The above is a montage from the publication “Modern Slavery Reporting: Case studies of leading practice” published by the UK Business and Human Rights Resource Centre. Link to PDF copy.

By TWC2 volunteer Kaavya G, based on an interview in August 2020

This is what Ali Mohammed told me:

He had been working in Kowata Engineering & Construction for a year and a half under a Work Permit with a validity of two years. He lodged a salary claim in early 2020 on the basis that he was supposed to be paid a basic salary of $1,200 a month according to his In-Principle Approval (IPA) (see Glossary for explanation), but instead, he was paid at a rate of $24 per day. The latter rate amounted to around $600 – 700 a month. Therefore he wanted to claim the difference in his salary, which he said amounted to over $13,000.

(Despite his mentioning this figure in the interview, we note from the case documentation that his written claim was for a little over $10,000.)

Before approaching the Ministry of Manpower (MOM), Ali said he had a discussion with his boss. He was even willing to accept 50% of what he was owed. To this, Ali said his boss replied, “Wait wait I give ”.

However, nothing changed and so Ali lodged a claim at MOM. When the boss learned of this, the boss allegedly told Ali, mockingly, “One dollar also cannot give, you do anything you do lah.”

Once a salary case is filed at MOM, it is normal procedure for mediation sessions to be arranged in an attempt to arrive at an amicable settlement. However, said Ali, his boss did not attend and so the case went all the way to the Employment Claims Tribunal (ECT).

TWC2 helped Ali prepare his case for the ECT.

In the end, the tribunal awarded him only $914, nowhere near the value of the starting claim. Why this big difference you may ask? I put this exact question to him as I was shocked at the vast difference. He told me “Haha IPA alibaba”, by which he meant that the original IPA which had promised a basic salary of $1,200 a month was false or a misrepresentation.

He proceeded to tell me that his boss made a new IPA behind his back and made him sign documents which may be related to him accepting a lower salary. I asked if he had anyone to back him up, but his reply was that his friends were afraid to come forward in fear of losing their jobs. I was curious and asked if he was willing to fight back, but he told me “No. Going back to Bangladesh next week.”

I was disheartened for him and told him maybe he should try once more, but he told me it was not worth it and he wants to meet his family.

Was the dispute over the terms of contract?

At that point, he showed me a copy of an employment contract dated July 2018 — roughly when he started with Kowata Engineering. One particular line caught my attention “You will be paid a basic monthly salary of $1200 inclusive of OT + Allowance”. I assumed that overtime pay was the major ground of dispute, in which case, his stance would be well supported by law.

A page on MOM’s website states clearly:

You can claim overtime if you are:

  • A non-workman earning up to $2,600.
  • A workman earning up to $4,500.

The overtime rate payable for non-workmen is capped at the salary level of $2,600, or an hourly rate of $13.60.

For overtime work, your employer must pay you at least 1.5 times the hourly basic rate of pay. Payment must be made within 14 days after the last day of the salary period.

Under the law, and as seen from the penultimate sentence above, the basic rate cannot include overtime pay. Overtime pay must be on top of basic pay, at a rate of 1.5 times basic. Consequently, the clause in the contract that Ali showed me cannot be legally binding.

But that’s not the story at all

My editor then spoke with the TWC2 volunteer who had assisted Ali with his case and the story came back quite different!

This is what he told me:

It turned out that there was a subsequent contract dated December 2018, about five months after the first. The company argued that, based on the second contract, the basic rate of pay was $3 per hour. For a typical eight-hour day, that would be $24 per day. This second contract had been signed by Ali. Therefore, for the claim period in question (January 2019 to January 2020), Ali’s claim of $1,200 a month in basic salary would not be valid.

What Ali had showed me was a clause in the earlier contract, whose terms had been superseded by another contract, and thus was beside the point.

Ali had indeed mentioned in our conversation that he was made to sign some documents sometime during his employment but he didn’t know what those were. He said he had not been given copies of what he signed, so he couldn’t show us.

The tribunal found this second contract of December 2018 to be valid (making his basic salary $24 per day instead of $1,200 per month), and dismissed most of Ali’s claim. Only a minor part of his claim — about not being paid at all through the Chinese New Year holidays — was found valid and was the key basis for the order of $914 issued by the tribunal.

Was there free and informed consent?

When workers end up with a second contract within months after the first, alarm bells ring. Was there informed and freely-given consent? If not, can any contract signed under some degree of coercion or misrepresentation be treated as valid in the eyes of the law? See Editorial Comment below.

Here at TWC2, we work towards highlighting and reducing the gaps in our laws, regulations and our justice system through which migrant workers fall.

TWC2 also strongly advocates that employers should give their employees a week before signing any documents. It will give them more time to think and they will also feel less pressurised. There will be sufficient time for them to be able to consult TWC2 to get a better translation or better understand what they are being asked to sign.

We have heard many similar cases like these and its important to raise awareness regarding these issues.

On the question of informed consent:

Very often, and in this case too, the new contract that a migrant worker is asked to sign is written in English. Almost always, no written translation is provided. In this case too, there was no written translation, though the employer argued at the tribunal that another Bangladeshi employee, a certain Nazmul, described as a manager in Kowata Engineering, “explained the content to Ali.”

Ali disagreed with that statement and told the tribunal that Nazmul did not explain anything to him. Instead, “he simply told me that I had to sign and thumbprint the December Contract.”

What to make of this difference of narrative? Considering how the new contract lowers the salary and thus how difficult it would be to gently explain the pay reduction and gain Ali’s acceptance, it is more plausible that pressure was applied to get him to sign it. If pressure was going to be applied anyway, then the logic could be: Why bother to explain and persuade?

The tribunal might have been wrong not to enquire closely into and give due weight to the circumstances surrounding the signing of the December contract, and thereby not questioning if there had really been informed consent.

On the question of whether it was freely-given consent:

The tribunal should have borne in mind that the December contract, by lowering the salary, would not have been in Ali’s interest. Therefore it must immediately become doubtful whether Ali would have freely given his consent to something that was injurious to himself.

TWC2 urges the courts to always consider this question and the circumstances of a migrant worker’s situation. For example, migrant workers have no automatic right to seek a new job after being terminated from one. When an employer tells a worker to sign a new contract that lowers his salary, what’s the alternative for the worker? He would know that if he refused to sign, he would lose the job, yet be unable to find a new one easily (or at all). He would need permission from either the existing (and unhappy) employer, or from MOM to look for a transfer. MOM does not give permission easily in such circumstances.

It’s as if someone points a knife at you and says, “Give me all your money”. If you then hand over your money, was it freely-given consent to “donate” the money to the knife-wielder? The simple fact that you were in a situation where the alternative was much worse (and the perpetrator was exploiting your vulnerable position) should be enough to cast doubt on how freely-given that consent was.

Contracts must contain consideration to be valid. What was the consideration given to Ali to agree to the second contract that lowered his salary? In a very narrow sense, the consideration was the continuation of employment. But that would require us to frame the question very narrowly. Once we take into account that there was already a subsisting contract between parties that gave him employment and at a better salary, the question should be phrased: What was the consideration given to Ali to accept a reduced salary? If no consideration can be demonstrated, would the second contract be valid?

More generally, courts should always be alert to the possibility that they are dealing with a case of contract substitution, which is one of the indicators of human trafficking as laid out by the International Labour Organisation (ILO) and the United Nations’ Palermo Protocol.