The second complaint is that the management of these state enterprises are corrupt and inefficient. In another study conducted by the ACFTU researcher found that the workers feel that over eighty-five per cent of the value of entering the market system has been for the benefit of and the pocket books of state-enterprise managers and the Communist local and regional officials. The workers say that the autonomous power granted by the management reforms (zizhuquan) has become 'self-enriching power' (zifuquan). These managers steal from their enterprises; hive off parts of the enterprise to their own personal private companies; and use the unpaid or delayed wages of the employees as their private piggybanks.
The third complaint has been that the cost-shaving of these managers has led them to flout the laws on worker safety; mines, mills, and factories have become death traps for the workers. Hundreds of miners have died in explosions or cave-ins in Chinese mines. Buildings under construction have collapsed as a result of shoddy materials being supplied and safety precautions ignored. Unpaid or extra work shifts have left the workers exhausted and despondent. Suicides of workers are not uncommon. There are regularly strikes across China. The China Labour Bulletin from Hong Kong monitors these.
Following a series of scandals surrounding unfair dismissal (particularly by foreign-owned firms such as Walmart), and the negative publicity which these attracted, in January 2008 the Chinese government passed The Labour Contract Law of the People's Republic of China. The 2008 reforms allowed ACFTU, which had previously been focused on state-owned enterprises (SOEs), into the private sector. The union has said that it intends to unionise over 90 per cent of workers in China, and by law any company with more than 25 employees must allow the formation of an ACFTU-approved union.
Until recently when workers organize work stoppages, strikes or demonstrations, the ACFTU has been an observer and at worst a co-instrument in putting down labour unrest. In some cases, the ACFTU is known to have directly restrained or detained workers' representatives as well as helping the state punish workers who engage in strikes (the right to do so was removed from the Constitution in 1982). ACFTU also collaborates with business owners, allowing firms to influence whom their union chairperson will be and helping them head off unrest or worker dissatisfaction before it affects their bottom line.
Chinese workers are all too aware of the uselessness of their official trade union. While in the past workers largely sought to greater democratise ACFTU, increasingly they are looking outside the organisation. In most workplace disputes, particularly strikes, workers forgo ACFTU procedures and elect their own representatives for the duration. These informal and illegal strikes have proved successful: in 2010 workers in Foshan were able to attain a wage increase from management despite having no support from ACFTU - government-approved union representatives even allegedly attacked striking workers who tried to talk to reporters.
However the ACFTU is now making much more of an effort to promote collective bargaining in both state and private employment. There are new regulations limiting the proportion of dispatch--or temporary--workers in China went into effect early in 2014, constraining hiring choices and requiring labour-force restructuring for many companies. A follow-up to the 2013 Labour Contract Law Amendment and the Provisional Regulations on Labour Dispatch and its associated implementing regulation reduce the proportion of dispatch workers to ten percent of a company's overall workforce. Although employers can apply for a two-year grace period to comply with the new regulations, many private companies are taking steps now to ensure they are ready in 2016.
The ACFTU is expanding its role as a proper trade union body by working with the unofficial independent trades unions in the private sector, encouraged by the reforming CCP after the Third Plenum. When Jiang Zemin succeeded Deng as head of the CPC and the CMC he largely followed the economic policies introduced by Deng; adding the "Three Represents" policy in 2004 that encouraged the Party to represent "advanced productive forces, the progressive course of China's culture, and the fundamental interests of the people".
In effect this policy allowed for the formation of State-Owned Enterprise as well as private corporations. There are about 120 large SOEs in China (managed by the State-owned Assets Supervision and Administration Commission (SASAC) as well as several large banks and insurance companies not supervised by the SASAC. In recent years the CPC leadership has concentrated its financial might in supporting these SOEs with cheap credit and a policy of growth. This has a dramatic effect in spurring their growth. However, the direction of cheap credit to these SMEs and the promotion of major infrastructural projects has stifled the growth of small and medium-sized corporations through a shortage of capital and led to a lack of spurs for domestic savings. China has to redirect these funds to reach the new middle-sized firms and allow the growth of a domestic savings pool; the very topics addressed by the Third Plenum.
In order for the SOEs to function properly and the private industrial corporations to continue their growth the need for reducing the endemic corruption on every level of Chinese economic and political levels is required. That is the nub of the "rule of law" program. By removing or curtailing the corruption the levels of strikes are likely to diminish and labour stability will increase. Removing these corrupt barriers to growth is best achieved by creating a functioning system of collective bargaining on a plant and industry-wide basis and promoting a grievance system that can have reference to impartial arbitrators. This is where the actions of the Fourth Plenum and the Chinese labour movement can each benefit. Perhaps it can happen. The whole of China would benefit.
[i] Jake Laband and Hengrui Liu, What is China's Fourth Plenum?, China Business Review 14/0/14
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