The Economist: Abritration needed

WORKERS’ opposition to privatisation and job cuts is widespread but rarely takes so brutal a form as it did on July 24th in northeastern Jilin province, when steel workers chased down and killed an executive who had reportedly come to tell them that an imminent privatisation of their factory would bring massive job cuts. Hong Kong-based human-rights monitors reported that 30,000 workers were involved, though Chinese officials insist the number was lower. By all accounts, the ugly scene at the Tonghua Iron and Steel Plant ended in the bloody beating and death of Chen Guojun, general manager of the private Jianlong Group which already owned a minority stake in the plant.

The incident highlights not only China’s labour discontent but the country’s difficulty in dealing with it. Last year, China introduced a series of labour laws that improved mediation and set up an arbitration process to give workers better formal recourse for their grievances, both individual and collective. Workers have indeed been using the process in greater numbers (see chart). But only a small share of disputes are taken up, whereas discontents are multiplying. Whether in factories, mines or construction sites, workplace conditions in China are often atrocious, and workers’ safety an afterthought. Nominal legal provisions calling for minimum wages and guaranteed rest days are routinely ignored. One of commonest complaints is the failure to pay wages. Workers go months without being paid, leading to frequent sit-ins or demonstrations.

None of these actions is organised by unions. In name, the All-China Federation of Trade Unions (ACFTU) is a vast union bureaucracy running from the national level to small enterprises. In practice it is controlled by the Communist Party at the national level and, in companies, is mostly a tool of the management. According to Chris Xiaoyun Lin, a lawyer specialising in Chinese labour, unions may find ways to play a greater role in future, such as by drafting labour laws and representing workers in collective bargaining. But they are unlikely to gain independence from the party—or anything like the influence of unions in Japan or South Korea.

When Chinese labour disputes get unruly, local governments often respond by trying to placate the workers and maintain stability, according to Geoffrey Crothall of the Hong Kong-based China Labour Bulletin. “They recognise that workers have legitimate grievances and are not rabble-rousers out to overthrow the government.” On the day of the Tonghua incident, the provincial government ordered Jianlong to abandon its plan to buy out the steel plant. Placating protesting workers may help calm a tense situation. But in the absence of genuine unions or better enforcement of the laws, it may also serve to encourage more protests.