Union Of The State – Economist

From The Economist:

Labour conditions in China can be notoriously lousy. Reports abound of sweatshops, workers’ protests and this year even of officials condoning the luring of children into slavery. A new law on employment contracts, coming into effect on January 1st, will in theory improve workers’ lots, but is creating more headaches.

The law is supposed to provide greater job security. Workers with ten years or more of service will have open-ended contracts and companies will have to inform unions before sacking anyone. Employers fear the law will mean bigger severance payments. The unions will also have the power to negotiate collective contracts.

But the law has many detractors. Some allege it will take China back to the “iron rice bowl” era of Maoist days when jobs were for life and the economy was crippled by a lack of incentive. Others, conversely, argue that it will strengthen state-controlled unions but do little for downtrodden workers. [Full Text]

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