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What rising prices mean to a worker

By Op Rana (China Daily)
Updated: 2008-08-29 11:15

The world loves to refer to China as the "factory of the world", though it never tires of blaming it for the cost development has exacted on its environment. The pressure on the environment can be reduced only with the combined effort of the entire world community - and the world better join hands immediately for that. But there is one pressure, the pressure on the workers of the "factory of the world", which the Chinese government can reduce on its own, and it has decided to do so.

No matter how insignificant company managements consider workers to be, they are still the most important factor of production and means to increasing big capital. To protect this workforce and to meet the changing demands of its post-reform society, China implemented a new law, binding on domestic and foreign companies both, from January 1 this year.

Even before January 1, Chinese laws required employers to sign contracts with their employees. In a majority of cases, however, contracts were signed typically for one or two years. To make matters worse, many companies didn't provide written contracts and didn't pay the workers on time - some of them didn't pay at all.

The new law is intended to stop such practice. It says companies have to sign a contract with an open-end clause with long-term employees. A worker who has worked for 10 consecutive years or served two consecutive terms in a company has the right to a contract without a fixed end date.

But some enterprises say the new law gives workers the right to demand higher pay and better working conditions. This, they say, will raise their cost of production and, in the long run, defeat the very purpose they opened shop in China: cheap labor.

Some companies even rushed to terminate their workers' running contracts before 31 December, 2007, and hire them anew in an apparent bid to circumvent some of the law's key provisions. One example is a Shenzhen-based telecom giant. It reportedly offered a bonus to about 7,000 employees with at least eight years of service to resign and reapply for their posts. Other companies, including overseas ones, tried to follow its lead.

Rising prices of food and other essentials have hit the working class the hardest. A large number of the country's faced the specter of layoffs and hidden unemployment when many of the giant State-owned enterprises were either closed down or changed managements. They are still the first to fall prey to the fluctuations of the market.

But that is the norm of market economy. As Marx says: "In proportion as the bourgeoisie, i.e., capital, is developed, in the same proportion is the proletariat, the modern working class, developed - a class of laborers, who live only so long as they find work, and who find work only so long as their labor increases capital. These laborers, who must sell themselves piecemeal, are a commodity, like every other article of commerce, and are consequently exposed to all the vicissitudes of competition, to all the fluctuations of the market."

Only the State can prevent this "commodity" from further exposure. It has taken the first and a big step by implementing the new labor law. It's a vital step, too, on the road to the central leadership's aim of a harmonious society.

What is needed now is proper enforcement. And it is here that officials' and the All-China Federation of Trade Unions' task is cut out: they have to represent the laborers in collective bargaining with the managements and get them their due rights because, as Marx says: "... the cost of production of a workman is restricted, almost entirely, to the means of subsistence that he requires for maintenance ... But the price of a commodity, and therefore also of labor, is equal to its cost of production. In proportion, therefore, as the repulsiveness of the work increases, the wage decreases."

Managements will obviously claim there are no "wage decreases". But then what do rising prices mean to a worker?

E-mail: oprana@hotmail.com