Law dents China's role as world's factory floor

[Omaha Steve]

http://www.startribune.com/world/17927749.html

The new law covers worker issues such as pensions and unwarranted dismissals, and gives employees more power.

By ARIANA EUNJUNG CHA, Washington Post

Last update: April 19, 2008 - 4:46 PM

DONGGUAN, CHINA

Wei Hoqiang used to work in a toy factory that forced him to sign a contract it did not let him read. It paid him 30 cents an hour, made him work 100 days without a day off and kept him in a room that was ice cold in winter and suffocating in summer. He said he knew he was being taken advantage of, but he was so afraid of his boss' ire that he stayed for two years.

Wei, 31, said he knew he could do better and in early March walked out on his employer. He immediately got three job offers.

Armed with a landmark new labor contract law that went into effect Jan. 1, employees like Wei are turning the tables on employers in China.

The law -- designed to combat forced labor, withholding of pay, unwarranted dismissals and other abuses -- represents a major victory for Chinese workers who for decades have complained of companies that would stop at nothing to wring out profits. It has prompted legions of workers in recent months to become bolder about quitting and about staging strikes to demand improvements in work conditions and wages.

For companies already struggling with inflation, high energy costs, the falling dollar and an environmental crackdown, however, the new law has been devastating.

It has added to the rising cost of doing business in China -- contributing to an exodus of what is estimated to be thousands of factories from places like the Pearl River Delta in southern China, for 20 years synonymous with cheap and abundant labor and the engine behind China's rapid growth.

FULL story at link.

[KSinTX]

1. The start of big financial things on this side of the pond perhaps