access collective bargaining and all agreements must prove to be agreed by
workers by secret ballots. These requirements of institutional and legislative
improvement show that the mode of dialogues, negotiations and collective
bargaining in establishing labour standards is taken with interest.
3.3.2. The implementation of labour standards in Mexico
Although the Mexican legal system regulates labour standards committed
in NAFTA as relatively good, there are many concerns about the implementation
of labour standards in Mexico in practice. Freedom of association and collective
bargaining has always been attacked with serious cases such as union officials and
workers are threatened or killed for exercising union rights. Forced labour and
child labour are still quite common, especially on farms of vegetables and crops,
with working conditions like slavery such as human trafficking, debt repayment
labour, forced marriage to do housework, exploitation of sex work, ...
Discrimination of employment and occupation between male and female workers
is not resolved; average income of male workers is still 29.3% higher than that of

industries also suffer from decrease or bankruptcy.
The social impact contrasts with the economic impact. Although the
employment rate in Mexico increased, especially in manufacturing, but overall,
the unemployment rate in Mexico in 2012 (after 18 years NAFTA) was 5.0%, and
now (after 25 years) ) is 3.2%, compared with the unemployment rate of the 19901994 period of 3.1%. There are years when unemployment rate is up to 7.2%
(2000). To a certain extent, NAFTA contributes to wage increases for workers,
but wage increases do not match the increase in labour productivity (economic
share is not fair). Nominal wages increased, but real wages were almost
unchanged from 1994 to now, only about a 2.3% increase, and only marginally
higher than those of 1980. Although, many jobs were created, but informal
employments increase in most industries. Half of the population is still stuck in
poverty and a quarter is in danger of returning to poverty. According to Sierra
Club, 75% of Mexicans live in poverty in 2001 compared to 49% in 1981.
According to Unicef, 40 million Mexican children live in poverty and 4.7 million
are in extreme poverty. Mexico is ranked among the world's largest rich and poor
countries. According to the ranking of happiness in the period 2014-2016, Mexico
ranked 25th compared to the level of happiness of American ranked the 14th and
15


Canada ranked the 7th. Despite economic development achievements, President
Enrique Nieto admitted that that the number of poor people in Mexico still lives
"backward and poor" is high and rising inequality. NAFTA helps Mexico to
develop the economy but does not help Mexico a balanced development and not
reduce the social development gap between Mexico and the two partners, i.e. the
US and Canada as expected when NAFTA was negotiated.
3.4. Assessment of Mexico's implementation of labour commitment
The implementation of Mexico's labour commitment shows that Mexico
has well implemented technical criteria, but has not yet implemented the content
criteria and result criteria, shown in the following points:

time, finance and resources to resolve. The not-so-good implementation of
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Mexico's labour commitment is one of the main causes leading to NAFTA
renegotiation which then poses challenges to Mexico's national interests.
3.4.4. Faced with transnational pressure on labour standards: damaging
Mexico’s prestige and image on the international arena. NAFTA creates a "stage"
for cooperation between labour groups and NGOs in NAFTA participating
countries to jointly appeal. There are cases of up to 65 interested groups in both
the US, Canada and Mexico joining hands and signing on the submission, and the
result of improvement of labour standards is mainly due to pressure of this
international linkage for joint submissions.
3.4.5. Not good implementation of labour standards: the risk of social and
political instability. Low wages, unsecured working conditions, poverty, etc. are
the causes of many strikes and collective work stoppages in Mexico and often lead
to violence and police intervention with dead and injured people, act of fire,
smashing, etc., causing social disturbance. Poverty is associated with increased
crime, drug trafficking, murder, kidnapping, etc. According to a referendum,
about 72% of Mexican people do not believe in the Government and 82% do not
believe in political parties. This shows the risk of social and political instability in
Mexico.
3.4.6. NAFTA re-negotiation: affecting Mexico's future development. The
re-negotiated version of NAFTA 1994 (NAFTA 2018) puts the content of labour
at the heart of the negotiation and labour commitment are treated equal with trade
and investment commitment, that is sharing the same enforcement and
punishment mechanisms for violations. Therefore, if Mexico continues to
implement labour standards in a passive way and continue to let violations occur
and repreat as well as delay in addressing the complaints and cases of submission,
delay in revising the law and enforcing the law effectively, labour standards can

(f) Lack of consumer role. Consumers in developing countries do not pay
much attention to the humanity of products regarding the labour aspect of
products and they are still attracted by cheap products. Therefore, they have not
jumped on the band wagon to improve labour standards in their countries.
(h) Political barriers. Although this is not the research area of the
dissertation, in fact, the big concern that some countries, especially unitary
countries fail to implement labour standards is the political reason, especially
regarding the labour standards on freedom of association and right to strike.
Governments is worried that these rights may be used for political purposes,
which may affect the leadership of the party or political instability. In this regard,
according to international standards, labour standards used for political purposes
are contrary to the spirit of labour standards committed in the FTAs, meaning that
countries and governments have absolutely the right to build institutions and take
necessary measures to prevent them.
Chapter 4: IMPLICATIONS AND LESSONS FOR VIETNAM IN
IMPLEMENTING LABOUR COMMITMENT OF THE NEW-AGED FTAs
4.1. The Vietnamese context in comparion with Mexico
4.1.1. Current socio-economic context of Vietnam
Vietnam started a "renovation" policy in 1986. Ten years later, the country
had moved out of the economic and social crisis. In 2009, the country escaped
from the situation of a poor and underdeveloped country and was classified as a
middle-income country in the world. Over the past 20 years, the economy has
grown rapidly with an average growth rate of 7.2%. GDP per capita reached 1,168
USD in 2010, 1,900 USD in 2014 and was estimated at 2,540 USD in 2018.
4.1.2. Labour commitment in new-aged FTAs
The FTAs Vietnam has entered into include multilateral FTAs with
ASEAN countries, Korea, Japan, China and some other countries, but these FTAs
do not have labour commitment. The first two FTAs with labour commitment that
Vietnam is a member are CPTPP and EVFTAs.
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the way to implement harmonious labour relations taken by Vietnam is not
sustainable, leading to many violations of labour laws, discrimination,
manipulation, interference and lack of goodwill by employers, causing many
labour problems shown by the reality of nearly 7000 strikes from 1995 up to now
and this is a challenge for social development.
4.1.4 Challenges of Vietnam's implementation of labour commitment
Regarding amendments of the law: According to the commitment, Vietnam
needs to amend the law to ensure compliance with core labour standards, but this
process will face with difficulties, due to: (i) limited awareness of core labour
standards by labour relations actors, law makers and related agencies involved in
the revision of the law, in particular, and limited awareness by the society, in
general; (ii) Vietnamese law applies the civil law system while labour issues are
diverse and abundant, so the law revision do not keep up with changes in the
labour market; (iii) Vietnam has not ratified 3 out of 8 core conventions, so there
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is no basis of reference for the development of a “standard” labour law system,
due to the possibility of lobby by labour relations actors and interest groups,
which may make the law revision deviated.
Regarding implementation in practice: Vietnam is a developing country in
a transition to a market economy, so the labour law is not completed and
violations of the labour law are quite common. Wages in Vietnam compared to
other countries in the region is considered low and not ensuring the lives of
workers. In labour-intensive industries such as textiles, footwear, electronics,
workers have to work overtime a lot to supplement their daily expenses. Labour
safety is unsecured and the number of occupational accidents is high. In 2017
alone, across the country, 8,956 occupational accidents occurred and 9,173
victims. Working environment is still polluted. The quality of vocational training
is still low, not meeting the practical needs of enterprises and labour market


Vietnam to develop comprehensively and inclusively so as not to face a further
increase in inequality.
4.2. Some lessons from Mexican experience
4.2.1. Lessons on implementing labour commitment
The study of Mexico’s experience concludes that the development model
based on low labour standards is not a sustainable development model. With a
balanced and inclusive development perspective, the Dissertation draws the
following lessons for Vietnam:
First is the lesson about changing the thinking of development model and
labour standards.
Thinking determines action. Vietnam needs to recognize the advantages of
high labour standards and this is an opportunity for a balanced and inclusive
development instead of just implementing labour standards to meet the
requirements of international trade. Changing thinking will help Vietnam take a
step in the right direction, carry out a development model based on high labour
standards instead of low labour standards, shifting from prioritizing economic
development to economic-social-environmental balance, considering labour
standards as a prerequisite in economic policy planning as well as in approving
economic programs and investment projects.
Second is the lesson on proactive action in implementing labour
commitment.
Mexican experience shows that being passive and reactive to resolve
problems when facing complaints and submissions will cost money and, at the
same time, damange the image, prestage and benefits of participating in the global
economy. It would be better if Vietnam choose to take an active approach to
improve and enforce labour standards so as to take advantage of high labour
standards for economic development and create a balanced development towards
long-term benefits and join the global economy in a sustainable way and
contribute to the implementation of sustainable development goals.

Mexican experience shows that failure to handle violations at the enterprise level
will lead to submissions against the government for the reason of not enforcing
labour standards as committed, leading it to face transnational pressure. Slow and
passive government action does not solve the problem but only makes the
problem more serious.
(c) Change the development perspective for sustainable development.
The priority for economic development is no longer appropriate, because it
leaves many negative consequences on the society, which takes a lot of time,
efforts and resources to solve. Vietnam has passed 30 years of renovation and now
becomes a middle-income country, Vietnam needs to shift from an economic
priority perspective to a comprehensive, balanced and inclusive perspective in
development decisions.
(d) High labour standards rather than low labour standards are
competitive factors in the current global economy.
NAFTA 2018 prevents using low wages to attract investment, which means
that even if countries want, they can not continue to compete by using low labour
standards. NAFTA 2018 treats labour standards violations the same as trade and
investment violations, and applies a single mechanism to address all violations.
This shows the importance of labour standards in the international economy and
implies a lot for Vietnam.
(e) Low minimum wages does not encourage technological innovation.
Low minimum wage is the driving force for employers to continue using
the labour force instead of investing in technological upgrading. If the policy of
gradually increasing the minimum wage is applied, the conditions of the worker
will be improved and they can reduce the overtime to have time for learning and
improving their qualifications, thereby helping them adapt to changing jobs for I
4.0, and at the same time, it encourages employers to step by step invest in
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