Explainer: Pre-coup Myanmar Labor Law Limits Delivery Drivers’ Right to Strike
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Explainer: Pre-coup Myanmar Labor Law Limits Delivery Drivers’ Right to Strike

Since the February 2021 coup d’état in Myanmar, human rights conditions have continued to deteriorate throughout the country. While the current ruling military dictatorship is guilty of causing and/or perpetuating many rights violations, some — such as restrictions on labor rights — had started even before the coup. In this explainer I will look at the origins of Myanmar’s present labor rights crisis and its possible post-coup evolution through the prism of an ongoing controversy surrounding one of the country’s leading food delivery service companies, hereinafter referred to simply as “the Company”.

Background

On 16 March 2022, the Myanmar-based delivery drivers of the Company — which bills itself as Asia’s leading food delivery service — learned they would face wage reductions for all routes in the country. The disgruntled delivery drivers organized via social media, vocally opposing what they said was a 50 percent pay decrease compared to pre-coup salaries.

The strikers’ core demands included: setting the minimum route payment of 670 Myanmar Kyat (USD 32 cents, at the time of publication), reliance on Google Maps for calculating delivery route distances, compensation for any injuries sustained during delivery, and paid leave.

Three days later, the Company acknowledged the strike and agreed to raise the standard remuneration rate to 580 Myanmar Kyat (USD 28 cents) per 500 meters, among other concessions. But by June 10, the strikers concluded the Company did not intend to implement these changes in practice, and resumed the strike, which continues to this day.

Core Legal Issues Under Myanmar Law

A key legal issue the strikers face in Myanmar is whether they are legally classified as employees, and are thus legally authorized to strike in the country.

According to the Company’s website, their delivery drivers bear the following characteristics:

  1. They must own and use their own vehicles for deliveries;
  2. They must pay for their own uniforms upon taking on these positions, at a cost of 85,000 Myanmar Kyat (about USD 40);
  3. To become a delivery driver for the Company, one must submit an application, attend training, and pass an examination;
  4. They must enter into a binding contract with the Company;
  5. They have to comply with the Company’s employee manual while delivering food;
  6. They are paid weekly, with rates determined by the number and length of each delivery route;
  7. They do not have the right to expect a set work schedule.

This writer could not identify the contents of the contract between the riders and the Company (the Contract). Therefore, the following discussions focus only on publicly available facts.

Scope of Myanmar Labor Law

Myanmar labor law applies to different legal instruments as follows:

  1. Employment and Skill Development Law
  2. Factories Act
  3. Payment of Wages Law
  4. Minimum Wages Law
  5. Social Security Law
  6. Labor Organizations Law
  7. Settlement of Labor Disputes Law
  8. Leaves and Holidays Act
  9. Occupational Safety and Health Law

Such legal instruments are governed by relevant rules, orders, and notifications issued by the Ministry of Labor, Immigration and Population.

Definitions under Myanmar Labor Law

The definition of “workers” or “employees” are scattered in these laws and therefore the scope of the definition rests on miscellaneous provisions affecting delivery drivers.

Minimum Wage Law

The Minimum Wage Law specifies the right of the worker and the duty of the employer regarding the Minimum Wage. The term “worker” is defined under section 2 (a) of the Minimum Wage Law as “a person who earns living by wage obtained by carrying out the work of permanent work, temporary work using his physical or intellectual power by conclusion of employment agreement with employer to work at any commercial, production and service, agricultural and livestock breeding business. In this expression, apprentices and trainees, clerks and staff, outside workers, house maids and drivers, security men, guards and sanitary workers and staff include.” Under this term, delivery drivers may be identified as workers because the nature of work conducted by rider may remotely fall under the temporary employment for the conduct of service.

Workman Compensation Act

Under the Workman Compensation Act, the “workman” means any person who has entered into or works under a contract of service or apprenticeship with an employer, whether by way of manual labor, clerical work, or otherwise, and whether the contract is expressed or implied. Drivers may fall under this definition for having a contract of service to conduct manual labor.

Leaves and Holidays Act

For the purpose of the Leaves and Holidays Act, the rules identify the workers based on the time intervals on which the wages are earned. It is notable that the Law is silent on earnings based on the route instead of time intervals.  Under the leaves and holidays rules, a definition is provided for a piece-work worker who works on a preconditioned wage-rate based on the number of products or the extent of performance. The nature of work conducted by the driver may remotely fall under this definition.

Employment and Skills Development Law and Labor Organization Law

Under section 2(b) of the Employment and Skills Development Law, employee means the person who works for remuneration of skill job, fairly skilled job, non-skilled job in a Government Department and Organization, the Co‐operative society, Private or Joint‐Venture, any Organization, the Company. Drivers may be identified as employees under this definition for working non-skilled job in the Company.  Likewise in the Labor Organization Law, a broad definition of worker is a person who relies on his labor to engage in economic activity or to generate a livelihood, including a daily wage earner, temporary worker, worker engaged in agriculture, domestic worker, government employee and apprentice. This definition may also cover drivers.

In conclusion, the definitions of worker or employee provided under Myanmar labor laws are somewhat vague and inconsistent. The most obvious inconsistency can be found in some of the definitions requiring a person in an employment agreement to be identified as the employee when others do not. The definitions tend to be broad for the purpose of each law and lack specific provisions defining the exact nature of each type of employment. Therefore, it is safe to say that the status of delivery drivers as employees is unclear for the purpose of most labor laws currently in force in Myanmar.

Employment Relationship

Due to the vagueness of the definitions provided in Myanmar labor laws, it is important to explore whether the relationship between the drivers and the Company can be identified as an employment relationship or not. Ireland’s code of practice (“Ireland’s Code”) provides a comprehensive checklist to assess the existence of employment relationship for determining employment or self-employment status of individuals. By using this assessment, the employment relationship between the drivers and the Company can be analyzed as follows:

Under the control of another person who directs as to how, when and where the work is to be carried out.Drivers do not own the business but just the vehicle used.

Drivers have to submit application, attend training, and pass a short test to be selected.

Drivers have to follow a manual when delivering goods.

 

Remark: However, it is notable that no detailed instructions are provided as to how and when the work is to be carried out. The app just shows route of the order. The food is made by shops and there is no specific time frame for the orders.

 

Supplies labor onlyDrivers have to use their own vehicle for delivery.

 

Receives a fixed hourly/weekly/monthly remunerationDrivers are paid weekly based on the number and length of each delivery route.

 

Cannot subcontract the workDrivers have to enter into a contract with the Company and cannot subcontract someone else to do the task for them.

 

Does not supply materials for the jobDrivers use their own vehicles for delivery.

 

Does not provide equipment other than small tools of the tradeDrivers have to buy required gear such as hats, shirts, and delivery bag from the Company for 85000 MMK upon appointment.

Although drivers have to purchase the gear from the Company, it may be able to considered as supply since the Company allows instalment by means of pay cut.

Remark: Regardless, the equipment and gear may be considered as belonging to the drivers because they don’t need to return after using.

 

Is not exposed to personal financial risk in carrying out the work

 

Except for the maintenance of the vehicles used for delivery, drivers are not exposed to the financial risk by the Company’s failures.

Remark: However, since drivers have to pay for their own fuel or maintenance for the vehicle, they may be exposed to financial risk.

 

Does not assume responsibility for investment and management in the business

 

Drivers do not manage taking orders or managing the shops or restaurants.
Does not have the opportunity to profit from sound management in scheduling of engagements or in the performance of tasks arising from the engagement

 

Drivers only provide their labor for the purpose of delivering the food and have no interest in the Company.

Remark: However, the way drivers manage each delivery in terms of how fast they go may result in better payments.

 

Works set hours or a given number of hours per week or monthDrivers do not have to follow a regular working hour.
Works for one person or for one businessMost drivers only work for the Company.
Receives expenses payments to cover subsistence and/or travelThe Company arranges affordable insurance plan with special price for drivers but does not pay for the insurance.

 

Entitled to extra pay or time off for overtimeDrivers control the hours of work in fulfilling the job obligation.

Remark: However, the bonus system is controlled by the Company. Since the bonus system requires the driver to work more than the others, it can be considered as extra pay for overtime.

 

According to the assessment using Ireland’s Code, delivery drivers may not be able to consider themselves employed although 1) the drivers cannot subcontract; 2) drivers do not manage the business nor investments; and 3) the Company controls the bonus system which may encourage overtime work. Drivers show considerable control over the profit/losses and undeniable control over conducting the business in terms of deciding how many hours they work and the length of route they want to take.

Therefore, although the Company has the following controls over the drivers, it is undisputable fact that the nature of work of the drivers is significantly different from the regular standard of an employee.

  1. Way of conducting delivery
  2. Control over recruitment process
  3. Evaluation and assessment of the riders
  4. Regular payment based on the number and length of the route
  5. Assigning bonus based on performance
  6. Use of equipment branded by the Company

Conclusion

Based on the analysis provided above, it can be concluded that the delivery drivers cannot be considered as employees of the Company under Myanmar laws and the assessment provided in  Ireland’s Code. This means that the strike of the drivers cannot be considered as legal and according to the law, the Company has the power to cut off the relationship with the drivers subject to the provisions in the contract.

Thus, although it is true that the delivery drivers in Myanmar are being taken advantage of amid crisis, the problem lies deep within the weakness of the law itself. For this purpose, the International Labor Organization has recommended the establishment of a policy reflecting the followings (Recommendation No. 198);

  • provide guidance on effectively establishing the existence of an employment relationship and on the distinction between employed and self-employed workers;
  • combat disguised employment relationships in the context of, for example, other relationships that may include the use of other forms of contractual arrangements that hide the true legal status, noting that a disguised employment relationship occurs when the employer treats an individual as other than an employee in a manner that hides his or her true legal status as an employee, and that situations can arise where contractual arrangements have the effect of depriving workers of the protection they are due;
  • ensure standards applicable to all forms of contractual arrangements, including those involving multiple parties, so that employed workers have the protection they are due;
  • ensure that standards applicable to all forms of contractual arrangements establish who is responsible for the protection contained therein.

It is, however, wishful thinking that a government that truly works and cares about the working class emerges one day in Myanmar and builds better foundations for labor, aligned with the International Labor Organizations’ standards.

Nwe Mon Mon Oo is a JURIST Assistant Editor graduated from the University of Yangon, Myanmar. She is currently an LL.M. student at Chulalongkorn University, Bangkok, Thailand.