By Panu Wongcha-um and Pracha Hariraksapitak
BANGKOK/MAHACHAI, Thailand (Reuters) - Thailand's junta delayed on Tuesday parts of a new labor law aimed at regulating the foreign workforce after the decree sparked panic and prompted more than 60,000 foreign workers to flee from the country.
The military government, which has ruled since a 2014 coup, has invoked Article 44, a security order that gives it power to push through policy, to delay the law that imposes heavy fines on employers and employees who do not have work permits, a senior official said.
The original decree was issued in part to tackle human trafficking concerns raised by the international community, Deputy Prime Minister Wissanu Krea-ngam told reporters.
"The government had to issue this law because we are being watched by the foreign community in terms of ... human trafficking. If we don't issue this law they will not buy our goods. So we have to do it," Wissanu said.
The U.S. State Department last month left Thailand on a Tier 2 Watchlist, just above the lowest ranking of Tier 3, in its annual Trafficking in Persons (TIP) Report because it did not do enough to tackle human smuggling and trafficking.
Wissanu said the government would delay implementation of four sections of the law for six months.
He did not elaborate but the labor ministry said it would suspend parts of the law until January in order to give both workers and their employers more time to get their work permits.
Thailand is a destination for many migrant workers from poorer neighboring countries, including Myanmar and Cambodia.
Official estimates put the number of foreign workers at 3 million but rights groups say the real figure is far higher.
Many work in Thailand without legal documents, leaving them vulnerable to exploitation by brokers and sometimes traffickers.
'WORK NO THAI WANTS'
Myanmar said that on Monday, it received more than 5,000 workers returning from Thailand across their border.
"Most of the workers went directly back to their home towns. We help them with the transport," said Aung Htay Win, a Myanmar labor ministry official.
Migrants are predominately employed in low-skilled jobs in Thailand's multi-billion dollar fishing sector, in agriculture, construction, manufacturing and as domestic workers.
Businesses have complained that the new regulations have caused a shortage of workers in the construction and fishing sectors.
Property development and construction, which have had a stellar performance in an otherwise sluggish Thai economy, have felt the brunt of the departures.
"We lost 75 percent of our workers overnight," an executive at a Bangkok construction firm, who declined to be identified, told Reuters.
In the fishing port of Mahachai, south of Bangkok and home to a many migrants from Myanmar, workers and business people said they were worried.
A Myanmar worker who identified himself as Kway, 36, said he had a work permit but his wife and young child did not have proper papers.
"I sent my wife and child back to Myanmar because I am not sure what will happen to them", he said.
Other residents said they feared the economic impact.
"The fishing businesses needs a large labor force and it is work that no Thai wants to do so I don't know why the government has introduced this new legislation," said Ton, 46, a shrimp vendor.
"Many people are afraid to come out of their homes," said the manager of a grocery shop.
(Additional reporting by Amy Sawitta Lefevre, Aukkarapon Niyomat, Chayut Setboonsarng, and Panarat Thepgumpanat in BANGKOK and Lei Win Naing Shoon in YANGON; Writing by Amy Sawitta Lefevre; Editing by Robert Birsel)