LA Times: China union drives harder bargains (a red dragon awakes worrying foreign firms)

[Omaha Steve]

http://www.latimes.com/business/la-fi-chinalabor12apr12,0,901649,full.story?coll=la-home-business

China union drives harder bargains
The sole workers' group is newly aggressive on wages and conditions, worrying foreign firms.
By Evelyn Iritani, Times Staff Writer
April 12, 2007

BEIJING — China's government-backed trade union, long considered a paper tiger, is growing real fangs — delighting worker advocates but making foreign executives sweat.

Dismissed for years as a Communist Party mouthpiece and organizer of holiday parties, the All-China Federation of Trade Unions has started playing hardball, pushing for tougher labor protections and launching an aggressive campaign to organize foreign companies that have benefited from the country's large, low-cost labor pool.

The federation recently took on some of America's biggest fast-food franchises, accusing McDonald's Corp. and Yum Brands Inc., owner of KFC and Pizza Hut, of underpaying teenagers in their outlets in Guangdong province, where the union has been trying to set up branches. Provincial officials cleared the companies this week, but the dispute made big headlines and highlighted the union's activism.

In December, Foxconn Technology Group, which makes iPods for Apple Inc., agreed to have its Shenzhen factory unionized after the union and other labor rights groups accused the Taiwan-based firm of exploiting workers. Also last year, the labor federation scored its biggest coup — succeeding where America's most powerful unions have failed — by organizing the Chinese operation of Wal-Mart Stores Inc., known for its anti-union stance.

"We see real changes" in the union, said Brendan Smith, co-founder of Global Labor Strategies, which follows labor issues in China.

The transformation is part of a larger shift underway in China that could increase wages and improve working conditions but also could raise costs and undercut the nation's appeal as a cheap, efficient manufacturing platform, labor experts say.

FULL story at link.

[Dune]

1. Irony

Oh the irony of having a communist nation finally give a capitalist oligarchy the medicine for a terrible social injustice called the caste system couched as a class system based on achievement. Sweat you capitalist exploiters of humanity you!

[otherlander]

2. Question about China

Is the main problem that there aren't any real labor laws, or that the corrupt government just turns a blind eye to violations of those laws?