New York Times: Chinese Workers at IBM Factory on Strike Amid Company Sale

07 March 2014

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

MARCH 6, 2014

HONG KONG — More than 1,000 workers have gone on strike this week at an IBM factory in southeastern China in the latest sign of labor activism as companies’ acute shortage of blue-collar workers makes employees increasingly willing to take to the streets.

IBM is selling Lenovo its x86 computer server business, which includes the factory in the southeastern city of Shenzhen, where the strike is unfolding. Lenovo agreed in January to pay $2.3 billion for the business in a transaction that is still subject to regulatory approval.

A video posted on Chinese social media shows hundreds of workers in blue factory smocks standing on Tuesday in front of an IBM building in Shenzhen, a sprawling electronics industry hub adjacent to Hong Kong with more than 10 million permanent residents and migrant workers. “Workers are not a commodity,” read one homemade banner; another said, “Give us back our respect.”

IBM said in a news release that it hoped workers for the wholly owned subsidiary being sold, International Systems Technology Company in Shenzhen, would be willing to continue working for Lenovo but that it would offer them compensation if they did not accept the new employer.

“Employees currently involved in x86 operations in Shenzhen have a personal choice of remaining with I.S.T.C. under terms and conditions comparable in aggregate to what they currently are receiving, or they can voluntarily choose what we believe is an equitable severance package and resign from I.S.T.C.,” the IBM statement said.

Strikes are especially common in China when factories are sold to new owners, a result of fears of layoffs among workers.

Geoffrey Crothall, the communications director at the China Labour Bulletin, a nonprofit group in Hong Kong that advocates for independent collective bargaining and other legal protections for workers in mainland China, said that the latest strike was reminiscent of one by thousands of Nokia workers in November in Dongguan, next to Shenzhen. In that case, Nokia shareholders had approved the sale of their employer, Nokia’s handset division, to Microsoft.

“We’ve seen so many similar cases over the last two to three years,” Mr. Crothall said, adding that the IBM strike began on Monday and appeared on Thursday still to be underway.

A quadrupling of college enrollments over the last decade, together with the beginnings of a decline in the number of young Chinese as a result of the country’s one-child policy, has left a dearth of young people willing to take factory jobs. Age discrimination is also widespread in China, where factories seldom hire anyone older than 40.

Demographic issues have affected the Chinese workplace faster and to a greater extent than almost any experts expected. Wages for blue-collar workers have increased about fivefold over the last decade before adjusting for inflation and at least threefold after adjusting for inflation.

Workers have also become quicker to object if they think their legal rights are being abused.

“Over the last five years, there has been a noticeable upswing in worker activism across China,” Mr. Crothall said.

A report on Feb. 20 from the China Labor Bulletin said that the group had recorded 1,171 strikes and worker protests from mid-2011 until the end of 2013.

“Factory workers staged protests when they were cheated out of their wages and overtime payments, when their bonuses and benefits were cut back and when the boss refused to pay the social insurance premiums mandated by law,” the group said, adding that “workers also went on strike to demand higher pay, equal pay for equal work and proper employment contracts.”

The report added that the police had intervened in a fifth of the documented protests, sometimes with beatings and arrests. Videos on social media showed a few Shenzhen police officers watching the IBM protests while making no effort to interfere.

Although the Chinese authorities often delete from social media platforms images of the frequent protests against the labor policies of Chinese-owned companies, they have been more willing to tolerate activism against multinationals and less prone to censor it online. In a sign of the increasingly virulent anti-foreign sentiment in China in the last several years, the workers chanted “running dog” when a local manager emerged from the factory to speak, drowning out his words.

“Running dog” was a popular term during the Cultural Revolution in the late 1960s and early 1970s as a label for those Chinese accused of betraying their country by supporting foreign nations, foreign institutions and foreign ideas.

The choice of the term was particularly unusual because the workers were striking over their refusal to be transferred from an American company to a Chinese company.

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