The CSR Newsletters are a freely-available resource generated as a dynamic complement to the textbook, Strategic Corporate Social Responsibility: Sustainable Value Creation.

To sign-up to receive the CSR Newsletters regularly during the fall and spring academic semesters, e-mail author David Chandler at david.chandler@ucdenver.edu.

Tuesday, November 6, 2007

Strategic CSR - Labor Law

The article in the url link below charts the progress of a dramatic revision of labor law in China that was due to be finalized this past summer (Issues: Employee Relations, p118; Wages, p204):

“The draft law was first presented in December 2005, and the standing committee met in April to discuss it and other pending bills. If passed in June, the measure is expected to take effect next year.”

While the article is vague in terms of details (to be fair, the revision of the legislation was on-going at the time), the focus here is on the broad, consultative approach of the Chinese government in soliciting input during the drafting process:

“The delay in passing a labor law has been because of a surprising development in China: The government solicited public comments on the draft, and it received nearly 200,000 of them. … But the process shows how China's government is increasingly seeking to involve interest groups and the public at large in the formation of laws. The cautious steps toward greater transparency reflect both the state's desire to retain popular support of its rule and its need to tap a wider base of expertise to ensure laws are suited to the ever-more-complex economy and society.”

The article comments on the apparent genuine desire of the Chinese authorities to ensure the law improves the social unrest that has accompanied many of the economic reforms that have transformed the Chinese economy and society in recent years:

“China wants the new law to bring more order to the workplace. Many workers lack written contracts and often don't receive salaries on time. The government is also concerned that many workers are being unfairly trapped in short-term contracts, with little chance of advancement.”

An update on the legislation and a discussion of its pros and cons can be found in a recent Knowledge@Wharton Newsletter at:

http://www.knowledgeatwharton.com.cn/index.cfm?fa=article&articleid=1685&languageid=1

“China's labor market is rife with problems -- frequent coal mine accidents and workplace injuries, and unpaid wages on a large scale. Legislators as well as scholars are keenly aware of these issues, but have come up with different solutions. Professor Chang Kai's answer is to raise labor standards, but Dong believes “high standards” will lead to "narrow coverage" and "weak enforcement". On the other hand, "The new law might hurt the workers it tries to protect," Dong wrote in another paper. "For example, to cope with difficulty in firing, companies might be more unwilling to hire, and some job positions might not be created."”

Take care
Dave

Bill Werther & David Chandler
Strategic Corporate Social Responsibility
© Sage Publications, 2006
http://www.sagepub.com/Werther

China Toils Over New Labor Law
Rare Public Debate Pits Growth vs. Worker Rights
By Andrew Batson and Mei Fong
1038 words
7 May 2007
The Wall Street Journal
A8
http://online.wsj.com/public/article/SB117849173259593852-iksPXSVyWmuECE4t646qC0rO0P4_20070514.html?Mod=regionallinks

or, reproduced in ChinaDaily.com at:
http://www.chinadaily.com.cn/china/2007-05/07/content_867069.htm