Financial Times: End of China’s migrant miracle – Toil and trouble

China Labour Bulletin is quoted in the following article. Copyright remains with the original publisher.

7 June 2015

Tom Mitchell

In November 2011, Zhang Guangde received an urgent summons to a factory town in southern China where his son, Tingzhen, was working for Foxconn, the Taiwanese contract electronics manufacturer for Apple and one of China’s biggest employers.

Tingzhen, a 28-year-old migrant worker from central China, had been on a ladder, fixing a security light, when he suffered an electric shock, fell about four metres and struck his head on the ground.

By the time Mr Zhang arrived at his son’s bedside in Shenzhen, a manufacturing centre in Guangdong province, doctors had removed a portion of his dangerously swollen brain. Tingzhen, once a champion track and field athlete, was bedridden for more than two years and has only recently begun to walk again. He will require care for the rest of his life.

Tingzhen’s accident set his father on a four-year odyssey through every tier of China’s justice system — the courts, arbitration and, when those two avenues failed, a centuries-old petitioning system through which peasants once appealed to imperial authorities for redress.

As China’s once seemingly inexhaustible pool of surplus rural labour is depleted — a moment christened the “Lewis turning point” by economists — the migrant workers who have powered the country’s economic miracle over the past 30 years are gaining unprecedented leverage over their employers in everything from pay and benefit negotiations to disability claims.

It has led to a surge in industrial unrest and a marked increase in the number of workers taking their cases to court, as the Zhangs did. Others find themselves in legal jeopardy for allegedly “disrupting social order” — a vague charge punishable by up to five years in prison — during the course of their industrial disputes.

But after a series of landmark labour cases over the past two years, China’s workers have secured few legal victories. This has engendered widespread scepticism about the court system’s ability to deliver justice to workers embroiled in disputes with influential employers and local officials. “The situation in China is that laws are trumped by power,” says Mr Zhang. “China is too corrupt and local governments constantly deceive their superiors.”

Industrial strife

Wu Guijun, a Shenzhen-based labour activist, reached a similar conclusion after spending a year in detention on charges that were eventually dropped.

“China’s judicial system is very bureaucratic and vulnerable to government pressure,” he says. “That makes it hard for workers to safeguard their rights.” Mr Wu was detained during the course of a 2013 dispute during which he allegedly led workers in a protest march that prosecutors said disrupted social order.

The ruling Communist party has signalled its determination to end local interference in court decisions, thus advancing the cause of justice while also centralising Beijing’s control over the legal system. It dedicated its last annual conclave, held in October, to rule of law issues and says it wants to instil enough public trust in the justice system that petitioners will become plaintiffs, and appeal to local courts rather than flocking to Beijing. It also hopes that an effective court and arbitration system can help defuse larger worker protests such as Mr Wu’s before they reach critical mass and spill on to the streets.

The party, however, has also made clear that it has no intention of relinquishing its ultimate authority over the courts. This includes the right to decide verdicts in politically sensitive cases, which are supervised by its powerful Politics and Law Committee.

The outcomes in a spate of high-profile labour cases over the past year suggest that the committee is attempting to strike a delicate balance. While it does not want to sign off on severe punishments that could provoke a backlash from China’s rapidly evolving labour movement, it also does not want to encourage worker activism. Chinese law does not protect the right to strike and independent unions are banned.

“Collective disputes such as strikes are tied up with [government concerns about] stability,” says Chang Kai, a legal expert at Beijing’s Renmin University who advises workers involved in industrial actions. “It’s hard to guarantee workers’ rights in these cases.”

In March, the party’s Central Committee instructed officials to “make the building of harmonious labour relations an urgent task”, noting that “labour tensions have entered a period of increased prominence and frequency and the incidence of labour disputes remains high”.

The official Chinese Academy of Social Sciences recorded a tenfold rise in the number of collective labour disputes involving between 100 and 1,000 workers.

These increased from just 23 in 2007 to 209 in 2012. Over the past year there have been industrial actions involving thousands of workers — and in some instances tens of thousands.

The China Labour Bulletin, an independent Hong Kong-based advocacy group, documented 1,171 worker protests between June 2011 and December 2013. The CLB also recorded 150 police interventions in worker protests in 2012-13, with arrests made in 69 instances.

The unrest has created a dilemma for local officials who are wary of alienating investors as China’s economy enters a prolonged period of slower growth. “Local governments don’t want to create a legal environment that’s seen to be unfriendly for business, particularly when things are not booming as much as they used to,” says Geoff Crothall, CLB’s research director.

Mr Wu was detained in May 2013 during a march by workers from his furniture-factory employer. The workers objected to the severance terms offered by their boss, who wanted to move the manufacturing operation to a cheaper location in China’s interior.

Now 42, Mr Wu migrated to Guangdong from central Hunan province 13 years ago and had worked at the factory for nine years. He denied leading the march and the charges against him were eventually dropped for lack of evidence.

The activist

Mr Wu describes his 371 days in detention as “a kind of hell” in which he was held in a small room with as many as 50 other people. His trial in Shenzhen was attended by activists from across the country. Adding to the case’s sensitivity, strikes at multinational employers such as Walmart and IBM erupted while Mr Wu’s verdict was being deliberated in the spring of 2014. The Walmart dispute also involved demands for higher compensation after the closure of an outlet in Changde, Hunan province.

Labour activists thought they detected the invisible hand of the Communist party’s Politics and Law Committee, whose branches extend all the way down to county level, in the court’s ultimate decision to throw out Mr Wu’s case and award him compensation of Rmb74,455.99 ($12,000). He has since used the money to establish his own labour rights group in Shenzhen.

The Walmart case has degenerated into a year-long stand-off, with all arbitration and court rulings going against the workers. Of the closed store’s 140 original employees, all but nine have given up and accepted compensation.

Local officials barred the Financial Times from attending the latest hearing on March 26, and State Security Bureau agents briefly held two activists who travelled to Changde for the proceedings.

“Many people who had wanted to come for the hearing, including lawyers and scholars, were told not to,” says Chen Huihai, one of the activists.

It was not Mr Chen’s first such experience with the party’s legal and security apparatus.

“The Politics and Law Committee knows everything about me,” he says candidly. “They even knew who had invited me for dinner. It was as if they had been sitting at our table.”

Like most petitioners, Mr Zhang is not on the radar screens of organs as powerful as the State Security Bureau and Politics and Law Committee. He has been regarded as more of a local nuisance — albeit a surprisingly persistent and effective one. In April the 52-year-old former construction foreman, who has worked on sites as far away as southern Hainan island, reached a provisional settlement with Foxconn.

Since 2011 Foxconn has paid for most of Tingzhen’s medical bills, which can run as high as Rmb20,000 a month. But it also repeatedly sparred with his family over the location and duration of his care according to Mr Zhang, who along with his wife moved 1,600km from their home in central Henan province to tend to their son.
Mr Zhang says Foxconn wanted Tingzhen to be treated in another city where wages — and therefore compensation standards — are lower.

Foxconn declined to comment on Tingzhen’s case for confidentiality reasons, but said the settlement agreement reached with the Zhangs would “ensure [Tingzhen] has the long-term support he will require” and was “consistent with the strong commitment to [Tingzhen] and his family that we have maintained since his tragic accident”.

The petitioner

After losing a series of costly court and arbitration challenges, in 2013 Mr Zhang turned to the lowest rung in China’s justice system — he became a full-time petitioner and made multiple visits to Beijing. While in the capital he sought — and was refused — hearings with authorities ranging from the State Bureau of Letters and Calls, which administers the modern day version of the imperial petitioning system, to the Communist party’s anti-graft office.

Mr Zhang would arrive in the capital by train or bus. Often penniless, he slept rough near Beijing’s South Railway Station or would share a cheap room with other petitioners. But he was able to sell both his literacy and his growing legal knowledge. “When times were really difficult and I didn’t have any money, I would write letters for other petitioners in exchange for a meal,” he says.

On his most recent trip in November, Mr Zhang was picked up by police after attempting to bring attention to his son’s plight in a resort area where global leaders including US President Barack Obama were gathering for their annual Asia Pacific Economic Co-operation summit and later in Tiananmen Square.

As an officially registered “temporary resident” of Shenzhen, Mr Zhang was deemed the responsibility of the Shenzhen government. It dispatched three policemen to escort him on a flight back to the southern manufacturing centre. It was the first time in his life that Mr Zhang had flown on a plane.

Upon leaving the airport terminal in Shenzhen, Mr Zhang fled from his police escort. “One of them chased me for about a kilometre but then gave up,” says Mr Zhang. He was not, however, subsequently detained. Instead, both police and the petitioning office in the Shenzhen district where Tingzhen was injured helped facilitate Mr Zhang’s successful settlement talks with Foxconn.

When his settlement with Foxconn is finalised, Mr Zhang intends to take Tingzhen back to Henan.

“For more than three years I haven’t been able to do anything else,” he says. “I spend my days petitioning and my nights reading and writing about the law. When this is done, I will continue to study labour law. I would like to be a lawyer.”

Additional reporting by Wan Li

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