BIZCHINA> Editor Choice
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BIZCHINA> Editor Choice
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Dangers of keeping workers in the dark
By Fu Jing and Wang Huazhong (China Daily)
Updated: 2009-08-06 07:47 Media reports said emergency service vehicles were prevented from entering the site as rioters blocked the plant's "only" gate, but Jing said: "Did they employ other tactics to get in or send plain-clothed police and soldiers to deal with the problem? We don't know yet but these are the questions the authorities must answer." The local government has been tight lipped on the events that unfolded on July 24, while the police force has released just the basic details, as well as refused to give any information about suspects or arrests. But just five days after the riot, the provincial authority organized urgent training sessions for county-level officials to help them deal with similar emergencies in the future. Jianlong Heavy Machinery Group became a shareholder in the Tonghua steel giant in 2005 and had seen a scheduled takeover earlier in the year also fall through due to the effects of the financial crisis.
It resumed talks with a view to gaining 66 percent of the share-holding rights in March, shortly after the State-owned firm's business began to show signs of recovery. With an annual production capacity of 7 million tons, Tonghua recorded a profit of 40 million yuan ($6 million) in June and 80 million yuan last month. It employs almost 13,000 workers, all of whom, along with their union representatives, were kept in the dark about the potential merger. They only discovered the news when they were addressed en masse by Chen. The Jilin State-owned assets supervision and administration commission described the deal at its only media conference as a "win-win situation", claiming the takeover would lead to increased efficiency and corporate governance at the plant. Wang Xidong, deputy director of the assets watchdog, said the provincial government approved the merger as it believed it would help the Tonghua Group to hit 10 million tons in annual production.
"It is a deal that can boost the development of Tonghua and is also in the interests of the workers," he said during the press conference. The workers did not see it that way, said local residents, who explained that, since the Jianlong Group bought into the plant, the company had consistently called for jobs to be axed in a bid to improve efficiency. It had naturally made staff worried about their future. "When Jianlong bought shares in 2005, it immediately switched workers from steel production posts to work as street sweepers or bathhouse keepers, which were jobs done by temporary workers. Then they made them redundant," said a 60-year-old cleaner and part-time employee of a logistic company that deals with the Tonghua Group. "It's great to know Jianlong will not make its comeback, otherwise I would probably have to ask friends to help me find another job in another factory. It is gruesome that it took a death to keep them away," he said on condition of anonymity. The Jilin provincial State-owned assets supervision and management commission blamed much of the resistance to private takeovers or mergers with SOEs on the workers and retirees who believe SOEs should provide "iron rice bowls", meaning a guaranteed job for life.
Employees at SOEs can receive support from trade unions and workers' representative committees. In the case of the Tonghua Iron and Steel Group takeover, both the company's management team and provincial officials failed to inform them of their plans. "The provincial assets watchdog and related parties have made a huge mistake by not keeping the workers and their union representatives informed," said Beijing lawyer Jing. "If they had gone through the legal procedures and listened to opinions from the workers, there would not have been such a burst of anger when the staff found out. This tragedy was avoidable." China has 170 million grassroots trade unions and they continue to play a big role in protecting workers rights, although many experts agree the system needs an urgent revamp to ensure efficiency. A 34-year-old Tonghua Group worker said he and most of his colleagues are members of the firm's trade union but added it has been ineffective for years. "I can't remember the last time we had a conference with our union representatives," he said. "The union certainly didn't go any good the day Chen was killed." An 80-year-old retiree explained the trade union consisted of just two people, a chairman and his assistant, and added: "It's hard for two people to do a good job for thousands of workers."
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