Globalisation's Impact on the Chinese Economy - Essay Example

Part of the restructuring that happened in the auto industry is the changing of labor regulations and practices to enable the auto industry to cope and compete with the new economic environment. 

The major labor regulation change in the auto industry was the Labour Contract Law which stipulates open-term contracts.   It meant that the employer-employee relationship mist is written in a contract the failure to do so would mean indefinite employment which employers cannot just terminate.  The law also stipulated labor dispatching which requires the labor contract between the service provider and the employee will be fixed for more than 2 years and the employee will be remunerated monthly even if there is no work to be done.

In the labor practice, globalization has provided employers greater latitude to easily reduce their workforce depending on the demand of the market.  Where before workers had job security, it is now underpinned by a one-year contract as stated by the new Labour Contract Law.

2. What is the role of unions in China? How does China’s Political System impact this? Should unions be founded on supporting the workers in China or the Organisations/Government? Justify your answer.

All trade unions in China are subordinated to the All-China Federation of Trade Unions (ACFTU) thus it can be said that there is only one union in China. 

The role of unions in China is to motivate employees to achieve the objective of the enterprise rather than represent and perform functions that are typically associated with HR in capitalist countries.  This means that unions are still subordinated to the Communist Party, an arrangement compounded by the

institutionalization of union officials.

This set up of unions being subordinated to the Communist Party defeats the very purpose of unions of why they were set up.  Even in the former Soviet Union, workers were represented by the union who in turn are represented in the Communist Party.  With the current setup in China, workers are virtually powerless and voiceless to air their grievances or plight or to even make suggestions to make their conditions better.  The setup is very top-down, where orders come from the Communist Party without any participation from the unions.  This made the workers to be just pawns in the production system because they cannot participate in making the policies that affects them. 

Unions should be founded on supporting the workers.  That is their purpose in the first place which was invented by their kindred communist in the former Soviet Union.  This ensures that there is a balance between the objective of the enterprise to be competitive (profit is struck out in a socialist system even if it is market-oriented) and for the welfare of the workers to be attended thus achieving a healthy balance between labor and their employers.  This is good for the state because negative news about China’s working policy will be removed such as child labor, employment in sweatshops, unreasonably long hours, etc.