China intervenes in strike at shoe factory
April 26, 2014, 12:01 am TWN
SHANGHAI -- China has ordered owners of a huge Taiwan-backed shoe factory to address striking workers' grievances about unpaid social security, an official said Friday.
Thousands of employees at a factory owned by Yue Yuen, which calls itself the world's largest branded footwear maker, in Dongguan city have been on strike since April 14, although some have returned to work, according to a labor rights group.
China's ruling Communist Party fears an independent labor movement could threaten its grip on power, so it only allows one government linked trade union.
But activists say government officials have been more sympathetic to individual grievances against factories, especially those funded by foreign companies or overseas Chinese investors from Hong Kong or Taiwan.
A Ministry of Human Resources and Social Security official said the government was aware of the Yue Yuen issue and Dongguan officials had ordered the company to rectify the situation.
"According to our preliminary investigation, the Dongguan Yue Yuen shoe factory really has the problem of not strictly submitting social security payments," ministry spokesman Li Zhong told a news conference in Beijing, according to a transcript posted online.
"The Dongguan city social security bureau ... has ordered the enterprise to carry out rectification in accordance with the law by April 25," he said, adding the ministry would seek to protect the legal rights of workers.
China is facing labor unrest as its economic growth slows and as factories in its southern manufacturing heartland report a shortage of workers, prompting rising demands from staff.
U.S.-based China Labor Watch (CLW) said equipment used to make shoes for Germany's Adidas was being moved out of the factory to another plant also in Guangdong province.
"CLW urges Adidas to rethink its choice to pull out of (the) Yue Yuen factory and support a fair resolution between Yue Yuen and its workers," the labor rights group said in a statement.
Yue Yuen could not be reached for comment. Adidas, in a brief statement, said workers had returned to the factory.
"We can confirm that the Adidas production facility within Yue Yuen's Dongguan location, Y6, is fully operational today," the statement said.
"Workers have returned to the Y6 facility and production has resumed," it added. "We will continue to closely monitor the situation.
"The Adidas Group remains fully committed to our long-term partner Pou Chen Group and to China as a sourcing country."
Shares of Yue Yuen Industrial (Holdings) Ltd, a company owned by Pou Chen and a Taiwan family, were down 3.84 percent in afternoon trading in Hong Kong on Friday.
China Labor Watch said brands manufactured specifically at the Dongguan factory included Salomon, Nike, ASICS, Adidas and Under Armour, as well as Prada's Car Shoe, but that could not be independently confirmed.