The headline, ‘electronics firms in Europe get away with employment practices from China’ is highly misleading. It should read, ‘EU allows electronics firms in Europe to selectively adapt employment practices from China with0ut Chinese-level benefits’.

Less sexy, I admit, but less China-bashing, too.

Chinese workers’ rights (and compliance) are by far the best in the developing world. China’s employment law system is quite different from the West’s. The U.S., for example, has an employment at will system, which means employers can terminate employees at any time for almost any reason. China’s system is the opposite: it’s a contract employment system. All employees must be hired under a written employment contract and, during the term of that contract, it is very difficult to terminate them. Employees can only be terminated for cause and cause must be clearly proved. This means employers must maintain a detailed set of rules and regulations and maintain careful discipline records to establish grounds for dismissal. The Chinese employment relationship is much more adversarial than is customary in the U.S because Chinese workers have more rights. Another difference is that China doesn’t really have our concept of ‘salaried’ employees. The Chinese work week is 40 hours and overtime must be paid for work exceeding the 40 hour limit. There are no exceptions to this rule. Here are some significant differences in their employee-employer relationship:

• Employment Terms. Chinese employers can hire someone on a fixed-term contract only twice: two successive 12-month contracts, for example. After that, employees automatically becomes permanent.
• Salary. Most employers pay salaries on a 13-month basis with the 13th. payment coming just before Chinese New Year. Failure to pay this “New Year’s Bonus” can cause serious problems. All Chinese workers have received 100% wage rises every decade for the past 40 years.
• Vacation. China is among the stingiest nations on earth for paid annual leave and employees vacations are calculated on’ work experience and tenure. Those who have worked at a company for one continuous year are entitled to five days annual leave. Years 2–9: five days. Years 10–19: ten days. 20+ years: fifteen days. But…tenure is not limited to the length of time an employee has worked for their current employer: it’s their cumulative work experience with all previous and current employers.
• Holidays. Paid annual leave does not include statutory rest days, seven public holidays and other additional holidays (like maternity leave and annual visits to family) and half-day holidays for specific groups like International Women’s Day, Youth Day, Children’s Day and Army Day.
• Unions. Labor unions play a much bigger role in collective bargaining, settling labor disputes and general management. China has the largest network of trades unions with 130 million members. Membership isn’t compulsory but, as in the West, over 90 percent of state employees are unionized. Private companies in urban areas are only partially unionized and only one union is allowed in each employer. All of them must belong to the All-China Federation of Trade Unions (ACFTU). In 2007, a Foxconn (which manufactures Apple products) subsidiary with more than 200,000 employees unionized after two years of fighting the Shenzhen city union’s organization efforts and after a local newspaper (state-owned, of course) accused it of forcing workers to stand for 12-hour shifts. Foxconn sued the newspaper for defamation but, in the end, unionization went through and Foxconn dropped the suit. Sound familiar? What’s significant here is that, without media support for the workers, unionization wouldn’t have happened. Sadly, WalMart China is just as bad an employer as it is in its home country: employees are still struggling to establish a real labor union–nine years after the company agreed to it.
• Workers’ Rights. Though China is no workers’ paradise, according the the UN it has ratified four of eight Fundamental Labor Conventions (the US has ratified two); two of four Governance Conventions (US one) and 22 of 177 Technical Conventions (vs. the US’ eleven). Plenty of room for improvement in both countries.