SCMP Wednesday, October 3, 2001
Trouble at the workplace
Staff at a Taiwan-owned food factory on the outskirts of Beijing were angry that the company would not sign contracts nor limit the working hours and took their claim to the county labour tribunal earlier this year. It refused to hear the case - and the company fired the workers' leaders.
At a foreign packaging plant in Tianjin, 71 workers were so angry that the firm would not give them fixed-term contracts that they detained the six managers last year - one American, one Malaysian and four from Hong Kong. Police were called and rescued the six before they were injured.
These are two examples of the rising tide of industrial disputes that have reached a level unseen in modern China. According to figures from the Ministry of Labour and Social Welfare, there were 207,605 labour disputes last year, equal to the number during the entire decade of the 1950s. Of these, 135,206 were officially registered, an increase of 12.5 per cent over 1999.
Most disputes occurred in the richest and most industrialised parts of China, such as Jiangsu, Guangdong, Shanghai and Beijing, while the four areas at the bottom of the list, with 1,061 cases between them, were Tibet, Qinghai, Hainan and Ningxia, which include three of the poorest areas in China. Last year, Shenzhen handled more than 12,000 disputes, compared with 209 in 1993, and Beijing 7,480, compared with 1,584 in 1995. The main disputes concern overwork, no holidays, delayed or no pay, being unable to leave the factory site, noisy and dangerous conditions and under-age workers. Most vulnerable are men and women between 15 and 25 from poor rural areas who come to the cities of the east and southeast to accept almost any job.
China's legal system and arbitration procedures are woefully ill-equipped to deal with the flood of cases, especially when local governments usually side with the employer against the workers in order to protect an important source of tax revenue.
"Labour relations in China have gone back to the level of the Industrial Revolution in the 19th century in Europe," says Han Zhili, a labour activist at a welfare centre run by the ministry, where workers can take their complaints. "The conditions of workers in many private and foreign-owned companies are those of primitive capitalism - excess hours, low wages and a harsh, severe contract."
Although the figures show such disputes are common in all kinds of companies - state-owned, collectives and private and foreign-owned firms - Mr Han says the worst abuses occur in the coastal cities of the southeast, especially in companies owned by South Korean and Taiwanese firms.
"Once foreign capital began to set up plants in China, these disputes between management and labour began to appear," he says. "Six years ago, one South Korean firm forced its Chinese employees to kneel."
In a Taiwanese factory, which makes paper products in Shenzhen, a manager found 5,000 yuan in cash missing from his desk on the morning of September 28. He and two others went to a dormitory where 15 female night-shift workers were sleeping. They were woken up, had their belongings searched and were even ordered to undergo a body search conducted by a female manager. No money was found. After the local media reported the case, the plant paid 3,000 yuan (about HK$2,830) in compensation for causing distress to the 15 workers.
In a similar case, also in Shenzhen, 56 female workers at a South Korean company received compensation after complaining they were strip-searched in July.
"Now, China has 300,000 companies with foreign investment and these disputes are increasing. Faced with the inhuman way they are treated, workers are being forced to take action," said Mr Han.
For him and other activists, the abuses are an inevitable result of the labour market. China's rural areas have a surplus of labour variously estimated at 100 million to 200 million people, plus more than 10 million laid-off in the cities, giving employers an inexhaustible supply of employees.
Yang Tiren, a professor at People's University in Beijing, says: "In the conditions that prevail in China, the enormous surplus of labour gives a huge advantage to the employer. Add the fact that the legal system does not function properly and the Government's role is weak. That means this situation will continue for at least five to 10 years."
Also helping the employers is the intense competition among local governments to attract domestic and foreign investment. Counties are reluctant to impose strict labour and environmental regulations for fear of deterring investors.
An example of how a local authority protects an illegal employer came to light in July, with reports of a serious accident caused by a water leak in a private coal mine in Nandan, a poor county in the southwest province of Guangxi. The mine owner, Li Dongming, as well as the county government denied that any miner had died in the accident. But reporters were sent to the district to try to find out more. As they set out to interview families of the miners, they were reportedly met by men armed with guns and knives who told them to leave the area or be killed. County officials are said to have done all they could to stop the interviews.
But suspicions were so strong that Premier Zhu Rongji set up an investigation team led by Li Rongrong, chairman of the State Economic and Trade Commission, and sent him and Jia Chunwang, Minister of Public Security, to Nandan. It took three weeks after the accident on July 17 to find out that at least 81 miners had been killed. Local people said that nearly 400 were down the pit at the time. The Communist Party chief and mayor of the county were dismissed and were put under disciplinary investigation.
Mine owner Li was arrested. According to mainland press reports, the officials from Beijing discovered that Li, a former primary school teacher, was one of the richest people in Guangxi thanks to profits from his tin-mining operations, which accounted for one third of the income of Nandan and, along with a bribe of 20 Santana cars, gave him virtual control of the county government.
Those who threatened the reporters were part of Li's private army of 300 people armed with machine guns and pistols equipped with silencers, on which he spent six million yuan a year.
In October last year, 200 men died in one of Li's mines, according to the mainland media. The county then reported a death toll of 38. Li paid the families of the victims between 20,000 and 100,000 yuan each on condition they did not speak of the deaths.
Mr Zhu was enraged not only at the high death toll and poor safety standards in both incidents but at how easily an entrepreneur allied with a criminal gang could take over a local government.
According to the ministry figures for last year, state firms accounted for 24.2 per cent of the disputes. Many are related to dismissals and the sale of assets to private or foreign companies, which often lead to public protests.
Recent examples quoted in the mainland media include the Haitian Group, a private firm based in Maanshan in the inland province of Anhui, which took over a state rubber factory. More than 300 of its workers refused to accept the new jobs offered by Haitian and blocked roads and railways.
Another instance recently cited was the 500 workers from a state dyeing factory in Jilin city in the northeast who refused to accept its sale and the conditions they were offered earlier this year. They blocked the main road outside the headquarters of its parent company, Jilin Chemical, and handed a protest letter to the provincial government.
In Lufeng county, Yunnan province, 500 workers at a state-owned steel factory, fearful that its sale to a private company would put them out of work, reportedly blocked the main Chengdu-Kunming railway line for six hours.
"Such disputes will go on for a long time," says Zuo Xiangqi, who now runs a labour consultancy in Beijing after working in the city's labour bureau for 10 years.
He says that, in the planned economy, state workers become used to wages and conditions similar to those of their seniors. Now, with the market economy, they find a widening disparity between what they and their managers earn, exacerbated by the fact that the manager is often a big shareholder, while they have no or few shares. "Of the 169 sectors of the economy, the state will withdraw from 146, which means that these contradictions will continue."
Mark O'Neill is a member of the Post's Beijing bureau.