Employment & Labor

Implementation and enforcement are traditionally the weakest points of labor law in China. But I've never seen a law attract so much public attention. At the factory level people are talking about it everywhere. One of the things about the law is it doesn't rely on outside labor enforcement. Once you've got a written contract, there are all sorts of avenues open to a worker: the labor department, labor tribunals, or through other grievance mechanisms. So what you're seeing here is a change of approach where the government is saying, "We'll create a proper contract between workers and employers and give workers the means of enforcing their own contracts." The effect has been immediate. There have already been strikes about it; there have been employers who have panicked about the commitment the law would require, so they've tried to lay off or outsource workers. The workers struck, saying, "No, we're not going to accept that." There have been a couple of high-profile cases of strikes against dismissal involving Hong Kong-listed companies. Take the richest woman in China [Zhang Yin, CEO of Nine Dragons Paper], who owns a huge paper company. She tried to outsource guards and security cleaning services, and didn't want to give contracts. The workers struck. It's been an emblematic case: if one of the richest and most powerful businesswomen in China couldn't sidestep the law, it's a good indication of the signal the government wants to send.

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