Does China Labor Law Sufficiently Protects Chinese Labour Interests - Essay Example

Does China Labor Law Sufficiently Protects Chinese Labour Interests Introduction This research dwells on the topical issue on whether the Chinese law has effectively protected its workers or not through a review of sub-topical issues supported by related examples of cases. The sub topical issues include the effectiveness of the law in protecting the workers, its failure facilitated by the obstacles that makes labour law ineffective in China, and recommendations to make the law more effective in protecting the welfare of the Chinese worker. It also analyzes the gap between the law on paper and the law in practice. The International Labour Organization (ILO,) which is based in Geneva is the United Nations organ charged with setting and upholding the labour standards by member states who are party to it. It has formulated various conventions which have been ratified by the member states. Most nations including China draw a lot from these conventions in the enactment of their labour laws1. Definition of labour law Labour law is a set of laid down rules, governmental rulings, and precedent whose focus is on the formal rights of employees and their organizations. The labour law contains restrictions on the employer and employee, and embodies their relationship vis a vi with trade organizations2. Labour law in China arose as a result of fierce struggle by the workers to have the rights to a better working condition, the right to participate in a trade union or otherwise not to all which run counter to the desire by the employers to keep the cost of production low as well as tame the growing power of workers3. In order to fully understand this concept of law, it’s imperative to differentiate between the two categories of labour law. The first one is referred to as collective labor law which is the relationship that exists between the employee, employer and the trade union. This piece of labour law embodies the trade unions, strikes, pickets, workplace involvement as well as co-determination which entail the right of workers to be represented in the boards of the employing organizations. On the other hand, individual labor law concerns an individual rights at his/her place of work as contained in the contractual agreements entered with the employer. The contract of employment entails provision of all the essential terms to an employee which is put down in writing. It provides an insight to the employee on the expectations in terms of remuneration, job description, fringe benefits, termination of contract, disciplinary measures et cetera4. Among the main features found in individual contract law includes among others, the minimum wages payable to a worker, health and safety at the working place, anti-discrimination policies and child labour5. Success of the labour law The government of China has endeavored to protect the welfare of Chinese laborers as is evidenced by the enactment of a series of legislations on labour. This followed a wave of unrests and disputes in the labour market across the nation. The nation has undergone a massive social and economic transformation in the period after the enactment of the Trade Union Law in 1992 and the Labour Law of 19946. There is a new dawn for the Chinese workers with the enactment of the 2008 New Labour Law. According to Harris and Moure (2007, 84), “everything is going to change ion January 1, 2008, for employers in China, well almost everything. That’s the day China’s new labour law goes into effect and if you have employees in China- you absolutely must take various steps to get compliance and to avoid being sued”. The new law has got very attractive contents that aim at restoring sanity in the Chinas labour force. For instance, it compels all employers to maintain a written employee handbook which stipulates the terms of engagement between the employer and the employee. The purpose of this handbook is to ensure that there is procedural and legality in the dismissal of an employee as opposed to what has been the norm where workers were sacked un-procedural and illegally7. On top of the above success, the new laws spell a bright future for the labour market of China. It provide a strategic roadmap for the next decade and are packaged with good incentives for both the workers and the employers, a move which if fully implemented will see China scale the heights of economic and social development with calm industrial market. This sis because the law provides room for reforms in China labour market, reforms that will provide a panacea to the ill conditions of the workers ranging from employment without contracts, issues of overtime and social unrests, working conditions to the non payment wages8 discrimination of the workers. A recent development was the order issued by the government agency the State Administration of Work Safety to all employers requiring them to keep health records of all their employees who are exposed to health hazards9. Failure the law on paper and law in practice The Chinese government has been applying double standard in its approach to the protection of workers in the state. While seeking to protect workers rights through the enactment of new legislations and regulations, it has paradoxically tightened social controls and blocked the creation of independent trade unions, a rather sad note to the rights of workers10. The same government has been favouring investment by the private entrepreneurs at the expense of the labour regime. It has embarked on giving preference to the rights of the investor whenever there is a clash of interest between interests of the explorer and employee. At times, the government gives a blind eye with some instances there lacking effective government control. An example is the violent strike by thousands of taxi drivers in Hangzhou in August 2011 due to among others the charges and restrictions imposed on the drivers by the cab companies compounded by lack of government regulation11. The period between the enactment of the 1992 Trade union Law and the Labour law of 1994 has seen a dramatic change of ownership of the state owned enterprises. Most of them were privatized and in the process millions of workers were retrenched with the few who remained operating in poor working conditions12. The privatization of the state owned enterprises and the increase in the private sector marked a rather sad story for the Chinese worker. The private entrepreneurs infiltrated into the governing Communist Party with an intent in influencing major government policies especially ones that favored them at the expense of the worker. They have perpetuated this through the purchase of both political power and impunity from the political leaders13. A contract is defined by Zhang as “an agreement between legal persons to ascertain their mutual rights and obligations for purposes of achieving certain economic goals14”. The Chinese civil code defines it as an agreement which puts in place, modify and put terminate the civil relations between parties (Zhang, 2006).The purpose of the Chinese contract law is to protect legal rights and interest of the parties, maintain the social economic order and advance the construction of the socialist modernization. The contract is binding once it’s entered into by the parties as per the legal provisions. It’s this definition and purpose of the Chinese contract law that provides guidance to parties entering into employment agreements, an aspect which largely has been lacking in the Chinese labour market. Most employer have been engaging workers with no contractual agreements, a reflection of how the Chinese law has failed to protect the labour force in practice, only doing so on paper. For the contractual agreements in the labour market and the Chinese labour law to be fully implemented, there is need to guarantee the independence of the judiciary in presiding over industrial related disputes. In China, it’s claimed that the courts lack the judicial independence making people not to trust them15. This is despite this independence being recognized in the 1954 constitution. However, it seems that the main issued is the full implementation of the provisions16. Child labour is outlawed by the International Labour Laws. It involves engaging minors in labour force such as in mining, rural agricultural firms, slavery, domestic work, employment in industries among others. In China, this has been a normal reality despite the law stipulating otherwise. There has been laxity in the implementation of the Child labour act which has seen an increase in the number of minors employed in the workshops and factories in the southern and coastal areas of China. The cheap labour offered by the minors has enticed many employers to prefer them over the adult. Poverty in the rural households has also compelled minors to seek employment despite the deplorable working conditions17. The underage workers are susceptible to work related hazards as opposed to the adult worker18. The situation is worse to the extent that the public officials tasked with the onus task of protecting and upholding the rights of the children are in fact the ones violating these rights. For instance, ion Guangzhou, it’s reported that a headmaster was involved in hiring his students to a toy factory he privately owned. He defends his illegal act with the fact that he was offering the minors a chance to earn some money to cater for their school fees19. This clearly shows that the law and authority have failed miserably in protecting the labour force from infiltration by the juvenile labour force. China is one of the few surviving communist nations. There has been an effort to transform the economy into a socialist market, a move which has complicated labour relations in the world’s most populous state. The situation was aggravated by the successive privatization of state owned corporations in the 1990’s. The transformation of China’s economic system from socialist planned economy to a socialist planned commodity economy in 1984, then to socialist commodity economy in 1987 and eventually to ‘socialist market economy’ in 199220 and the eventual adoption as China’s basic economic system had its effects in the industrial relations21. The ideology of the nation changed with the recognition of private ownership as opposed to the traditional state ownership. However, the government put in place the comprehensive labour code in 1st of January 1995 to address the issue of workers welfare and the labour relations (Jianyong, 1996). However the code suffered from major defects which rendered it ineffective in protecting the Chinese workers. One, the code was a contradiction by the government between delegating powers to the workers through trade unions without loosening the control that the Communist Party of China had over the trade unions. This made trade unions ineffective as their hands were tied by the leadership of the communist party. It also denied them the right to collective bargaining22. China has slowly carved a niche for itself as a leading economic powerhouse in the world. Its one of the strongest economic giants to recently emerge. However, despite these gains in economic development and which have been made possible by the hard working Chinese worker in the production and manufacturing industries, little concern has been shown in the health and safety of the worker. The investors in China are primarily concerned with making profits by lowering the cost of production, giving little regard to the workers safety23. For example, Genco Mine Service hires a small Chinese company to transport its workers to underground mines despite the company using outdated equipment which puts the miners at risk24. The owner is quoted as saying, “it’s up to China to figure out how to protect factory workers from occupational diseases and injuries.” (Loretta, 2007). This is a clear pointer that the law in China is compromised to allow cheap and low cost of production at the expense of the safety and health of the workers. The labour law of 2008 is reform oriented with stiffer penalties for abusers which brought hope to many Chinese workers. However, like previous legislations, there has been an oversight by the authority in issuing the guidelines for its implementation which has hindered its effectiveness. For instance, the draft contract issued by the Dongguan labour department to comply with the new law. The above sorry state has been aggravated by punitive measures that employers have resulted to -in wake of the new law- is not in the spirit of the new law. It goes contrary to its objective of promoting rights of workers through inclusion of retrogressive clauses that restricts industrial action25. This draft gave leeway to companies to draft their contracts contrary to the existing law, all meant to favour the employer at the expense of the worker. In the run up to the date of the implementation of the 2008 labour law, the country experienced cases of mass lay offs which were precipitated by clauses in the law which companies deemed unfair to them. For instance it outlawed the hiring of workers without contract and firing them at will. During the same period, Hauwei Technologies retrenched about 7,000 of its 16,000 employees through voluntary sequestration. Despite being compensated for their exit, majority felt offended for their exit wasn’t intentional but a measure to avoid obligations in the new law26. Other companies which lay off their workers include Wall-Mart (100), CCTV (1,800)27. The unlawful dismissal of employees by the companies attracted a wave of unrests ands protests which were staged to oppose the move. For example, there was a protest staged by 50 workers which had been dismissed prior to the enactment of the new labour law. Their employer, Transpo Electronics (Shanghai) Co Ltd, had relented to renew their contracts despite most of them having been with the company for over five years28. Another key development has been the failure by the 2008 laws to achieve the intended objective. The laws were put in place with the purpose of channeling the workers frustrations through a system of arbitration with the end result being to avert widespread protests which would shake the political foundations of the state. However, a wave of strikes which have been experienced in China in the post-2008 labour laws tells a different story (Wong, 2010). Despite the negative outcomes from the 2008 labour laws, there has been some positive outcomes and measure from the authorities in ensuring that the law is effectively implemented and that it achieves its objective of upholding the rule of law in protecting the welfare of the workers as well as the employer. The government ministry which is in charge of labour affairs issued guidelines to the implementation of the 2008 labour laws. The Ministry of Labour and Social Securities in its guidelines stipulates the procedures for the implementation of company rules and the time of signing of open-term contracts between the employer and the worker. It also issue a notice to the local labour bureaus to revise the employment laws and related regulations so that they be in conformity with the new law especially touching on probation periods for a ne2wly employed worker, lay offs due to economic conditions, when the employer can stop payment of wages as well as the sensitive issue of casual laborers. The new law has given momentum to workers to organize themselves into trade unions to further the cause of fight for the workers rights. For instance, workers were able to effectively organize protests over the unlawful dismissal of their colleagues was a pointer to the high level of self awareness in terms of a workers rights. The labour unions supported by labour right activists have been instrumental in ensuring that the new law is put into practice as per its provisions. A positive note is in the drafting of contracts that are in line with the new law. Moments to the enactment of the new law, several provinces and municipalities had formulated and released to the public domain new updated contracts which were to be the standard drafts to all partiers in their areas of jurisdiction. For example, in the southern city of Guangzhou, the new labour contract was already out and it actually fulfilled the requirement of the new labour law. Conclusion and recommendations The Chinese authorities need to put in place several measures to ensure that there is a balance between the need to protect the rights of the labour force and the interest of the investors/employers. One, there is need for a clear policy setting the boundary between the worker and the employer so as to allow the trade unions to be autonomous. An independent trade movement will be better placed to champion for the rights and welfare of its members/workers free of any interference or form of intimidation. Secondly, there should be measure put in place to provide for the establishment of collective bargaining mechanisms as well as provision of rights to collective bargain which will pave for collective bargaining agreements on matters pertaining to the industrial relations. This will be an effective tool of shielding both parties from the negative effects of an industrial dispute such a strike, dismissal and poor working conditions, as parties are given a chance to come to the table and agree on issues. Thirdly, the Communist Party control of the workers union should be done away with and allow the workers in China to go on strike without legal restrictions. The latter part calls an act to legalize industrial protests as well provide guidance on the methodology of going about with the protests. The department of labour should work closely with other stakeholders in educating the employers on the importance of the labour laws to avoid the punitive measures that have been experienced. The employers should be encouraged to have a positive approach in the new law by considering the positive aspects of it and not the negatives. For instance, instead of focusing on the possible need to increase wages and the curtailment of superfluous dismissal of workers, an employer should focus on the benefit of operating with an unwavering workforce that’s highly motivated and bound to be economically productive. The enforcement of the new law should be highly emphasized and it should be uniformly implemented in all provinces of the nation. The judiciary should be empowered to prosecute culprits who abuse the labour law as well as assist in providing interpretations to the law. This will help to avert a scenario where the law is good on paper but on the ground it’s not in good practice. There is need to harmonize the China’s labour laws with government policy of nurturing a market driven private sector ,as well strike a balance between the rights of private business with those of workers. There is also need for a public ethics act which outlaws government officials from operating private business which would render them flout the labour laws. In conclusion, this report regard the 2008 Chinese labour as the springboard towards meeting the internationally accepted labour market standards where collective wage agreements and a workforce that enjoys its rights are no longer overlooked in China. CCTV reported that the new law was geared towards protecting the interests of the Chinese employees with key provisions touching on the welfare of the employee to be provided by the employer29. However, care should be taken to avoid the blind assumption that the new labour laws provide the much needed outright solutions to the labour problems in people’s republic of China. A cautious approach should be adopted in the reforms in regard to the protection and promotion of workers rights as this is just the beginning of a long journey towards the ideal end. This approach calls for a lot of sobriety and political goodwill which will provide the much needed legislative guidance in the implementation of the labour law in China. References Anon ,(n.d.) Conflict of Interest and the Ineffectiveness’ of China’s Labour Laws. Available at http://www.clb.org.hk/en CCTV report 4 December 2007 on the implementation of the new labour law. China Labour Bulletin(n.d.). Available at http://www.clb.org.hk/en/node/101108. China Law Bulletin, 2011. As China's Economy Grows, So does China's Child Labour Problem. http://www.china-labour.org.hk Anon.China’s New Labour Law No Help To Chinese Worker, November 05, 2007. Available at http://english.donga.com/srv/service.php3?bicode=060000&biid=2007110530318. Hays,J. (n.d), Report on Chinese Labour Rights :Laws Union, Unrests and Strikes .Available at http://www.factsanddetails.com/8711. Human Rights China. Report on ,Law, Union, Unrests, Strikes available at http://www.hrichina.org. IHLO. 2007.The New Contract Law of China-Opportunities and Threats. Workers. ILO, International Law at the Actrav Distance Learning Project of the International Labour Organization. Available at http://www.ilo.org. Jianyong, Li., 1996. The China Labour Code: its major issues and improvement. LLM, The University of British Columbia. Available at http://hdl.handle.net/2429/6085. Tofani, L., 2007. Salt Lake Tribune Special Report: Companies say they are not to blame; who is? .The Salt Lake Tribune. Available at www.sltrib.com/china. UNICEF, 1997.The State of the World’s Children . Ursula, G., 2011. The Long March of China’s Trade Unionists. French Magazine, Le Nouvel Observateur,29 July, 2011, 2438. Zhang, Mo, 2006. Chinese Contract Law: Theory and Practise. 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