FSM Labor Temporarily Says No to Foreign Contract Workers

FSM Labor Temporarily Says No to Foreign Contract Workers


In a letter dated August 30, 2016, Mr. Glayne B. Franklin, Acting Chief of FSM Immigration and Labor, communicated to Mrs. Malpihna Nelper, Chief of Pohnpei State Labor Office, stating: 

“[e]ffective today August 30, 2016 all renewals and extensions of employment packages under the private sector will be returned to your office without my endorsement.”

In the letter 49 private companies–all seeking foreign worker renewals–are named ranging from engineering and construction companies to stores and auto shops.  Even the Ramp & Mida Law Firm is named in the letter.  (Click HERE for Letter).

On September 1, 2016, the Chuuk branch of the FSM Immigration and Labor office issued a letter to the private sector stating,

“[a]ll renewal or extension applications of foreign contract workers in the private sectors submitted will be denied and returned for noncompliance of 51 FSMC §114 & § 152(2).” 

“[a]ll employers of the those foreign contract workers in the private sectors that are not in compliance of 51 FSMC §114 & § 152(2) are hereby instructed to make necessary arrangements for their foreign contract workers exit out of the FSM.” (Click HERE for FSM Labor Law).

ISSUE #1: Does the FSM National Government Have Jurisdiction Over Labor within the States?

Does the FSM national government have the power to regulate labor within the states?  We argue it does not.

A distinguishing point must be made between “immigration” and “labor”. Immigration is undoubtedly a national power but not the regulation of employment within the states.  The FSM constitution does not specifically mention employment within the states as a national power and, thus, it is arguably a state power.

Also, it is important to note that state officials generally have greater knowledge of state affairs and should handle activities such as employment.  As stated in a national court opinion (In re Nahnsen, 1 FSM Intrm. 97, 107, 109 (Pon. 1982)):

“State officials generally should have greater knowledge of use, local custom and expectations concerning land and personal property.  They should be better equipped than nat’l gov’t to control and regulate these matters.  Framers of Constitution specifically considered this issue and felt that powers of this sort should be state powers.”

We are of the opinion that each of the states have the exclusive power to deal with employment within state boundaries; therefore, we deem the national government’s action unconstitutional as an encroachment onto state powers.  Ultimately,however, the national court will have to decide this matter as we found no case law dealing with the issue.

ISSUE #2: Is the FSM National Government in Compliance with its Labor Laws?

Assuming a state does not challenge the FSM national government’s authority to regulate state employment, is the FSM national government in compliance with its own laws in taking these actions?

We argue that the FSM national government is not in compliance.  In fact, the law firm formally launched a petition on behalf of a client with the FSM Department of Justice, and FSM Immigration and Labor.  The client agreed to the petition being used for the blog so long as its name is redacted.  Click HERE for the Petition.

The arguments made in the petition are clear: the national government does not have the power to regulate employment within the states; even if it did, it has the duty to conduct surveys on manpower needs and has failed to do so.  Its failure should not be blamed on the private sector.

It must be noted that in response to the petition, the FSM DOJ notified the law firm on September 13, 2016 that the letter issued by Mr. Glayne B. Franklin, Acting Chief of FSM Immigration and Labor, would be rescinded.  It is not clear whether the letter was rescinded and/or whether the FSM government will continue to regulate employment within the states by refusing to renew foreign worker applications.

The FSM Government is Attempting to Ensure Local Workers Receive Preferential Treatment

In both letters issued by FSM Immigration and Labor, Title 51 section 114 of the FSM Code is cited which state:

“Resident workers [FSM Citizens] shall be given preference in employment in the Trust Territory in any industry or occupation for which such workers are qualified and available. Nonresident workers shall be employed only to supplement the labor force of available and qualified resident workers.”

On the face of the letters the concern is employers not giving local workers preferential treatment for jobs. The issue with the letters is FSM Immigration and Labor is assuming that by immediately pushing out foreign workers like engineers, plumbers, carpenters, electricians, masons, welders, doctors, nurses, teachers, and so forth, employers will give locals preference or will be forced to hire locals.

The proposed swift move by FSM Immigration and Labor make no sense.  As a local attorney and business owner in Chuuk (i.e. L5 Hotel), the companies I am associated with employ a total of 34 local workers (7 from the law firm and 27 at the L5 Hotel).  The L5 Hotel is composed of 100% local employees.  I believe, although I could be wrong, that many businesses already give preferential treatment to local employees.

The biggest issue is there are not enough “qualified” locals.  Perhaps our governments need to focus more on how to bring back qualified locals to our country.   Worth noting is that whether someone is qualified is a conclusion that I believe the private sector must make not the government–state or national.  The fact that a local meets the educational qualification does not mean that he/she has the work ethics, thus, would be deemed unqualified from the private sector point of view.


We feel the states have the exclusive power to deal with labor within state boundaries, therefore, the FSM national government’s action is unconstitutional as an encroachment onto state powers.  Furthermore, the FSM national government is obligated to conduct surveys on manpower needs and has failed to do so as required by law.

In the end, a word of caution.  Whether the FSM national government or the state government controls labor, both must be careful that they do not take any action that could undermine our already weak economy which depends heavily on foreign workers.