New economy, same old problems for China’s workers

Workers employed in China’s new online companies are increasingly taking to the streets in protest as their bosses fail to pay wages and lay off staff without any compensation.

CLB noted last week how increased competition from online retailers was squeezing out traditional shopping centres and supermarkets in China but many online shopping ventures are now failing as well, leading to wage defaults and staff layoffs. Many online financial service providers are also struggling to stay afloat and workers are often owed several months’ wages in arrears.

The Chinese government, and in particular Premier Li Keqiang, continue to champion China’s new cult of entrepreneurship and push for greater investment in online enterprises but there are clear signs that some online markets are already saturated and that many start-ups do not have a solid foundation.

Meituan delivery workers on strike

Delivery workers for China’s largest group buying site Meituan staged two strikes in two separate cities in early April. Meituan delivery workers in Shanghai went on strike protesting the non-payment of wages and overtime, while employees in the northern city of Xianyang (photo above) protested the unilateral termination of their contracts without any compensation.

Competition among e-commerce platforms has put tremendous pressure on delivery workers, forcing them to work longer hours for lower wages. A Shenzhen delivery driver said they typically work 12-hour-days, delivering more than 300 items each day, with an average monthly wage of just 3,400 yuan. The majority of drivers do not have social insurance or any employment contract.

Workers protest wealth mismanagement

Two sit-ins occurred at financial services companies on 18 April, one in Beijing, the other in Shanghai, after employees had gone several months without pay.

Workers at 100kedai.com occupied their company’s Beijing office for several days and held a demonstration demanding payment of wage arrears (photo above). The company claimed to be involved in wealth management, e-commerce and consulting, however, its website is currently unreachable. Workers at Shanghai Oculus Financial meanwhile protested at the office building of its partner the Kuailu Group demanding three months of unpaid wages. Kuailu, a media investment company, was recently caught up in a major box office fraud related to the film Ip Man 3

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