This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 02 TAIPEI 003856 
 
SIPDIS 
 
DEPT PASS AIT/WASHINGTON 
 
DEPT FOR EAP/RSP/TC 
 
FROM AIT KAOHSIUNG BRANCH OFFICE 
 
E.O. 12958: N/A 
TAGS: ECON TW
SUBJECT: Aftermath of Thai Labor Riots: Investigations and 
Practical Response 
 
Ref:  Taipei 03525 
 
¶1. Summary. In the aftermath of the labor riots involving 
Thai workers on Kaohsiung city's Mass Rapid Transit (KMRT) 
system (reftel), various civil and criminal investigations 
have begun, with some preliminary reports issued. Despite 
the fact that the laborers remain the target of a criminal 
investigation, steps have been taken toward resolving some 
of the issues that led to the riot.  End Summary. 
 
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The Investigations 
------------------ 
 
¶2.  At the instruction of Premier Hsieh, Chang Ting, the 
Kaohsiung Prosecutor's office has launched an investigation 
into possible criminal acts relating to the August 21, 2005 
Thai labor riots in Kaohsiung.  The Chief Prosecutor in 
charge of the investigation, Chief Prosecutor Gao Da-fang, 
has met with several executives of the Kaohsiung Rapid 
Transit Corporation (KRTC), the Hua Pan Management Company, 
a Thai delegation composed of members of the Thai Parliament 
and representatives of the Thai Labor Ministry, and a few 
Thai workers. Inspectors have obtained copies of contracts 
that were signed between the KRTC and the Hua Pan Management 
Company (a labor brokerage firm) and the accounting books of 
the two companies.  According to an AIT/K source, KRTC had 
allotted NT$29,500/month (USD920) for each worker.  The 
money was transferred to Hua Pan, which was responsible for 
the distribution of the laborers' salaries, but only 
NT$19,000/month (USD590) was given to each worker. Officials 
are investigating what happened to the difference of 
NT$10,500/month (USD330) that was supposed to be paid to 
each laborer. 
 
¶3. In the investigation to date, Prosecutor Gao has 
completed interviews of eighteen Thai workers who allegedly 
resorted to violence in the incident. The prosecutors have 
detained Hua Pan's president Yen Shih-hwa and its financial 
executive and also interviewed KRTC's responsible 
executives. The prosecutor's investigation is limited to 
activities that violated Taiwan's criminal laws, including 
both the workers' actions, and the allegedly corrupt money 
flow between KRTC and Hua Pan.  While Gao reported progress 
in investigating the Thai laborers, he had no comment on the 
corruption investigation other than to say it was ongoing. 
 
¶4.  Having conducted its own investigation of the matter, 
Kaohsiung City Government's Labor Bureau released a 
preliminary report on the circumstances leading up to the 
riot.  According to the report, the incident stemmed from 
the Thai laborers' dissatisfaction with treatment received 
from the labor management company, including poor living 
conditions, withholding of pay to which they were entitled, 
and unreasonable restrictions including a prohibition on 
making phone calls or consuming alcohol during their off- 
duty time. 
 
¶5.  According to the report, neither the Kaohsiung City nor 
Kaohsiung County governments were informed of the 
contractor's policies for recruiting and managing Thai 
workers.  Kaohsiung City awarded the contracts for 
construction of the KMRT, and, the Kaohsiung City Labor 
Bureau determined that the City is responsible for 
supervising KRTC's construction and safety procedures 
However, since the Thai laborers are housed in Kaohsiung 
County, they fall under the jurisdiction of the County 
Government during their off-duty hours. 
 
¶6.  The report stated that the Executive Yuan's Council of 
Labor Affairs (CLA), the KRTC, and the Hua Pan Management 
Company all failed to submit required reports to the local 
governments on the recruiting and management of foreign 
laborers.  Kaohsiung County Government, which is responsible 
for the treatment of Thai workers at their dormitory, was 
not informed by CLA or the Hua Pan Management Company of Hua 
Pan's policies for managing the Thai laborers.  The report 
makes no mention of any effort by the City or County 
Governments to obtain the delinquent reports.  The Kaohsiung 
County Government has only three employees assigned to 
monitor the living situation for all foreign laborers living 
in the area.  The report points out that Kaohsiung City 
Government's Labor Bureau did not receive any request for 
assistance from Thai workers prior to the incident. Based on 
the report, KRTC was fined NT$300,000 (USD9,000) for 
mismanagement. 
 
¶7.  The Executive Yuan's Council of Labor Affairs (CLA) also 
published an investigation report on the Thai labor riot. 
The report was made by the special investigation team, which 
consists of representatives of Thai government, local NGOs, 
academics, and religious groups.  The report focused mainly 
on human rights, management, and the system for recruiting 
foreign laborers.  The report concluded that the central and 
local governments shared some responsibility for the riot. 
The report goes to recommend that KRTC be barred from hiring 
foreign labor.  The special team also recommends a formal 
investigation into rumored corruption on the part of the 
KRTC and Hua Pan Management.  They specifically questioned 
the design and financing of the dormitory that housed the 
workers.  The report criticizes Kaohsiung City Government 
and County Government for negligence in supervising the 
hiring and management of foreign laborers.  It states that 
the local governments failed to react to Thai laborers 
complaints prior to the riot. 
 
¶8.  According to the report, the CLA has decided to 
subsidize local governments so that they can hire civil 
servants to hire and oversee foreign laborers. 
 
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Practical Measures 
------------------ 
 
¶9. In order to provide the Thai workers with a better 
working environment, the Kaohsiung City Government has taken 
the following steps: 
 
  ¶1.   Ordered KRTC to immediately improve the living 
     environment for foreign laborers. The existing dormitory, 
     designed to house 800 people, has been home to 1700 workers. 
  ¶2.   Arranged a permanent dormitory at Hsiaokang training 
     center for lodging of 150 Thai workers, who moved in on 
     August 30. Former Acting Mayor Chen spent the night with the 
     workers when the new facility opened. 
  ¶3.   Requested that KRTC not repatriate any Thai workers 
     involved in the incident. 
  ¶4.   Arranged to provide legal assistance and assign defense 
     attorneys if necessary 
  ¶5.   Set up a blue ribbon panel, led by Kaohsiung Deputy 
     Mayor Cheng, to investigate KRTC's activities, and to ensure 
     that KRTC makes improvements in the living situation for 
     foreign laborers. 
 
¶10.  In a further effort to resolve the situation, Acting 
Kaohsiung Mayor Chen Chi-mai requested that the KRTC 
terminate its contract with Hua Pan Management.  Instead, he 
requested that KRTC, with assistance of the city government, 
directly manage the Thai laborers.  The Kaohsiung City 
Government is also considering making a request that KRTC 
revise the composition of its board of directors.  KRTC has 
made a quick response to the city government's request that 
vice chairman Chen Min-hsien  step down from the vice- 
chairman position in the board of directors, but, despite no 
longer being vice-chairman, he still remains a member of the 
board due to his holding of 7 percent of KRTC equity. 
 
¶11.  AIT will continue to follow and report on the case as 
it develops. 
 
 
Thiele 
 
Keegan