Labour disputes on the rise in China

Labour disputes in China more than doubled between 2007 and 2009, underscoring rising dissatisfaction among factory workers and migrant labourers over low wages.

Last year, Chinese courts handled 318,600 labour disputes. Considering that only a fraction of labour disputes find their way to courts, the actual number of disputes was likely far higher. This represented a 110 per cent increase in the number of disputes since 2007, according to statistics released by China’s Supreme People’s Court this week.

The rise in disputes has been attributed by officials and scholars to a number of factors, including factories laying-off workers and decreasing pay as a result of the financial crisis, rising demands from a new generation of migrant workers who have greater awareness of their rights, and a shrinking workforce as a result of demographics, which has given workers greater leverage in negotiations.

In the first half of this year, a number of strikes broke out across factories in China’s manufacturing heartland, bringing focus to workers’ rights. In June, strikes brought work to a grinding halt at car-maker Honda’s factories in southern Guangdong, while suicides of workers at electronics manufacturer Foxconn’s plant stirred debate over working conditions.

To stem the unrest, local governments and factories across China have raised wages. Since the strikes, 27 provinces have seen an average minimum wage hike of 24 per cent. Also behind the wage hikes is an effort by the central government to boost domestic consumption, and hasten a rebalancing of the economy away from its reliance on exports.

“A lot of enterprises, especially export companies, are unable to satisfy workers’ requirements for higher salaries,” said Sun Jungong, a spokesman of the Supreme People’s Court, in Beijing this week.

He said some enterprises tended to “ignore the protection of workers’ rights in order to maximise profits”, with illegal employment and violations of employees’ legitimate rights “being common”.

Courts have struggled to handle the surge in many cases, prompting local governments to consider amending laws to give workers greater say in resolving disputes at the grassroots level.

In Guangdong, the southern manufacturing base, the Provincial People’s Congress is now considering adopting a draft law that would, for the first time, give official sanction for workers in China to strike.

The law would also widen worker participation in consultations, and allow workers, under the supervision of the unions, to elect their own representatives in negotiations.

In China, independent unions have little space to resolve conflicts within enterprises. The official All China Federation of Trade Unions is widely seen as representing the Communist Party’s interests in preserving stability, rather than voicing workers’ demands.

Companies here also discourage workers from engaging in negotiations, with employees’ representatives often facing discrimination. According to the Hong Kong-based China Labour Bulletin (CLB), which monitors labour trends in China, the draft law will now bar employers from discriminating against worker-appointed collective bargaining representatives, or workers who themselves serve as representatives in negotiations.

“We believe that once workers themselves are involved in collective bargaining, this mechanism will be able to satisfy their demands, attract their interest, and garner their support,” the CLB said in a recent report.

According to the CLB, the law, if passed, would have a “deep and far-reaching role in bringing greater harmony to industrial relations, benefiting all three main parties involved — labour, management and the government.”

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