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28 Apr 2023

China Labor Bulletin

China: Workers at alleged adidas & New Balance supplier strike over wage dispute, as international orders decline

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"In an about-face, workers at a reputable Zhejiang garment factory strike over wage dispute", 28 April 2024

Workers at a garment factory in Zhejiang province that produces for Adidas, New Balance and other major international brands went on strike on 14 April over wages. Workers at... Jiaxing Quang Viet Garment Co., Ltd., stopped production for at least five days, demanding that factory representatives give them a clear explanation of how their wages would be calculated. 

The Jiaxing Quang Viet (嘉兴广越) factory...employs over 1,200 workers. International orders have been reduced for the factory’s cotton sports clothing and down coats, and the factory began paying workers less than usual. 

Workers...stated that the monthly salary is typically 5,000 yuan, but in April workers earned less than 4,000 yuan, and some took home as little as 1,500 yuan. According to a job ad from the factory, workers can make 7,000 to 10,000 yuan per month, which includes monthly wages, piece rates, and bonuses...

Workers protested outside the factory, and the police were called in to mediate. About a dozen police were stationed at the factory, and some workers were reportedly taken away by police. 

Workers can be seen in online videos speaking with a representative from management who promised a clear calculation of their payments, but only stated that a computer system calculates their pay based on hours worked. Workers responded that such a calculation system should be able to immediately tell them their salaries, and they wanted more transparency. 

Production resumed at Jiaxing Quang Viet later the same week, and workers are awaiting more clarity about their wages...

Union calls the strike a “misunderstanding of the workers” but sought to intervene

On 17 April, China Labour Bulletin called the local Pinghu trade union and spoke with a Mr. Yu of the union’s rights defence department. Mr. Yu told CLB that his office was aware of the Jiaxing Quang Viet strike and had taken steps to learn more...

CLB asked whether workers or the enterprise union had contacted the Pinghu union, and Mr. Yu said that they had not...Workers may have little confidence in the union - or not know of its existence - and the enterprise union is often controlled by company management. At Jiaxing Quang Viet, the enterprise union seemed fairly in touch with workers. But Mr. Yu explained that the Pinghu union was following usual protocol about communicating with the enterprise union, which is under its jurisdiction...

CLB suggested that in the meantime, the union could consider broader ways to play a role in protecting workers’ rights and interests...

In our conversation with Mr. Yu at the Pinghu union, CLB first pointed to new legislation on Europe making companies legally liable for labour rights violations in their supply chains and suggested that the union could leverage this in favour of workers...

Mr. Yu...was concerned that the brands would not pay attention to a local union in China. However, CLB’s own experience through a partnership in Bangalore, India, responds to this point. We have observed a small, grassroots union at a garment factory - not unlike Jiaxing Quang Viet - engage with international brands on issues of pay, workplace safety, and other working conditions. In fact, the union in Bangalore succeeded in establishing a worker fund in the event of a factory shutdown due to economic conditions and reduced orders of brands. 

CLB also pointed to the official nature of the ACFTU in China, giving the institution inherent advantages over grassroots trade unions such as in India. If the grassroots trade unions in India can grasp the demands of workers and organize them well and present them to brands, then China’s official union at the municipal and local levels should certainly have such capacity. Moreover, the higher-level trade unions in China with greater authority and resources could play the role of communicating with international brands on behalf of China’s workers, factories, and suppliers alike. Further, if work conditions and benefits are improved in China, labour-capital relations will improve, and the incidence of large-scale strikes and protests may be reduced. 

CLB also offered a recent Dutch intermediate court decision as an example...A Hong Kong supplier brought a breach of contract case against a Dutch brand for cancelling its orders at the supplier’s factory in Vietnam, leading to the factory’s closure and layoffs of many workers....The court found in favour of the supplier and cited the brand’s corporate social responsibility pledges to workers in the decision...