There is no U in labor
March 13, 2009 by Chinatex
In the event any of you were hoping for some relief in the form of a complete revocation of the labor laws, I hate to tell you that it’s not going to happen. Remember that the purpose of the new labor laws, effective January 2008, was not to cripple your manufacturing, trading and other businesses in China, but to build a new market for hungry labor lawyers. Maybe not, but really the purpose was to eliminate the many factories that were playing too far outside of the grid. You know what i mean by this – they were not paying taxes, not paying their employees a decent wage and the profits were being sucked out of China to Hong Kong, Taiwan and other countries. While in some ways the labor law might have gone a little far, as the pendulum often does, it is here to stay as evidenced by the following article. Bottom line as old Chinatex tells his clients, make sure you have a contract with all of your employees and follow the labor law or you will end up calling me when one of the hungry Chinese lawyers or a disgruntled employee files a claim against you. Hope your 2009 is going well. Yeeha!! Chinatex
Changes ruled out to Labour Contract Law
Top lawmaker denies legislation is placing a significant cost burden on businesses
NPC & CPPCC
Cary Huang in Beijing
Mar 10, 2009
No change will be made to the controversial Labour Contract Law because it has had nothing to do with the widespread failures of exportoriented small and medium-sized firms in coastal regions, as entrepreneurs have claimed, a senior lawmaker said.
|
Xin Chunying, deputy director of the legislative affairs commission of the National People’s Congress Standing Committee, said yesterday a recent investigation had found that the law, in effect since early last year, increased business costs by only 2 percent. |
While factory owners decried the law as a crippling cost burden, workers hailed the new legislation. The law unleashed a flood of arbitration and labour dispute cases in manufacturing hubs, such as Guangdong’s Pearl River Delta, where many migrants work.
Recently, representatives of Hong Kong’s battered exporters embarked on a three-day trip to Beijing to step up efforts to lobby for an amendment to or a relaxed implementation of the law, to create a more investor-friendly environment. Some regional governments have gone ahead and relaxed implementation of the law over fears that stringent execution would lead to more factory closures amid the worsening economic environment.
But Ms Xin flatly ruled out such a possibility. ”[We] will not amend the law because of the economic crisis because there is no connection between the crisis and [the enactment of ] the Labour Contract Law,” she told a news briefing on the sidelines of the NPC session in Beijing.
Chen Wei, vice-president of the China Association of Small and Medium-sized Enterprises, said the government should relax somewhat the implementation of the law, in view of difficulties faced by SMEs. He also dismissed Ms Xin’s claim that the law led to a 2 per cent increase in costs, saying some of the association’s member firms claimed that they had seen costs increase as much as 10 to 20 per cent.
There is growing anecdotal evidence of a strain on the mainland’s labour laws, a reflection of the difficult task the government faces in balancing economic growth and social stability during the downturn.
Official data also indicated a growing number of labour lawsuits since the enactment of the controversial law. Supreme People’s Court executive vice-president Shen Deyong said labour disputes had nearly doubled last year, compared with 2007, because of the economic downturn and the Labour Contract Law.
The national figure had increased by 95 per cent year on year, and the number nearly tripled in some eastern and southern coastal cities during the period, Mr Shen said recently. However, Ms Xin argued that the enactment of the law had helped keep relations between employers and employees stable during the downturn.
Comments
Feel free to leave a comment...
and oh, if you want a pic to show with your comment, go get a gravatar!
