Analyzing the Role of Trade Unions in Employee Relations in China

This report provides an in-depth analysis of employee relations in China, focusing on the role and impact of trade unions within the country's unique economic and political landscape. It begins with an introduction to employee relations and trade unions, followed by a detailed examination of the legal framework governing labor relations in China, including key legislation and the rights afforded to workers. The report explores the structure and function of the All-China Federation of Trade Unions (ACFTU), the largest trade union in the world, and its role in representing workers' interests. It also addresses the challenges faced by unions, such as balancing government influence and protecting worker rights, and discusses contemporary issues, including wage inequality, discrimination, and the impact of technological advancements on employment. The report evaluates the impact of these factors on employee productivity, organizational performance, and the broader Chinese economy, drawing upon various sources to present a comprehensive overview of the subject. Finally, it offers a conclusion summarizing the key findings and implications of the analysis.

Contemporary international
issue

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
CONCLUSION ...............................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Employee relation means the organisation's effort to manage the relationship between the
management and workers and provides fair treatment to all the workers that helps to committed
and loyal to an organisation. Trade union is formed by the workers to protect the common
interest related to their work of the members in particular industry, company and trade. The role
of the union is to secure the rights of the workers against their pay, working condition and
benefits.
The following assignment is based upon the role of the union in employee relation in
China. The assignment will also provide an understanding about labour relation which affect the
productivity of the organisation. In addition to this it also includes issues faced by employees in
China. Among all the most important unequal pay and no local government support to the labour
union, in which the employees are discriminated on the basis of their education(urban and rural).
This issue is mostly faced by employee who comes from rural area in this China that are consider
as the low level employees within China.
MAIN BODY
The role of unions in employee relations in china
The first union law of China was enacted in 1950 of the people's republic . Under this law
they introduce the specifies rights and obligations of the unions of the china. As the political,
social and economical situation of the china has undergone profound changes that shifted
towards the socialist market economy. China economy is rapidly developed as well as issues
related to the labour is also developed. The issues related to the labour is increased day by day.
For example China's socialist economy is promised to provide the job security for life long to
the employees but the effect of this is negative because the companies in china enhances their
production so they employed over staff as well as provide job security that reduces their
incentive of the work that creates dissatisfaction within the employees and enhance the issue
between the management and union(Noe and et.al.,2017).
All-China federation of trade union(ACFTU) is established in 1925 that represent the
interest of the trade union councils as well as local and national trade union. It is the nationalized
organisation federation in China for the people's republic. ACFTU is the largest trade union in
the world. It have 302 million members of 1713000 trade union organisation. It is divided into 10
1

national industrial unions and 31 regional federation. It have membership of 130 million people
in which 248 million are urban workers. The trade unions of the china are organized on the basis
of board industrial. The membership in ACFTU is opened for those workers who rely on wages
for large and whole part of their income distribution for the social benefits that helps to create
positive environment as well as opportunities to enhance their business operations on that
environment(Xing and et.al.,2016).
China has comprehensive legal framework that provides a number of protects and
entitlement from the exploitation of the employer. Worker has right to get on time wages on the
proper formal employment contract. In china the working hours are fixed such as 40 hours in a
week with social insurance that covering healthcare, pension, work injuries, maternity leave,
unemployment, severance pay at the time of contract termination, protection against the
discrimination at workplace and equal pay for equal work. The workers of the China have right
to form a trade union that represent workers to the management before any decision related to
workers pay and any change in condition of the contract(Zhu and et.al.,2015). There are some
laws that is introduces by China to protect the rights of the workers such as trade union law,
labour contract law and labour dispute mediation and arbitration law. This law works on
protecting employees basic rights in the organisation as well as give power to the employees that
they can take action against the employers as well as against the organisation.
There is duty of the local government to ensuring that the rights of the workers are
protected. But the local government of the China are under staffed and under funded as well as
lack of ability. Local government of the China more concern to creating the friendly environment
in the business as well as boosting the local economy rather than focusing on protecting workers
rights. During the reform era in China, it argued that the government usually excluded the power
of the labour in relation to owners of the business, give power to their employers to fescue the
pay, working condition and benefits of their employees. It enhance the issues between
management and workers because labour union themselves take action towards their right and
ensure the labour laws are followed by the company(Chin and Liu, 2015). Labour law includes
wages and overtime is fully paid, social insurance of the employees, proper contract between the
management and employees.
The trade unions of China are faced various challenges to protect their rights against the
management such as some organisations workers follow a legal procedure to make a union
2

including take permission from the higher level of the unions that is legal and affiliated from the
government of the china. For controlling the rising labour disputes, the all-china federation of
trade union is enhanced foreign investment, build up branches of the trade union and with the
help of top down effort(Collins, Zhu and Warner, 2018). Chinese government is not focused on
protect human rights. It must be create major problems in the country and create dissatisfaction
to the employees that there is no support for anyone to protect their rights that directly effected
the various organisational productivity.
Form the recent discussion about the role of union on employee performance between the
California labour leader and trade union of the Guangzhou federation. It concluded that trade
union of China need to protect the interest and right of the workers and select the worker who
represent the workers. The union plays important role in order to satisfied the employees
demands as well as enhance the performance of the employees because the union is product the
right of the workers against the management and always take action that provides the benefits to
the employees. The union satisfied the needs of the employees and employees are motivated and
they feel they are important for an organisation that helps to enhance the productive of the
organisation as well as performance of the employees(Errasti, 2015). In present, the issues
related to the role of the union in employee relation is overcome because of good relations with
the union to the organisation by participating equally to provide benefits to the society.
Currently China is the seventh largest economy in the world as well as its gross domestic
product has been also grown. There are several factors that contributes in the economy of the
China such as unprecedented capital that is spending on utilities, machinery, roads, equipments
and machinery as well as more skilled workforce. Development in infrastructure improves the
labour productivity as well as enhance the quality of the product but the wages of the workers are
very low and equal to the 12% of the US workers. The low wages is a very major issue related to
the employees because they pay are very low and that do not satisfied they basic need that
enhance the anxiety in the employees and reduces they performance that directly effect the
overall performance of the organisation and indirectly effect the economy and GDP of the
China(Ni and et.al.,2015). When the communist party is established in China in 1921. the
secretariat of the China labour association was set up to protect the workers rights and launch the
national labour movement. There are several law that protect the rights of the workers by
providing various benefits to the employees.
3

The Chinese trade union system have broad network with the trade unions that protect the
rights of the workers in China. The China communist party is also provides support to the
Chinese trade unions. The primary role of the All-China federation of trade union is assisted the
operation related to the labour market. According to the law of China, the members are allowed
to form a trade union when the members are more than 25. the employers have no right to setting
up a trade union and do not get members of the any trade union committee. The union considers
all the issues related to workers such as salary issue, termination etc. Most of the trade unions are
funded by the workers where ETU is formed because ETU implements the provision in benefits
to the employee that is 2% of the all workers must be contributed and paid by the employers to
the union. This fund is used to welfare of the trade union(Zhang and Peck, 2016). One of the
negative aspects of the trade union of the China is the workers do not go for strike that is a plus -
point for the organisation of the China but that enhance dissatisfaction level of the employees
that may be effect the quality of the work means reduces the performance of the employees. The
issue are several but the companies in China knows to deal that may be overcome the issue.
Currently the establishment of the trade union is not mandatory for the company that
helps to enhance the local branches of the All-China federation trade union and workers trade
union continuously rising in the China that helps to enhance the power of the employees in the
organisation because they are part of strong trade union. It helps to protect their right as well as
increase the satisfaction level of the employees that enhance the performance of the employees.
One of the major negative aspect of the All-China federation trade union is they do not putting
their efforts to protect the rights of the employees(Smith and Chan, 2015). The trade union
largely shifted to enhance the Chinese communist party and prioritised their interest on business
rather than workers that enhance the disputes between the workers and workers leader and
negatively affect the performance of the employees means reduces the performance of the
employees(Chan, 2016). The All-China federation trade union is faced the crisis of legitimacy
with the trust of the labours that doing the afford to create strong trade union.
Every one has some pros and cons. The Chinese trade union have some negative aspects
and interest and so many issue of the employees but they also have some positive aspects that is
beneficial for workers such as take various improvement to the living standard of the workers
related to the working conditions to the several workers. China have highly inequality in the pay
of the employees that effects the employees performance for example, at the same level all the
4

employees are performed their work but they do not get equal pay that creates dissatisfaction of
the employees and enhance the performance of the employees and create the situation of the
industrial dispute. This is very wrong policy that is followed by various organisation in the
China. One more issue is gender, age and race means discriminate laws that is also effected the
culture of the organisation because the many organisations in China is considered the race, age
and gender at the time of employment for example, the female employee are not get higher
position as well as good pay rate rather that to the male employee that is also an issue in China.
The union take action against this partiality and can take equality in the organisation(Kirchherr,
Disselhoff and Charles, 2016).
In China, the differences in the education is the biggest reason to enhance the inequality
as well as rapidly increasing the changes in the technology that enhance the demand of the highly
skilled workers that reduces the need of unskilled and semi skilled workers that create the
environment of the unemployment in China. Differences on the base of area, company provides
privilege to the urban employees rather than rural employees that also increased inequality in the
country(Employment relations “with Chinese characteristics”: The role of trade unions in
China,2011). There are some issues related to the informational technology is faced by the China
such as influence of the national culture, economic structure, technology status and political
issues. The unique Chinese culture wants new perspective for improving their cultural issues.
There are various dimension of the Chinese culture such as Chinese culture follows low
individualism, high power distance and average masculinity etc. that comes between the workers
and management when they come from difference cultural. In an union are so many people and
they belongs to the different different culture that may be resolve the issue of the culture by
giving equal importance to the each culture that helps to settle and reduces the issues related to
the culture(Dickovick and Eastwood, 2016).
The trade union is empowered in China because of the strong support of the employees that
effects the overall performance of the organisation because they have power to take action
against the any discrimination as well as support of the union. The union can contribute in
improve the life style of the workers and provide a better life by protecting their rights and
duties. The organisation can create good relation with the trade union that helps to enhance the
friendly environment in the organisation. The union can mislead the employees for their personal
5

benefits that create risk for both an organisation as well as workers that is also a major issue that
is faced by several company in the China.
The union have power to change the procedure of the human resource management in the
organisation and helps to create a human resource that is developed policies in the benefits of the
workers related to their pay, incentives and extra pay etc. Health and safety issues also come in
concern to the workers because it is an also important aspects that can be created big issues for
the company such as company have to introduce policies that protect workers rights against their
employment(Lan, Pickles and Zhu, 2015).
one of the
CONCLUSION
From the above study it can be concluded that the role of union in employee relation is
very important for the organisations in China as well as other countries. There are several issues
that is faced by the employees in the organisation, the union protect their rights against the
organisation. It has been defined that the union is needed to protect the rights and implementing
laws against the organisation. In china they hired people on the bases of their genders. It is a big
issue for the china because it effects negatively on the country. woman participation in the
organisation only on lower level. In China 61.5% women work on lower level they do not right
to work at higher level. It is a major issue that affects the country's position as internationally
because in other countries the woman have right to get position equal to the men.
6

REFERENCES
Books & journals
Chan, A. and Unger, J., 2017. Corporatism in China: A developmental state in an East Asian
context. In China after socialism: In the footsteps of eastern Europe or East Asia?(pp.
95-129). Routledge.
Chan, A., 2016. China's Workers Under Assault: Exploitation and Abuse in a Globalizing
Economy: Exploitation and Abuse in a Globalizing Economy. Routledge.
Chin, T. and Liu, R.H., 2015. Understanding labor conflicts in Chinese manufacturing: a Yin-
Yang harmony perspective. International Journal of Conflict Management.26(3). pp.288-
315.
Collins, N., Zhu, Y. and Warner, M., 2018. HRM and Asian socialist economies in transition:
China, Vietnam, and North Korea. In Handbook of Research on Comparative Human
Resource Management. Edward Elgar Publishing.
Dickovick, J.T. and Eastwood, J., 2016. Comparative politics: Integrating theories, methods, and
cases. New York: Oxford University Press.
Errasti, A., 2015. Mondragon’s Chinese subsidiaries: Coopitalist multinationals in
practice. Economic and Industrial Democracy, 36(3), pp.479-499.
Kirchherr, J., Disselhoff, T. and Charles, K., 2016. Safeguards, financing, and employment in
Chinese infrastructure projects in Africa: the case of Ghana’s Bui Dam. Waterlines.35(1).
pp.37-58.
Lan, T., Pickles, J. and Zhu, S., 2015. State regulation, economic reform and worker rights: The
contingent effects of China’s labour contract law. Journal of Contemporary Asia.45(2).
pp.266-293.
Ni and et.al., 2015. Patterns of corporate responsibility practices for high financial performance:
Evidence from three Chinese societies. Journal of business ethics.126(2). pp.169-183.
Noe and et.al.,2017. Human resource management: Gaining a competitive advantage. New
York, NY: McGraw-Hill Education.
Smith, C. and Chan, J., 2015. Working for two bosses: Student interns as constrained labour in
China. human relations.68(2). pp.305-326.
7

Xing and et.al., 2016. Intercultural influences on managing African employees of Chinese firms
in Africa: Chinese managers’ HRM practices. International Business Review.25(1).
pp.28-41.
Zhang, J. and Peck, J., 2016. Variegated capitalism, Chinese style: Regional models, multi-scalar
constructions. Regional Studies.50(1).pp.52-78.
Zhu, Y., Xie, Y., Warner, M. and Guo, Y., 2015. Employee participation and the influence on job
satisfaction of the ‘new generation’of Chinese employees. The International Journal of
Human Resource Management.26(19). pp.2395-2411.
Online
Employment relations “with Chinese characteristics”: The role of trade unions in
China.2011[Online].Available
through<http://www.sociology2010.cass.cn/webpic/web/sociology/upload/2013/01/
d20130122161050142.pdf>
8