Following the Kunshan disaster, China substantially increases fines for workplace accidents

In the wake of the devastating explosion that killed at least 75 factory workers and injured 185 others in the eastern city of Kunshan last month, China’s national legislature has massively increased the fines that can be levied on enterprises involved in workplace accidents.

The Workplace Safety Law, first introduced in 2002, had capped fines at just 100,000 yuan but a National People’s Congress Standing Committee amendment, approved on 31 August, set the new range for fines at between 200,000 yuan and 20 million yuan, depending on the seriousness of the incident.

Individual managers deemed responsible for accidents will also face fines of between 30 and 80 percent of their annual income. The previous law had capped individual fines at 200,000 yuan, hardly a dent in most senior executives’ pay. Moreover, managers deemed responsible for serious accidents will not be able to take senior positions in the same industry again.

The revised law, which goes into effect on 1 December this year, also gives local governments and regulators greater powers to enforce workplace safety provisions, including the right to cut the power supply to enterprises deemed unsafe and likely to cause accidents.

The increased fines and tougher regulatory framework created by the revised law are both necessary and long-overdue. However, they are just one part of the wide-ranging changes that are needed to really ensure workplace safety in China. As a group of scholars and labour activists noted in an open letter issued soon after the Kunshan disaster, given that businesses and the government have thus far failed to protect workers, the most pressing need now is to give workers themselves the right to supervise and enforce workplace safety.

It is the trade unions that have the greatest responsibility in this regard. The letter argues that trade unions need to reinvent themselves as workers’ organizations that can bargain with management to establish safe and healthy working conditions in the workplace. In addition, enterprises need to set up workplace safety committees comprised of both workers and management that can monitor any violations of safety standards and have the power to halt production if it deems there is an imminent danger to staff.

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