Between State-Led Unions and Self-Organization: Chinese Workers in the Global Crisis

By Paolo Rizzi

 

 

 

Introduction

The aim of this article is to identify patterns of industrial conflict in China in recent years. In particular, I will focus on whether the global crisis, which began in 2007-2008, changed industrial conflict and how industrial conflict influenced the State. In doing so, the article attempts to blend together academic, journalistic, and militant source materials.

The first section of the paper briefly explains contemporary Chinese labour legislation. The second section examines the role of the official state-sponsored trade union, the All China Federations of Trade Unions, (ACFTU). The third and final section discusses changings in social composition of Chinese workers involved in industrial conflict as well as aims and methods of industrial conflict itself.

 

The Legal Environment of Industrial Conflict

The Trade Union Law (TUL) of the People’s Republic of China (PRC) was adopted in 1950 and amended in 1992 and 2001. The TUL establishes that “[t]he All-China Federation of Trade Unions […] represent the interests of the workers and staff members and safeguard the legitimate rights and interests of the workers and staff members according to law”(Art. 2). and that “[a]ll manual and mental workers in enterprises […] have the right to organize or join trade unions according to law without any discrimination .”(Art. 3). In 1994 the National People’s Congress (NPC) adopted the Labour LawLabour Law of the People’s Republic of China, http://www.npc.gov.cn/englishnpc/Law/2007-12/12/content_1383754.htm, accessed on 2015 July 16th. that unified in a single law the previous regulations that were spread across a number of different legal sources. Moreover, the Labour Law abolished the distinction of employment relations between private, public, or state ownership and certified the end of the so-called “iron rice bowl,” meaning the end of the system of life-long employment in State Owned Enterprises (SOEs).Casale Giuseppe and Zhu Changyou, Labour admnistration in reforms in China, International Labour Office, Geneva 2013, pp. 10-11. Chapter II of the Labour Law establishes the labour contract and collective contracts as “agreements reached between labourers and the employer to establish labour relationships and specify the rights, interests and obligations of each party”(art. 16) that “shall become legally binding once they are concluded in accordance with law.”(art. 18) Article 19 describes the clauses that must be included in the contract:

(1) Time limit of the labour contract; (2) Content of work; (3) Labour protection and labour conditions; (4) Labour remunerations; (5) Labour disciplines; (6) Conditions for the termination of the labour contract; (7) Liabilities for violations of the labour contract.

Collective contracts are valid within the enterprise in which they were bargained. Chapter X of the Labour Law regulates labour disputes. According to Article 79, the first step is mediation at the level of The Labour Dispute Mediation Committee (LDAC) of the working unit. If mediation fails, or one party is not content with the outcomes of mediation, any party can apply to the LDAC. Additionally, if arbitration is unsuccessful, the dispute can be brought as a lawsuit before the People’s Court.

In 2007, a number of social laws were adopted by the NPC. The Labour Contract LawLabour Contract Law of the Peoples’ Republic of China, http://www.npc.gov.cn/englishnpc/Law/2009-02/20/content_1471106.htm, accessed on 2015, August 13th. (LCL) was adopted on June 29, 2007 and came into effect on January 1, 2008. The LCL’s Chapter V establishes new regulations for collective contracts that were not included in the 1994 Labour Law. Article 51, for example, states that the collective contract in an enterprise “shall be concluded by the trade union on behalf of the employees” and that in “an enterprise where a trade union has not yet been set up, such a contract shall be concluded with the employing unit by the representatives elected by the workers under the guidance of the trade union at a higher level.” Article 52 establishes the opportunity to conclude sector-wide or area-wide collective contracts at or below county level, but only in the sectors of mining, construction, and service catering. Article 5 of the LCL creates tripartite mechanisms between the Department of Labour of the People’s Government and representatives of the trade union and of the employers in order to coordinate labour relations. The Labor Dispute Mediation and Arbitration LawLaw of the People's Republic of China on Labor-dispute Mediation and Arbitration http://www.npc.gov.cn/englishnpc/Law/2009-02/20/content_1471614.htm, accessed on 2015, September 28th. (LDMAL) was adopted on December 29th 2007 and further details the legal procedures of labour disputes and improves the quality of arbitrations teams.Casale and Zhu 2013, p. 24 Article 7 of the LDMAL states that when a dispute involves more than ten workers, one of them can be elected as a representative in the dispute. Chapter II stipulates that, in addition to the committee operating in the unit of the parties involved already cited in Article 79 of the Labour Law, labour mediations can be carried out also by the “people's mediation institutions at the grass-roots level established in accordance with law and by organizations with the function of labour-dispute mediation established in towns, townships or neighborhoods.”

Social insurance schemes are regulated by the Social Insurance LawSocial Insurance Law of the People’s Republic of China http://www.bycpa.com/html/news/20116/1585.html, accessed on 2015, September 28th. (SIL), adopted by the NPC on October 28th 2010. The SIL is intended to address China’s pronounced rural/urban divide, since it establishes the New Rural Pension Scheme (NRPS) (Article 20) and the New Rural Cooperative Medical System (NRCMS) (Article 24). The NRPS and the NRCMS were previously enjoyed only by urban inhabitants.

Minimum wage was first introduced in Chinese legislation by Article 48 of 1994’s Labour Law, which stated that minimums were to be created at the level of provinces, autonomous regions, and municipalities. According to Article 49, the minimum wage must be set in accordance to:

(1) The lowest living expenses of labourers themselves plus that of the average number of family members they support; (2) The average wage level of the society as a whole; (3) The labour productivity; (4) The situation of employment; and (5) The regional differences in economic development.

Minimum Wage Regulations (MWR) were promulgated in 2004 by the Ministry of Labour and Social Security and provide comprehensive schemes for the calculation of the minimum wage. The MWR advise that the calculations should be carried out by local administrations within a province, autonomous region or municipality in consultation with trade union and employers representatives.Zenglein Max J., Fragmented Minimum Wage System, in China’s Labor Question, Rainer Hampp Verlag, München, Mering 2011, pp 75-78.

The right to strike was guaranteed by the constitutions of the PRC, which were adopted in 1975 and in 1978. In the constitution adopted in 1982 there is no mention of the right to strike. The absence of constitutional protection to the right to strike does not mean that striking in China is illegal, per se. One of the major potential consequences, however, is that legal protection is not explicitly guaranteed for actions committed by labourers during a strike.Chang Kai, “The Legislation of Right to Strike in China”, International Society for Labor and Social Security Law Asian Regional Congress 2005, http://www.airroc.org.tw/ISLSSL2005/program/doc/II-3.doc accessed on 2015, September 28th.

 

The Role of the State-Led Union

The sole legal trade union in China is the All China Federation of Trade Unions (ACFTU). The ACFTU was founded in 1925 and became the official organization of the workers of the People’s Republic of China (PRC) in 1949, incorporating all other unions. In 1959 the major private companies in China were nationalized, and since then the ACFTU has acted as a “transmission belt” of the Communist Party of China (CPC). The ACFTU began changing in the early 1990s when the urban SOEs underwent the process of marketization and privatization. The emergence of a labour market in the urban areas of the PRC confronted the ACFTU with the need to find a new role in the so-called “market socialist economy”.

After a period of decline between 1990 and 2000, the ACFTU’s membership began to grow from 169,942,000 members in 2003 to 287,869,000 in 2013. This growth is due to a change in the official policy toward trade unions. The 14th congress of the ACFTU, which was held in 2003, opened membership to migrant workers, thus allowing them to reach the quota of 70 million unionized migrants in 2007. The other great source of unionizing was the campaign launched by President Hu Jintao in 2006 to unionize the private sector and, most notably, foreign owned companies known for their anti-union policies, such as Walmart and McDonald's. The result of this campaign was a great surge in the establishment of unions representing the workers of private companies with a top-down approach.Traub Merz Rudolf, All China Federation of Trade Unions: Structure, Functions and the Challenge of Collective Bargaining, in Industrial Democracy in China: With Additional Studies on Germany, South Korea and Vietnam, China Social Science Press, Beijing 2012, pp 11-31].

 

2.1 Various Models and Dynamics of Workplace and Upper-Level Trade Unionism

Workplace unions can be established in China in two ways. The first and most common way is the top-down approach in which the upper level of the trade union (meaning city-level and district-level) meets a quota of unionized workers and bargains directly with management for the establishment of a union within each enterprise. In this kind of approach workers are not involved -- in many cases trade union representatives are not elected by labourers but are chosen by the ACFTU and management, and sometimes only by management.Traub-Merz 2012 pp 31-33.

A minimum of 25 employees from within an enterprise can set up a workplace trade union. This kind of bottom-up approach was seen in the unionizing process at Walmart; employees contacted the upper levels of the ACFTU and established a union. However, the subsequent wage bargaining was conducted by the upper levels of the union without consulting the labourers, and the enterprise ignored union representatives elected by the employees, preferring to bargain with the ACFTU officials.

The bottom-up approach in the formation of workplace unions is rare. More commonly, top-down appointed unions face spontaneous worker mobilizations. Take, for example, the famous strike initiated by the workers of the Honda Auto Parts Manufacturing (CHAM) plant in Foshan, Guangdong province, during the summer of 2010. The fundamental demands of the CHAM workers were an increase in wages and a democratization of the trade union. These requests were originally opposed by the workplace union representatives which instead backed management. However, after a few days of the strike, the upper levels of the ACFTU decided to intervene to support worker requests for higher wages and the representatives of the stirking workers secured a pre-meeting with trade unionists before the official meeting with the management. In the end, management agreed to raise wages but refused to discuss the union’s democratization. However, the strike at the CHAM, and the other strikes that followed in 2010, put a considerable amount of pressure on the ACFTU which recognized the necessity of authentic democratic elections for the workers' representatives.Traub-Merz 2012 p 31. Hui Elaine Sio-ieng and Chan Chris King-Chi, The Prospects of Trade Union Reform in China: The Case of Wal-Mart and Honda, in Industrial Democracy in China: With Additional Studies on Germany, South Korea and Vietnam, China Social Science Press, Beijing 2012 pp 104-119. Direct elections of union officials have been held in Guangdong province since 2012, many facing difficulties in forcing management to accept democratically elected representatives. At any rate, the experiment in Guangdong also highlights internal factions within the ACFTU which are not? in favor of democratization and believe that these types of elections should not take place when there is the risk of electing radical representatives who would disrupt “harmonious industrial relationships.”Wen Xiaoying, “Gōnghuì zhíxuǎn: Guǎngdōng shíjiàn de jīngyàn yǔ jiàoxùn”, Open Times, 2014, http://www.opentimes.cn/bencandy.php?fid=377&aid=1835 accessed August 27, 2015.

Other forms of assistance to migrant workers were initiated under the so-called “Yiwu model.” This was based on an experiment carried out in Zhejiang province as a reaction to the formation of “self-defense” organization by workers who felt discriminated against and unfairly treated. To prevent the spread of autonomous organizations, the “Yiwu model” provides migrant workers with a series of legal services. The Centre for Legal Protection of the Rights of the Workers was created and put in charge of collective bargaining and settlement of labour disputes. Party-state officials are appointed as Centre's counselors to assure the commitment of the institutions. Direct involvement of government in the “Yiwu model” is considered to be fundamental to overcome limitation of ACTFU.Zhu Ying, Warner Malcolm and Feng Tongqing, “Employment relations “with Chinese characteristics”: The role of trade unions in China”, in International Labour Review, Vol. 150, No. 1–2, 2011 p. 136; Jing Yuejin, The “Yiwu Model” and Labor Rights Protection With Chinese Characteristics, in Industrial Democracy in China: With Additional Studies on Germany, South Korea and Vietnam, China Social Science Press, Beijing 2012 pp 88-102.

The case of Wal-Mart and other enterprises where workers unionized through a bottom-up approach show that, even when workers are involved, there are powerful structural obstacles to the development of industrial democracy. The cases of strikes in 2010 and the “Yiwu model” show that workers’ mobilization can force the government and the ACTFU to operate more energetically in favor of labour rights. At the same, actions taken by official institutions in favor of labour rights are planned to prevent the creation of independent organization of the working class.

 

2.3 Collective Contracts without Collective Action

Official statistics show a rise in the numbers of collective contracts. At the end of 2007, 343,000 collective contracts were signed nation-wide, covering 626,000 enterprises and involving 39.7 million labourers. In October 2014, The People’s Daily (Renmin Ribao) reported that 2.42 million collective contracts were signed, covering 6.33 million enterprises and 287 million labourers. The reason for this dramatic rise in numbers can be easily traced back to the three-year plan imposed by the national government to spread the coverage of the collective contracts.Huang Renmin, Characteristics of Collective Wage Bargaining in China and the Practical Role of Trade Unions, in Comparative Industrial Relations: China, South-Korea and Germany/Europe, China Social Science Press, Beijing 2010 p. 25.

Even though the number of collective agreements continues to rise to meet quotas? set by the Chinese State, their analyses have found two main problems with the quality of such contracts.

The first problem is that collective agreements are vague or difficult to implement. Many contracts are not detailed; they merely repeat what is already established by laws and do not specify any further obligations for the employer or any further rights for the employee. Moreover, the implementation of collective contracts should be reviewed by the labour administration, which itself is small, weak and underfunded. Lastly, laws on collective contracts do not provide consistent regulations for the process of bargaining working conditions and wages.Luo Siqi. Collective Contracts, but no Collective Bargaining, in China’s Labor Question, Rainer Hampp Verlag, München, Mering 2011, pp 54-55; Huang Renmin 2010, pp 33-35.

The second problem is that workers are not involved in the process of bargaining. The greater part of contracts are negotiated through top-down channels by an upper-level trade union or by local authorities. Apart from experimentation attempted in the province of Guangdong and a few other provinces, there is no direct link between employees and their representatives. The disconnect between workers and unions means industrial actions are almost never called by the trade union. In this sense it is possible to state that even though there is great coverage of labourers with collective contracts, there is no real collective action behind it.

As reported in §2.1, there are signs of a changing role for the ACFTU as result of spontaneous workers’ activism. In these cases there are reports of collective agreements with more favorable outcomes for the employees' side in terms of wage increases and implementation of the contract itself. Nevertheless, interviews with union officials show that these agreements are considered as an exception under extraordinary circumstances, not as an ideal starting point for collective action as the norm of collective bargaining.Chan and Hui 2012, pp 17-19.

It can be concluded that the role of the All-China Federation of Trade Unions is slowly adapting to the new conditions of a market economy. This process of adaptation is aimed at the keeping of social peace and making the ACFTU, effectively, a lobby that works in the interests of the workforce as long as it has the approval of authorities and doesn’t create conflict.

 

Industrial Conflict in the Global Crisis

The global crisis, begun in 2007-2008, hit China when the country was attempting a cooling down of the economy following a period of high inflation caused by rising labour costs and prices for imported natural resources and foodstuffs.Naughton Barry, “A New Team Faces Unprecedented Economic Challenges”, in China Leadership Monitor, No. 26 2008. Lower international demand caused troubles in particular for the country’s export-oriented, labour-intensive small and medium enterprises. The state first responded with a series of relatively small-scale monetary adjustments.Naughton Barry, “The Scramble to Maintain Growth “, in China Leadership Monitor, No. 27 2009. In November 2008, after a deeper than anticipated slowing of economic growth, the State Council decided to implment a robust stimulus package to “further expand domestic demand and assure stable rapid growth”.Naughton Barry, “Understanding the Chinese Stimulus Package”, in China Leadership Monitor, No. 28 2009. The stimulus was widely regarded as an effective measure for boosting economic growth even though, according to many observers, it didn’t resolve the broader structural problems of the Chinese economy and instead deferred to the objective of re-equilibrating the distribution between investments and internal consumption.Yilmaz Akyüz, “Export Dependence and Sustainability of Growth in China”, in China & World Economy, Chinese Academy of Social Sciences, Vol. 19, No. 1, 2011, pp 16-19. Moreover, the annual adjustment of the national minimum wage was suspended in 2009 and re-enacted in 2010.Zenglein 2011, p 74.

 

3.1 How Many Industrial Actions?

However, one question remains: did the impact of the global crisis influence the number of actions of industrial conflict in China? The official data released by the China Statistical Yearbook and by the China Labour Statistical YearbookChina Statistical Yearbook, various years, http://www.stats.gov.cn/ China Labour Statistical Yearbook, various years, http://tongji.cnki.net/overseas/engnavi/HomePage.aspx?id=N2011010069. offer only a partial answer. Since the first half of the 2000s, indicators of labour disputes were on the rise. In 2008, some of these indicators escalated quickly but it is notable that 2008 was not only the year of the economic slowdown but also the year in which many social laws adopted during the previous year came into effect.

The number of collective labour disputes, with only 2,588 in 1995, peaked with 19,241 cases in 2005, but then slowly declined to 12,784 cases in 2007. The following year, however, labour disputes reached a new peak at 21,880 cases. In the years from 2011 to 2013, the number of collective disputes stabilized around 7,000 cases per year. The number of cases appealed by workers rose slowly from 249,335 in 2004 to 325,590 in 2007, and then peaked at 650,077 in 2008. After years of ups and downs the number in 2013 stabilized around 640,000.

Statistics on total cases settled show a similar pattern to that of collective labour disuptes. From 258,678 settled in 2004, there was a stable growth to 340,030 in 2007, then a peak of 622,719 cases in 2008 and even more, 689,714 cases, in 2009. In the following years, the number ranged from 592,823 to 669,062.

The number of labourers involved in labour disputes presents a wavering trend. Starting from 801,042 labourers involved in 2003, the number declined to 653,472 in 2007 and then dramatically rose to 1,214,328 in 2008. In the following year, 1,016,922 workers were involved in labour disputes, followed by a rapid decrease to 779,490 in 2011 and a stabilization around 880,000 in 2012 and 2013.

All of these numerical indicators show peaks in 2008 and 2009, the years in which the impact of the global crisis was strongest in terms of layoffs of workers and other causes of conflict on workplace.Lüthje Boy, Regimes of Production and Industrial Relations, in China’s Labor Question, Rainer Hampp Verlag, München, Mering 2011, p 103. After 2009, the indicators generally decline, stabilizing at a level above the pre-crisis period, with the exception of collective labour disputes. These numbers provide an outlook on how industrial conflict changed as new labour laws came into effect.

However, methods provided by the law are not the only expression of industrial conflict owing to a number of reasons. First, the high impact of informal economy: a 2012 World Bank report shows that slightly less than one-third of the workforce in urban areas worked for employees who did not pay social insurance and/or who were without a formal labour contract.Park Albert, Wu Yaowu and Du Yang, Informal employment in urban China : measurement and implications, Working Paper Report Number 77737, World Bank, 2012, p 27. Another reason is that, as was reported in §1, the strike, usually considered as the most important form of industrial labour action, is not protected as a right by Chinese law and, as a result, there are no official statistics about the duration of strikes.

An indirect indicator of strike actions may be statistics about so-called “mass incidents.” Various journalistic sources published pieces about an escalation from a number of 8,700 mass incidents in 1994 to 74,000 in 2004, then from 87,000 incidents in 2005 to over 180,000 in 2010.Richard McGregor “Data show social unrest on the rise in China.”. Financial Times January 19, 2006; Brendan O’ Rilley “Diverse reasons behind growth in China’s ‘mass incidents’.” Chinaoutlook May 13, 2014. http://chinaoutlook.com/diverse-reasons-behind-growth-in-mass-incidents/ accessed August 26, 2015. A deeper analysis shows that data on strikes are defined differently across time. The series from 1993 to 2004, for example, identifies “mass incidents” while the series from 2005 to 2010 seems to identify “public order disturbances.” “Mass incidents” such as strikes, sit-ins, public demonstrations and mass petitions, are a subset of “public order disturbances” which also includes incidences of ordinary crime.Statistics of mass incidents, Eastsoutwestnorth, http://www.zonaeuropa.com/20061115_1.htm accessed August 26, 2015. However, for the scope of this paper, statistics about “mass incidents” and “public order disturbance” are only a vague indicator since they report actions caused by a variety of reasons, not only industrial conflict, and participation in each “incident” may vary from a few tens to many thousands of people.

The Chinese Academy of Social Sciences published in 2014 a study on “mass incidents.” In this study “a mass incident” is defined as an action involving more than 100 individuals. According to this definition, there were 163 “mass incidents” in 2010, 172 in 2011 and 209 in 2012. Labour disputes were the major catalyst for these “mass incidents,” causing 267 out 871 incidents recorded from January 2000 to September 2013. This indicator, however, is merely indicative, as it is not a precise measure of incidents but, rather, a record of incidents reported by the Chinese state-run media.Report identifies sources of mass protest, China Daily 2014-04-09. http://www.chinadaily.com.cn/china/2014-04/09/content_17415767.htm accessed August 26, 2015.

A study conducted by sinologists Tong and Lei analyzed large-scale mass incidents, meaning mass incidents involving more than 500 individuals. Because of the scales of these incidents, it is not likely that these incidents could have been hidden by authorities or ignored by the media, so this series of data is likely highly reliable. Tong and Lei found 9 large-scale mass incidents in 2003, 20 in 2004, 9 in 2005, 25 in 2006, 63 in 2007, 76 in 2008, and 46 in 2009. In total, there were 248 incidents between 2003 and 2009, of which 108 were caused by labour disputes. The peak year was 2008 which is also the only year when the number of labour incidents in the private sector were higher than the 12 incidents recorded in state owned enterprises.Tong Yanqi and Lei Shaohua, “Large-Scale Mass Incidents and Government Responses in China” in International Journal of China Studies, Vol. 1, No. 2, 2010 pp. 478-508.

In 2011, the Hong Kong based NGO China Labour Bulletin (CLB) started a collaborative mapping of industrial conflicts in the PRC, based on news collected from various media outlets.China Labour Bulletin Strike Map. http://strikemap.clb.org.hk/strikes/en accessed August 26, 2015. This mapping recorded 185 actions in 2011, 382 in 2012, 656 in 2013, and 1,379 in 2014. In 2011 34.6% of the labour actions recorded were strikes, 39.3% in 2012, 55.8% in 2013, and 31.8% in 2014. These numbers cannot be taken as exhaustive given the voluntary nature of the project and the opacity of the Chinese media system. Nonetheless, the CLB mapping shows that, during the global crisis, news coverage about strikes and other workers’ actions was increasingly reported by the country’s mainstream media.

Academic, journalistic and military sources find that industrial conflict, and more broadly social conflict, have remained high in China since the beginning of the global financial crisis. While the data are too incomplete and heterogeneous to attempt a precise measure of conflict,, it can be said that, unlike what happened in many western countries, the crisis did not diminish industrial conflict and that there was a clear peak in the years 2008-2009.

 

3.2 Social Composition and Patterns of Industrial Conflict

A growing number of on-field researches is increasingly focusing on the social composition of the new wave of industrial conflict. In particular, the following section will review the main findings of these studies in terms of differences among labourers, the legacy of the socialist system, and patterns of industrial actions.

 

3.2.1 From the Iron Bowl to the Market of Means of Production

Since the beginning of economic reforms between the late 70s through the early 80s, China’s working class population underwent a dramatic transformation. During the Maoist era, workers were considered as the leaders of the PRC. Even though this is widely regarded as merely a theoretical proposition, workers still enjoyed some advantages, especially the so-called “iron rice bowl system,” meaning that workers were involved in a system that guaranteed a job “from the cradle to the grave” in a situation where the workforce market was virtually non-existent.Pei Xiaolin, “The contribution of collective landownership to China’s economic transition and rural industrialization: a resource allocation model”, in Modern China, Vol. 28 No. 3 2002, pp 279-314; Pei Xiaolin, “The genesis of China’s economic transition”, in China Information, Vol. 19 2005, pp 5-38. The creation of a capital market, first, and a workforce market, later, created a situation with many differences among various sectors of production in terms of the organization of work and the relationship between labourers and management. German sociologist Boy Lüthje identifies five types of productive regimes in China?:

The State Bureaucratic (SP) type can be found in the SOEs in steel and petrochemical sectors, the urban based workforce has a medium to high skill level. After the period of restructuring during the 90s, the working conditions in these big SOEs are stable;

The Corporate Bureaucratic (CP) type can be found in private-public joint ventures in the automotive and petrochemical sectors, working conditions in this type are quite stable but there are, occasionally, processes of restructuring;

The Corporate High Performance (CHP) type can be found in foreign-owned and new Chinese private enterprises in fields such as electronics and components, working conditions are not stable;

The Flexible Mass Production (FMP) type, found mainly in US and Taiwan-owned electronics and subcontracting enterprises, is a more extreme version of the CHP type in which there is a great divide between skilled and unskilled labourers;

The Low Wage Classic (LWC) type can be found in garment and textile sectors and in enterprises subcontracting for automotive and electronic industries and it is the lowest rank of production. In LWC can be found full exploitation of rural migrants and extremely long working hours. In this type, individual and collective conflicts arise for the respect of laws and over the discipline of work.

Lüthje investigated industrial relations on-site in a number of enterprises identifying these different models. In state bureaucratic enterprises, trade unions are widely accepted by the management as entitled to oversee the full implementation of the law.

A similar situation can be found in corporate bureaucratic enterprises, where trade union officers are usually co-opted into management but there are more individual conflicts caused by skilled labourers demanding more opportunity for advancement. The occasional restructuring of CP enterprises may lead to mass protests. In the CHP type there are many conflicts over individual and collective issues and the union is scarcely present or effective. In FMP enterprises there are both individual and collective conflicts in order to meet the dictates of law. In LWC enterprises workers undertake individual and collective industrial action actions to require compliance with the legal guarantees and to question the discipline of the workplace. In both the FMP and LWC, the trade union is not present at all.Lüthje 2011, pp 103-114.

 

3.2.2 A New Generation of the Chinese Working Class

Lüthje’s work provides a picture of how the transition from a planned economy to a market economy differentiated the Chinese production system and the conditions of the country’s working class. The most recent research in the field shows that the patterns of industrial conflict were also changed by the formation of a new generation of workers. Corresponding with the entrance of this new generation into the production system, there has been a change in the aims of industrial actions. While in the lowest ranks of productive regimes conflicts over the application of the law still remain, in medium-to-high end enterprises, strikes took place over wages and, in general, for better conditions than the legal minimums. This new generation of workers is characterized by a higher level of education than the previous generation and by the effects of the one-child policy that posed an end to the surplus of labour.Traub Merz 2012, pp 39-44. From the mid-2000s, the reaction of the media system to industrial conflict changed, pehaps partly because of the pro-union stance assumed by authorities (see § 2). These two changes made journalistic coverage of industrial actions more common. In particular, the media’s attention is focused on the “model experiences” of the direct elections of the workers’ representatives by the workers themselves.Chan Anita, “Trade Union Elections at Foreign-Owned Chinese Factories”, in China: an International Journal, Vol. 15, No. 3, pp. 105-106, 110-111.

 

3.2.2.1 Migrants

One of the main features of China is its institutional discrimination organized by the hukou system. This system divides Chinese citizens according to their registration in rural or urban areas. As a result of the hukou, 150 million workers were estimated to have migrated internally in 2009. Internal migrants are defined as people living and working in urban areas but formally resident in rural areas, and, therefore, not enjoying social programs meant only to serve urban residents. A vast literature records the difference between migrant and urban workers in terms of income, of access to legal contracts, and access to non-monetary benefits.Gagnon Jason, Xanogiani Theodora and Xing Chunbing, “Are migrants discriminated against in Chinese urban labour markets?”, in IZA Journal of Labor & Development, 3:17, 2014.

The first generation of migrant workers, having been born during the late 60s and the 70s and entered into the workforce during the 80s and adhered to the official slogan of “working in the city but not staying in the city.” Many wanted to go back to the land after a period of work in the industrial cities. But in addition, lower wages and the lack of access to urban welfare prevented the first generation from settling in cities.Pun Ngai and Lu Huilin, “Unfinished Proletarianization: Self, Anger and Class Action among the Secondo Generation of Peasant-Workers in Presente-Day China”, in Modern China, 36(5), 2010, pp 497-498. On the contrary, the second generation of migrant workers, who were born during the 80s and who entered into the production system in the late 90s and early 2000s, harbor different expectations and behaviors. Workers of the second generation are not usually interested in going back to rural areas; they are better educated and have expectations of higher wages and better careers and are more active in industrial actions. These young workers are recorded as key actors in strikes and other forms of workplace conflict.Pun and Lu 2010, pp 507-508 Chan Jenny, Pun Ngai and Selden Mark, “The politics of global production: Apple’s Foxxconn and China’s new working class”, in New Technology, Work and Employment, Vol. 28 Issue 2 2013, pp 104-112; Traub-Mertz 2012, p 42.

 

3.2.2.2 Temporary Workers

In past years, the plight of migrant workers often overlapped with, but was not exactly the same, as the category of temporary workers. Until 2008, enterprises in China, especially in the medium-to-low ranks of production discussed in §3.2.1, increasingly employed workers hired by external agencies. These workers were paid less, received little, if any, non-monetary benefits and had short-term labour contracts. Fieldwork conducted by Lu Zhang found that within automotive enterprises, the percentage of temporary agency workers varied from 20% to almost 50% of total employees between 2003 and 2006.Zhang Lu, “Lean Production and Labor Controls in the Chinese Automobile Industry in An Age of Globalization”, in International Labor and Working Class History, Vol. 73 Issue 1 2008. p 34.

The use of agency workers has been fundamental for the creation in many enterprises of a dual employment system, with one contingent of employees categorized as regular workers and another as temporary, doing the same work for different remuneration. The differentiation between regular and temporary workers permitted enterprises to react flexibly to the highs and lows in the cycle of production hiring more temporary workers only when the orders of production required them.Hao Zhang, “Hegemonic Authoritarianism: The Textile and Garment Industry”, in China’s Labor Question, Rainer Hampp Verlag, München Mering, 2011, p 122. The dual system was also intended to formulate a segmented workforce with greater barriers to solidarity in industrial labour action. Even though it was successful in separating regular and temporary workersZhang 2008, p 40-41., the dual system was never able to prevent workplace conflict. On the contrary, the dual system created a situation of inequality that is perceived by temporary workers as unacceptable and that, in the end, causes conflicts between temporary workers and management.

The Labour Contract Law that came into effect on 1 January 2008 posed limits to the use of agency workers. The LCL established the principle of equal pay for equal work and states that agency workers should be used only for a limited set of temporary jobs and not for regular jobs with short term contracts renewed at the end of each term. At any rate, these new protections concern only agency workers and not the other vast contingent of temporary workers: student interns. The official intent of the policy is to raise the skills of workers coming from vocational schools through mandatory internships. In reality, student interns are used to cover low-skill duties for which enterprises are not willing to hire full-time workers.Selden Mark, Chan Jenny and Pun Ngai, “Intern or Workers? China’s Student Labor Regime”, Global Research September 09, 2015 http://www.globalresearch.ca/interns-or-workers-chinas-student-labor-regime/5474874 accessed on September 28, 2015; Zhang 2008, pp 33-36.

While at the end of the 90s temporary workers were mainly migrant workers, beginning in the mid-2000s, the composition of temporary workers has become far more fragmented. The vast majority, about two thirds, of agency workers are still migrant workers, but there is also a significant number of urban workers who cannot find a contract as a regular labourer. Among student interns, there were equal shares of students coming from the cities and students coming from rural areas.Zhang Lu, “Whose Hard Times? Explaining Autoworkers Strike Waves in Recent-Day China”, in Workers in Hard Times. A Long View of Economic Crises. University of Illionois Press, Chicago 2014, pp 219-221.

 

3.2.2.3 The Socialist Legacy

The legacy of the Maoist-Socialist period regarding the attitude of workers in China is ambiguous. There are findings which suggest that workers who were educated during the Maoist period partly accepted the process of restructuring of SOEs because of the promise of economic benefits from this restructuring. In addition, accounts by trade unions and Party officers explained that restructuring was necessary for the good of the national economy.Zhang 2014, pp 217-218. It can be stated that, paradoxically, China’s Maoist education system was used to justify the subsequent transition to the “market socialism system”. In more recent years, workers educated after the beginning of the economic reforms show tendencies to use a shallow Maoist discourse to legitimize their requests and to symbolize radical action.Chan Chris King-Chi and Pun Ngai, “The Making of a New Working Class? A Study of Collective Actions of Migrant Workers in South China”, in The China Quarterly, Vol. 198 2009, pp 300-302. Another feature that can be traced back to the legacy of socialism is that workers show a strong sense of egalitarianism in the workplace, taking action as a consequence of inequalities that are felt as unacceptable and, even under the dual system, showing a certain degree of solidarity between stable and temporary workers.Zhang 2014. pp 223-225.

 

3.2.3 Aims and Methods

At present a comprehensive review of the aims and methods of industrial conflict is not available. Nevertheless, social? scientific literature detects some of the patterns of industrial conflict as enacted by the new Chinese working class.

Many social scientists analyzed in depth the wave of actions which occurred after the strike at the Honda Auto Parts Manufacturing CHAM plant in 2010. Findings from all of these strikes and actions show there was a breakthrough in the demands of the workers who not only asked for the respect of the law, as was typical in actions taken by workers of the “first generation”, but also demanded wages higher than the legal minimum or higher than the ones paid by the employers. Migrant workers of the second generation and temporary workers are found to have been the core activists in these actions. Actions taken during the summer of 2010 were widespread, and in many cases featured participation by more than half of the workforce. The broad support from workers for these actions made them largely effective as management either agreed in toto to the demands of the workers or agreed to a bargaining process over wages. Self-organized workers conducted all of these actions.Traub-Merz Rudolf, All China Federation of Trade Unions: Structure, Functions and the Challengeof Collective Bargaining, Global Labour University, Working Paper No. 13 2011, pp 26-27; IHLO ITUC/GUF Hong Kong Liasion Office, A Political Economic Analysis of the Strike in Honda and the auto parts industry in China, www.ihlo.org July 2011, pp 19-22. These dynamics were found not only in Guangdong, the province in which CHAM is located, but also in other Chinese provinces, both in the industrialized eastern coast (Beijing, Henan, Jiangsu) and in the developing internal areas (Chongching and Hubei).Hui and Chan 2012, p 115 Hui Sio Leng, “Understanding Labour Activism: The Honda Workers’ Strike”, in China’s Labor Question, Rainer Hampp Verlag, München Mering 2011, p 144 IHLO ITUC/GUF Hong Kong Liasion Office 2011, p 21 This pattern was observed before 2010 and also in sectors different from the automotive sector.Wenten Frido, “Restructured Class-Relations since 1978”, in China’s Labor Question, Rainer Hampp Verlag, München Mering 2011, p 42 Pun Ngai, Chan Chris King-Chi and Chan Jenny, “The Role of State, Labour Policy and Migrant Workers’ Struggles in Globalized China”, in Global Labour Journal, Vol. 1 Issue 1 2010, pp 139-140

The other common feature revealed by recent studies is that workers are taking advantage of the organization of work and life in the new market economy in order to advance their requests and actions. One of the main changes in the production system was the introduction of the just-in-time (JIT) organizational scheme, mainly in foreign-owned enterprises of joint-ventures that apply models taken from Japanese industries. JIT production enhances what Beverly Silver calls “workplace bargaining power,” meaning the power that results "from the strategic location of a particular group of workers within a key industrial sector.Silver Beverly, Forces of Labor. Workers' Movements and Globalization Since 1870, Cambridge University Press, Cambridge 2013, p 13. In the JIT model, even a relatively small group of workers can stop the production of a whole sector, halting a single, but critical, segment of the chain of production. Moreover, one of the main characteristics of JIT is the absence of inventory as it is designed to follow the highs and lows of the market. This means that when the production is suddenly halted, there is no stock to sell.Zhang 2014, pp 221-222. Examples of the effect of wild-cat strikes are shown by cases studied by Lu Zhang in which actions taken by a as little as 3- 6.5% of the workforce stopped the production.Zhang 2014, p 223. For example, the CHAM strike in 2010 was initiated by a limited sector of employees. The workers of the transmission assembly division started the strike that later was joined by all 1,800 employees, totally halting the plant’s production.Hui and Chan 2012, pp 108-109.

The last common feature is the use of the structures that organize the life of workers, especially the dormitory system. Dormitories are so widespread in China that recent scholarship has developed the phrases “dormitory labour system” and “dormitory labour regime.” While there is a consensus on the existence of the dormitory system, different scholars provide different accounts of it. Pun Ngai, for example, considers the dormitory labour regime (DLR) as a link between the rural reproduction of work-force and urban exploitation, meaning that all welfare costs of the migrant workers are incurred by the place of origin in rural areas while the work is exploited in urban areas.Pun Ngai, “Women workers and precarious employment in Shenzhen Special Economic Zone, China” in Gender and development Vol. 12 N. 02, 2004, p. 30. Pun also points to the gendered nature of the DLR as, especially until the early 2000s, a considerable number of the migrant workforce was formed by young women fleeing from the prevailing patriarchal constraints of the countryside.Pun Ngai, “Gender and Class: Women’s Working Lives in a Dormitory Labor Regime in Chna”, in International Labor and Working-lass History, n. 81, 2012, p. 179.

Pan and Ren identify the “dormitory labor system” as a distinctive mode of production which resulted from the hybridization of “socialism in one country” and global capitalism, placing an emphasis on the role of the dormitory system in creating an environment attractive for foreign companies delocalizing production in mainland China.Ren Yan and Pan Yi, “Dormitory Labor Regime: Another Space for Labor Controlo and Resistance” http://www.china-europa-forum.net/bdfdoc-541_en.html, 2006, p 2, accessed on 2016 February 11th). While Pun, Pan and Ren share a common use of categories from critical schools of thought such as Marxism and Feminism, the existence of the dormitory system has also been analyzed by liberal scholars such as Chris Smith.Chris Smith, “Living at Work: Management Controlo and Dormitory Labor System in China”, in Asia Pacific Journal of Mangement, 20, 2003, pp. 339-341).

Most case studies on the dormitory system are located in the Pearl River Delta. However, dormitories can be found in all of China’s industrialized provinces that import their workforce from rural areas. In the early 2000s, Chris Smith found the dormitories to be more systematic than contingent, meaning that all companies operating in all sectors are forced to use dormitories in order not to lose comparative advantages over their competitors.Chris Smith 2003, p. 334, 338-339). Ten years later, Lüthjie found the dormitory system applied mostly in companies adopting “flexible mass production” or the “low wage classics” regime of production (see § 3.2.1).Lüthjie Boy, “Diverging Trajectories: Economic Rebalancing and Labour Policies in China”, in Journal of Current Chinese Affairs, vol 42, No 4 2013, p. 119.

The main benefit for companies, of course, is that they can host migrant workers in dormitories built near the place of production. These workers can be put to work according to the needs of variable rates of production. Originally dormitories were owned by the state and rented to companies. More recently, foreign owned companies began building their own dormitories in order to suit their internal housing needs. As was noted earlier, companies also use dormitories to extend their control into the private lives of workers. Recent research has found a number of ways in which this control manifests. Workers are forbidden to host visitors in the dormitories, to cook or to exchange beds privately. Chris Smith has reported on the separation of people coming from the same town or province in order to break up relationship networks among labourers.Ren and Pan 2006, pp. 3-4, Chris 2006, pp. 346-347. Finally, the dormitory system is used to tie the worker to the company. There are extreme cases in which the company impounds the ID card of the worker for the duration of the contract. Most commonly the contract is kept on a short-term basis in order to maintain a short-term residential permit. In this way, it is more difficult for the worker to use the threat of to leaving the job as a form of leverage in labour negotiations.Chris Smith 2006, pp- 344-345 Pun 2004, pp. 34-35)

While the dormitory system remains a powerful tool in the hands of employers, it is also an environment that allows labourers to organize various forms of social conflict. The first and most elementary form of resistance to management’s control is disobedience towards the dormitory regulations. In the case study analyzed by Pan and Ren, workers regularly defied the regulations against hosting their families or fellow citizens and exchanged their beds to recreate geographical networks.Ren and Pan 2006, pp. 4-5. Dormitories are places that concentrate a high number of workers, mainly young and temporary ones. Although they are designed to break up networks based on geographical origin, they ultimately end up facilitating the creation of new networks among coworkers and cohabitants.Chris Smith 2006, pp. 348-349 PunNgai, “Putting transnational labour process in its place the dormitory labour regime in post-socialist China”, in Work Employment and Society, Vol. 21 No. 01 2007 Chan and Pun 2009, p 291- 302 Notwithstanding the control by the companies, dormitories are places of relative freedom in comparison to factories. Dormitories are places were documents and leaflets are distributed and where the exchange of information and perspectives among workers takes place. Reporting on a case of conflict over the application of the Labour Law in an electronic factory in Shenzen, Ren and Pan show how labourers used dormitories as places in which information could be spread, as places to meet with co-workers and relatives, and even as a place to study the law and to draft an open letter to the local Labour Bureau.Ren and Pan 2006, pp. 5-8.

 

Conclusion

A new generation of Chinese workers entered into the production system in the 2000s and changed the methods and objectives of industrial workplace conflict. More and more Chinese workers are now keen to take action in order to demand better wages and working conditions. Well-educated youth, migrants and temporary workers are key to industrial conflict in the form of self-organized strikes and other forms of militant industrial actions. The new generation of labourers demonstrated an ability to take advantage of the introduction of new organizational features in the regimes of production, especially the neo-Taylorist just-in-time system as well as in the organization of non-working life, as in the case of the dormitory labour regime.

After the beginning of the global economic crisis in 2007-2008, Chinese workers became more militant and large waves of industrial actions were recorded during the following two years. It cannot be said that the peak of industrial conflict reached between 2009-2010 completely changed the patterns of industrial conflict; it is far more likely that the global crisis contributed to particularly harsh working conditions leading a new generation of Chinese workers to engage in industrial conflict thus revealing new features of industrial relations in China.

The Party-State apparatus responded with new social laws and by pushing the All-China Federation of Trade Unions to be more responsive to workers’ demands in order to help bring about a better balance between economic growth and social stability. In particular, the ACFTU acted as a lobby of interests inside the Party-State, as an obstacle to industrial conflict and to the formation of self-organized workers’ organizations. The media system responded by providing a greater amount of attention to industrial conflicts, putting it on the agenda in public debate. While journalistic coverage cannot be used as a precise measure of industrial conflict in China due to its political biases; nevertheless, it has become a widely-used indirect measure to understand the changing nature of Chinese industrial conflict in the 21st century.