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Abstract
China's new labour law is a significant reform that offers workers greater employment security and income protection. It is a product of both unprecedented industrial unrest as well as the Chinese government's decision to move its economy to a higher-wage, higher-technology future. The law has energised many workers, who are now using the courts and the Communist Party-controlled trade unions to press their claims. But the law has also evoked a sharp reaction from many employers, who have sought to circumvent its purposes in two ways. First, they coerce many employees to resign their posts—thereby forfeiting important seniority claims—and then rehire them as new employees. Second, many labour-intensive manufacturers have begun to shutter their factories and shift production to even lower-wage regions of China or Southeast Asia. Although long an instrument of labour control and intimidation, the All-China Federation of Trade Unions has sought to use the new labour law to win for itself a measure of institutional and ideological legitimacy.
Notes
1 Global Labour Strategies, ‘Why China matters: labour rights in the era of globalization’, at http://labourstrategies.blogs.com/global_labour_strategies/files/why_china_matters_gls_report.pdf, accessed 10 August 2008.
2 CK Lee, Against the Law: Labour Protests in China's Rustbelt and Sunbelt, Berkeley, CA: University of California Press, 2007.
3 See VH Ho, Labor Dispute Resolution in China, China Research Monograph 59, Institute of East Asian Studies, University of California, Berkeley, p 228.
4 Ibid, ch 4.
5 J Yardley & D Barboza, ‘Help wanted: China finds itself with a labour shortage’, New York Times, 3 April 2005, p 1; and Howard A French, ‘Workers demand union at Wal-Mart supplier in China’, New York Times, 16 December 2004, A4.
6 D Barboza, ‘China drafts law to empower unions and end labour abuse’, New York Times, 13 October 2006, A1
7 J Adams, ‘New labour regulations designed to protect China's workers are already having an impact’, Newsweek, 14 February 2008, at www.newsweek.com.
8 T Costello, B Smith & J Brecher, ‘Labour rights in China’, Foreign Policy in Focus, 21 December 2006, at www.fpif.org.
9 O Chung, ‘Last call for Guangdong shoemakers’, China Business, 5 February 2008.
10 IHLO, ‘Sackings at Wal-Mart: global restructuring or avoiding the new contract law?’, December 2007, at www.ihlo.org.
11 Ma Baoping, ‘Issues concerning the building of a socialist harmonious society’, Journal of Lanzhou Commercial College, 5, 2005, p 114.
12 Available at http://www.mps.gov.cn/n16/n1237/n1432/index.html.
13 Ibid.
14 The ‘Hu–Wen government’ refers to the administration that took office in 2003, under President Hu Jintao and Premier Wen Jiabao. This administration has placed a strong emphasis on fostering economic development through advances in science and technology, creating a ‘harmonious society’ by spreading the benefits of economic growth more equitably throughout society, and on the rule of law.
15 Chinagate.com, ‘China's Five Years Plans’, at http://www.china.com.cn/chinese/ch-zgwunianguihua/index.htm.
16 Former President Jiang Zemin called for a national effort to ‘go West’ and ‘develop the great West’ on 17 June 1999. Jiang Zemin, ‘Losing no time in implementing the Western development strategy’, Selected Works of Jiang Zemin, Beijing: People's Press, 2006, ch 2.
17 Ibid.
18 ‘Premier Zhu Rongji's speech at the Closing Session of the National Technological Innovation Conference’, People's Daily, 26 August 1999.
19 ‘Comarade Hu Jintao's important speech at the Central Economic Work Conference’, at http://www.clxzfw.gov.cn/fb/show.asp?id=533.
20 Ibid.
21 Ibid.
22 As reported by the Judiciary Committee of the Standing Committee of the NPC. See Press Conference on the Feedback of the First Draft of the Labour Contract Law, 21 April 2006, released at http://www.gov.cn/xwfb/2006-04/21/content_260252.htm.
23 Labour Contract Law, 2008, Article 10.
24 Ibid, Article 82.
25 Ibid, Article 14.
26 Ibid, Article 51.
27 Ibid, Article 52.
28 Ibid, Articles 57, 58, 68.
29 The exact number was 191 849, including 1280 in letters and 145 in newspapers. Xin Chunyin, Vice Director of Judiciary Committee, Press Conference on the Feedback of the First Draft of the Labour Contract Law.
30 The full draft is available at Labour Law of the People's Republic of China, 1995, http://www.cnfalv.com/a/ldf/; and Labour Contract Law of the People's Republic of China, 2008, http://www.ldht.org/Html/lifa/lfjc/038834.html. Various amendments to the different drafts are available at http://www.ldht.org/Html/lifa/lfjc/197985.html; http://www.ldht.org/Html/lifa/lfjc/633741746536.html; and http://www.ldht.org/Html/lifa/lfjc/7601997519036.html.
31 Maquila Solidarity Network (MSN), ‘Chinese Labour Contract Law’, Maquila Solidarity Update, 13 (3), 2008, pp 4–5.
32 Migrant Workers' Center, ‘A survey on the implementation of the new Labour Contract Law’, 19 May 2008, at [email protected]. See also JL Chan, ‘Legalization of labour relations in China: the labour contract law as a double-edged sword’, manuscript in preparation.
33 MSN,‘Chinese Labour Contract Law’, p 4.
34 Chan, ‘Legalizatiaon of labour relations in China’, p 4.
35 IHLO,‘New Labour Contract Law: myth and reality six months after implementation’, 2008, at http://www.ihlo.org/LRC/WC/270608.html. See also MSN‘Chinese Labour Contract Law’; and Worker Empowerment, ‘New ongoing violations after the implementation of Labour Contract Law in China’, 2008, translation of the original document by the Shenzhen Dagongzhe Migrant Worker Centre, available in Chinese at http://www.ngocn.org/?11799.
36 MSN,‘Chinese Labour Contract Law’.
37 Worker Empowerment, ‘New ongoing violations after the implementation of Labour Contract Law in China’, p 3.
38 Ibid.
39 Ibid, p 4.
40 Labour Contract Law, Article 14.
41 4347, 3559 and 2280, respectively.
42 ‘Labour disputes multiply in the Pearl River Delta’, 3 June 2008, at http://www.ldht.org/Html/news/news/244160889.html.
43 Jiang De, ‘Four months after Labour Contract Law came into effect, employing units taste the bitter fruit for evading the new law’, Legal Daily, 10 May 2008, at http://www.legaldaily.com.cn/0705/2008-05/10/content_848607.htm.
44 See Labour Contract Law, Article 14.
45 ‘Shang you zheng ce, xia you dui ce’.
46 The exact number was 97 988. Du Yiwen & Bo Yaoyao, ‘100 thousand people dissolved their labour contracts in Nanjing since the new Labour Contract Law took effect’, Modern Express, 19 June 2008, at http://www.ldht.org/Html/news/news/320059867.html.
47 Information collected from Huawei's official website, at www.huawei.com.
48 Qiu Huihui, ‘Huawei's countermeasure against the new law’, 21st Century Economic Report, 27 October 2007, at http://tech.sina.com.cn/t/2007-10-27/00181817070.shtml.
49 Telephone interview with Xiao Qin (alias), employee of Huawei Co Ltd, conducted by one author, 19 July 2008.
50 Ibid. Under the new law, required compensation is calculated on the basis of one month's wages for every year worked in the enterprise; for unilateral firings this amount is doubled. The previous (1995) law contained a similar formula, but without the doubling requirement. As we have noted above, the previous law was widely ignored as well.
51 ‘Huawei claims that all the resignations were voluntary’, Sina.net, 5 November 2007, at http://tech.sina.com.cn/t/2007-11-05/00141831426.shtml.
52 ‘Huawei spent 1 billion RMB in encouraging its old employees to resign’, Southern Municipal Daily, 2 November 2007, at http://news.xinhuanet.com/employment/2007-11/02/content_6996878.htm.
53 Survey on Huawei's resignation case, 3 September 2008, Sina.net, at http://survey.news.sina.com.cn/voteresult.php?pid=19642.
55 Zhang Xinguo, ‘Several problems on reverse dispatch and consequent labour disputes, People's Court News, 16 April 2007, at http://www.lawyer-sh.com.cn/ReadNews.asp?NewsID=4832.
56 Outlook Weekly (Liao Wang Zhou Kan) is a weekly magazine published by the Xinhua Press.
57 ‘New labour–capital games with the New Labour Contract Law’, Outlook Weekly, 23 January 2008.
58 Ibid.
59 Ibid.
60 Telephone interview with Fang Hongbing (alias), former employee of an unnamed cloth factory in a suburb of Shanghai, conducted by one author on 31 July 2008.
61 See http://cache.tianya.cn/publicforum/content/free/1/1086175.shtml; http://cache.tianya.cn/publicforum/content/no20/1/156566.shtml; and http://cache.tianya.cn/publicforum/content/free/1/1082962.shtml.
62 Ibid.
63 VIPHR, at http://www.viphr.net/bbs/index.asp.
64 Author interview with Zhang Yuanyuan, Human Resource Manager of an unnamed toy company in Shanghai, 19 August 2008.
65 Article 37.
67 ‘Primary duties of ACFTU’, Brief Introduction of ACFTU , at www.acftu.org.
68 ‘ACFTU: conference on the new Labour Contract Law’, 5 December 2007, at http://acftu.people.com.cn/GB/6616351.html.
69 ‘ACFTU: Huawei's resignation issues has left negative effects’, Xinhua Press, 10 November 2007, at http://tech.163.com/07/1110/22/3SVIETFF000915BE.html.
70 Ibid.
71 Telephone interview with Xiao Qin (alias), employee of Huawei Co Ltd, conducted by one author, 19 July 2008.
72 Global Labour Strategies, ‘Behind the Great Wall of China’, 2008, at http://labourstrategies.blogs.com/global_labour_strategies/files/behind_the_great_wall_of_china.pdf, accessed 26 August 2008. See also L Morris, ‘An uncertain victory for Chinese workers’, YaleGlobal Online, 2008, at http://yaleglobal.yale.edu/display.article?id=10983, accessed 8 August 2008.
73 See Chan, ‘Legalization of labour relations in China’; and Lee, Against the Law.
74 MSN, ‘Chinese Labour Contract Law’, pp 18–19.
75 Clean Clothes, ‘Chinese activist attacked’, Clean Clothes Newsletter, 25, 2008, pp18–19, at http://www.cleanclothes.org/ftp/ccc_newsletter_25.pdf, accessed 12 August 2008.
76 Students and Scholars Against Corporate Misbehavior (SACOM), Paper Money: The Exploitation of Chinese Workers of the Nine Dragons Paper Owned by the ‘Richest Woman’ Zhang Yin, Research report, 2008, downloadable from http://www.sacom.hk (in both Chinese and English); and Worker Empowerment, ‘New ongoing violations after the implementation of Labour Contract Law in China’.
77 Costello et al, ‘Labour rights in China’.
78 Chung, ‘Last call for Guangdong shoemakers’.
79 Associated Press, ‘Rising costs squeeze Chinese factories; some companies look to cheaper markets’, International Herald Tribune, 22 February 2008; and Norihiko Shirouzu, ‘Chinese labourers face grim job search’, Wall Street Journal, 10 November 2008.
80 D Harris & B Luo, ‘The impact of China's Labour Contract Law’, China Law Blog, at www.chinalawblog,com, 15 September 2008.
81 E Wong, ‘Factories shut, China workers are suffering’, New York Times, 14 November 2008, A1.