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Chinese Gov’t Allegedly Detains Labor Leaders; Shoemaking Factory Strikes Continue

Rivet's 2020 Denim Circularity report takes a deep dive into how the global denim industry is plotting its circular future amidst a worldwide pandemic.

More evidence that the Chinese government is intervening to halt persistent shoemaking factory strikes, a labor leader alleges that he was detained by local authorities for agitating disgruntled workers to protest.

The manager of the Shenzhen Chunfeng Labor Dispute Service Center, Zhang Zhiru, speaking to Bloomberg, claims he was held for three days by police and interrogated. One of his peers, Lin Dong, who was also detained, remains missing.

According to Zhang, he and Lin convened with a group of labor leaders who represent employees from eight separate Yue Yuen factories in Dongguan to craft a strategy for upcoming negotiations. Shortly after, both were approached by security officials who demanded they pledge, in writing, to abstain from any involvement in the strikes. After they refused, Zhang and Lin were incarcerated without charges.

Zhang said, “I asked them when I could return home, and they said once the workers at the shoe factory return to work, I could. The public security officials said they would bring me to have some fun and asked me to call my wife and say that I was on a holiday with friends.”

The strikes have lasted for more than two weeks and some estimate they involve as many as 40,000 factory workers. The labor organizers claim that management reneged on their promises to pay full social security benefits and to provide stipends for housing costs. According to China Labor Watch, the strikes began on April 5 and have since snowballed into a sprawling demonstration of thousands. Some workers reported that only two or three out of ten plants remain in operation.

Yue Yuen tried to placate the workers by offering them a compensation package that would include funds to cover pension contributions never made as well as housing funds also pledged. Yue Yeun would not specify how much it was willing to compensate its workers, and it remains unclear how many years of back payments that package would include. Some estimate the collective disbursement could be as high as $32 million which would cover both social insurance payments and housing funds.

The workers were underwhelmed by the offer and, instead of winding down their demonstrations, expanded next door into Jiangxi. More than 2,000 workers in the neighboring province have followed suit, showing up for work but refusing to manufacture any shoes.

Apparently worried about costly disruptions in production, especially after Adidas announced it shifted some of its manufacturing to alternate facilities, the Chinese government has become increasingly involved. Local government officials in Dongguan decided that Yue Yuen Industrial, one of China’s largest shoemakers, is obligated to compensate workers for pension contributions promised but never delivered. Also, the government-run trade union released a survey that determined the pension payment should be calculated on the basis of each worker’s base wage, rather than total income.

Some are worried about the prospect of even more heavy-handed measure taken by local law enforcement. Geoff Crothall of the China Labour Bulletin, also speaking to the Financial Times, expressed some anxiety on this score. “The Dongguan trade union federation is to be commended for taking the issue seriously and looking for solutions. The company too seems to be engaging in good faith. But at the same time, we have heard the police presence around the factory is increasing and there is more pressure on workers to accept the deal on the table. Looks like the authorities are using both carrot and stick.”

The Taiwanese-owned company, Yue Yuen Industrial, employs over 60,000 workers in the southern province of Guangdong. The factory produces sneakers for several major Western brands including Reebok, New Balance, Asics and Timberland, as well as Adidas and Nike. The parent company also owns shoemaking facilities in China, Indonesia, Vietnam, Mexico and the U.S.

 

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