* Exploitative practices cost workers $21 billion a year
* Desperate people lured by loans and cash advances
* Abuses most prevalent in Asia and among migrant workers
By Laura MacInnis
GENEVA, May 12 (Reuters) - Governments should crack down on unscrupulous recruitment practices that condemn up to 8 million construction workers, farm hands, and nannies to a contemporary form of slavery, a United Nations agency said on Tuesday.
Recruiters use cash advances to lure desperate people into jobs in which they are mistreated, deprived of pay, and charged exorbitant fees, according a new report on forced labour from the International Labour Organisation.
Though most common in Asia, the ILO said such exploitation takes place worldwide and bleeds as much as $21 billion from the annual wages of migrant workers.
It cited "collusion between recruiters in sending countries and employers in destination countries to trick these vulnerable migrants out of fair wages and employment conditions."
"This is widely seen as a modern form of debt bondage."
Chinese workers pay up to 2.5 times their expected annual income in recruitment fees to obtain jobs in the United States, the Geneva-based ILO found.
And in Indonesia, it said that many women hired as domestic workers abroad must agree to have as much as 90 percent of their salary paid directly to the recruitment agency in their first five months working overseas.
The ILO raised particular concerns about Thailand's shrimp, fishing, and seafood processing industries, and among shrimp producers in Bangladesh, and said labour coercion was a problem on farms and in rice mills, stone quarries, and handloom weaving factories across South Asia.
Indian brick kiln workers are often given loans and cash advances worth several months of earnings and then forced to work six days a week for 16 hours a day, leaving them with nowhere to turn until their debts are paid, the report said.
"Such situations point to a need for better oversight of recruitment agencies and their practices," it said.
"There is a need for more consensus and clearer guidelines on issues such as fee charging, contracts of employment, or the rights of short-term migrants to change jobs and negotiate terms of employment," the report said.
It also singled out Myanmar because of the "continued use of forced labour" by the former Burma's military rulers.
INFLATED FEES CAUSE DEBT
The ILO estimates there are 12.3 million people worldwide in some form of forced labour or bondage, including 4.2 million sex workers and 8.1 million employed in agriculture, construction, manufacturing, and other industries.
The workers at highest risk in Latin America are in garment factories, on farms and in private homes, where domestic staff can be isolated and can face abuse, the report found.
Much like in Asia, the ILO said employers in Latin America entice workers with cash advances and then charge them inflated fees for food and shelter that keep them in debt.
Other abusive practices include compulsory overtime, such as the case of workers in Guatemala threatened with dismissal for refusing to work shifts for up to 24 hours, the ILO said.
Labour laws in the Middle East give employers undue control over their staff, including workers who travel across Africa and Asia to work in construction, the report said.
Inflated visa charges, high recruitment and transit fees, and altered contract terms have also been a problem for migrants travelling to Gulf states from Pakistan, Bangladesh, and other countries, the ILO said.
Forced labour is also a problem in Africa, according to the report, which cited the example of seasonal workers in southern Ghana who are regularly deprived of wages. Kenya was described as a source, transit route and destination for people trafficked for forced labour and commercial sexual exploitation.
In Europe, it said Ukraine was in a similar situation, as both a destination and origin for people in bondage. The former Soviet republic has attracted inflows of coerced workers and sex workers from Moldova, Kyrgyzstan, Uzbekistan, and Russia.
"While most victims identified by authorities are women trafficked for sexual exploitation, the number of identified cases involving men trafficked for labour exploitation is growing," the ILO said of Central and Eastern Europe. (For the full report, see www.ilo.org/forcedlabour) (Editing by Stephanie Nebehay and Jon Hemming)