Sunday, August 16, 2009

The present economic crisis bites everywhere in the world, even in China whose economy is still growing rather than shrinking. The basis of that growth, however, involves little if any protection for workers' rights and a legal system where it is illegal to organize independent unions. Despite these restrictions Chinese workers are fighting back against their employers, both public and private. Here are a couple of recent examples. First, the story of taxi drivers on strike in both the north and south of China from the LibCom website...
Taxi strikes in North and South East China:
Taxi drivers in the northeast city of Mudanjiang, Heilongjiang Province, struck and staged sit-ins outside Communist Party and government offices, whilst in the southeast city of Wenzhou, Zhejiang Province, a militant strike by cabbies got immediate results.

The strike in the north began on the 23rd of July over proposals to limit the length of operating rights, and continued at least until the 30th. Zhao Shiyuan, secretary general of Mudanjiang City Government, said the city government had to mobilize taxi drivers from neighboring cities to offer taxi services.

China shares border with Russia via Mudanjiang, a tourist city in Heilongjiang Province and more than 300 kilometers away from Harbin, the provincial capital. Mudanjiang City has 2.8 million permanent residents and has 2,705 taxis in service, most of which are privately run, said Zhao.

"Misinterpretation by the part of cabbies is the cause of the strike," claimed Zhao, who added the draft document was open to discussions and could be improved based on opinions aired by taxi drivers. Mayor Zhang Jingchuan has held dialogues with some of the drivers with the hope of bringing the drivers back to work.
Militant strike in the south
In the southeast, the strike was shorter, lasting only one day. More than 2 000 drivers joined the strike – about two thirds of the city’s cabs, and strikebreakers were attacked or had their windows smashed. The government immediately agreed to meet with taxi drivers and address their demands, one spokesman calling them “reasonable”.

According to police, some scab taxis were lured to suburban areas and then attacked. 2 000 police patrolled the streets, but only twelve people were arrested, of which eight were charged with attacking taxis or handing out leaflets.

Drivers, over 70 percent of whom are from the relatively poorer provinces of Anhui, Hubei, and Jiangsu, usually rent their cabs from private owners and agents. They were striking due to high rent costs, lack of fuel subsidy and the high level of other maintenance costs, which left many with only just enough money for food at the end of each day. They said they only earn up to 3,000 yuan or 440 U.S. dollars a month even if they work 12 hour days.

“With the hiking of gas prices and high rental fees, we’re just able to make ends meet if we're lucky; if not, we would go hungry,” a driver said.

Whether the government's six measures that appear to address the strikers’ main concerns will be implemented or were simply announced to end the strike, remains to be seen. Fees for waiting at the airport were immediately abolished.
The Voice of Taxi Drivers
The strike was apparently organised by the handing out of leaflets headed “The Voice of Taxi Drivers” at the airport, petrol stations and restaurants. Government officials have therefore blamed the strike on a small group “inciting” the strike.

This appears to be an attempt to go for a “middle way” in dealing with taxi strikes, both conceding to demands, or at least appearing to, and arresting those considered responsible.
And here from the Straights Times is another report of a clash that happened yesterday between Chinese police and steelworkers. Sort of a step up from a strike.
Cops clash with steel workers:
BEIJING - ARMED police in central China have clashed with steel workers who were holding an official hostage in a protest over privatisation plans, state media reported on Saturday.

The incident happened on Friday at the Linzhou Steel Corporation in Anyang city, Henan province, after four days of demonstrations, the China Daily said.

Officers tried repeatedly to break through the lines of the workers, who had been patrolling the gates since early this week, the paper said, without stating if the police succeeded.

The paper quoted unspecified reports as saying the workers were holding an official of the local State-owned Assets Supervision and Administration Commission. It gave the official's surname as Dong.

In a signal that authorities take the situation seriously, Chen Quanguo, a deputy governor of Henan, reached Anyang on Friday to address the workers' 'misgivings", a senior city official told China Daily.

The clashes adds to recent evidence showing that labour-related unrest may be escalating in China.

Last month, angry workers in north-east China killed a factory manager amid a protest over an unpopular takeover.

Linzhou Steel, a state-owned enterprise with 5,122 employees, was sold to a private firm last month for about 64 million yuan (S$13.4 million) without the workers' consent, the paper said.

Massive layoffs followed the takeover, with workers getting 1,090 yuan for each year of service they had put in, according to the paper.

It is not the first protest over the privatisation of the firm, the paper said, citing a situation in March when more than 1,000 workers tried to resist the plans by blocking the streets and shutting off the factory for days.

'I've been with Linzhou Steel for more than two decades and all I got was 20,000 yuan and a letter asking me to leave,' one of the workers said on the web portal. -- AFP
Then, of course, there is yet a further step up from fighting the police. The killing of a company manager by workers incensed over layoffs mentioned above is analyzed further in the following article from the China Labour Bulletin which has been struggling for workers' rights in China for many years now.
China debates the lessons of Tonghua tragedy:
The death of Chen Guojun at the hands of angry workers at the Tonghua Steel works on 24 July prompted a flurry of comment and speculation in the domestic Chinese media. Many commentators suggested that Chen, a rising star in the privately owned Jianlong Group which was due to takeover Tonghua, had antagonized the workforce with his uncompromising and combative management style. Others cited sinister conspiracy theories involving former mangers and shady scrap-metal cartels in the city.

There was one issue however that everyone seemed to agree on; namely the need to better protect the rights and interests of workers during the process of state-owned enterprise (SOE) reform and privatization - the only question that remained was how. And in addressing this issue, several analysts focused their attention on the key role of the state-owned assets supervision and administration commission (SASAC), as well as the telling lack of an effective trade union presence at the steel plant.

The state-owned assets supervision and administration commission is the quasi-governmental body under the state council charged with protecting state assets such as SOEs, and maximizing their market value during transactions with private investors. In theory, SASAC is supposed to represent the overall interests of SOEs, including their employees, in practice however this rarely, if ever, happens. And in Tonghua’s case in particular, SASAC made no effort whatsoever to consult the workers or consider their interests when arranging the sale of 66 percent of the steel plant to one of China’s largest private companies. Many commentators roundly condemned SASAC’s paternalistic approach in arbitrarily deciding what was in the best interests of Tonghua’s workers without even consulting them.

Southern Weekend (南方周末) commentator Dai Zhiyong, noted on 29 July that even after postponing the takeover deal in the wake of Chen’s death, SASAC still:
"Firmly believes that Jianlong’s move to increase its stake in Tonghua Steel is the most beneficial course of development, one that coincides with the interests of the entire workforce. The truth is, up until now, they still don't understand that they are not a benevolent father, and that the workers are not children; the workers naturally will have a different opinion from the major stockholder and SASAC, as to what is advantageous for them. "

Jing Chuan, a lawyer at the Gaodong Law Firm in Beijing, told the China Daily:
"The provincial assets watchdog and related parties have made a huge mistake by not keeping the workers and their union representatives informed. If they had gone through the legal procedures and listened to opinions from the workers, there would not have been such a burst of anger when the staff found out. This tragedy was avoidable. "

The renowned social scientist, Yu Jianrong, pointed out however that it was virtually impossible for a body like SASAC to take the interests of all parties into account when managing the sale of state assets. Writing in the Southern Metropolis Daily (南方都市报), Yu said:
"In maximizing the interests of state assets, there is a conflict between protecting the interests of the enterprise and those of the workers. In theory, the correct way would be to find a balance between them. However, SASAC isn’t really equipped to perform this role... Neither does it have sufficient motivation or incentive to find that balance. As a result, ‘reducing employees to increase profit’ is not only seen as a convenient operating measure, it’s actually been elevated to the status of guiding thinking. This not only abandons the workers’ interests, it is simply not the right thing. "

Yu’s solution to this contradiction was to abandon the pretence that SASAC could represent everyone’s interests, and make it solely responsible for representing the interests of capital – the job that it effectively does already. Yu proposed that another body, with the same powers as SASAC, be established to represent the interests of labour. Interestingly, Yu did not suggest that the All China Federation of Trade Unions (ACFTU) should perform this role. Perhaps he was all too well aware of the limitations and ineffectiveness of the union in representing workers’ interests in SOE restructuring.

As a 34-year-old Tonghua employee told the China Daily, even though he and most of his colleagues were union members; “I can’t remember the last time we had a conference with our union representative. The union certainly didn’t go any good the day Chen was killed.”

An elderly retiree at the plant told the newspaper that union consisted of just two people, a chairman and his assistant. “It is hard for two people to do a good job for thousands of workers,” he said. Tonghua Steel currently has about 13,000 staff on the payroll.

However, Dai Zhiyong argued that the trade union was the only realistic option for the workers, and as such there was an urgent need to revitalize that flagging institution.
"If the union is ineffective, other interest groups, including SASAC and the leadership of the enterprise, will naturally ‘lower transaction costs’ and exclude the nominal owners of the SOE from the negotiation and benefit-sharing process. The workers will be left with an either-or situation: either have their teeth knocked out and swallow the blood - to be resigned to their fate - or to take irrational measures in defense of their rights and interests.
The key to averting the radicalisation of capital-labour relations therefore is to address the source of the problem - for the union to stop operating amateurishly, merely collecting a few yuan in membership fees, and sending out letters and token gifts during the New Year and other holidays. "

Dai suggested that the Tonghua tragedy could be the catalyst needed to kick-start union reform in China:
"One possible starting point to avoiding tragedies like Tonghua in the future, and, in addition, to provide the space for both capital and labour to negotiate fairly and resolve their problems rationally, would be trade union reform. "

However, just as crucial as union reform is the need for managements to accept the union as an equal partner in negotiations, something the Jianlong Group, and Chen Guojun in particular, were seemingly unwilling to do. A detailed investigation into the Tonghua tragedy by China Newsweek (中国新闻周刊) published on 5 August described how Chen implemented a stringent new management system at Tonghua whilst deputy-general manager from 2005 to the beginning of 2009. It was a system reportedly based on that of Taiwan’s China Steel, and featured the strict separation of workers and management and the implementation of harsh fines and extravagant bonuses. Chen was a tough disciplinarian and reportedly introduced fines of between 100 yuan and 200 yuan for even minor infractions such as having a single button open on one’s uniform.

This strict new system stood in marked contrast to the more inclusive and egalitarian style of the previous SOE management. Indeed, one of the chief complaints of the workforce during Chen’s tenure as deputy-general manager was not so much that their wages decreased (which they did) but that gap between workers’ and managers’ salaries grew exponentially. Most workers earned around 36,000 yuan a year, while mid-ranking managers could earn around three times that amount, and Chen himself was reportedly paid three million yuan a year for his services, or more than 80 times the average worker’s salary.

A whole swath of workers over 50-years old, or with more than 30 year’s of service, were laid-off soon after Chen arrived in 2005, and so the news that he was to return to Tonghua as general manager, just a few months after Jianlong had pulled out because the plant was not making a profit, naturally sent alarm bells ringing.

On the morning of Friday 24 July, as news spread of Chen’s return, one of the workers laid off four years ago strung a banner across the entrance to the main office building saying “Jianlong get the Hell out of Tonghua Steel!” (建龙滚出通钢).

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