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Analysis and Commentary

A prescription for workplace democracy in China

The democratic election of trade union officials at an electronics factory in Shenzhen in May this year has generated considerable debate among labour scholars in China. In the latest issue of the journal Collective Bargaining Research (集体谈判制度研究), for example, Wang Jiangsong discusses what the election means for China and how best to capitalise on its success. Wang points out that holding democratic elections is only the starting point for the development of fully functioning and representative trade unions, and he outlines the measures needed to create genuine workplace democracy. Key points include:

  • Allow workers to freely select and elect candidates for the trade union committee without interference from management and or the higher-level unions.
  • Focus on enterprises where there is a clear need for and a demand from the workforce for democratic trade union elections.
  • Establish clear provisions for election procedures and ensure that the enterprise abides by its legal obligations to provide space and financing for the union.
  • Ensure that elected trade union officials are economically and legally independent from management and wholly accountable to the union membership.
  • Democratically elected trade union officials should ensure their members’ interests are protected and promoted by engaging in collective bargaining with management.
  • The right to strike should be recognised and codified in law.

Wang Jiangsong’s article is translated below by CLB as an example of the current thinking of many labour scholars in China.

Giving workers freedom of association can prevent direct union elections from becoming just another political showcase

By Wang Jiangsong

On 27 May 2012, workers at the Japanese-owned Ohms Electronics Co., Ltd. in Shenzhen’s Longgang district elected a new union chairman straight from the production line. Thirty five-year-old Zhao Shaobo was elected by an absolute majority, whilst the original union chairman Li Shizhong was eliminated in the first round of voting.

Two months before the election, several Ohms employees had asked management for increased pay and benefits, as well as to conduct a new union election. After the employer refused, more than 700 employees went on strike in protest. Following the intervention of the local trade unions and government, the situation was resolved and the employees went back to work. Subsequently, the municipal and district trade unions decided to hold a new union election at the Ohms factory. And this time, they did not follow past practice and monopolise the union chairman’s rights to make nominations and decisions. Instead, they returned these basic rights to the workers; the higher-level union only provided procedural guidance in the course of the election process to ensure that the election proceeded according to regulations and that the results were legitimate.

In early April, Ohms established a preparatory committee, with the seven workshop union chapters electing representatives via secret ballot. In total, 75 union representatives were elected, 65 (87%) of whom were ordinary workers. These 75 representatives then selected 14 candidates for the enterprise union committee, as well as four candidates for the union’s finance committee. Finally, on 27 May a general meeting was held of all union member representatives, and the 75 member representatives elected the first set of enterprise union committee members and finance committee members, as well as the union chairman.

Wang Tongxin, Vice Chairman of the Shenzhen Municipal Federation of Trade Unions told the media after the election that, in some of China’s enterprise trade unions, management had often sought to influence or even interfere in the election of trade union chairmen, and that few workers knew the union committee members and chairmen who are elected. Some enterprise trade unions were controlled by management, and dared not speak on behalf of the workers, making it difficult for the trade union to play the role it is meant to play. This year, Wang Tongxin said, Shenzhen will carry out direct elections at the 163 enterprises with more than 1,000 workers whose union officials are up for re-election. And such direct union elections will ultimately be systematised and regulated.

There have been calls for the reform of China’s trade union system for more than 20 years. Direct union elections have been piloted on numerous occasions in various parts of the country, but with limited success, and the image of the official trade union has remained firmly in place. We have yet to see large-scale direct union elections across one city. It should be acknowledged that direct union elections are a very good thing. Indeed, their significance can be compared to that of the village elections in Wukan. Previously, the Guangdong authorities had allowed some freedom of association and encouraged the growth and development of civil society organisations, but freedom of association for labour was not allowed. This issue concerns political reform in China as a whole, and cannot be decided in Guangdong alone. In order to coordinate the freedom of association of labour with province-wide civil society institutional reforms, Guangdong turned to implementing workers’ rights to elect and create trade union organisations under the existing union structure, which has been an effective starting point.

But, to do this task well and avoid having it become merely a new formality and showcase, we must explore and implement specific reform measures to accompany it. Guangdong should issue Implementing Regulations on Direct Elections in Enterprise Trade Unions that incorporate the positive lessons learned from the successful direct elections at Ohms, as well as previous negative experiences with direct union elections throughout the country that became mere formalities. Such implementing regulations should clearly set out provisions for the following issues:

1. Repeal the current system of having local Party committees and higher-level trade unions recommend candidates, and allow workers to freely and independently elect union leaders that they trust.

Although the Constitution provides for the freedom of association of citizens, and the Trade Union Law provides workers with the right to elect trade union leaders, in real life trade union officials from state-owned enterprises and public institutions are all decided by the Party committee. In private enterprises, the “boss’ trade union” is very common. In some places, companies draw support from local Party and government forces, which dispatch full-time staff from the higher-level trade union to the private enterprises. These various practices erase the right of workers to freedom of association and their right to vote based on their own free will. This is one of the reasons why trade unions do not truly represent and protect workers’ rights. An important lesson from the experience with Ohms is that, while the higher-level trade unions helped workers eradicate the infiltration and control of the union elections by the bosses, they also gave up their right to provide candidates to the workers and ultimately decide on the winners, thereby basing the elections entirely on the workers’ own will, autonomy, and freedom.

Trade union officials who have been directly elected by the membership are responsible only to the law and to their members. There is some concern that this will weaken the Party’s leadership of the trade unions and that of higher-level trade unions over lower-level unions. This concern is unwarranted: It is looking at new problems through old lenses. In the context of a market economy, the Party and the government are only arbiters mediating between labour and management, using the law to regulate the actions of both sides. They should not interfere in the internal affairs of labour and management. As for the leadership of higher-level trade unions over those at the lower levels, this is an idea and a practice that needs a shakeup. A trade union is a democratic, mass organization. According to reforms proposed as early as the 1980s, higher-level unions should be elected by lower-level unions, and their main function should be policy guidance and macro services; they cannot intervene in the independent operations of the lower-level unions. Of course, this does not mean that higher-level trade unions should do nothing. In cases where workers have no experience with direct elections, for example, the role of the higher-level unions is more important: they need to get involved to eradicate illegal intervention by management, while also requiring management to provide the necessary conditions for trade union elections. They need to promote awareness amongst the workers of the significance of and procedures for direct union elections, take the lead in setting up preparatory committees for union elections, and more. This will require higher-level trade unions to have awareness of their long-term interests and to give up some short-term goals; to sacrifice some immediate power and interests in order to win the long-term support of workers and grassroots unions.

2. The fact that the terms of current enterprise union officials are ending should not be the only reason for introducing direct elections; priority should rather be placed upon areas where labour-management conflicts are relatively heated.

The Shenzhen Municipal Federation of Trade Unions’ choice of enterprises for direct union elections this year was based on those enterprises where the union officials were up for re-election. Looking at both the positive and negative sides of this approach, the ease of operation helps to reduce the cost of the election but does not guarantee good results. The results do not depend upon whether the election is easy to conduct, but rather upon whether or not workers have a strong motivation, demand, determination and enthusiasm for the direct elections. If not, even when the direct elections proceed smoothly and without hindrance, the results are merely the same medicine in a different bottle.

In what places do workers have the most motivation, determination, and enthusiasm for direct union elections? Without a doubt it is in places in which the interests of workers have been harmed, and where acute labour-management conflicts have taken place; where the workers are preparing to go on strike, in the process of a strike, or where a strike has recently taken place. The Ohms factory was just such a place. Another such place was the Citizen Watch factory in Shenzhen, where all of the workers went on strike at the end of last year, as well as Citizen’s Precision Machinery Co, where a strike recently broke out. The Shenzhen municipal trade union recognised this point when it deployed genuine democratic elections at Shenzhen Hailiang Storage Products Co. and at Pepsi-Cola, after labour disputes had taken place there. Unfortunately, this point was not the main principle for consideration. The workers at the Citizen Watch factory had applied to the municipal trade union for direct elections but, because they were not included in the program, the municipal union pushed the matter down to the district union. The district union then pushed it down to the sub-district union, and it was finally kicked down to the head of the factory, who called the workers’ leader to tell him not to make any more trouble.

Actually, conditions were ripe in these places to carry out direct union elections. First, the workers had a clear awareness of the need, importance and urgency of organising themselves. Second, while the strikes were brewing and during the strikes themselves, the workers had in fact already organised, but their organisations had simply not been officially recognised. By holding direct union elections in these places, worker leaders would naturally have surfaced. Strikes take place almost every day in Shenzhen; why stop at 163 elections per year?

Holding direct union elections in such places not only has the best results but, more importantly, it expresses most fully the essence and function of trade unions in a market economy: trade unions are workers’ organisations, democratic and self-governing organisations; and the function of a union is to represent and safeguard the legitimate rights and interests of workers. This will certainly be a powerful role model and have a positive effect on all workers, enterprises and society as a whole.

3. Provisions regarding trade union election procedures

First, an election preparatory committee should be established, comprised of representatives of the higher-level union, management, and labour; the labour representatives should make up at least two thirds of the members. The reason for including management representatives is to reach a consensus regarding the union elections and to persuade management to provide the time, space and other necessary conditions required for the elections. The function of the preparatory committee is limited to procedures and providing those necessary conditions for the election to take place; it cannot exert any influence over the electoral process or the results.

There are three rounds of elections, all conducted by secret ballot:

  • The first round is conducted in work groups, in which worker representatives are elected based on a fixed proportion.
  • The worker representatives elected by each work group participate in a second-round of elections in each workshop or department, resulting in representatives that attend the company’s general meeting of union representatives.
  • The general meeting of union representatives elects the company union committee and the finance committee, as well as the union chairman and finance director.

4. Provisions regarding the obligations of companies

According to China’s Trade Union Law, companies must provide the necessary office space for trade unions, and trade union funds (at two percent of total payroll) must be allocated in full and on time. As independent social organisations, trade unions have their own accounts and property rights. This ensures the economic independence of trade unions.

5. Provisions regarding the rights and interests of full-time union officials

Certain special provisions should be made regarding the rights and interests of the full-time chairman elected by a union (unions in larger companies may also have several full-time staff):

  • Since the chairman is elected by the workers themselves, and the trade union is an independent social entity, the full-time union chairman’s labour relationship with the enterprise should be revoked during their term as chairman. Instead, an authorised agent relationship should be established between the chairman and the trade union membership, making the chairman a legal representative and manager of the union.
  • A full-time union official’s salary and a part-time union official’s stipend are not paid by the company, but rather out of the union treasury and dues payments.
  • A full-time union official who is not re-elected, or reaches the end of their term, may voluntarily sign a new labour contract with the company, and the company may not refuse to sign a labour contract because of the person’s previous trade union position.

Such a system is important because: Firstly, it is only in this way that union officials can break free of the economic dependency on the enterprise and become true representatives and protectors of workers’ rights and interests. Secondly, union members become the true authority, creating a hard constraint that can force union officials to dutifully serve their members. Trade union officials and union members thereby become a true interest community, and the union becomes a democratic, unified, vital and strong collective entity.

6. Provisions regarding the means and mechanisms to safeguard the legitimate rights and interests of union members

Once it implements the above five points, a trade union has achieved organisational and economic independence. It will be democratic in nature, and will be entrusted with the mission and function of protecting workers’ rights and interests. But this is only a beginning. To continue to maintain this character and truly perform its function after it is established, the union depends on the assurance and institutionalisation of mechanisms that allow it to do its work. The three most important ways to achieve this are:

(1) Representing workers in regular collective bargaining with management, in which labour and management jointly determine wages, working hours, working conditions, social security and other basic workers’ rights. What prevails in China today is a government-led collective consultation system that involves labour and management and is run by the trade union. This system has long been unable to resolve acute labour conflicts, leading to damage to workers’ rights and interests and to recurring strikes. A collective bargaining system must be implemented across the board, with labour and management negotiating autonomously in accordance with legal procedures, and with the government only mediating and arbitrating as a third party.

(2) Electing worker representatives to serve on the company’s board of directors etc., who have the right to be informed about the company’s overall development and to participate in decision-making power. This provision has been written into the Regulations on the Democratic Management of Enterprises jointly issued by six government authorities, including the All-China Federation of Trade Unions. Importantly, it should be contingent that union leaders directly elected by union members are also employee-directors. That is, whether the candidates have the capacity to participate in the management of the company as worker representatives should be an important basis upon which to vote during trade union elections. In order to save on costs and improve efficiency, the general meeting of the workers’ congress and the general meeting of union representatives should be held concurrently.

(3) As a basic workers’ right and an important means of negotiation, strikes should be clearly recognized and regulated under the law. In fact, because the currently widespread and spontaneous “wildcat” strikes break out suddenly and in a disorderly manner, the confrontation level is very high, and there are great risks and losses to both labour and management. It is also difficult to settle the situation quickly and in a manner most conducive to the interests of both sides. The lessons from international experience and practice should be used to bring together collective bargaining and strikes. First negotiate and then strike, using a strike as the ultimate means of deterrence to facilitate collective bargaining; this is the most advantageous method for both labour and management, as well as society as a whole.

All in all, it is hoped that the trade unions use the opportunity provided by direct elections to reform our country’s entire union system and even the management system for society as a whole. To this end, the parting thoughts of this article will come from the well-known microblog 工人小萝莉.*

The impact of the Ohms union election is far-reaching, going far beyond trade union elections, workers’ interests and labour conflicts! The first impact is the reversal of the long-standing, deeply-rooted negative image of trade unions in the eyes of workers. Chinese workers’ understanding of union rights will be more specific and clear, and workers’ enthusiasm for and confidence in participating in union organisations will increase as well. The second impact is that, while social conflicts are generally becoming more aggravated, workers can use direct union elections and collective bargaining to resolve labour conflicts and coordinate the interests of labour and management, which will provide a rational and peaceful path to alleviate and resolve social conflicts. The third impact is the “workers secure rights from the bottom up while trade unions assist from the top down” model, which breaks through the polarized thinking of “good/bad” and “right/wrong” and finds a place where the people (workers) and institutions (trade unions) can work together to promote national and social progress. It also provides a possible means for the reconciliation of the growing tension between the government and the people.

*工人小萝莉 currently has more than 66,000 followers in China.