Employment Relations in China

This week’s blog topic is China and the transition of employment relations in recent years. Since 1978 employment relations in China have endured quite a remarkable transformation.  In the 30+ years since China started its transition into a new economic development strategy, there has been unparalleled impressive and sustainable economic growth throughout many areas; including economic policy, trade, education and managerial practices (Kuruvilla & Friedman, 2013). From the 1990s onwards Chinese employment relations has really moved forwards – with the introduction of various legal regulations (including the first Trade Union Law and Labour Law in the early 1990s) that helped to develop China’s economic and social strategies (Lee, 2009).The main question in this week’s topic is whether employment relations in China are transforming; as many experts refer to China as an economy in ‘transition’. My thoughts point to yes. 

In the last 6 years, China has introduced and enforced new labour laws that are focused on ‘improving and perfecting the labour contract system’; making the rights and responsibilities of employees and employers clear and concise (Haiyan Wang et al. 2009). Previous to this change, labour laws require employers to have labour contracts with their employees but fewer than 20% actually did. There was a huge sense of ‘informalisation’ of work in China (Kuruvilla & Friedman, 2013). This allowed for vaguely stated minimum wages, working conditions and job security was increasingly scarce (Haiyan Wang et al. 2009). 

The Labour Contract Law of 2008 requires employers to consult with trade unions and worker representatives when it comes to decision making on matters such as dismissal and redundancy (Lee, 2009). It also reaffirms the legal foundations for wage negotiation and sectoral bargaining (Lee, 2009). The 2008 Labour Contract Law has given Chinese employees better job security and improved working conditions through the input of collective bargaining (Lee, 2009). The addition of collective bargaining has given workers more rights but has definitely contributed to the increase in strikes undertaken (mainly when it comes to wage increases) (Kuruvilla & Friedman, 2013).

The 2008 Labour Contract Law was probably one of the biggest developments to hit Chinese employment relations in the last decade or so. While it gives employees more legal rights there are still areas that workers and employers alike are still getting used to – especially because their previous practices were more unconventional. This is one of the reasons why I still think Chinese employment relations are still in transition. 

Links at the bottom, if you want to know more. I’m off to Queensland for the weekend, woohooo!

http://www.tavinstitute.org/humanrelations/special_issues/China.html

http://www.ilera-directory.org/15thworldcongress/files/papers/Track_4/Wed_W2_LEE,Changhee.pdf