Malaysian employers have used migrant labour to "artificially suppress" wages with the government possibly collaborating in efforts to remain competitive, a regional trade unionist said today.

Describing it as "a form of slave labour", Asean Trade Union Council executive secretary S Venkateswaran said he expected governments within the region to buckle to the pressure of competing with emerging low-cost countries.

"The governments of Asean (Association of Southeast Nations) are now suspending labour standards to maintain competitiveness.

"The issue here is strictly labour cost, nothing else," he told malaysiakini today.

Due to unsustainable labour costs and unattractive wage-to-productivity ratios, he said governments may well be lending a helping hand in encouraging the entry of more low-cost migrant labour.

Asean is a 10-member grouping for economic, social and cultural cooperation and regional peace and stability comprising Thailand, Indonesia, Malaysia, Singapore, the Philippines, Brunei, Burma, Laos, Cambodia and Vietnam.

Elaborating on what he calls "the artificial suppression of wages", Venkateswaran, who is also Transport Workers Union executive secretary, said migrant labour has long been used by employers for their own benefit.

Market distorted

"The unions have pursued this matter by asking for a government to government commitment for stricter regulation of the migrant labour market instead of allowing the market to dictate the terms of employment," he said.

He feels the local labour market has been further distorted by the presence of undocumented migrant workers in the country.

"There is no proper profiling of the supply-demand factors and the problem is compounded by corruption.

"You can say that this a form of modern slave-trading," he added.

Recently, he presented the regional labour situation in a paper 'Organisation Development in Asean and its Impact on Employment Policies' at a conference on employment laws and contracts in Kuala Lumpur.

In it, Venkateswaran noted the trend among Asean governments to encourage foreign labour to the extent that is "more than what is socially and politically desirable to retain businesses and industries within their shores".

Based on a recent wage survey in four selected countries, he said Indonesia had the lowest hourly wage rates at US$0.10 per hour compared to Malaysia's rate of US$1.50, while China and Vietnam recorded US$0.29 and US$0.42 respectively.

This sample of hourly wage rates, he said, would explain the "corporate migration" from high-cost to low-cost countries such as China and Vietnam for short-term gains.

"But it certainly does not explain or provide the rationale for sustainability of business operations on a long-term basis," he said in the paper.

"It is also bound to cause social unrest in the affected countries, especially those that already have a high rate of unemployment."

He said most migrant workers were prepared to accept low wages as they were mostly involved in performing unskilled jobs.

28 millions in Asean

"Companies perceive migrant labour as a low-cost option for their operations. It has been estimated that on an hourly-basis, five or six workers are employed for the cost of one local worker in more advanced Asean countries," he explained.

"In Malaysia, the plantation, construction and manufacturing sectors are predominantly staffed by migrant workers from Indonesia and Bangladesh."

Venkateswaran said migrant workers are also hired in the services sector, as domestic help and as assistants in petty trading businesses.

The International Labour Organisation estimates that 28 million migrant workers are employed in Asean countries.

"Out of this, about three million or 10.7 per cent are employed in Malaysia, many of them in the informal sector," he added, citing the figures.

"Indonesia, the Philippines and Thailand are the major source countries while Malaysia, Singapore and Brunei are host countries.

"There are also constant cross-border movements between Laos, Vietnam and Cambodia, particularly during planting and harvest seasons."

He said social action groups have defined migrant workers as "any foreign national who is willing to perform 3-D (dirty, difficult, dangerous) jobs" that locals shun, and at "a fraction of the wages paid to local workers".