The China Law Blog compared China’s employment laws to those of the United States. Reading this post was a revelation, because I did not know that Chinese workers had more job protection—if not higher pay—than most U.S. workers, and I was curious how this came about.
I discovered the reason was due to the transition from state controlled to private owned businesses. Since 1978—when China implemented its open-door policy—the country went from no privately owned small businesses to more than 10 million small to medium-sized private enterprises that represent about 90 percent of all businesses.
In addition, The Diplomat.com reports, “China’s private sector now comprises some 70% or more of China’s economy …”
And before anyone criticizes China for paying low wages to migrant factory workers who moved to the cities from rural China, Bloomberg says, “Rural spending power has been lifted by wages earned by peasants working in cities. “
“Wage levels in China [while low compared to the United States] have increased continually over the last two decades as the economy has developed and the private sector has created new employment opportunities. … In 2012, a total of 25 provinces increased their minimum wage by an average of 20.2 percent.” Source: China Labour Bulletin
Prior to this transition, state workers didn’t have to worry about a job. Once the transition began, significant numbers of workers started losing jobs. Since China’s constitution says the government’s role is to serve the people, the government changed the laws to make it more difficult to fire a worker offering better job protection.
In fact, the Library of Economics and Liberty says, “China appears to have come through the world economic crises better than many countries. … As Europe and the United States slump, the CPC can speedily launch infrastructure projects or shift millions of migrant workers from one locality to another.”
“China’s employment law system is quite different from the U.S. The main difference is that the U.S. is an employment at will system, which means you can terminate employees at any time for pretty much any reason. China’s system is the opposite. The Chinese system is a contract employment system. … An employee can only be terminated for cause and cause must be clearly proved. … This whole situation makes the employment relationship and the employment documents much more adversarial than is customary in the U.S.” Source: China Law Blog
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Lloyd Lofthouse is the award-winning author of My Splendid Concubine [3rd edition]. When you love a Chinese woman, you marry her family and culture too. This is the love story Sir Robert Hart did not want the world to discover.
His latest novel is the multiple-award winning Running with the Enemy.
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