2008: Factory closure leaves workers in the cold

published 30-01-2013 11:55, last modified 29-04-2013 11:00
On 13 February 2008, 700 workers at the Panyu Li Chang Footwear Co. Ltd, located in the Panyu district of Guangzhou City, returned from their New Year’s holiday to discover that the factory’s owner had absconded with their wages (¥2,000 per employee), had failed to make social security payments for some ten years, had closed the factory and sold all of the machinery and equipment.
2008: Factory closure leaves workers in the cold

Arrested workers - Panya Daily

Issue

On 13 February 2008, 700 workers at the Panyu Li Chang Footwear Co. Ltd, located in the Panyu district of Guangzhou City, returned from their New Year’s holiday to discover that the factory’s owner had absconded with their wages (¥2,000 per employee), had failed to make social security payments for some ten years, had closed the factory and sold all of the machinery and equipment.

Some 400 of them marched peacefully from the factory to Guangzhou’s Municipal Government offices to file a claim against the factory owner and demand help from the Chinese authorities. But police headed the workers off along the way, intimidated them and then detained some 50 of them. Five were formally arrested on criminal charges of illegal assembly and demonstrating. They face criminal charges and prison sentences of up to seven years.

On 28 February, The Panyu Daily reported that the five arrested workers had been forced to stand on a podium while the charges against them were announced publicly. Jian Xi Bo, the secretary of the legal committee, explained that demonstrators who resorted to blocking roads and bridges do not fall under the protection of Chinese law.

Action

In March 2008, the CCC urged supporters to send letters the Guangzhou Municipal Government to demand the immediate and unconditional release of the five arrested workers, noting that “It is time for China to stop its systematic repression of internationally recognised human rights, particularly freedom of expression and freedom of association. The ability of workers to engage in dialogue with employers and openly express their grievances is a fundamental part of a just society.”

The CCC demanded that:

• Panyu Li must drop all criminal charges against the workers and release them immediately and unconditionally

• The Philippine labour department and ACFTU must ensure that all of the factory’s employees receive their full back wages, severance pay, and social insurance and pension premiums

• The government must respect the workers' right to freedom of expression and association, which may entail peaceful actions to defend their rights. These rights should not be criminalised

• The government must protect the workers and bring the factory owner to justice.

Background

The Panyu Li produces soles for sports shoes and one trade website stated that it produced soles for Nike. But Nike denies that Panyu Li is in its supply chain. Nike further pointed out that local government sources claimed that Panyu Li does not produce for international companies.

Outcome

A follow-up letter from the ITUC reported that “the local Panyu District’s Labour and Social Security Bureau reimbursed the workers their missing wages out of its own funds.” However, the letter also notes that the workers had to vacate their homes with very short notice (24 hours) and many of them ended up without a home. Furthermore, they were not offered proper assistance in recouping their social insurance payments.