“Has your boss run away without paying your arrears? Have you been fired? Has your salary been cut? With the necessary knowledge and by protecting our rights, we can overcome this crisis”. It is a leaflet currently distributed amongst the thousands of migrant workers in the Longgang district in Shenzhen.
Then there are more questions, followed by brief explanations: what to do if your salary is not timely paid? If the factory interrupts its activities or calls for a long vacation? If your employer decides to cut its workforce? If someone forces you to resign? If the factory is being tranferred? The answers include long quotations from Chinese labor laws explained to common workers in plain and clear language. At the end, a box highlights the phone number of the authors: the Centre for Workers’ Health and Safety, a local civil society organization founded by Huang Qingnan, a former migrant worker who had his face disfigured by acid thrown by a jealous colleague back in 1999.
While a string of bankruptcies hit the giants of the global financial market, millions of migrant workers of the Pearl River Delta industries, the “world factory”, are trying hard to weather the storm and save their very shaky jobs.
“After the beginning of the financial storm, protecting workers’ rights has become harder; now even doing our job is much more difficult,” Yu Huimin, a collaborator of Huang Qingnan, declares over a cup of tea. Following the crisis, a lot of factories closed down and, worst even, labor standards have plummeted for those workers who staid in the job.
“Before it was easy for me to find jobs with a salary of 1.260 yuan including free board and lodging, now at most they offer me a base salary of 800 yuan”, said Li, a young migrant worker from the northern province of Henan. Last June the electronic components factory where she worked for over six years suddenly went bankrupt, leaving hundreds unemployed. In a few days Li was able to find a new position, but after six months even the new factory was closed and the production moved elsewhere. She is in the mid thirties wit two little children. She is still full of vitality, but in the world factory being thirty means that you are already old. “Laoban only wants girls younger than 25 and even if you have got a high school diploma they don’t want you. How can I compete with them?”
In the delta area, presently the real vexing problem seems to be not the shortage of jobs but the fact that salaries have dramatically dropped. From 2006 to 2008 the average wage of Shenzhen’s workers raised more than 30%, from 2451 to 3233 yuan per month. Now there are wage reductions of 10% or even 20% compared to the levels of last year. But cuts in workers’ wages are hardly an effective measure to solve company problems, say labor activists. Yu Huimin argued: “salaries count as a minimal part of the production costs of an enterprise. It’s absolutely meaningless to harm workers’ interests in order to protect the company, firstly because this is not so useful, and secondly because workers already have a difficult life and an increase of the pressure on them is just another possible cause of instability”.
For Chinese workers the crisis is actually “the storm”, so they call it. It is a tempest, indeed. According to official estimates 20 million migrant workers, about 15% of the total 130 million migrants to the coastal cities, would lose their jobs this year. However these cold figures underestimate the ongoing systemic change. Liu Kaiming, a well-known specialist head of the Institute of Contemporary Observation, a civil society organization based in Shenzhen, said: “This is just an estimate. According to my calculation, in the manufacturing industry of coastal areas about 20 millions workers went back home. On top of this, we should add about 16 millions workers in the building industry and an unspecified number of workers in the services and in other industries, amounting to a sum total of somewhere between 36 and 40 millions workers. Every one of them will come back to the cities looking for a job. I think that even though workers in the building industry won’t have particular difficulties in finding new jobs, thanks to the big projects started by the government, it won’t be the same for the workers in the industries of manufacturing and services. The 20 millions might well be just the people unable to find a new job”.
A person who understands very well the impact of this economic crisis on Chinese migrant workers is Zhang Quanshou, better known in the zone as “the commander” of migrant workers. On his name-card is written “National People’s Congress Representative” in red letters, a position that he obtained in 2008. Arriving in Shenzhen from Henan province as a common migrant worker in the Nineties, a decade ago, he found a way to make a life finding jobs for his fellow villagers in cities like Shenzhen. In 2000 he founded a company mediating between migrant workers and factories: he takes a percentage of the earnings of every man he helps.
Zhang receives his guests guarded by large uniformed bodyguards in a luxurious office in a working class neighborhood of Pinghu town, north of Shenzhen. On one wall there are dozens of plaques with prizes, honors and titles from government bodies, on the other walls there are photos of him with the high ranking officers. Before the crisis, every year about 12,000 workers passed through his company and the prospects seemed so pleasing that he set the goal to double the number in 2009. In July 2008 the factories started not wanting “his” workers anymore and in some cases they sent back the people already hired. Moreover, workers stopped to rush to his office. After the Spring Festival there were just 5,000 new arrivals, half the number of the previous year. Many migrants decided to stay at home waiting for news.
According to Zhang, employers in the area prefer to hire young women between the ages of 16 and 23, because they are more disciplined and hard-working than their male counterparts. Among the most evident consequences of the crisis on his activities he counts the fact that recently, because of the uncertainty on future orders, he can only sign labor contracts of no more than three months. Previously, it was normal to sign agreements for at least one year. However, he says he didn’t notice any influence of the crisis on workers’ wages, which have remained substantially unchanged. “In late spring there will surely be new jobs, otherwise the whole world will go wrong”, he commented.
Paradoxically, the financial crisis hit Chinese workers right in the moment when hopes of raising labor standards were at their peak. In 2008 alone, three new laws on issues fundamental for workers such as labor disputes and labor contracts came into force. The financial crisis cast a shadow on all those improvements, at least for now.
Hua Haifeng, an activist of the Chunfeng Service Center for Labour Disputes, a civil society organization providing free legal advice to migrant workers in the Shenzhen Bao’an district, told me that the first months of 2008 saw an exponential rise in the number of workers who, reassured by the new legislation, had decided to sue their employers. But since the end of last summer there has been an abrupt shift in this trend. From internal data of the Chunfeng Service Center, it’s possible to see that the requests of consulting had peaked in April 2008 with 90 cases, while in October of the same year the number dropped to only 14. Nevertheless, there are still many workers filing suit with the state service of free legal counsel or with improvised “civil representatives” (gongmin daili) who, without any qualifications, promises miracles for little money.
Beside individual cases there are still many larger labor disputes. In early 2009 one involved the furniture company DeCoro, originally from Italy. The company, leader in the manufacturing of sofas, started off over a decade ago by paying salaries above average. However, recently a string of incidents and labor disputes tainted the company reputation. According to Xu Shilong, a lawyer contacted by many DeCoro’s workers, a serious incident occurred in March 2008, when 1,784 employees decided to recur to legal counsel to claim their overtime pay. After that, disputes surged as the company turned down growing requests grounded on the new labor laws.
Since last January, Chinese media paid growing attention to the DeCoro. According to local media reports, because of the collapse of orders from the USA, since October 2008 the company was having serious financial problems and 2,239 employees were left without pay in November and December. The Shenzhen government tried unsuccessfully to mediate, the workers went on strike and, on January the 15th, Luca Ricci, the company CEO, fled the country with all his foreign staff, leaving Chinese authorities to deal with the enraged workers.
“I would have never imagined it, nobody thought that our boss was such a person. Many workers still think that he’s going to come back, I have dreamt that he’ll come back very soon too”, said Chun, a 30 year old worker who worked in the administration department of the DeCoro factory for eight years. Now herself, her husband, also a former DeCoro employee, are at home without a job, with their two year old daughter. Facing two thousands enraged workers the local government paid part of the due arrears, almost 11 million yuan. “A case like this is very representative of what is going on in these days”, commented the lawyer Xu Shilong.
The official concern over instability is tangible. On February 17th the All-China Federation of Trade Unions, China’s only official trade union, a colossus with over 200 millions members, issued a warning. Its vice president Sun Chunlan said: “In the present situation it’s necessary to be on guard against hostile forces inside and outside the country ready to take advantage of the difficulties experienced by some enterprises in order to infiltrate migrant workers and cause damages”. Beijing is worried that workers dissatisfaction could lead to large anti government demonstrations.
To forestall this predicament the government is trying to extend more welfare benefits to migrant workers. In the last months, the Chinese media have been carrying news of new benefits for unemployed migrant workers hastily passed by local governments, of new regulations which would pose the basis for a national unified pension system, of huge re-employment projects launched by the provincial governments, all of this on the background of the forthcoming passage of China’s first Social Security Law.
The aim is a swift reform to give migrant workers the possibility to share the benefits of China’s fledgling welfare system. In fact even today in China living in a great city without permanent local residence (hukou) is the root of many problems. People without local hukou are not entitled to receive state assistance. They have no free medical assistance, they have to pay higher school fees for their sons, in case of occupational problems they cannot receive benefits, and so on.
It is still too soon to make an assessment on the impact of this financial crisis on Chinese workers. Many analysts say that it will be necessary to wait at least until the end of May, when the Chinese companies will receive their orders from abroad, to see the real effects of the crisis. Now, in the cities and in the countryside, everything is silent, quietly and anxiously waiting.
[I have to thank Francesco Sisci for the editing and his precious advices while I was working on this article. This article has also been published on Asia Times]
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