Reforming Labor Relations in China's State-Owned Enterprises: The Impact of Balancing Measures

Issues and Studies

Volumn 38, Issue 2, 2002, Pages 85-121

  Cheng, Joseph Y S ^b   Li, Qi ^a  

^a CAPITAL UNIVERSITY OF ECONOMICS AND BUSINESS   (China)

^b NONE

Author keywords

Authority of management; Balancing measures; Identities of both workers and management; Integration of objectives and demands; Labor relations

Indexed keywords

EID: 0347607218     PISSN: 10132511     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Article

References (58)

1. A list of interviewees has been included in the manuscript submitted to the journal; it is not released here for their protection.
2. See, for example, Olivia K. M. Ip, "Changing Employment System in China: Some Evidence from the Shenzhen Special Economic Zone," Work, Employment and Society 9, no. 2 (June 1995): 269-85.
3. Lin Yifu, Cai Fang, and Li Zhou, Zhongguo de qiji (China's miracle) (Hong Kong: The Chinese University Press, 1995), 119-26.
4. Wang Shengsheng et al., Guoqi gaige ershinian (The reform of state-owned enterprises in the past twenty years) (Beijing: Zhongguo shenji chubanshe, 1998), 81-86; Gao Shusheng, Zhongguo jiuye tizhi gaige ershinian (The reform of the employment system in China in the past twenty years) (Zhengzhou, Henan: Zhongzhou guji chubanshe, 1998).
5. Wang Shengsheng et al., Guoqi gaige ershinian (The reform of state-owned enterprises in the past twenty years) (Beijing: Zhongguo shenji chubanshe, 1998), 81-86; Gao Shusheng, Zhongguo jiuye tizhi gaige ershinian (The reform of the employment system in China in the past twenty years) (Zhengzhou, Henan: Zhongzhou guji chubanshe, 1998).
6. Daniel Z. Ding and Malcolm Warner, "'Re-inventing' China's Industrial Relations at Enterprise Level: An Empirical Field-Study in Four Major Cities," Industrial Relations Journal 30, no. 3 (September 1999): 243-60; Jiangwei Han and Motohiro Morishima, "Labour System Reform in China and Its Unexpected Consequences," Economic and Industrial Democracy 13 (1992): 233-61; Solomon M. Karmel, "The Neo-authoritarian Dilemma and the Labor Force: Control and Bankruptcy vs. Freedom and Instability," Journal of Contemporary China 5, no. 12 (1996): 111-33; and Qi Zhirong and Xu Xiaohou, Zhongguo laodong guanxi daolun (An introduction to labor relations in China) (Hangzhou: Zhejiang renmin chubanshe, 1995), 70-71.
7. Daniel Z. Ding and Malcolm Warner, "'Re-inventing' China's Industrial Relations at Enterprise Level: An Empirical Field-Study in Four Major Cities," Industrial Relations Journal 30, no. 3 (September 1999): 243-60; Jiangwei Han and Motohiro Morishima, "Labour System Reform in China and Its Unexpected Consequences," Economic and Industrial Democracy 13 (1992): 233-61; Solomon M. Karmel, "The Neo-authoritarian Dilemma and the Labor Force: Control and Bankruptcy vs. Freedom and Instability," Journal of Contemporary China 5, no. 12 (1996): 111-33; and Qi Zhirong and Xu Xiaohou, Zhongguo laodong guanxi daolun (An introduction to labor relations in China) (Hangzhou: Zhejiang renmin chubanshe, 1995), 70-71.
8. Daniel Z. Ding and Malcolm Warner, "'Re-inventing' China's Industrial Relations at Enterprise Level: An Empirical Field-Study in Four Major Cities," Industrial Relations Journal 30, no. 3 (September 1999): 243-60; Jiangwei Han and Motohiro Morishima, "Labour System Reform in China and Its Unexpected Consequences," Economic and Industrial Democracy 13 (1992): 233-61; Solomon M. Karmel, "The Neo-authoritarian Dilemma and the Labor Force: Control and Bankruptcy vs. Freedom and Instability," Journal of Contemporary China 5, no. 12 (1996): 111-33; and Qi Zhirong and Xu Xiaohou, Zhongguo laodong guanxi daolun (An introduction to labor relations in China) (Hangzhou: Zhejiang renmin chubanshe, 1995), 70-71.
9. Daniel Z. Ding and Malcolm Warner, "'Re-inventing' China's Industrial Relations at Enterprise Level: An Empirical Field-Study in Four Major Cities," Industrial Relations Journal 30, no. 3 (September 1999): 243-60; Jiangwei Han and Motohiro Morishima, "Labour System Reform in China and Its Unexpected Consequences," Economic and Industrial Democracy 13 (1992): 233-61; Solomon M. Karmel, "The Neo-authoritarian Dilemma and the Labor Force: Control and Bankruptcy vs. Freedom and Instability," Journal of Contemporary China 5, no. 12 (1996): 111-33; and Qi Zhirong and Xu Xiaohou, Zhongguo laodong guanxi daolun (An introduction to labor relations in China) (Hangzhou: Zhejiang renmin chubanshe, 1995), 70-71.
10. Chang Kai, "Laoquan baozhang" (Safeguard of labor rights), in Laodong guanxi, laodongzhe, laoquan: Dangdai Zhongguo de laodong wenti (Labor relations, laborers, and labor rights: Labor Issues in contemporary China), ed. Chang Kai et al. (Beijing: Zhongguo laodong chubanshe, 1995), 41-76; Qi and Xu, Zhongguo laodong guanxi daolun, 44-45; and Wang Aiwen, Shehui laodong guanxi: Yanbian guocheng de kaocha yufenxi (Social labor relations: An examination and analysis of its evolutionary process) (Beijing: Hongqi chubanshe, 1993), 38-39.
11. Chang Kai, "Laoquan baozhang" (Safeguard of labor rights), in Laodong guanxi, laodongzhe, laoquan: Dangdai Zhongguo de laodong wenti (Labor relations, laborers, and labor rights: Labor Issues in contemporary China), ed. Chang Kai et al. (Beijing: Zhongguo laodong chubanshe, 1995), 41-76; Qi and Xu, Zhongguo laodong guanxi daolun, 44-45; and Wang Aiwen, Shehui laodong guanxi: Yanbian guocheng de kaocha yufenxi (Social labor relations: An examination and analysis of its evolutionary process) (Beijing: Hongqi chubanshe, 1993), 38-39.
12. Chang Kai, "Laoquan baozhang" (Safeguard of labor rights), in Laodong guanxi, laodongzhe, laoquan: Dangdai Zhongguo de laodong wenti (Labor relations, laborers, and labor rights: Labor Issues in contemporary China), ed. Chang Kai et al. (Beijing: Zhongguo laodong chubanshe, 1995), 41-76; Qi and Xu, Zhongguo laodong guanxi daolun, 44-45; and Wang Aiwen, Shehui laodong guanxi: Yanbian guocheng de kaocha yufenxi (Social labor relations: An examination and analysis of its evolutionary process) (Beijing: Hongqi chubanshe, 1993), 38-39.
13. Jiang Ruxiang, "Fenhua yu zhenghe: Zhongguo shehui wendingxing yanjiu" (Division and integration: An analysis of stability in Chinese society), Minzu jingji yu shehui fazhan (National Economy and Social Development), 1996, no. 2:10-13; Qi and Xu, Zhongguo laodong guanxi daolun, 52; Andrew G. Walder, "Workers, Managers, and the State: The Reform Era and the Political Crisis of 1989," The China Quarterly, no. 127 (September 1991): 467-92; Yunqiu Zhang, "An Intermediary: The Chinese Perception of Trade Unions since the 1980s," Journal of Contemporary China 6, no. 14 (1997): 139-52; and Ying Zhu, "Major Changes Under Way in China's Industrial Relations," International Labour Review 134, no. 1 (1995): 37-49.
14. Jiang Ruxiang, "Fenhua yu zhenghe: Zhongguo shehui wendingxing yanjiu" (Division and integration: An analysis of stability in Chinese society), Minzu jingji yu shehui fazhan (National Economy and Social Development), 1996, no. 2:10-13; Qi and Xu, Zhongguo laodong guanxi daolun, 52; Andrew G. Walder, "Workers, Managers, and the State: The Reform Era and the Political Crisis of 1989," The China Quarterly, no. 127 (September 1991): 467-92; Yunqiu Zhang, "An Intermediary: The Chinese Perception of Trade Unions since the 1980s," Journal of Contemporary China 6, no. 14 (1997): 139-52; and Ying Zhu, "Major Changes Under Way in China's Industrial Relations," International Labour Review 134, no. 1 (1995): 37-49.
15. Jiang Ruxiang, "Fenhua yu zhenghe: Zhongguo shehui wendingxing yanjiu" (Division and integration: An analysis of stability in Chinese society), Minzu jingji yu shehui fazhan (National Economy and Social Development), 1996, no. 2:10-13; Qi and Xu, Zhongguo laodong guanxi daolun, 52; Andrew G. Walder, "Workers, Managers, and the State: The Reform Era and the Political Crisis of 1989," The China Quarterly, no. 127 (September 1991): 467-92; Yunqiu Zhang, "An Intermediary: The Chinese Perception of Trade Unions since the 1980s," Journal of Contemporary China 6, no. 14 (1997): 139-52; and Ying Zhu, "Major Changes Under Way in China's Industrial Relations," International Labour Review 134, no. 1 (1995): 37-49.
16. Jiang Ruxiang, "Fenhua yu zhenghe: Zhongguo shehui wendingxing yanjiu" (Division and integration: An analysis of stability in Chinese society), Minzu jingji yu shehui fazhan (National Economy and Social Development), 1996, no. 2:10-13; Qi and Xu, Zhongguo laodong guanxi daolun, 52; Andrew G. Walder, "Workers, Managers, and the State: The Reform Era and the Political Crisis of 1989," The China Quarterly, no. 127 (September 1991): 467-92; Yunqiu Zhang, "An Intermediary: The Chinese Perception of Trade Unions since the 1980s," Journal of Contemporary China 6, no. 14 (1997): 139-52; and Ying Zhu, "Major Changes Under Way in China's Industrial Relations," International Labour Review 134, no. 1 (1995): 37-49.
17. Jiang Ruxiang, "Fenhua yu zhenghe: Zhongguo shehui wendingxing yanjiu" (Division and integration: An analysis of stability in Chinese society), Minzu jingji yu shehui fazhan (National Economy and Social Development), 1996, no. 2:10-13; Qi and Xu, Zhongguo laodong guanxi daolun, 52; Andrew G. Walder, "Workers, Managers, and the State: The Reform Era and the Political Crisis of 1989," The China Quarterly, no. 127 (September 1991): 467-92; Yunqiu Zhang, "An Intermediary: The Chinese Perception of Trade Unions since the 1980s," Journal of Contemporary China 6, no. 14 (1997): 139-52; and Ying Zhu, "Major Changes Under Way in China's Industrial Relations," International Labour Review 134, no. 1 (1995): 37-49.
18. Karmel, "The Neo-authoritarian Dilemma and the Labour Force," 111-33; Greg O'Leary, "The Making of the Chinese Working Class," in Adjusting to Capitalism: Chinese Workers and the State, ed. Greg O'Leary (Armonk, N.Y.: M.E. Sharpe, 1998), 48-74.
19. Karmel, "The Neo-authoritarian Dilemma and the Labour Force," 111-33; Greg O'Leary, "The Making of the Chinese Working Class," in Adjusting to Capitalism: Chinese Workers and the State, ed. Greg O'Leary (Armonk, N.Y.: M.E. Sharpe, 1998), 48-74.
20. Qi and Xu, Zhongguo laodong guanxi daolun, 51; and Walder, "Workers, Managers, and the State."
21. Qi and Xu, Zhongguo laodong guanxi daolun, 51; and Walder, "Workers, Managers, and the State."
22. Chang, "Laoquan baozhang."
23. Wenfang Tang, William L. Parish, and Tongqing Feng, "Chinese Labor Relations in a Changing Work Environment"; Wang, Shehui laodong guanxi, 90-92; and Andrew G. Walder, "Factory and Manager in an Era of Reform," The China Quarterly, no. 118 (June 1989): 242-64.
24. Wenfang Tang, William L. Parish, and Tongqing Feng, "Chinese Labor Relations in a Changing Work Environment"; Wang, Shehui laodong guanxi, 90-92; and Andrew G. Walder, "Factory and Manager in an Era of Reform," The China Quarterly, no. 118 (June 1989): 242-64.
25. Wenfang Tang, William L. Parish, and Tongqing Feng, "Chinese Labor Relations in a Changing Work Environment"; Wang, Shehui laodong guanxi, 90-92; and Andrew G. Walder, "Factory and Manager in an Era of Reform," The China Quarterly, no. 118 (June 1989): 242-64.
26. Wu Guoguang, Zhulu shiwuda: Zhongguo quanli qiju (Toward the 15th party congress: Power game in China) (Hong Kong: Taipingyang yanjiusuo, 1997), 20.
27. Lu Feng, "Danwei: Yizhong teshu de shehui zuzhi" (Unit: A special form of social organization), Zhongguo shehui kexue (Social Sciences in China), 1989, no. 1:71-88.
28. For a brief survey of the literature, see Sheng Hong, chapter 1: "The Study of the Transitional Economy in China," in Zhongguo de guodu jingjixue (The study of the transitional economy in China), ed. Sheng Hong (Shanghai: Shanghai sanlian shudian and Shanghai renmin chubanshe, 1994), 1-20.
29. For instance, in the "Detailed Rules on the Implementation of the Labor Contract System," the central government removed the limitations on "keeping workers in the same unit of employment" and "extending the term of contract." This policy, in reality, allowed workers with more than ten years' seniority (usually the permanent workers) to continue to enjoy job security after signing a labor contract. See Beijing Municipal Labor Bureau, Laodong zhengce fagui huibian (Collection of labor policies and regulations) (Unpublished, 1995), 129-32.
30. Wang Jianxin et al., Zhongguo laodong nianjian: 1995-1996 (China labor yearbook: 1995-96) (Beijing: Zhongguo laodong chubanshe, 1996), 208.
31. Wu Bangguo, "Directives on Labor Work," ibid., 14-15.
32. A document issued by the CCP Central Committee in 1997 reported that, in comparison with the same period in 1996, in the first quarter of 1997 the number of events where laid-off workers took to the streets and made trouble increased 10 percent. The Central Committee regarded laid-off workers as the major factor of social instability in the long-term future. See Wang Haitao, "Time-Bomb Threatening Social Stability: An In-depth Perspective of the Crisis of 30 Million Laid-off Workers," Kaifang (Open Magazine) (Hong Kong), no. 138 (June 1998): 17-19.
33. In 1996, the Shanghai municipal government adopted a new measure in the carrying out of the re-employment project: "trusteeship" for xiagang workers through the setting up of re-employment service centers. The centers were required to be set up by the supervising agencies of SOEs (now most of these agencies had been changed into group corporations or holding companies). These centers were responsible for managing xiagang workers, guaranteeing their essential living expenses, and helping them to secure reemployment. According to this measure, the surplus personnel in SOEs must be laid off first and then moved to the centers. After the former workers enter the centers, their former enterprises are to still maintain nominal employment relationships with them. Funding for the re-employment service centers was to be shared by the government, community, and enterprises; these monies were earmarked for xiagang workers' essential living expenses, daily out-patient expenses, and social insurance expenses. The gist of this measure was to make use of the service centers sponsored by the supervising agencies of SOEs as a transitional arrangement in order to facilitate the laying off of surplus personnel.
34. Liu Guoguang and Zhou Guiying, Zhongguo jingji gaige quanshu (1978-1991): Gongye qiye juan (Complete works on China's economic reforms, 1978-91: Volume on industrial enterprises) (Dalian, Liaoning: Dalian renmin chubanshe, 1992), 573.
35. For further details, see the General Office of the Coordinating Group for Strengthening the Building of Leading Bodies of SOEs, Guoyou qiye lingdao banzi kaohejianshe gongzuo zhidao (Directives on assessing and building the leading bodies of SOEs) (Beijing: Dangjian duwu chubanshe, 1997), 138-53.
36. Renmin ribao (People's Daily), March 11, 1997.
37. See note 20 above.
38. Wei Jianxing, "A Speech at the Seventh Presidium Meeting of the Twelfth National Congress of the ACFTU," Zhongguo gongyun (China Labor Movement), 1995, no. 2:7.
39. Department of Policy and Law, Ministry of Labor, Laodong zhengce fagui huibian (Collection of labor policies and regulations) (Beijing: Zhongguo laodong chubanshe, 1993), 520-48.
40. Task Force for Social Structural Transition, "Zhongguo shehui jiegou zhuanxing de jinqi yu zhongqi qushi he weiji" (The trends and hidden troubles in the structural transition of Chinese society in the short and mid-terms), Zhanlue yu guanli (Strategy and Management), 1998, no. 5:1-17.
41. Andrew G. Walder, Communist Neo-traditionalism: Work and Authority in Chinese Industry (Berkeley, Calif.: University of California Press, 1986), 11.
42. Li Lulu and Wang Fenyu, Dangdai Zhongguo xiandaihuajincheng zhong de shehui jiegou jiqi biange (The social structure and changes in the process of modernization in contemporary China) (Hangzhou: Zhejiang renmin chubanshe, 1992), 83-103.
43. See note 13 above.
44. Jiang Ruxiang, "Fenhua yu zhenghe"; Qi and Xu, Zhongguo laodong guanxi daolun, 50; and Zhang, "An Intermediary."
45. Jiang Ruxiang, "Fenhua yu zhenghe"; Qi and Xu, Zhongguo laodong guanxi daolun, 50; and Zhang, "An Intermediary."
46. Jiang Ruxiang, "Fenhua yu zhenghe"; Qi and Xu, Zhongguo laodong guanxi daolun, 50; and Zhang, "An Intermediary."
47. Theodore Groves et al., "China's Evolving Managerial Labour Market," Journal of Political Economy 103, no. 4 (August 1995): 873-91; and Tang, Parish, and Feng, "Chinese Labor Relations in a Changing Work Environment."
48. Theodore Groves et al., "China's Evolving Managerial Labour Market," Journal of Political Economy 103, no. 4 (August 1995): 873-91; and Tang, Parish, and Feng, "Chinese Labor Relations in a Changing Work Environment."
49. Qi and Xu, Zhongguo laodong guanxi daolun, 51; and Zhao Jianjie, "The Situation and Special Features of Labor Relations in SOEs," in Chang et al., Laodong guanxi, laodongzhe, laoquan, 77-103.
50. Qi and Xu, Zhongguo laodong guanxi daolun, 51; and Zhao Jianjie, "The Situation and Special Features of Labor Relations in SOEs," in Chang et al., Laodong guanxi, laodongzhe, laoquan, 77-103.
51. A 1996 survey among Chinese entrepreneurs found that 71.3 percent of the directors of SOEs were still appointed by their supervisory agencies. See Survey System of Chinese Entrepreneurs, "Zhongguo qiye jingyingzhe de zhiye liudong yu zhiye quxiang" (The current career mobility and career orientation of managers in China), Jingji gongzuozhe xuexi ziliao (Studying Materials for Economic Workers), 1997, no. 2:2-16.
52. Andrew G. Walder, "Wage Reform and the Web of Factory Interests," The China Quarterly, no. 109 (June 1987): 33.
53. Since the central government introduced the reform policy of "housing allowance in place of actual housing allocation" on July 1, 1998, commercial property has become the mainstream form of housing available to urban residents. Several months before the implementation of this policy, many SOEs, public-sector organizations, and government organs rapidly distributed housing units to their employees; and this became known as "taking the last bus of welfare housing"
54. Li Peilin, "Qiye yanjiu de shijiao" (A perspective of enterprise studies), in Zhuanxing zhong de Zhongguo qiye: Guoyou qiye zuzhi chuangxin lun (Chinese enterprises in transition: A theory of SOE organizational innovation), by Li Peilin et al. (Jinan: Shandong renmin chubanshe, 1992), 23.
55. Walder, Communist Neo-traditionalism, 14-15.
56. For example, in 1998, governments at all levels allocated 68.4 billion yuan to support the
57. Yang Yiyong, Jiuye lilun yu shiye zhili (Theories of employment and solutions to unemployment) (Beijing: Zhongguo jingji chubanshe, 2000), 33.
58. Li Peilin, "Dealing with Unemployment in Old Industrial Bases: Post-Industrialization and Marketization - A Survey of Nine Large-Scale SOEs in the Northeast," Shehuixue yanjiu (Studies of Sociology), 1998, no. 4:1-12.