Mon, Jun 02, 2014 page15

• In China, managers are the new labor activists

  • Reuters, SHANGHAI
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  The instigator of China’s biggest strike in decades last month is a new player in Chinese labor activism: management.

  A previously unpublished account from inside the strike at Taiwanese shoe manufacturer Yue Yuen Industrial Holdings Ltd (裕元工業) obtained by media shows that supervisors were the first to challenge senior plant leaders about the social insurance contributions that became the focus of the dispute.

  The involvement of managers underscores the growing complexity and unpredictability of labor relations in China.

  A generation of long-serving migrant factory employees is starting to retire just as the economy is slowing and the spread of social media makes strikes easier to organize.

  Yue Yuen’s strike was not the first time in recent years that managers, rather than front-line workers, helped orchestrate industrial action in China.

  Managers were also involved in leading a strike at IBM Corp’s facility in Shenzhen in March, according to a worker and another person briefed on the strike. IBM has declined to comment.

  Supervisors and other low and mid-level managers also helped corral workers during a March strike at Shanmukang Technology, which supplies mobile phone cases to Samsung Electronics Co, a former employee said.

  Managers have been orchestrating strikes during international deals for years, lawyers said.

  “It happens all the time” that managers encourage workers to strike during an international transaction that affects a company’s Chinese operations, said Jonathan Isaacs, special counsel with responsibility for Chinese employment and labor issues at law firm Baker & McKenzie in Hong Kong.

  In many cases, “the reason an M&A [mergers and acquisitions] transaction, layoffs or restructuring goes sideways or causes labor unrest is that the local management were disgruntled and riled up the rank-and-file workers,” Isaacs added.

  In November 2011, mid-level managers led thousands of PepsiCo Inc workers to strike in protest against the terms of the company’s acquisition by Tingyi Holdings (康師傅控股), according to Hong Kong-based worker advocacy group China Labour Bulletin.

  Labor unrest has surged in China in recent months as slowing economic growth and rising costs have squeezed companies in industrialized areas like the Pearl River Delta in southern Guangdong Province.

  The China Labour Bulletin. has recorded 319 strikes and labor protests in the country since the beginning of the year.

  Chinese factory disputes typically start with younger employees pushing management for higher pay, but in the past few years, as restructurings have become more common, managers have begun to take a more active role in negotiations and work stoppages because they have more at stake, lawyers said.

  China’s 2008 labor contract law requires companies terminating employees to pay compensation worth one month’s salary for every year of employment. The longer an employee has been working at a factory, the greater the potential payoff from a closure, merger or restructuring.

  Turnover at Chinese factories is high, reaching 100 percent a year in some companies. Younger workers spin through jobs quickly, sometimes staying for only a couple of months at one plant and thereby making managers among a factory’s longest serving employees.

  Line managers may have information about organizational changes before rank-and-file workers, and they may use the threat of a work stoppage to motivate corporate leaders to improve managers’ pay or compensation, lawyers said.

  Although they “are better at motivating and organizing others, but managers will always stay off the front lines in strikes, always be in a mobilizing role,” said Guangdong Labor Institute deputy secretary-general Yang Zhengxi (楊正溪), who said his observations are based on field research of a Sanyo Electric Co Ltd electronics plant in Shenzhen in 2011.

  According to the account compiled by a labor group, a supervisor first raised a complaint about the social contributions issue in late March, a few weeks before the strike began. The supervisor and colleagues spread word among workers, who then went to look up their social insurance contributions. The labor group requested anonymity to protect its relationship with Yue Yuen staff.

  During the IBM strike, after a chaotic first day, line managers began to organize the workers, according to a worker who asked not to be identified.

  “The longer these people have worked in factories, the greater their interest in social insurance, and the more likely they are to incite other workers and participate in strikes themselves,” said Pun Ngai (潘毅), sociology professor in the applied social science department at Hong Kong Polytechnic University.

  China has about 40 million migrant workers aged over 50, who comprise about 15 percent of the country’s 262 million migrant workers, according to the National Bureau of Statistics of China.
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