[ad_1]
Migrating from one country to another to seek a better, more dignified life for oneself or for one's family is one of the most widespread human activities of our time. The world is experiencing a dramatic increase in legal migration abroad for work and there are currently 250 million migrant workers from developing countries working in developed countries. Annual cross-border remittances have increased to over $ 600 billion.
Migrant workers are not only homeholders of their families at home, but also in the case of many developing countries, the money they send home represents a significant percentage of annual GDP. For example, in the Philippines, over 10% of GDP (about 30 billion US dollars) comes from foreign workers. Such a globalized macroeconomic phenomenon is unprecedented in human history.
Worker migration is a stakes for the global economy. But, ironically, the existing recruitment systems in the host countries with the largest migrant population are inefficient and open to abuse, which implies many passages exclusively on paper.
Third-party agencies and other intermediaries easily tamper with paper documents and even with centralized databases used by governments to approve workers' entry. Their goal is often to extort money from migrants and even physically abuse them or enslave them.
The less qualified the migrant worker is, the more likely it is that corruption plays a role in recruiting to work abroad.
For example, construction site workers must face exploitation by recruiting agencies that demand bribes for the opportunity to work abroad. To pay agents, migrants usually sell all their belongings, including their ancestral land, or make a bank loan before they even start making money. Once they start working, if they get sick, they are injured or if their company fires them, they have nothing but debts.
The exploitation also begins with the replacement of the employment contract by employers, in which a migrant worker will sign a contract in their country of origin, but will find a different one when he arrives at his place of work. The labor contracts to which these workers are sometimes forced to sign are illegal and do not take into account their basic human rights.
Today's situation is unsustainable and many nations recognize the need to do things differently. After all, if the governments of countries that rely heavily on migrant workers do not eliminate illegal practices, it will eventually be more expensive once workers are exploited, abused or imprisoned and become a financial burden for their host country.
How could blockchain technology solve these problems?
A technological solution is at hand – the blockchain. This tamper-proof ledger essentially automates trust, which is exactly what is required here.
There is a lack of trust between the government agencies and the governments of origin of migrant workers. Missing between recruiting agents and employers and between almost all the participants in the legal migration process.
The current system of recruitment of migrant workers attempts to solve this problem manually using human labor or third party agents to verify identity and transactions. These agents are the nodes where corruption and exploitation practices infiltrate the system.
Instead, using peer-to-peer verification on the blockchain, information is shared in real time – which means that no single participant can ever have a different version of the ledger. This eliminates any possibility of collusion or fraudulent activity.
The nodes of the distributed ledger included government agencies from home and host countries, job applicants, employers, recruitment agencies and non-governmental human rights organizations. Each phase of the recruitment would be updated on the ledger only when each party signs and verifies the transaction.
Another important step is the storage and verification of the identities of all the parts of the employment contract. An encrypted profile of each worker would be stored on the ledger including the chronology of work and economic identity.
Many migrant workers would not have had the opportunity to build their own credit or employment history and these data profiles are important for their future life.
Employers would also be profiled with reviews and feedback from workers, as well as results of formal evaluations and audits. Recruitment agents would also be allowed access to data on registered applicants with the required skills and experience.
Rationalization of salary transfer
The next step would be to integrate labor contracts and workers' identities with salary payments, to ensure that salaries are paid by employers according to contractually agreed terms and that no illegal deduction is made. .
Wage money transfer home is another sore point. Again, blockchain technology could make it much cheaper, more efficient and faster for migrant workers to send money to their families. The integration of the recruitment platform with salary payments would allow collaboration with blockchain-based solution providers in the money transfer space.
Fintech companies in Asia are actively developing low-cost blockchain money transfer systems. One of these fintech companies is the Noah Project rationalize remittances initially from Japan to the Philippines, based on its token.
With blockchain, both the sender and the recipient would be able to track down the money and know exactly if the funds have reached their destination or not.
Conclusion
Blockchain technology is the right tool to spread trust and we must use it to have a lasting impact on the lives of millions of people.
Clarke Robertson is CTO of Infrastructure, former Vice President of ValueCommerce (Japan) and co-founder and CEO of WME Limited.
