Employment Relations In China

Employment relations generally mean the relationship that exists between the two parties known as employers and the employees. It is a legal link which exists when an individual performs a set of work allocated to him/her under specific situations and in exchange for that he/she gets certain remuneration. Basically, employers and employees are the two key factors that interact and communicate in employment relations, whether directly or indirectly. However, there is one more important member that plays an efficient role in the employment relations and that is known as “the State”. The State is not a single regulatory body, but many agencies and institutions are there which comes under the State and designed to perform different roles and duties (Shao, Nyland, & Zhu, 2011). In general, the State belongs to an open system and is a very powerful source. “The State” is the name given in short, to describe the interactions and regulations of all the agencies that come under the government to carry out its functions including the judiciary, the civil service, the military, other government bodies, and the employment agencies such as the Advisory, Conciliation, and Arbitration Service, in short termed as ACAS.

As it is discussed earlier that the State is not a single performer, but it is comprised of many governments and employment agencies, it influences the employment relationship in many different ways. It participates in the making of law and legal bindings and its enforcement in various areas of an employment relationship (Wailes, 2008). China is a country that is not fully developed but is developing with an average population and plays a significant role in influencing the global economy of the world. It has been seen as an emerging superpower, which has the ability to compete with many of the world’s highly advanced and developed countries in the market place. It also embraces the elements and characteristics of a free market economy, which means that it has a few restrictions of government over the market. However, the current structure of employment relationship with the country of China specifically includes the features like tough working conditions, under development in the laws of employment, migrant labor, high turnover of the employee, and weakened the rights of employees. This structure of China is so much influenced by the process of Globalization and the succession of China in World Trade Organization. The State has the major role to play in the dynamics of the employment relationships in China, and it affects both the ways, i.e. positive and negative to the employment relations (Wong, 2008).

There are various laws and contract designed by the state keeping in mind the employment relationship of employers and employees. These laws and contract help in making the place of work free of disputes and determining equal rights of the individuals who work for a company. It helps in maintaining a better relationship between them and improves and stabilize the situations of the labors giving them certain benefits which they deserve. Fair pay and the equal distribution of remuneration influences the workers to work actively for the betterment of the employer to achieve the common purpose of the organization (Scott, 2000). Hence, it leads to the development of the work structure of the companies and the economic growth of the country. China has made remarkable progress with the introduction of the concept of collective bargaining. This is a very old concept introduced in 1990’s, but with the effect and consideration of Labor Contract Law by the state, this power maintained its balance in the employment relations. It provides almost equal rights to both the parties to have influence and keep their point of consideration over each other when it comes to negotiation, which proves to be beneficial in providing a fair and equal opportunity to everyone who relates to this category (Chan & Hui, 2013). Earlier in 1960’s, there were no laws that administer the employment relations in China. However, it was the first country to introduce the Trade Union Law and Labor Law in the country. The norms and regulations of the new laws then introduced created provisions for labor dispute settlement and provided meaningful security to the workers engaged in such activities. It centered its attention in creating balance through a pluralistic system of politics by producing solutions to the problems. The party state in the country made an attempt to aggregate stake holder’s interests with the help of its associations (Howell, 2015).

Therefore, the balance in all of these factors led to the development of the industrial relations which is quite a strength when it comes to employment relations. The trade unions of China are constituted under the All-China Federation of Trade Unions, in short pronounced as ACFTU. It is known as the largest trade union amongst the whole world and comprised of various regional federations and industrial unions of national level. The State has set up fair and effective laws for unions, which resulted in the expansion and growth of trade union organization. The rework on trade union laws provided decisions for organizing workers who are migrant which accelerated the growth rate in the trade union membership (Cathy Walker, 2013). Systematic arrangement and organizing migrant workers create various opportunities for the expansion of their area of influence and the new methods of collective bargaining. The State decided to focus more on maintaining harmonious and peaceful society and centered its laws to protect the people more than anything else. This kind of system provides equal opportunities for the workers and encourages trust and confidence among them. It helps in the undisturbed settlement of labor disputes and encourages the peace and harmony in the workplace which is of utmost importance for the country as well as the trade unions. It promotes economic and industrial growth and due to legal bindings and restrictions and the penalties imposed, people are likely to solve small problems by themselves without any conflicts (Greenfield, 2004).

There has been a rise in the conflicts between the workers over the last few years. The major causes of disputes include compensation, remuneration, labor insurance, and other welfare schemes. This has put the legal framework of the State in question as to whether the kind of contractual and legal regulations are working to create benefits and protection to workers or it is just increasing the rate of conflicts among the workers and labors (Cooke, 2008). It also has been noted by the kind of settlements that the employers and organizations are increasingly violating the legal rights for employees. Hence, it has become the greatest weakness on the part of the State as it adversely affects the work structure and economic stability. It also indicates that the market reforms and economic alterations have triggered increased problems and conflicts between labor and management (Chen & Tang, 2013). The establishment and implementation of Labor Contract System in the country of China does not meet its expected standards of effectiveness in relation to regulate employment. The demand for labor in China exceeded its supply, thus affecting the bargaining power of workers. There also has been seen some inadequacies and ambiguities in the contract system which provide the employers with unnecessary rights to abuse the benefits of employees (Lin, 2016).

The failure of local government to execute appropriate inspections seems to be a flaw on the part the government. The emergence of this system tends to enhance the labor costs and remuneration as it emphasizes more on the rights of employees and labor. It threatens the recruitment of graduates and peasant workers as the Labor law provides more emphasis on labor protection. The enterprises and organizations prefer to take highly qualified and educated workers rather than taking immediate graduates or fresher in order to minimize the labor costs which has increased after the implementation of Labor Contract System. It maximizes the difficulty of searching jobs for an average qualified individuals, and the contract system makes the job short-term, thus, resulting in the problems of job security (Vriesacker & Mortelmans, 2015). After the implementation of government laws and regulations, the small and medium-sized enterprises fear their survival as the costs are high which threatens the survival and growth of small organizations. The new law focuses more on the safety and protection of employees, which creates more pressure on the employers regarding labor-related problems which adversely affect the enterprise on the whole. It creates an unfair and unequal environment, some taking more of the advantages of the new rules by the state while some others are bearing the consequences of the same (Cooke, 2005). According to the law, it is necessary for the companies to pay for overtime by the workers, which also affects both the parties in different ways.

A wide increase in the number of protests and campaigns has been marked performed in different ways by different people. Even though there are various laws and regulations made by the government under labor contract law and trade union law, people don’t make correct use of legal terminology instead they take steps for collective and mass protests in various forms such as hunger strikes, committing suicide, work stoppage, rallies, killing of employer, etc. (Stackel, 2010). These kinds of action today in China exists a lot and are of voluntary in nature. The reason for these protests may vary, but the instances of their occurrences have increased comparatively and it should be managed appropriately as it adversely affects the economic development and the work culture of the economy. The State plays the primary and the most important role in the process of globalization. It creates interdependence and an imbalance of power as the countries differ in their economic and political strengths. There has been a negative impact of globalization on the employment relations in China. It has changed the corporate structure and culture of the country (Regina Chen, 2004). Earlier, in Chinese organizations, the corporate culture was associated with the basic norms of loyalty and trust which due to the impact of globalization has changed to the values and principles of one’s own competitiveness and individualism within enterprises. Joint ventures also have a major role to play in the transformation of the culture in the corporate sector. The practice of appointment of managers from overseas and foreign countries also tends to change the work environment within organizations as they introduce their own work policies and methods into the workplace which transforms the work culture (Frenkel & Kuruvilla, 2002). 

The employment relation system in China is actually a system of labor administration. It appears as the reforms and transitions in the market creates tremendous pressure on the employment relations in China. The country basically adopts a socialist system and is a state dominated structure. The debate among the scholars is still going on about the choice of employment relations system. Some scholars favor the corporatist system of employment relations as according to them China’s market reforms are easier to convert into a corporatist structure while some others favor the pluralistic form of structure considering the geographic boundary and the diversification in its culture across different regions (Adler & Mittelman, 2004). China’s party-state laws and regulations seem to provide advantages and disadvantages simultaneously. Therefore, the role of the state is that to analyze each and every perspective, providing equal opportunities and benefits to all the parties concerned in order to create a balanced economy. Labor disputes are one of the major drawbacks which need to be looked upon considering the work structure of both the parties. The laws should be enforced in such a way that it should not lead to unnecessary benefits to any one of the party or individual. It should promote equal and fair chances of growth for everyone which is necessary for creating a harmonious environment. This will also enhance and encourage the economic as well as the industrial development of the country (Zhu, Warner, & Feng, 2011).

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