Allen T. Cheng
Bloomberg
26 October 2004
China Resources Enterprise Ltd. and other companies in China are facing growing labor unrest over jobs and the government's failure to provide other support in the dismantling its cradle-to-grave welfare system.
About 6,800 workers at China Resources, a Hong Kong-listed retail company backed by the government, are on strike for a seventh week in northern China, alleging the company is forcing them to sign "unfair" labor contracts, according to Hong Kong-based labor-research group China Labour Bulletin.
China Resources officials declined to answer questions about the strike. "I don't think we can comment," corporate communications Manager Cindy Tam said in a telephone interview from Hong Kong.
The strike is one of several in China recently. In nearby Anhui province, some 10,000 textile workers and retirees protested decreases in pension money, lack of medical insurance and worker's compensation for injuries, according to China Labour Bulletin.
"Protests like these are happening all over," Robin Munro, research director of China Labour Bulletin, said in a telephone interview from Hong Kong. "We expect many, many more as the wave of privatizations of state-owned companies takes off."
China is selling more than 190,000 state companies to private investors. The State-Owned Assets Supervision and Administration Commission announced last year that it's focusing on building just 190 or so large state-owned companies and selling the rest.
Tianwang Textile
In northern China's Shaanxi province, the 6,800 workers, the majority of them women, have been on strike at the Tianwang Textile Factory in the city of Xianyang after China Resources took over the factory.
The company wants workers at Tianwang Textile to accept severance pay equal to a month's wage for each year of employment before signing a new contract that hires them back at lower wages, Munro said.
"The new contracts do not respect seniority of workers," said Munro, who said he spent time with the workers in Shaanxi recently. "Many are angry."
Tianwang Textile was turned into an employee-and-management-owned shareholding company a few years ago, Munro said. Workers paid 4,000 yuan (US$483), and Communist Party officials paid 8,000 yuan and senior party officials paid 16,000 for an unspecified stake in the company, he said.
"Now they are forced to sell their shares back so China Resources can take over," Munro said.
About 1,000 police appeared at the factory gates with water cannons four days into the strike on Sept. 18. They were met with thousands of workers who surrounded them, forcing them to back down.
During the weekend, the workers tried to organize a sit-down demonstration at the city's main railroad link and disbanded after a deputy provincial governor turned up to calm them down, Munro said.