By Chris King-Chi Chan and Kahlid Nadvi
The recent rise in grass-roots labor activism alongside proactive changes in labor regulations highlights the fact that the nature of labor regimes in China is rapidly evolving. The authors in this article analyze aspects of these changes and suggest caution in considering whether the overall outcomes are positive. What they do bear out is that this remains an area of contestation calling for further reforms and regulatory interventions in order to bring about better labor standards in China.
Although Corporate Social Responsibility (CSR) and private “soft” regulation have been highlighted as an effective alternative for the protection of labor rights in the age of globalization and weakened state power, the evidence from China tells a different story. Here, it seems that it is the Chinese state and its “hard” public regulation that may provide more effective protection for workers, especially for China’s vast numbers of migrant workers who have limited “Hukou” (local citizenship) rights. Recent years have seen growing labor strife and the power of workers’ activism becoming the important forces behind improvement in wages and working conditions. Such forms of labor activism and the growing shortages of skilled workers in many of the coastal zones have also acted as key drivers of the Chinese State’s greater engagement in labor legislation and labor policy (C. Chan, 2010 and 2014). This suggests a relatively brighter outlook for Chinese workers, as more effective public regulation leads to improved labor outcomes. One significant measure of this trend is the substantial increase in wages seen in China over the past decade.
What is clear from the current situation is that despite the growing importance of public regulatory interventions around labor, labor contracts and worker’s contractual rights, the Chinese State is not homogeneous and its role in the protection of labor rights is multifaceted and uneven. The implication is that in places where workers’ power is weak, the local government may not effectively implement labor regulations. Moreover, where the collective institutions of industrial capital are better mobilized, their own associational power to pressure the Government may well imply that workers’ power to influence state policy is constrained. This calls for further and more detailed research into changes in China’s labor regimes resulting from shifts in labor regulations and labor dynamics, and their implications for labor standards. We conclude by suggesting a number of areas where such further studies, drawing on multi-disciplinary approaches, and providing more nuanced, more substantial and more rigorous evidence, would be helpful.
First, there is a need for more careful analysis of the Chinese State by labor scholars, within the framework of the broader social relations between labor and capital at the global, national and local levels (Jessop, 2008). This implies both conceptual and empirical work. It also includes the need to understand better the relationships between national and local levels of government in China. Furthermore, it calls for a more in-depth understanding of the evolving nature of political consensus in China and an understanding of why an effective social contract or a social consensus around labor standards or CSR norms in production remains somewhat out of reach in the Chinese context (Knorringa and Nadvi, 2014; Lin, 2010).
Second, the questions about collective bargaining should be further examined. Although the Shenzhen Collective Consultation Ordinance and Guangdong Democratic Management Regulations have been suspended as Hui and Chan report, a softer version of the Guangdong Province Enterprise Collective Contract Regulations was passed in September 2014 with effect from January 2015. Its impact on workers’ activism and workplace relations is an important issue to be examined. In Guangdong, pilots of direct trade union elections and collective bargaining have been carried out in the core cities of the Pearl River Delta such as Guangzhou, Shenzhen, Foshan and Dongguan (Hui and Chan, forthcoming). Further evaluation of such projects within the Pearl River Delta will be helpful to inform both theoretical reflection and policy on industrial relations more widely, across other regions in China. This raises broader questions as to whether, why and how Guangdong – the first province to be opened up to labor-intensive export manufacturing – will offer lessons to other parts of the country in terms of bringing about more effective labor regulations, better labor relations and consequently improved labor standards.
Third, while labor-intensive manufacturing industries have begun to relocate from the coastal metropolitan cities to lower-wage inner provinces in response to the local government’s campaign for industrial upgrading and for lowering businesses’ production costs (Zhu and Pickles, 2014), questions arise as to what impacts this is likely to have on labor regimes and worker’s conditions both in the inner provinces and in the coastal regions. In the early 2000s, the internal relocation was from the Pearl River Delta to the Yangtse River Delta; the new pattern is from both of these regions to inland provinces and from the Pearl River Delta to the outskirts of Guangdong, or from the South Jiangsu region to North Jiangsu. Building on Zhuang and Ngok’s article, further comparative studies of local labor regimes, including local practices on labor inspection, will help to reveal the impact of industrial relocation on regional patterns of labor standards.
Fourth, this uneven pattern of labor rights protection is also shaped by other factors, such as the form of ownership, industry, and area of protection. One can indeed assume that the level of enforcement of labor laws varies between state-owned and foreign-invested enterprises, technology-intensive and labor-intensive industries, wage and social security protections, and individual and collective rights. To clarify this complicated picture, the implementation of various labor regulations and its impact on labor standards must be studied in comparative perspective. Similarly, while Lüthje’s article aptly captures the dynamics of the automobile industry, more research is needed on other industries that have been relatively less well explored (e.g. services, construction and heavy manufacturing), where labor standards issues and associated labor conflict remain germane.
Fifth, although China’s economic growth in the post-reform era has been predicated on its export manufacturing performance, the Chinese State has, since the 2008 global economic crisis, begun to recognize the economic importance of the domestic market and domestic consumption. Robust and sustained growth within the Chinese market has prompted Western retailers and brands to view China not only as a manufacturing platform but also as a key end market for industries as diverse as electronics, clothing, sports goods, foods and automobiles. Many Chinese producers have also begun to refocus their energies on the domestic market. This then raises questions as to whether and how rising domestic consumption, and a large and growing middle class, might influence labor and environmental considerations in the Chinese context (Guarin and Knorringa, 2014), and how the State might respond to this in terms of regulatory interventions
Finally, while there is much specificity inherent in China’s experience of labor regulation and labor activism, there are also a number of important lessons to be drawn for other parts of the world. The growing interest in emerging economies and the very different patterns of labor regulation, labor inspection and labor practices seen across China, Brazil and India call for further international comparative analysis of labor regimes across these rising powers and how they are shaped (Nadvi, 2014).
Furthermore, Chinese capital is increasingly internationalizing, with Chinese firms investing in primary commodities, manufacturing, construction and service industries across the developed and developing worlds. In many cases these international movements of Chinese capital are accompanied by international movements of Chinese labor. What are the labor regimes that govern these Chinese migrant workers? How do Chinese firms that are becoming global players engage with labor issues in the management of their own complex supply chains, including on the wages of workers from lower-income countries and their working conditions?
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This article is the conclusion made at a research article, titled – “Changing labour regulations and labour standards in China: Retrospect and challenges by Chris King-Chi CHAN and Khalid NADVI “ published at International Labour Review Volume 153, Issue 4, under Creative Commons 4.0 License.