Myanmar will allow unions to be formed and workers to strike when a new law kicks in this month.

Deputy Labor Minister Myint Thein told the Democratic Voice of Burma, which operates out of Norway, that President Thein Sein signed the bill into law last week.

The labor organization bill cancels a nearly 60-year-old anti-labor union decree, the 1962 Trade Unions Act, which effectively banned trade unions.

Myint said the law, which takes effect at the end of the month, will allow more transparency in the labor market and also boost the country's ability to attract foreign investment.

"It will help us get more benefits for the economy because our labor organization law means workers can organize according to their will," Myint told DVB. "Our government transparency will attract foreign countries and foreign direct investment can flow freely."

Private sector workers will have to give at least three days notice and public sector employees must allow 14 days notice. Striking workers won't be allowed to block transport routes or security infrastructure.

Workers in officially designated essential services won't be allowed to strike.

An employer who dismisses workers because of union affiliation or because they have gone on strike faces a fine of up to $120 and a year in jail, Myint said.

To be an official union, the organization must have at least 30 members who can leave whenever they wish. Unions will have to register with a government-appointed agency.

Steve Marshall, the International Labor Organization's representative in Myanmar called the law "a massive move for the country" in terms of social and economic development.

"You don't join unions to simply be in a club. You join unions for collective bargaining and proper economic management of the labor market," Marshall told DVB.

The ILO has had a representative in Myanmar, formally known as Burma, since 2002 when it signed an agreement with the ruling military government, many of whose members are now civilians in the military-backed government that took office in March after being elected in November.

The main job of the ILO's representative in Myanmar is to help victims of forced labor seek redress.

The ILO condemned the junta in 1998 for its "systematic and widespread" use of forced labor. The military leaders were treating civilians as an unlimited pool of unpaid laborers and servants, it said.

In June, Aung San Suu Kyi, the pro democracy advocate who has spent many of the past 20 years under some form of arrest and incarceration, urged the ILO to increase its activities in Myanmar.

In a video message to the ILO's 100th International Labor Conference in Geneva, Suu Kyi made "a special appeal for my own country, Burma," to improve working conditions. She said Myanmar was once considered the nation most likely to succeed in Southeast Asia.

"But now it has fallen behind almost all the other nations in this region," she said.

"The work of the ILO in our country has highlighted the indivisibility of social, political and economic concerns. In its attempt to eliminate forced labor and the recruitment of child soldiers, the ILO has inevitably been drawn into work related to rule of law, prisoners of conscience and freedom of association."

Nyan Win, a spokesman for Suu Kyi's National League for Democracy party, told the BBC the move to allow unions was in the right direction. Labor rights had "improved from nothing to something," he said.

The establishment of the union law is another apparent move toward a more democratic society for a country ruled by juntas for most of the past 50 years.

But critics of the new government regard it as a civilian veneer on an ostensibly military administration -- one-quarter of the seats in Parliament are reserved for military appointments. Most of the government leaders are former senior military figures from the previous junta who retired to run as civilians.

A test of the government's tolerance of unions will be how the union-in-exile Federation of Trade Unions of Burma is treated if the organization decides to come in from its shadowy existence. It has been holding annual "conferences" at "a certain place in the Thai-Burma border area," the FTUB Web site says.

It was formed in 1991 after the junta clamped down on unions. In 1998 Myo Aung Thant, a senior FTUB member, was sentenced to life in prison for labor organization activities inside Myanmar.

As late as 2003, two FTUB members reportedly were sentenced to death. The ILO-affiliated International Committee for Trade Union Rights said they were sentenced for attending an FTUB meeting on the Thai border where they were relaying information on forced labor to the ILO.