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Chinese Shoemaker Ready to Settle with Thousands of Striking Workers

One of the world’s biggest shoemakers in southern China is prepared to cut a deal with the thousands of factory workers who have been striking for four days.

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.

Tens of thousands of striking workers 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.

Suffering from the disruption in production, Yue Yuen is poised to offer the disgruntled workers a deal. Speaking to the Wall Street Journal, Geore Liu, executive director of Yue Yuen, said, “The basic principle is that today we’ve promised our employees to make a delayed payment to social insurance and the housing fund. The move will affect a large number of employees, so we’ll have to work with local government agencies to work out the details, and that takes time.”

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.