2008 Annual Survey of violations of trade union rights - China

Population: 1,308,873,000
Capital: Beijing
ILO Core Conventions Ratified: 100 – 111 – 138 – 182

Despite the promises made concerning human rights improvements in the run up to the Olympics, workers found themselves detained or arrested, charged and imprisoned for their involvement in collective protest action during the year in the People's Republic of China. Workers are prevented by law from organising outside the All-China Federation of Trade Unions (ACFTU), which is bound by its constitution to accept the leadership of the Chinese Communist Party (CCP). The Trade Union Law bans workers from organising independently.

Trade union rights in law

No freedom of association: China's Trade Union Law was adopted in 1950. It was amended in 1992 and again in October 2001. Workers are not free to form or join the trade unions of their choice. Only one "workers'" organisation is recognised in law, the All China Federation of Trade Unions (ACFTU).

According to the revised version of the law, "the ACFTU and all organisations under it represent the interests of the workers and safeguard their legitimate rights". Trade unions must also "observe and safeguard the Constitution (...), take economic development as the central task, uphold the socialist road, the people's democratic dictatorship, leadership by the Communist Party of China, and Marxist-Leninism, Mao Zedong Thought and Deng Xiaoping Theory (...) and conduct their work independently in accordance with the Constitution of trade unions".

Among their basic duties and functions, trade unions shall "coordinate labour relations through consultation", "mobilise workers to strive to fulfill their tasks in production" and "educate them in the ideological, ethical, professional, scientific, cultural and other areas, as well as self-discipline and moral integrity". The law also gives trade unions ample prerogatives in various areas such as "democratic management and supervision" (see below).

Trade union monopoly: Article 10 of the law establishes the ACFTU as the "unified national organisation". Under Article 11, the establishment of any trade union organisation, whether local, national or industrial, "shall be submitted to the trade union organisation at the next higher level for approval". Trade union organisations at a higher level "shall exercise leadership" over those at lower level. The law also empowers the ACFTU to exercise financial control over all its constituents.

Collective bargaining: There is currently no law governing collective bargaining procedures, only regulations on collective contracts. However, if a collective contract is established in line with the regulations, it is legally binding. The 1992 Trade Union Law first authorised unions at the enterprise level to conclude collective contracts and the Labour Law (effective 1995) developed the system by adopting collective consultation as a key medium for settling disputes between employers and workers. Article 33 of the Labour Law states that workers have the right to conclude a collective contract "in an enterprise where the trade union has not yet been set up". The amended Trade Union Law of 2001 again strengthened the union's mandate in collective wage negotiations as do regulations issued in 2000 and 2001.

In May 2004, the Provisions on Collective Contracts issued by the Ministry of Labour and Social Security came into force which builds upon the previous regulations issued in 2000 and 2001. They call for more detail in the collective contracts signed. The regulations also outline the procedures involved in the consultation and the theoretical equality of both parties. However despite greater opportunities for collective bargaining and the obvious need for protection for workers – including migrants – there has been little progress towards genuine collective bargaining. Instead the ACFTU continues to "represent" the workers to management and government structures, without seeing the need to discuss, inform, listen to or be guided by the workers who still have little say in policy. In the private sector, workers denied the ability to organise independently where ACFTU branches do not exist, face almost insurmountable obstacles to collective bargaining and representation.

A 2004 government "white paper" on employment encourages the ACFTU to conclude "collective contracts" in order to protect workers' rights, and the labour law permits collective consultation and contracts to be concluded between the ACFTU (or workers representatives) and the management.

According to ACFTU statistics for 2006, the number of collective contracts signed across the country reached 862,000, up 108,000, or 14.3%, on the figures for 2005. The number of sectoral level collective contracts is unknown. The majority of contracts still appear to be formulaic repetitions of articles from the Chinese labour law and to reflect minimum legal requirements, and many cover too few areas of concern to be of much use to workers.

Developments at the provincial level: The Shanghai Collective Contract Rules (the "Shanghai Rules"), adopted in August 2007, came into effect in January 2008. To summarise, the Shanghai Rules provide for procedures and legal requirements governing three major areas: 1) collective bargaining; 2) collective contracts; and 3) related dispute resolution. The new rules provide that collective bargaining shall accomplish the formulation, amendment or adoption of company policies, rules or major decisions directly affecting the following employee interests: (i) salary and wage; (ii) working time; (iii) leave and holidays; (iv) occupational safety and hygiene; (v) social insurance and benefits; (vi) employee training; (vii) labour discipline; (viii) production quotas; and (ix) other matters as required by law. The rules stipulate the composition of bargaining teams and provide for the engagement of third party professionals. Bargaining is made mandatory in cases where (i) a company must lay off more than 20 employees or more than 10 percent of its employees; (ii) a labour dispute has resulted in a mass strike or petition to the authorities; or (iii) something in the production process that has the potential to cause major accidents or work hazards has been detected. The Shanghai Rules also set guidelines for regional or industry-specific union organisations to engage in collective bargaining with companies in construction or food-service businesses for the conclusion of regional or industry-specific collective contracts.

The Shanghai Rules also mandate the City of Shanghai to establish a tripartite system for the coordination and resolution of employment relationships and labour disputes. Upper-level union organisations are given the discretionary power to oversee the collective bargaining activities of companies within their jurisdiction. A union has the right to make a claim under the law against a company in breach of a collective contract, where this infringes the rights and interests of its employees. A union may also apply for arbitration or file a lawsuit if efforts have failed to resolve, through coordination, a dispute arising from the performance of a collective contract.

Although this is a provincial law and therefore limited to the Shanghai region, it is the first law of its kind, and in the absence of national regulations with the same effect, the Shanghai Rules could serve as a model for other local authorities.

New Labour Contract Law: In June 2007 the Labour Contract Law was adopted with effect from 1 January 2008. The Law addresses some of the crucial failings of the current labour law and provides specific penalties and remedies for failing to observe labour laws and regulations. It seeks to determine and clarify the nature of the employment relationship between workers and employers and stipulates aspects which must appear in a labour contract, such as the contract's duration, the job description, hours of work and rest, remuneration, social insurance and labour protection. The new law also contains special rules relating to collective contracts, dispatched workers and part time work. It includes penalties for companies which fail to provide proper written contracts, and penalties for breaking contract terms. The law also appears to bolster the role of trade unions in discussions on redundancies and other major changes and it is clear that individual contracts cannot be used to undercut the levels of remuneration and working conditions established under collective contracts. Protections for part-time workers are limited; hourly wages should not be set at levels below the minimum rates established by local government yet there is no requirement to give either notice or financial compensation in the event of termination.

Right to strike not protected under the law: The right to strike was removed from China's Constitution in 1982, on the grounds that the political system in place had "eradicated problems between the proletariat and enterprise owners". Despite expectations that the revised Trade Union Law would include the right to strike, the revised law skirts around the issue by stating (Article 27): "In case of a work-stoppage or a go-slow in an enterprise, the trade union shall represent staff and workers in consultation with the enterprise, institution or relevant party, and shall reflect the opinions and demands of staff and workers as well as raise solutions. The enterprise or institution shall strive for a settlement with the reasonable demands made by the staff and workers". Article 27 does not employ the term "strike"(bagong), but instead refers to instances of "work-stoppage" (tinggong) and "go-slows" (daigong). There are increasing calls within China for legislation of the right to strike and continued academic debate on the issue. In reality the number of strikes (both spontaneous and planned, but always without the official recognition of the union if there is one) is increasing. In the past few years there have been a number of successful and sustained strikes involving large numbers of workers. Several of these are detailed below.

Also in 2007, a new law on Employment Promotion was issued (effective 1 January 2008) along with supporting regulations (the Regulations on Employment Services and Employment Management). These two pieces of legislation are ostensibly designed to legislate against the currently widespread and endemic discrimination against migrant workers, women and people living with the Hepatitis B Virus (of whom there are around 120 million currently in China) as well as regulate employment recruitment agencies. Perhaps most significantly the law for the first time states that migrant workers (from the rural areas) should have the same rights to employment as their urban counterparts, and those who have been resident in a city for more than six months will be entitled to unemployment benefits and services from the local government. As with all legislation however the ultimate success or significance of the new laws will be dependent on proper implementation, monitoring and punishment of violators.

Health and safety – stoppages allowed: Articles 46 and 47 of the new Work Safety Law, promulgated in November 2003, state that workers who encounter a situation at work that directly endangers their personal safety have the right to refuse orders which violate health and safety rules, and the right to stop work and leave the workplace. The Chinese labour law (article 56) contains similar provisions. The Trade Union Law (article 24) is far weaker and states that when a trade union finds that workers have been directed to work in unsafe conditions then the union "has the right to put forward proposals for a solution".

Dispute resolution: In the last decade, the government has made considerable efforts to create a dispute resolution system that involves three stages: mediation, arbitration and the courts. The Labour Law assigns trade unions the roles of chairing enterprise-based "labour dispute mediation committees" and of participating as a member in tripartite "labour dispute arbitration committees" (LDAC), the latter being chaired by the local labour bureau. In addition, a new law on Labour dispute arbitration and mediation was passed in December 2007 taking effect in May 2008. The law is officially aimed at providing a "fair and timely" settlement of labour disputes. It allows an enterprise to establish its own labour mediation committee to solve internal disputes at its own level. Such a committee should include employees and management representatives. The new law also attempts to reduce costs for workers, has increased the length of time allowed for the initiation of a case (from 60 days to 12 months) and is claimed to have streamlined the process – allowing more workers to start and end the process. Officials reported that the new law would cover labour disputes concerning issues over collective contracts, pay, occupational injuries, compensation, working time, holidays, social insurance and pensions, among other things, and that the arbitration documents would carry legal standing.

According to official statistics, labour dispute arbitration organisations at various levels dealt with 1.72 million cases involving 5.32 million employees between 1987 and 2005, with a growth rate of 27.3 percent annually. An increasing number of labour disputes end up in the law courts and it is too early to tell if the new law will reverse this trend. Much of this is due to the under-resourcing of the LDACs and the labour bureaus, the unprofessional behaviour of LDAC personnel, the fact that many cases are refused or obstructed for the reasons given above and to the fact that employers take court decisions more seriously. While many court cases are settled in favour of the workers, many settlements are never carried out and it is estimated that only around half of the workers involved received their promised compensation.

The major causes for disputes continue to be wage arrears, benefits, and social insurance issues while around 18 percent arose from conflicts over the termination of labour contracts. According to an official with the Ministry of Labour and Social Security (MOLSS), the total amount of estimated wage arrears between 2005 and July 2007 reached some 66 billion Yuan (EURO 6.8 billion), with arrears in the construction industry alone reaching around 3.3 billion. Reports of the beating of migrant workers (usually in construction) who were protesting about unpaid wages continued to emerge in 2007.

There is an ongoing year-on-year increase in collective cases being brought to court or to arbitration, especially those of migrant workers. This has implications for labour dispute settlement, as well as migrants' growing consciousness of their rights. One 2005 study showed that the number of collective labour disputes nationwide increased more than five times, from 1,482 in 1994 to 11,000 in 2003 and almost double that in 2004 to around 20,000. More than 410,000 workers were involved in the 19,000 collective actions in 2005.

A report by the ACFTU showed that in 2006 there were some 300,000 lawsuits against employers filed by workers reaching the courts – a reported rise of over 20 percent from 2005. Over half of these cases were resolved in favour of the employees but in practice many court decisions are not implemented and the compensation awarded to the workers is never paid. In part response to this in August 2006, a Supreme People's Court circular was issued directing courts to ensure that lawsuits filed by migrant workers over unpaid wages are dealt with and enforced in a timely manner. Since the implementation of the Labour Contract Law on 1 January 2008, reports indicate that the number of arbitration cases filed in Guangzhou alone has risen dramatically. 60 percent of all cases involved non-payment of salaries and overtime. According to reports, staffing in the arbitration committees remained low suggesting that the system is likely to quickly become overburdened and excessively slow.

International obligations: China has ratified neither of the two fundamental ILO Conventions on freedom of association, the right to organise and to bargain collectively (ILO Conventions 87 and 98). The Chinese government has also not ratified core ILO conventions No. 29 and No. 105 regarding forced labour. In February 2001, it ratified the International Covenant on Economic, Social and Cultural Rights (ICESCR), but announced at the same time that provisions guaranteed under Article 8,1 (a) of the Covenant, namely the right to establish and join workers' organisations of one's own choosing, would be dealt with in accordance with Chinese law. In doing so, the government effectively entered a reservation concerning a fundamental element of the Covenant, thereby putting itself in breach of internationally recognised principles on the law of treaties. It did not, however, enter any such reservation concerning Article 8, 1 (d) of the covenant, which guarantees the right to strike.

In April and May 2005, the United Nations Committee on Economic, Social and Cultural Rights, which monitors State parties' compliance with the ICESCR, examined the first report submitted to it by China following its ratification of the Covenant. In its "Concluding Observations", the Committee "regretted" China's "prohibition of the right to organise and join independent trade unions". It also "urged" China "to amend the Trade Union Act to allow workers to form independent trade unions outside the structure of the All China Federation of Trade Unions.

In 2006, China ratified ILO Convention 111 concerning Discrimination in Respect of Employment and Occupation. In January 2007 the Chinese authorities ratified ILO Convention 155, the Occupational Safety and Health Convention.

Trade union rights in practice and Violations in 2007

Role of the official Chinese trade union (ACFTU) and new developments: The ACFTU has a monopoly as the country's sole official and legal trade union that assists the government in the primary task of ensuring social stability during the economic changes in Chinese industry, while also representing the demands of workers resulting from the multiple problems and inequalities emerging in the new "socialist market economy". As a result, it actively calls on employers to follow the labour law, while at the same time urging workers to better equip themselves with knowledge of the law.

In keeping with the nationwide emphasis on the development of a "harmonious society" and in particular of a "harmonious workplace", the ACFTU has been promoting its role in the development of a harmonious and stable society. At the Fifth Session of the 14th ACFTU Executive Committee held on 12-14 December 2007, ACFTU Chairman Wang Zhaoguo "emphasised that the broad masses of workers and union cadres should make greater contributions to scientific development and social harmony. He called on trade unions at all levels to earnestly perform their duty of protecting workers' legal rights and interests, ... called on trade unions to carry out the principle of "organise the unorganised and fight for labour rights" in real earnest ... "

The current Chairperson of the ACFTU, Wang Zhaoguo, is also a member of the Communist Party's Politburo and a former Governor of Fujian province. In 2007, Wang was reappointed to the NPC and also included in the Politburo. The organisation remains firmly under the leadership of the Party.

There is little doubt that the organisation is under huge pressure to meet the government's target of avoiding a repeat of the large-scale collective action that took place in northeast China during the spring of 2002 and to help stem the increasing rise of "mass protests". Several new policies were decided at the 14th Congress in 2003, including direct trade union elections of enterprise-level branch Chairpersons and the opening of the union to migrant workers, whose formal status as farmers previously excluded them. According to the ACFTU, about 29.5 million migrants had joined by July 2006 and by the end of September 2007, 61.97 million migrant workers had been admitted into trade unions across China, making up about 51.6% of the total number of migrant workers. If correct, these figures represent a remarkable increase.

In the latter part of 2007, there was a spate of reports of mass layoffs of long term employees by Chinese and foreign enterprises in the run up to the implementation of the new Labour Contract Law. In December the ACFTU issued a circular to safeguard employees' legitimate rights and interests, urging the resolute correction of actions such as forced resignations and re-signed labour contracts. The ACFTU's circular stated that these types of activities by employers in violation or evasion of the labour laws "impacted negatively on building a socialist harmonious society". It also asked all unions to "search out actions by employers that violate existing labour laws and regulations, or evade the Labour Contract Law in violation of employees' rights, and resolutely demand their rectification.

The need for the ACFTU to achieve a far greater level of unionisation in private enterprises and in particular in transnational companies and foreign owned corporations was again emphasised throughout the year. In March 2006, China's President Hu Jintao reportedly issued instructions on a policy document – "A Situation Analysis on the Factors of Instability in Foreign-invested Enterprises in China's Coastal Area, and Some Proposed Countermeasures". Hu Jintao was reported to have ordered the ACFTU specifically to do "a better job of building Party organisations and trade unions in foreign-invested enterprises". Following this, the ACFTU instructed its staff to set the target of unionising over 60 percent of foreign invested enterprises by the end of 2006. The target was subsequently raised to 80 percent for 2007. According to an ACFTU spokesperson, this target was fulfilled with ACFTU branches in 60 percent of the 51,728 foreign-funded firms by the end of 2006 and by mid 2007 some 1.25 million trade unions had been set up in private firms. Other official sources give higher figures.

The ACFTU has targeted many large foreign firms in the past few years, most notably Wal-mart. In July 2006 the first Wal-Mart union was established and by the end of the year it was claimed that all Wal-Mart's 68 branches had been unionised. Later in the year it was also announced that communist party committees had also been set up at Wal-Mart branches – an example of the parallel lines the ACFTU and the party follow. By the end of 2007, unions had been formed in 77 of its (then) 84 outlets. New ACFTU branches have also been established in firms such as Carrefour, McDonalds, Motorola, Kentucky Fried Chicken, Samsung and Nestle. Similar campaigns have also been launched targeting the top Fortune 500 companies.

In March 2007, Chinese media reported that KFC, McDonalds and Pizza Hut were paying illegally low wages to their part-time and casual "work-study" students in Guangzhou. One observer stated that in return for not pursuing the matter, the companies agreed with the ACFTU to allow the ACFTU to establish union branches and two months later some six new branches had been reported. KFC was also accused of trying to control the establishment of the new unions by establishing "trade union small groups" after organising a management led union at its headquarters in cooperation with the Hubei Province ACFTU. At least one local trade union attempted to establish its own independent structure in Shiyan city but management has reportedly been pressuring workers to resign from this union and to join the formal and KFC operated one. So far the higher level ACFTU authorities have not intervened.

According to ACFTU figures it had around 477,000 full time paid personnel and 3,831,298 part-time paid personnel (end 2005). In 2007, the "political profile" requirement for new employees of the ACFTU continued to include the need to be a "communist party member" or a "member of the communist youth league". Only the "Democratic management" department, economy & technology department, finance department, international department and legal affairs department do not specifically require applicants to be members of either the communist party or the communist youth league.

Support for workers' grievances: Where detailed reports of social unrest are available, the role of the official trade union is often questioned by the workers concerned. At local level, ACFTU officials usually do not support or recognise independent workers' action. Their dual function as upholders of the Party and representatives of the working class puts them in a difficult position to defend workers' interests in the face of massive restructuring in the state sector and investor-friendly policies in the private sector. With regard to the welfare and protection of the millions of workers who have been dismissed in this restructuring process, the impact of the ACFTU in negotiating and enforcing any social safety provisions that may have been obtained appears to be limited. The privatisation of state, or other collectively-owned assets, frequently goes hand in hand with the corruption of local and regional government officials, over whom the ACFTU appears to have no influence. It should be noted, however, that, while major labour unrest is generally not reported inside China, smaller collective actions increasingly are, thanks chiefly to the initiatives of workers and the courage of individual journalists and editors.

Despite migrant workers being admitted into the ACFTU for the first time in 2003 and well-publicised campaigns welcoming migrants into the fold, the ACFTU is absent in the majority of disputes and collective actions in the major manufacturing zones where the majority of private business is located. On the other hand, the ACFTU keeps a high profile in efforts to claim back missing wages for migrant workers, which are a major source of discontent, as well as pushing for wage increases and the raising of minimum wages. Between the start of 2007 and the Chinese new year (February), the ACFTU announced that it had helped chase unpaid salaries for 1.4 million migrants, totalling around 650 million Yuan.

One 2004 survey of migrant workers in the Pearl River Delta revealed that while many migrants interviewed suffered from severe work injuries, only 1.9% reported that they had received attention from the ACFTU – a figure lower that the 4.5 percent who reported attention from the government. A recent large-scale national survey showed that only 23.5% of the migrant workers interviewed reported the existence of trade unions in their enterprises and also stated that when their legal rights are infringed, only 4.2 percent would seek assistance from the trade union.

The lack of practical and visible assistance for workers at the grassroots level is one of the most crucial factors in the rise of labour groups providing legal and health services for migrant workers. In some areas a trend towards the "NGOisation" of the ACFTU has been noted with some lower level ACFTU branches also beginning to offer legal aid services and other support while continuing to avoid engagement in workers' collective disputes at the plant level.

However while there is little evidence of actual ACFTU involvement in disputes, in October 2007 the ACFTU issued new measures aimed at protecting the rights of enterprise level trade union officers and establishing "cadre rights guarantee funds".

Trade union elections: Although the Trade Union Law states that trade union officers at each level should be elected, this is often ignored and most officials are appointed. Many provinces are now developing regulations on union elections. Elected candidates are subject to approval by the provincial-level ACFTU committees. The majority of workers, if aware of the existence of a branch union, have little idea if their chairperson has been elected or not. In many cases workers, are simply unaware that they have a trade union.

A 2006 survey, by the Chinese Institute of Industrial Relations, of the chairpersons of 1,811 trade unions in state-owned enterprises found that the Party was still appointing 24.5 percent of the chairs of state-owned enterprise trade unions. In cases where chairs assumed their posts through election or open selective examinations, 35.1 percent of them participated in the election or examinations after the Party recommended them. The vast majority of chairs, regardless of how they were appointed were party members or officials. In addition, 72.1 percent of those questioned stated that their union committee had also established a Party group or branch at the workplace. Many provinces have developed, or are in the process of developing, regulations concerning the obligation to hold trade union elections stipulated in Article 9 of the Trade Union Law which affirms the principle that: "Trade union committees at various levels shall be democratically elected at members' assemblies or members' congresses." The Guangzhou municipality passed a regulation, due to take effect in January 2008, stating that company managers were barred from holding union positions.

Membership: True membership levels are difficult to assess and many reports appear to be inconsistent. According to "China Daily", at the end of 2005 the ACFTU had some 1.17 million grass roots unions and around 151 million members. Other sources state that the ACFTU saw an "unprecedented" six percent rise in membership in the first six months of 2006 leading to a membership of 160.32 million, including some 2.58 million new members working with foreign companies. The ACFTU then released figures in 2007 which stated that by the end of September 2006 the number of Chinese grassroots trade union organisations had reached 1.324 million, and the number of union members had reached 170 million. The ACFTU Vice-Chair Sun Chunlan stated that the ACFTU was expecting 200 million workers to have enrolled as trade union members by July 2008, when the 15th National Congress of China's Trade Unions is scheduled.

However, it should be noted that legal procedures for registering a union office in an enterprise can be completed without trade union officials even entering the workplace, and branches can be set up in some enterprises simply by carrying out administrative procedures.

Under the current Trade Union Law, (Article 10), a basic-level trade union committee shall be set up in an enterprise, an institution or a government department with a membership of 25 or more. Where the membership is less than 25, a basic-level trade union committee may be separately set up, or a basic-level trade union committee may be set up jointly by the members in two or more work units, or an organiser may be elected, to organise the members in various activities." This would essentially leave it up to the workers to establish a union and does not require all units to automatically establish a union. For several years some companies – most publicly Wal-Mart – have stated that they are not stopping unions from existing but that the workers had not yet expressed the wish to establish one. To counter this argument, in July 2006 ACFTU Chair, Wang Zhaoguo, proposed an amendment to the Trade Union Law that would require foreign enterprises to establish ACFTU-affiliated branches and that the establishment of unions depends on the "will" of the workers.

All attempts to establish independent trade unions repressed: No independent trade unions are allowed to exist, and all attempts at establishing independent workers' organisations are repressed, sometimes violently. According to informal statements there exist two forms of illegal trade unions in China; the first where workers are unaware of the need to register with the ACFTU and the second where "hostile forces" incite workers to set up unions to overthrow the system. The former are educated and assimilated into the ACFTU while the latter are cracked down upon. Organisers of worker groups or protests are often arrested. Some are sentenced to terms of imprisonment (officially called "reform through labour", or "lao gai") after criminal trials which fall well short of international standards. Others can be assigned to terms of "re-education through labour" ("lao jiao", sometimes called "rehabilitation through labour"), an administrative process which bypasses the few safeguards of the criminal justice system. The fear of detention also makes negotiations between workers' representatives and the authorities and employers extremely difficult. Nevertheless, there has been a marked trend of worker organisers being prepared to take this risk.

Collective bargaining remains ineffective: The majority of provinces have implemented laws and regulations providing for the implementation of a collective contract system, including regulations governing regional and industry-specific collective contracts. The ACFTU reported that there were more than 800,000 collective contracts in place, covering 1.5 million enterprises by the end of 2007. Despite this, collective bargaining remains severely handicapped by the non-existence of truly independent organisations on either side. Almost all contracts are drawn up by employers and simply reflect minimum legal requirements. The subordinate position of the ACFTU to the government and the Party means that it will often work with the employer in drawing up collective agreements which simply mirror the labour law. There is very little actual bargaining and in fact the Chinese term employed is "collective consultation" rather than "collective bargaining" although the new Labour Contract Law appears to favour the term bargaining over consultation . Very often workers are offered no formal contract at all, especially migrants in export processing zones (EPZs). If they do sign a contract, they are rarely given a copy. ACFTU officials have been quoted as opposing wage increases in order to avoid triggering other demands for similar deals.

Despite this, some provinces are enacting specific collective contract regulations which, if properly implemented may improve the contract negotiation process and the quality and scope of the resulting contracts. For example Hebei province implemented new Regulations on Enterprise Collective Consultations between Labour and Management which state that the consultation process should give equal weight to the interests of the enterprise and the workers. According to one commentary the regulations explicitly state that where there is no trade union in the enterprise, the workers' representatives in the negotiations should be "democratically elected by a majority of employees." Where there is a union, representatives should be recommended (tuijian) by the union, and scrutinised by the workers' congress. The new regulations continue to use somewhat vague language regarding the legal duty to engage in open and equal negotiations.

In the run up to the implementation of the new labour contract law on 1 January 2008, there were many reports of mass lay-offs at both state-owned enterprises like the Chinese MNC Huawei as well as at smaller enterprises and Wal-mart. A wave of protests and strikes grew in response to management's perceived lay-offs designed to shed companies of long term employees in advance of the law – those who would be entitled to unlimited contracts. As with most legislation in China, the most crucial issue is the implementation of the law. Despite repeated public reassurances that guidelines for implementation would be issued, up until the new law actually took effect on 1 January 2008, no regulations had been issued leaving some of the more nuanced clauses in the law open to management interpretations.

Worker disputes and protests: Collective disputes are defined as involving three or more people. The overwhelming majority are small-scale incidents – an average of 38 people in 2003 – that are mostly settled via mediation at enterprise level, arbitration or the courts, with the latter channel becoming increasingly popular with workers in large cities, as seen above. Workers feel they will get a fairer hearing in court than in arbitration committees, despite the lengthy processing time and low success rates. On average, over half of the judgments and arbitration find in workers' favour although serious problems remain over the timely enforcement of such favourable court decisions for workers.

Privatisation continues to be a major cause of labour unrest and is plagued by massive corruption. Many workers have been affected by the embezzlement and misappropriation of factory assets and funds set aside for redundancy and other benefits during state-owned enterprises' (SOE) restructuring. Many of the larger protests in 2007 can be traced back to the issue of corruption, the non-payment of funds earmarked for workers, and the widespread flouting of local or national regulations on pensions, health care and redundancy. On 18 July, around 3,000 bus drivers in Jinzhou, Liaoning Province launched a strike to protest over wage issues and the privatisation of the city's bus company. All bus routes were reportedly cancelled and drivers staged a protest outside the Jinzhou Municipal Party building. Most had returned to work by 23 July, but around 1,000 remained on strike. The following day, local authorities ordered a news blackout and all new Internet postings related to the strike were taken down.

Unpaid wages and increasingly low wages and poor working conditions were the other major source of protests in 2007 and especially of the often smaller but more frequent protests, strikes and sit-ins by workers at privately owned enterprises.

While it remains difficult to estimate the total number of worker protests in China, it is clear that the trend of increasing protests has continued. In addition to regular collective protests against non-payment of wages, fake and genuine bankruptcies and corruption involved in the privatisation of state-owned industrial assets, there has also been a rise in individual protests. Some media reports have concentrated on workers who have jumped or threatened to jump off buildings to claim unpaid wages. This is a tactic of some workers, aimed at attracting attention, either through physical harm or risk thereof, or through arrest. The workers involved are almost exclusively migrant workers.

In early 2006, the PRC Ministry of Public Security announced that more than 87,000 "mass social disturbances" had occurred in 2005, up 6 per cent from 2004 and 50 per cent from 2003. More than 3.7 million people were involved in such incidents in 2004. The figures were widely quoted in the foreign media and since then similar national figures have not been widely reported. Many mass disputes were about land seizures in rural areas, about half of which were labour-related. The report states that there were over 1,000 strikes involving factories with more than 100 workers in 2005 in Guangdong Province alone. According to an ACFTU scholar, 60 per cent of protests are work-related and their number is increasing by 30 percent a year. Statistics announced in December 2007 by China's National Bureau of Statistics revealed that in 2006 public security bodies handled 599,392 cases involving "disturbances of social order", "disturbances in public spaces", "trouble-making activities" or "obstruction of public service execution."

It appears, especially in the latter part of 2007, that local governments and company employers increasingly turned to violent repression of worker strikes and protests with the large-scale deployment of armed police and riot police as well as ordinary public security forces. In some instances, companies hired men to beat and threaten workers protesting about missing wages or taking other forms of industrial action, often with deadly results.

On strike for trade union rights: Several hundred workers at the Yantian International Container Terminals (YICT), a major southern Chinese port went on strike over low pay and to demand the creation of a trade union in April 2007. An earlier strike was also reported in March. The strike was ended after management reportedly agreed to raise wages by three percent and to allow workers to organise a union.

Violent dispersal of striking workers and protests: In Fuyang, Anhui Province, several thousand workers from the state-owned Huayuan Textile factory staged a demonstration on 16 April against the withholding of their wages. Hundreds of workers lay down across the railway tracks in protest and on 17 April several hundred police were sent in to disperse the workers. It was reported that the factory later offered the workers a pay rise of ten percent but this was not accepted. In May, private security guards wielding iron bars injured nine workers demanding back wages at a construction company in the Baiyun district of Guangzhou city. In June, some 300 construction workers at a hydroelectric power station in Guangdong province went on strike to demand four months of unpaid wages. The strikers were then attacked and beaten by more than 200 "gangsters" with "spades, axes, steel pipes and sabres." Xinhua reported that one worker was in a critical condition in hospital with brain injuries, but no other information on injuries was provided. Four Fuyuan employees were later detained by police. It was later reported that Lei Mingzhong, a migrant worker from Chongqing municipality was beaten to death at the building site.

On 29 June 2007, around 3,000 workers from the former state owned Shuangma Cement Plant in Mianyang, Sichuan Province, went on strike in protest at a proposed severance package during restructuring. One female worker was initially detained by the factory management. A media blackout on the event was imposed and the town was reportedly guarded by police. One of the four detained workers, a woman, reportedly cut her wrists while at the police station and was hospitalised with some reports alluding to her death. The strike continued for over two weeks.

Around 800 miners at the Tanjiashan Coal Mine in Hubei Province went on strike after it was discovered that some 360 million Yuan allocated by the central government for redundancy payments had allegedly been appropriated by the mine's directors. After six days of striking, the miners were surrounded by security police and in the ensuing clash, at least one worker and one guard were killed. An October strike, at Hong Kong-listed Nine Dragons Paper (Holdings) in Guangdong, over workers being forced to sign new contracts with a contractor rather than entering into a direct labour contract with the company, was reportedly ended by several hundred riot police.

Detention of strikers and protestors: While the Labour Law, Trade Union Law and Occupational Safety and Health Law make mention of "work-stoppages", workers who put these vaguely-worded provisions to the test are likely to face a host of problems. They are usually picked up by the police and warned about public order offences, traffic violations, breaking the law on parades and demonstrations, or much more serious political charges. Strike organisers and independent labour activists also face the threat of re-education through labour, a form of administrative detention. Though in principle limited to three years, in practice these periods of forced labour can be extended at the authorities' will.

For example, on 7 August, local riot police detained eight leaders involved in a protest outside the offices of the Qingyang Municipal Transport Company in Gansu Province. The transport workers had been protesting since January after the previously state-owned company was privatised and sold, leaving all the workers laid off without social security or unemployment benefits. The eight workers were reportedly beaten and placed under house arrest. On 9 October 2007, eight workers at the Qingxin Mine in Hunan Province were detained after leading a protest over the alleged misappropriation of around 2.6 million Yuan after the company was restructured and privatised into a company in which each employee held shares. Two were later released but several others who had planned to travel to Changsha were later placed under house arrest. It was reported that the mine owners had paid the county government some two million Yuan to provide police to ensure that the strikers could not petition the provincial government in the city of Changsha.

Crackdown on legal aid groups for workers: The past few years have seen a constant increase in the number of workers using the courts as way of achieving redress for unpaid wages, missing benefits or other issues. A parallel growth in the legal field has seen a rise in the number of lawyers taking on civil litigation cases, including labour rights cases. Increasingly such lawyers are being blacklisted, banned from practice and in some cases imprisoned for their work. The ACFTU has also begun some work on the provision of legal aid for workers involved in labour disputes. However some have stated that the aim is to prevent workers from organising or relying on local labour groups in order to maintain limits on the influence of such groups.

Throughout 2007 there was a concentrated clampdown on the NGO sector and in particular on labour rights groups. As in 2006, many mainland groups established to support workers by providing legal aid or offering training found themselves the subject of intensified official scrutiny, investigation, monitoring and harassment, especially in the last few months of 2007 when their work concentrated on seeking redress for workers laid off in advance of the new Labour Contract Law. Advice given to workers involved in mass layoffs in the latter half of 2007 formed the backdrop for the repeated targeting of the Dagongzhe Workers centre in Shenzhen and the brutal stabbing of its lead worker, Huang Qingnan. Huang was stabbed repeatedly by unknown assailants and remains partially crippled by the attack. According to reports, the Shenzhen authorities, despite initially failing to investigate the attacks, responded to global publicity and support for Huang and apprehended the culprits, who were believed to be a local landlord and hired men.

Detained labour activists:

Long-term detainees: Dozens of independent labour activists and leaders jailed in previous years remained in prison and in re-education through labour camps in 2007. The following is a partial list and more information about some of these and earlier cases may be found in previous issues of this survey. They include activists, notably members of the Workers' Autonomous Federations (WAF), arrested in the wake of the Tiananmen Square massacre of 4 June 1989, and the protests that followed. Most of those imprisoned at this time were sentenced to harsh prison terms for crimes such as "counter-revolution" or "hooliganism", neither of which exist in current Chinese criminal law. According to rights groups there are some 100-200 people still in detention for their role in the 1989 protests and subsequent crackdown, the majority of whom are ordinary workers.

Leaders and activists detained in 1989 and believed to remain in detention include Hu Shigen, who helped establish the Free Labour Union of China (FLUC) Preparatory Committee and who was jointly indicted in 1993 with fifteen others, including Liu Jingsheng, on "counter-revolutionary" charges and now in poor health; Liu Zhihua, reportedly the last imprisoned member of a group of workers who organised one of the largest strikes that took place in June 1989 in Xiangtan, Hubei Province. Liu, then 21 years old, was convicted of "hooliganism" and originally sentenced to life in prison; Liu Jian; Kang Yuchun, sentenced to 17 years, who is ill with heart problems; Zhu Fangming, Vice-Chair of the Hengyang City Workers Autonomous Federation, sentenced to life imprisonment on a charge of "hooliganism" (he was reportedly released by the Chinese authorities who denied he was ever "punished"); and Wang Jun, an 18-year-old temporary worker from Shaanxi Province, who was originally sentenced to death but is now due for release in 2009.

Medical concerns and deaths: In addition to concerns over Hu Shigen and Kang Yuchun, fears continue over the deteriorating health of Yao Fuxin, who was sentenced in May 2003 to seven year's imprisonment, along with Xiao Yunliang, for their part in the mass protests in Liaoyang in March 2002. The health of both men deteriorated during their imprisonment, after the prison authorities provided them with little or no medical care. Despite repeated calls by their families and protests by the international trade union movement and despite the clear legal basis for their release, medical parole was denied to Yao and Xiao. In February 2006, Xiao Yunliang was released three weeks ahead of completing his sentence. The ACFTU failed to provide any response to repeated calls by the international trade union movement that it intervene on their behalf.

Zhang Shanguang, a teacher from Hunan and a veteran independent labour activist and former prisoner was sentenced to ten years in 1998 on charges of "threatening the security of the State" after attempting to set up an independent trade union. There have been repeated reports that Zhang has been ill-treated and tortured. Shao Liangchen, a leading member of the Ji'nan Workers' Autonomous Federation in Shandong Province and originally sentenced to death, then reprieved, was diagnosed with leukaemia in 2004 and passed away in late 2005, two days after having been released on medical parole.

Psychiatric detention: Wang Miaogen, initially imprisoned for his involvement in the Workers' Autonomous Federations (WAF) in 1989, is believed to remain in psychiatric detention. Another labour activist, Pen Yuzhang, a member of the Changsha Workers' Autonomous Federation in 1989, has also been held in a psychiatric institution. Government reports about his release have not been independently confirmed.

Sentences in 2007: In April, the Jingzhou district court in Hubei sentenced Zhou Yuanwu, who led workers' protests at the Jingzhou Brewery in 2006, to 30 months in prison for "obstructing public officers in performance of their duties". Zhou was accused of striking a police officer in 2006 when police attempted to detain him without a warrant, a charge he has denied. The ITUC wrote to the Chinese authorities condemning the arrest and sentence.

Yang Chunlin, an ex-SOE worker from Jiamusi City, Heilongjiang Province was detained on 6 July and formally arrested on suspicion of "subversion of state power" on 3 August. Yang's arrest was apparently ordered by the Ministry of Public Security in Beijing after he collected signatures to endorse an open letter entitled "We Want Human Rights, not the Olympics" in villages where he had been helping farmers dealing with land disputes in the first half of 2007. The letter was reportedly signed by more than 10,000 people, mostly Heilongjiang farmers. Yang was sentenced to five years in prison on 24 March 2008. He maintained his innocence throughout the trial. During and after the hearings, Yang was reportedly beaten with an electric rod on at least two occasions.

Li Guohong, a workers' representative dismissed from the Zhongyuan Oil Field (ZOF) in Henan Province, was assigned 18 months of re-education through labour in October after he went to Puyang City, where Zhongyuan Oil Field is headquartered, to learn about a lawsuit which dismissed workers were filing in Beijing against the oil field. There, he was himself promptly "administratively detained" for fifteen days. He was due to be released on November 16, but the authorities instead sent him for re-education through labour.

Continued imprisonment for activists: Many labour and trade union activists sentenced in previous years, as reported in previous versions of the Survey, remained in custody. They include: Li Bifeng, Zhao Changqing, Li Wangyang, He Chaohui, Chen Wei, Huang Xiangwei, Li Jianfeng, Lin Shun'an, Lin Shuncheng, Lin Shunhan, Zhan Gongzhen, Zheng Xiaohua, Lin Chan, She Wanbao, Kong Youping, Nin Xianhua. Lu Wenbin, Hu Mingjun, Wang Sen, Yue Tianxiang, Guo Xinmin, Wang Wanxing, Gao Hongming, Xu Yonghai and Zha Jianguo. Information on Ni Xiafei and Li Keyou has not been made public and it is assumed they remain in detention. All had tried to protect workers' interests, by protesting or organising and representing workers.

Workers' whereabouts unknown: The plight of many workers detained during labour protests remains unclear. While it is assumed that most are usually released after a few days or weeks in administrative detention, no formal notification is forthcoming. Huang Zhuyu, Wang Jun and Xu Haiyan, workers at a guesthouse in Sichuan were detained in September 2006 after they joined 40 laid-off workers attempting to petition the local Party committee about unemployment benefits. Public security officials beat two other female petitioners, Zhang Xiaohua and Liu Xiaohong, who were hospitalised. No further information about their current place of detention or any charges against them is available.

The whereabouts of seven miners from Neijiang City, detained following a protest, remain unknown. They are: Wang Changchun, Wang Fanghua, Wang Heping, Wang Liguo, Wang Qun, Zhang Jun and Zhu Wanhong.

Released in 2007: Yang Jianli a US-based researcher who participated in the Tiananmen Square pro-democracy movement in 1989 was arrested after reportedly attempting to investigate the rapidly growing labour unrest situation in Shenyang City, Liaoyang City and Daqing City in north-eastern China in 2002. Yang was sentenced on charges of "espionage" and "illegal entry," and given a five year prison term. He was released and allowed to return to the US in August 2007. Li Weihong, a 21-year-old worker at Hunan Fire Fighting Equipment Factory in Changsha, Hunan Province, was convicted of hooliganism along with six others, after protests in 1989. All were executed except Li, who was sentenced to death with two years' reprieve. Repeated inquiries produced no response until the Chinese government confirmed that after five sentence reductions, Li was released on 11 November 2007. Sun Hong, an 18-year-old worker at a fluorescent light factory in Beijing was detained for burning military vehicles and stealing a gun in the protests in June 1989 and reportedly sentenced to death with two-year reprieve. Recent information received states that, after nine sentence reductions, Sun was released on 7 July 2007.

According to new information, several releases of other workers involved in the 1989 protests have been made public. These include Zhou Yan who was a 23-year-old worker at a Shanghai textile factory in 1989 when he was detained for infiltrating student and citizen organisations during the 1989 protests in order to gather intelligence for an unnamed foreign power and incite unrest. Zhou was sentenced to life in prison for espionage. In late 2007, it was reported that he had in fact been released in June 2006 after several sentence reductions. In September 2006 a previously unknown factory worker detained during 1989, Zhang Maosheng was released after serving 17 years in prison for allegedly setting fire to a military vehicle in June 1989. Du Hongqi and Li Yanying, two laid-off workers of the South China Industries Group had founded an underground trade union in September 2003 to fight for better working conditions and had organised several petitions and protests. After the mass lay-offs, their union helped to voice the workers' demands for unemployment compensation and aid to find new jobs. The leaders were subsequently apprehended. Du was arrested on 8 December 2003 under the charge of "assembly to disturb social order". In October 2004, he was tried and sentenced to three years' imprisonment. Du is now believed to have been released.