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Out Of Time

Has development helped China’s workers escape excessively long work hours?

11·26·2016

Out Of Time

Has development helped China’s workers escape excessively long work hours?

11·26·2016

Walking into a Walmart in China at almost any given time, you wouldn’t guess that workers have been sporadically striking and sparring with management over work hours. Essentially, Walmart wants to be able to assign hours based on a set average each month, rather than have employees work from nine-to-five. The plan would wipe out overtime pay for working irregular shifts, so the company’s more than 100,000 workers are less than impressed.

Employees have reportedly been persecuted for attempts to form unions and have complained of harassment from employers when attempting to contact labor bureaus.

It’s a familiar story to Western audiences; Walmart has long had quarrels with its staff in countries across the globe and has stamped out union activity wherever it can. But in China, where labor laws are still theoretically influenced by communism, a complex picture emerges of overtime work. In many cases China’s labor system has taken on elements of Western work culture, while still bedeviled with problems regarding worker rights.

In the case of Walmart, two former employees have formed an organization that takes on some aspects of union work without being a union. This became known as the Walmart Chinese Employee Fellowship. There is no set membership and it has just one full-time staff member. It has, however, provided an avenue for workers to communicate nationwide in a country where the only approved labor unions are run by employers or the authorities under the auspices of the All China Federation of Trade Unions (ACFTU).

The clash between Walmart and its employees continues, exacerbated by the fact that Walmart salaries have stagnated while costs of living in China have increased, making a onceattractive job now seem lackluster. The situation is a sobering reminder that workers face an incredibly difficult time reducing or even preserving current working hours and increasing overtime pay. Aside from the loss of overtime, workers have also expressed concerns that the new shifts would wipe out their ability to work second jobs, while making it easier for supervisors to schedule unreasonable shifts and force employees to resign without severance pay.

On the books, China has pretty solid protections for overtime pay. Unlike in the US, the concept of a “salaried employee”, who receives a set per-week or per-month salary regardless of hours worked, doesn’t actually exist in China unless a labor bureau has specifically given permission— even though it’s still common for contracts to stipulate a wage by month regardless of the type of work arrangement.

With the permission of a labor bureau, the company can also opt for “flexible working hours” or a “comprehensive” system, but this permission has to be constantly renewed.

In the case of Walmart, the company received this permission, but when it asked employees to sign new contracts that would make it official, workers went on strike. Some workers have also claimed that they were coerced into signing documents that were used by the company to obtain permission for these new working hours.

If a company lacks permission for a flexible or comprehensive working hour system, employees are to be paid by the hour, and paid overtime once the work exceed 40 hours a week or eight hours each day.

That is how it is supposed to work for everyone, regardless of whether they are a factory worker or senior manager, and in the vast majority of cases, even people who appear to be contractors are actually treated as employees according to the law—in theory.

“The only ones who truly follow working-hour regulations in Chinese labor law are state organs and public institutions, and a few more ‘standardized’ large corporations and state-owned enterprises,” Wang Jiangsong, a labor scholar affiliated with the China Institute of Industrial Relations, points out. “In reality, sixday work weeks, or 11-hour work days are very common,” he says of private enterprises.

Wang says that, unfortunately, quitting is rarely a good option for workers facing unreasonable overtime. “‘Voting with your feet’ is only effective in situations where the labor force is lacking, where there are not enough workers,” he says. “Usually you’ve climbed out of the tiger’s cave and into the wolf ’s den.”

For workers trying to claw back pay for extra hours worked, the situation is particularly tough.

“Our government, the [national] labor union has promoted relying on existing legal procedures to apply for labor arbitration or start lawsuits… The net benefit from doing this, for the laborer, is not very large, because even if you win, the process takes too long, so the costs are too great,” Wang says. “In 2013, I discovered some data. If a laborer wants to pursue 3,000 to 4,000 RMB of salary [owed], the cost that he…has to pay can potentially be 8,000 to 9,000 RMB to go through all the steps in the judicial process.”

The frequency and severity of overtime does, of course, vary by profession, though it’s interesting to note that among the hardest hit are white collar workers.

“I’ve found that high-tech industries are pretty hard hit in terms of overtime, so cases in white-collar sectors of over-exertion or death from overwork are numerous,” Wang says, also listing textiles and services among the afflicted industries.

Indeed, the term “guolaosi” (过劳死), or “death by overwork”, is a common one in China. One of the most famous cases of death by overwork was high-profile banking regulator Ji Jianhua, who suffered a heart attack which media widely attributed to being caused by overwork. Numerous instances of people dying from overwork have cropped up in media reports, and China Youth Daily has put the figure at 600,000 deaths from overwork every year.

China’s tech sector mirrors many of the elements encountered by its Silicon Valley counterpart, often exaggerating them, and the ubiquity of overtime work among startups is most certainly among them. Shared workspaces are becoming common. The sight of employees sleeping at the office is not an unusual one, particularly given the fact that China’s danwei (work unit) system of organizing employees’ lives has long featured dormitories so workers don’t need to go home to sleep.

Fortunately for Chinese workers, at least napping during work hours is generally much less of a sin than in Western offices, and many employees openly sleep at their desks on lunch breaks.

But this is far from enough to combat the dreaded guolaosi, which is largely reported as a white-collar problem. Meanwhile, deaths in factories or China’s notoriously dangerous coal mines are seen as a result of poor safety conditions, despite the fact blue-collar workers in poorer areas are likely to face brutal working hours.

It isn’t all doom and gloom though; overall, the economic boom has of course dramatically improved working conditions for most of China’s workers, particularly those in the countryside. Having hailed from the countryside himself, Wang points out that mechanization has removed a lot of the backbreaking labor involved in farm work, and this in turn has made working hours better.

But it’s not a system that is responsive to worker demands.

While laws may seem good in theory, the actual enforcement can ebb or strengthen according to economic trends. Labor rights groups point out that when employment is tight and authorities are pressed, they are often quick to side with employers and limit employee action, on the basis that companies need to stay running to keep employment high.

This has direct bearing on any efforts at reform.

“After legislation is made, what’s important is enforcement and judicial safeguards. In regards to enforcement and judicial safeguards in China, there is a common phenomenon of ‘law without guarantee, enforcement without severity, law-breaking without correction,’” Wang says. “From the bottom up, [the laws] give laborers the legal will to protect themselves; that’s effective. But on the other hand, if laborers cannot effectively use these legal resources to protect their legal rights, then these laws don’t have much use.”

“Whether or not we can truly realize the advancement of rule of law in labor is, based on the experiences of Western nations and of Western market economies, dependent on the three basic rights of workers: the worker’s right to unionize, the right to collective bargaining, and the right to strike,” Wang adds.

It’s a salient point given the current travails facing Walmart staff. The clash is at its most heated in Shenzhen, where workers are attempting to sue the company over the new system and its lack of overtime pay.

TWOC saw images of a document that Shenzhen employees were sharing among themselves, one of the disciplinary forms they had been asked to sign, which stipulated the severity of penalties that employees faced for misdeeds. These range from a verbal, to a written, and then a final warning before dismissal.

These transgressions included, somewhat ironically, spreading critical information online in the group discussion among employees, or for provoking complaints against Walmart.

So basically, it’s the kinds of activity that would be considered “forming a union”. Some staff claim they have already received police warnings not to complain to their superiors.

In 2006, Chinese authorities used Walmart as the example to argue the necessity of allowing the ACFTU operate within foreign companies as a union. In June this year, Walmart staff in China discussed their labor disputes with American Walmart union staff via Skype and a translator, in a very rare case of Chinese employees liaising with American unions over employee rights in China. Taking a step back, this was an exceedingly strange case of workers from an ostensibly communist state liaising with a union based in the world’s leading cheerleader for capitalism, about the actions of one of the world’s largest companies.

As China’s economy slows down, so the authorities can focus on “quality” growth rather than growth at a breakneck pace, the Walmart dispute will be a fascinating case study into how authorities intend to grapple with dissatisfied workers while juggling issues like employment rate and employer demands. Because they can be certain that Walmart is not going to be the only large company to run into these issues, and what happens here will have legal ramifications for those that follow.


“Out Of Time” is a story from our newest issue, “Climate Change”, coming soon. To read the entire issue, become a subscriber and receive the full magazine. Alternatively, you can purchase the digital version from the iTunes Store.