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Truckers on Strike and the Structural Contradictions of China’s Logistics Industry

Tan Jiangying, June 15, 2018

 

On June 8, messages circulated on social media that truck drivers across China were going on strike on the 10th. This came with a feeling of deja vu, as a similar call for strike had happened on April 25, when crane operators announced a strike for May 1. And, as happened with the crane operators earlier, the truckers’ strike never materialized. The day came, and the strike was called off.

One can guess that the strike leaders were controlled by the stability-maintenance authorities in their locality. But the effect again mirrored that of the canceled crane operators’ strike: upon hearing the call to action, truckers gathered and demonstrated on the days before the appointed time. They hailed from all over the country: Xiushui in Jiangxi province; Hefei, Fuyang; Wuhu in Anhui province; Lianyungang in Jiangsu province; Ningbo in Zhejiang province; Tongren in  Guizhou province; Jiading in Shanghai; Wuhan in Hubei; Liaocheng in Shandong; Chengdu in Sichuan; Chongqing; in addition to other cities and provinces.

By announcing strikes on one day but carrying the action earlier, they made “a feint in the east and attacking in the west” [a well known Chinese idiom and military strategy], successfully staging their actions that would otherwise be suppressed.

The truck drivers staged motor protests on the 8th and 9th of June to demand lower gas prices, higher pay for their freight, abolishing excessive road and bridge tolls, and an end to arbitrary fees and fines. They also stood out to oppose the steady monopolization of the logistics industry.

Over a couple days of resistance, the truckers made the whole country aware of their plight. These men practically live in their trucks, leaving their wives and children for a life on the road. They work over 12 hours a day in miserable conditions and subpar safety. Adding to this are their many run-ins with the authorities, who impose upon them fees both legal and illegal. As their income drops, they doggedly maintain their living by accepting ever heavier and riskier loads.

And it’s not just the drivers. Workers throughout the logistics chain toil for next to nothing, even with the exorbitant rates suppliers pay for Chinese shipping (over twice the price of American rates). The costs are passed on to the consumers, but where does the money end up?

Take the Beijing-Xi’an line as an example: a round trip costs about 21,500 yuan, of which 14,500 yuan covers gas. The rest goes to the five-day costs of living, maintenance work and parts, annual registration and vehicle inspection fees, insurance, and various fines one can expect to be slapped with by the authorities. In the end, there is not much left for the truck owners and/or the drivers to make a profit or earn a decent wage.

The root cause of the truckers’ conditions stem from the government’s monopolization of the logistic industry’s lifeblood — fuel and highways — which feeds rent-seeking behavior on the part of the transport police and highway administration. And then there is the immediate factor in the outbreak of the truckers’ strike: the imbalance and inequality of capital and labor within the logistics sector.

China boasts a fleet of about 15 million trucks demanding two drivers each, making around 30 million truckers across the country. Some own the vehicles they drive; others rent trucks, and others don’t personally drive anymore and provide their trucks to the second group. Most drivers are renters. The supply side of the logistics sector is diverse, as is the demand side — the enterprises and goods owners. This plurality of supply and demand once made for an essentially free arena of competition, but recent and sudden shifts in the industry have led to the rise of monopolies.

The shift came with the merger of two logistics giants — Yunmanman [满运软件科技有限公司] of Jiangsu Province and Guiyang’s Truck Alliance, Inc. [货车帮科技有限公司] — to form the Manbang Group. Yunmanman, established in 2013, was the first logistics company in China to incorporate cloud computing, big data, and AI technologies in its platform. It employs four million drivers and owns one million trucks in 315 cities across the country. The comparably-sized Truck Alliance, Inc. boasts a formidable nationwide data infrastructure. It provides comprehensive service for the logistics network across 4.5 million trucks, and works with 88,000 supply partners.

Following the merger, CEO and board chairman Wang Gang (王刚) of Didi Chuxing, CEO Luo Peng (罗鹏) of Truck Alliance, Inc, and Zhang Hui (张晖) of Yunmanman became joint directors of the new Manbang Group. The original companies have remained distinct entities with their own brands, but they now work in tandem to dominate the industry.

Data from Manbang indicates that 5.2 of 7 million mainline fleet trucks in China are now registered with the conglomerate; and around 125 of the nation’s 150 logistics companies are Manbang affiliates. Every day 18.28 billion tons of freight is moved around the country, of which Manbang handles 13.59 billion.

On April 24, 2018, the Manbang Group carried out its first round of financing, worth about $1.9 billion. After the merger, its stock value is expected to break $6 billion.

From May 26 to May 29, Manbang made its first post-merger appearance at the China International Big Data Industry Expo 2018 that was held in Guiyang’s International Convention & Convention Center. According to Reuter’s Chinese-language service, “aside from providing a service that matches trucks to goods, Manbang also became the biggest platform for transport vehicles and all-in-one vehicle support covering services like vehicle oil, electronic throttle control (ETC) systems, vehicle replacement, financing, insurance, or site development. This year Manbang Group has seen successful with its online transaction platform, with the value of transactions reaching hundreds of millions of yuan per month.”

The merger of Yunmanman with Trucking Alliance Inc. brought about a fundamental change in industrial relations within the logistics sector. First, Manbang introduced an annual fee of somewhere between 1680 and 3000 yuan directed at the truck drivers and related information service personnel, which forced the hands of many who had already become dependent on the app for their business.

The second and more explosive event occurred on June 4, when the Truck Alliance app implemented a client update that made it impossible to receive information in real time. Job pricing was fully automated, depriving users of the ability to set their own prices. As a part of the new merger, Truck Alliance was blatantly and openly exerting control over its customers with impunity. Suppose a supplier pays Manbang 1000 yuan, then of that sum the driver gets only 800 yuan and Manbang pockets the rest. This situation caused an uproar among vehicle owners, suppliers, drivers, and other industry personnel.

The crux of the matter is that Manbang is a third party service brokerage platform that not only collects an annual service fee for its information, but has reached into the transaction between trucker and supplier and take a cut from it. It’s gone from information provider to hegemon of the logistics industry. It uses its monopoly on supply and demand data to force truck operators and drivers into paying a “transaction commission” outside the normal app service fee. Manbang doesn’t expend any capital or labor to collect this massive and blatantly exploitative profit. Looking at the plans drafted by Manbang’s nine operations departments, it’s clear that it wants to completely have its way with the industry, forcing all other capital investors (vehicle owners) and laborers (truckers) into submission.

This is adding insult to injury for the truck owners and drivers already suffering under the  monopolistic business landscape and predatory government authorities. The June 4 client app update was the last straw.

The actions of the truckers across China is remarkable and praiseworthy:

  1. This is not a sudden outbreak, but the fruits of long-term, built-up resentment. Truckers have exposed the corruption of the logistics industry before, such as when they called for strikes on November 11, 2015, and April 16, 2017. They organized nationwide and local groups on QQ and WeChat, and formed unofficial logistics associations and alliances to begin defending their rights. It can be seen as a nascent truckers’ union.
  1. This is an industry-wide action following on the heels of crane operators’ protests at the end of April. The strength, effectiveness, and bargaining potential of such collective actions are by no means something that could be achieved by one enterprise alone. Collective actions like group bargaining are the staple in the labor movements of many other countries. It is satisfying to see Chinese workers embark on the labor movement’s righteous path.
  1. The alliance of truck drivers form as a permanent organized and law-abiding force in the logistic industry. These cooperatives and other labor organizations are necessary to counter huge conglomerates like Manbang and protect small capital investors and truckers. Without camaraderie between the workers, the industry is doomed to be monopolized.
  1. The government is obligated to guarantee the rights of the workers to assemble and organize. It also has a responsibility to protect disadvantaged groups in the industry and the rights of workers to unionize. Only in this way will competition be fair, and as the industry makes progress as a whole, it will be possible to ensure legal rights and benefits like proper wages, working hours and conditions, and social security.

 

 

Tan Jiangying is a labor scholar in China.

 

 

 

 

The Significance of Crane Operators Across China Going on Strike

Wang Jiangsong, May 7, 2018

 

Crane operators on strike

 

On April 25, an open letter from a WeChat group named “Changsha tower crane operator federation” (长沙塔吊联盟) was circulated. It said:

To all hardworking front-line tower crane operators, conductors, and elevator operators, greetings! As construction, crane, and mechanical equipment operators and engineers, in the most dangerous line of work on the construction site, our salary and compensation is severely out of step with the risks we take and the utter indispensability of our work. In the construction industry, the hours we work far exceed those stipulated in the Labor Law, and we have no social security. Yet despite being in the most unsafe work and working the longest hours, our pay is miniscule. In order to trigger a wave of simultaneous strikes among crane operators around the country, in order to protect our basic labor rights and dignity, and gain an equal salary, the Changsha tower crane operator federation has decided to unite, stand-up, and declare that we have the right to basic dignity in our labor and the right to engage in collective bargaining. Thus, we call for a united strike on the eve of International Labor Day of May 1, in Changsha’s May First Square (五一广场), so that we may make our voice known. We welcome and will be grateful for support from all walks of life.

Location: Changsha May First Square

Content: Organize a more robust crane operator federation, make better videos of the demonstration scene than that of crane operators on strike in other provinces, and reiterate our demand for construction labor rights.

Given the kind of activity and the particular nature of the profession involved, we hope that all fellow workers will proactively participate and make our voice known to the whole of society.

Changsha Crane Operator Federation
April 25, 2018

The letter caused an uproar in the WeChat group, and when shared around came along with expressions of concern for the safety of the crane operators. As expected, the following afternoon, one of the workers who posted the message said: “Terrifying. Because I forwarded a post about a worker strike on May 1 yesterday, the Changsha Ministry of State Security collected all possible information about me within a day, including my address, telephone number, work unit and more. Two hours ago they came to my workplace and demanded that I come to the police station and explain myself.” The worker promised to the MSS agents that he would not participate in any of the activities and was then allowed to leave, though he’s now worried that his employer is going to fire him because of it.

Moreover, the event was not limited only to crane tower operators in Changsha, but one that had been called for by various WeChat groups of tower crane operators across the country, making it a national event. On April 26, the spokesman for crane operators in Hainan published a video on Weibo calling on all operators in the province to join the national strike on the morning of May 1, with the demand that their regular salary and overtime wages be increased. “If we don’t strike, who’s going to increase our income?” he asked, adding: “A strike won’t be nationwide without workers in Hainan. Hainan crane operators too are full of passion, so let it burn!” On the same day, crane tower workers in Zigong, Sichuan Province, held a demonstration, their banners demanding wage hikes, or else they’d also join the May 1 strike.

The following day, workers in the following eight cities in eight provinces also held banners and circulated photographs of their protests online: Nanchang in Jiangxi, Tianshui in Gansu, Zhumadian in Henan, Xiantao in Hubei, Qingzhen in Guizhou, Huaian in Jiangsu, Hengyang in Hunan, Xiamen in Fujian.

Over the next three days, workers in at least 13 cities (Wuhan, Shijiazhuang, Yinchuan, Sanmenxia, Luoyang, Lankao, Yuncheng, Zhuzhou, Yueyang, Pingjiang, Dazhou, Zhongshan, Maoming) and elsewhere also held assemblies and shared photos and videos of their protests online. As of April 30, according to a preliminary count, the provinces in which crane operators staged demonstrators, held banners, called slogans with their demands, and shared photos or footage online, include: Hunan, Hubei, Henan, Hebei, Jiangsu, Jiangxi, Hainan, Fujian, Gansu, Qinghai, Ningxia, Sichuan, Guizhou, Guangdong, Guangxi, Shanxi, Shandong, Shaanxi — 19 provinces, with protests in between 27 and 30 cities. Participants ranged from dozens to hundreds in each event. This is the first instance of such a large-scale, nationwide, collective action by industrial workers in China for over decades, and may in fact be the first instance of its kind ever.

When May 1 came around, however, China’s crane operators did not formally go on strike. There are three potential explanations for this.

The first is that some places already agreed to the demands to increase wages and overtime pay, while other cities saw those examples and emulated them; the second is that some local governments said they would strictly prohibit any such strike, and the workers were sufficiently cowed as to call off the plan; the third is that the crane operators didn’t want to get mixed up with the ‘May First National Civil Resonance’ (五一全民共振) called for by some overseas activists, which has explicit political objectives. The latter, under the strict control of the authorities, didn’t go anywhere.

Despite that, the genesis of this large scale ‘mass incident’ of crane operators deserves our attention and analysis.

  1. This is an inevitable development in the evolution of China’s market economy and labor-capital relations

During the first wave of labor mobilization in China from 2010 to 2015, almost all collective worker actions took place at specific companies: for example, with strikes at Carrefour and Walmart. In these cases, though the strikes spanned multiple stores, the number of participants involved was not large, and still the action was limited to that particular chain of stores.

China’s labor movement is bound to follow the trajectory of the broader economy and labor-capital relations, and thus expand from actions in particular companies to actions spanning multiple companies, regions, and even industries. This instance of a simultaneous mobilization of crane tower operators in dozens of cities across the country has every qualification to be considered the beginning of a historical inflection point in labor in China.

Strictly speaking, collective rights defense taking place at one enterprise can only be called a ‘collective labor action,’ and not really a ‘labor movement.’ Only when many workers establish horizontal ties among one another, achieving a cross-enterprise and cross-region network, can it be called a labor movement proper. One of the most effective and powerful forms of organization, allowing a group of geographically distributed workers to unite their forces and coordinate actions in a single organizational structure, is the industry-wide labor federation. This is also why this form is a core component of labor movements in market economies, and the primary vehicle for collective bargaining between labor and capital. The reason for this is that workers in the same occupation, business, or industry, are in the same position vis-a-vis capital, and have identical interests that they demand from the same counterparty, thus their solidarity and unity has the lowest cost. As soon as they unite, they immediately have the power of scale; once they’re successful, they have ongoing efficiencies of scale to maximally resolve the structural problem [of disparate power between capital and individual workers], and the collective bargaining agreements they reach with industry have the power of law in governing labor-capital relations. All this is entirely consistent with the aspirations and demands of freedom, equality, and justice in exchange and contracts in a market economy, and at the same time is the fundamental meaning of a market economic system governed by the law. The responsibility of the state (defined as legislature, administration, and judiciary) is located in the preservation, not the destruction, of the freedom, equality, and justice of this negotiating mechanism between labor and capital.

  1. The state should rationally treat self-initiated, self-directed, and self-organized collective actions and acknowledge and protect the three rights of labor

The outside world only learned about this collective action by crane operators after the fact, and knew nothing of their internal discussions, contact with one another, organization, and planning before the fact. There is also no information or evidence indicating that outside players (for instance labor NGOs) got involved or played any role in assisting, counselling, guiding, or providing any other form of help. Even less has there been any shadow of ‘hostile foreign forces.’ Thus, we have every reason to understand this sequence of events as a self-initiated, self-directed, and self-organized collective action on the part of crane operators themselves.

If this conclusion is valid, then the mistaken judgement of the relevant organs in the government must be corrected: they believe that collective action by workers are necessarily directed, organized, manipulated, and planned behind-the-scenes by hostile foreign forces or domestic NGOs, and that they’re competing with the Party, government, and official unions for the working class. This is likely one of the primary reasons behind the mass arrests and prison sentences of labor organizers in December 2015, particularly the arrests on December 3. Following the December 3 incident however, instances of collective rights defense by workers did not contract in scale, but after a short lull in fact came back in full force, and as in the case of the crane operator demonstration attained a high water mark. All this abundantly demonstrates that the level of [labor] consciousness and organizational capacity of workers in China has reached a new level, at least in some sectors and regions, and they’re capable of their own collective action without the involvement of outsiders.

In the past, the standard operating procedure for the relevant organs when faced with labor protests — they themselves having failed to do their job and duty of defending the legal rights of workers, then lost the trust of workers — was to find a scapegoat: blame it on the incitement of hostile foreign forces or domestic NGO activists. This was how they passed it off to their own superiors. The shame is that this sort of buck-passing is actually able to deceive the higher-ups, though workers aren’t fooled, and the actual problems facing workers are unchanged. Thus the resentment and rage builds up daily, and the conflicts between labor and capital, and even between labor and the government, become more and more intense. Put it bluntly, the scapegoating that goes on is simply digging the government into a pit.

The experience and norms of market economies tells us that the state should rationally and forthrightly address issues raised by self-initiated, self-directed, and self-organized collective action, and acknowledge and protect the rights of workers to form organizations (freedom of assembly), to engage in collective bargaining (the right to collective dispute resolution), and to strike (the right to industrial action).

  1. The demonstration by crane operators establishes a model for broader labor and social movements

Crane operators, as the prime movers behind this collective labor action, appear to have come to a clear realization of themselves as a specially-positioned technical worker in the production chain — they have a ‘structural power’ and to a degree are irreplaceable. The crane operators also effectively reached out to and integrated in their efforts crane conductors and elevator operators, upon which they recognized that the interests of the entire construction site and all the workers and jobs on it are related, to a large extent, and in common with their own. From this they could foresee that as long as there is no undefendable attack by an outside force, the natural course of affairs would have it that a construction industry union is formed. This is the only fundamental means of getting at the root of the chaos and problems in the construction industry.

From a broader perspective, it is beneficial not only to workers, but the entire construction industry, society, and the nation. The next direction for the labor movement in China is for workers in each industry and sector to autonomously form their own federations.

There is absolutely no evidence indicating that the collective action on the part of the crane operators had any connection with the ‘national civil resonance’ advocated by overseas democracy activists. In fact, the opposite is the case: just as that event failed to gain much traction, the protests by crane operators appeared all the more remarkable and successful.

It can be said that in contemporary China’s social transition, the democracy movement (referring to the narrow opposition political movements that aim to change China’s political system) should perhaps take a leaf from the book of the labor rights movement. The current stage of the labor movement of course focuses on increasing its economic benefits, and this is the primary reason that they’re able to mobilize and unite a sufficient number of workers and thus gain some small victories, or at least be able to retreat largely unscathed. The political quality and value of the labor movement requires only that individuals with perspicacious judgement look beneath the surface, make their own inferences, and carry it forward.

 
Wang JiangsongWang Jiangsong (王江松) is a labor scholar in China. 

 


Also by Wang Jiangsong:

A Six-day Strike in Shanghai Caused by a $110 Pay Cut – Collective Action by Sanitation Workers in China’s ‘New Era’ of Stability Maintenance, April 13, 2018.

 

 

 

 

‘In Winter-frozen Earth, Spring Starts to Quicken’

A 2016 New Year’s Message from China’s Labor Community

 

劳工六人图

Click to enlarge.


Dear fellow workers, compatriots, and friends from around the world: Happy New Year!

Toward the end of 2015, the labor community in China experienced an unprecedented attack. A group of activists who have dedicated years to defending the rights and interests of workers were detained, monitored and interrogated by the police. It could have been a moment for fear and paranoia to set in. But those in the labor community and other walks of life responded quickly by drafting a petition to the Communist Party Central Committee, National People’s Congress, and State Council. The petition described in no uncertain terms the severe and widespread violations of workers’ rights and interests over the last few decades, and the inevitable emergence of independent labor NGOs and worker centers and their valuable contribution to the protection of labor rights and social justice, and demanded the release of the detained activists. In less than two weeks, over 490 people added their names to this petition, and over 60 Chinese lawyers joined a legal aid team. This response was followed by petitions, appeals, and demonstrations by over 200 organizations and thousands of individuals from the international labor and academic community in over 40 countries condemning the crackdown and expressing support for the arrested labor activists.

Their calls, however, fell on the deaf ears of the Chinese authorities. The detained activists have to this day still not been allowed to meet with their lawyers. In addition, the Communist Party’s propaganda apparatus—the Xinhua News Agency, People’s Daily and China Central Television (CCTV)—launched a smear campaign against these activists, in particular Zeng Feiyang (曾飞洋), essentially sentencing them without a trial in the court of public opinion. Feiyang’s wife and child have been intimidated, and Zhu Xiaomei (朱小梅) has been separated from her baby daughter, whom she was breastfeeding when she was detained. The families of the other detained activists—He Xiaobo (何晓波), Meng Han (孟晗), Peng Jiayong (彭家勇), Deng Xiaoming (邓小明)—are all sick with fear, and the whereabouts of another former worker-turned-collective bargaining specialist, Chen Huihai (陈辉海), is still unclear. Their treatment reflects a cowardly approach to the rule of law, and the criminal proceedings are rife with legal and procedural unfairness.

Fellow workers, compatriots, and friends: If the rights and interests of workers who make up the large majority of China’s population cannot be protected, if workers are increasingly deprived of their economic, political, cultural, and social rights, if the confrontations between officials and citizens, workers and employers, rich and poor, continues to worsen, then what are the prospects for everyone to live in a free, equal, fair, democratic, law-based society where “socialism is the core value”? It is doubtful that even our most basic survival and security can be assured in such a society!

Workers on strike at Lide Shoe Factory in April, 2015, in Guangdong.

Workers on strike at Lide Shoe Factory in April, 2015, in Guangdong.

It follows then that defending and fighting for workers’ rights and interests is not only essential for workers, but also to the stability, security, fairness, and well-being of society as a whole. Labor rights activism is not a crime! Labor rights organizations have not committed any crime! Labor rights activists have not committed any crime! Not only are they are not guilty of any crime, they have also made great contributions to our society, state, and nation. They are the underlying force behind a labor movement that has emerged in waves since 2010. They are why people from all walks of society are increasingly paying attention to, and supporting, the labor movement.

China’s 30 years of rapid economic growth is already in its last gasps. Now, demographics are changing, reducing the labor force, and the environment is severely damaged. At the same time, social contradictions and historical debt hidden by growth are surfacing one after the other. Government, businesses, and workers face the dual burden of an economic recession and social instability, and workers bear the greatest share: in times of economic growth they gain the least, and in downturns they inevitably lose the most. Not only are they the first to lose their jobs and fall into poverty, but as soon as they protest they are repressed by the government’s stability maintenance apparatus.

How can it be that the working class is fated to ceaselessly bear all the costs through economic growth as well as recession? Why should the powerful reap the profits when the economy grows and flee in times of recession? In early 2015, the labor community made a proposition to the government known as “the New Deal for Workers,” suggesting reforms to the system of wealth distribution, and universal social insurance coverage. It could be a way to boost domestic consumption, but this requires the government and businesses to give a bigger piece of the pie to labor and society. Similar policies helped the United States make it through the Depression of the 1930s, but do Chinese officials have that kind of heart and will?

Fellow workers, compatriots, and friends, it’s true that we wait on the government to appraise the situation and put forward the correct policy, but we also know that freedom, equality, justice, safety and happiness are things that we cannot wait for—they can only be obtained by fighting for them. We may have to make sacrifices if we choose to fight, but we will gain nothing without fighting for it.

In this new year, labor activism may face an even grimmer situation. But we are convinced that the labor movement will keep advancing. The rights to organize, bargain collectively, and to strike, and the economic, political, cultural, and social rights of workers, will all be achieved step by step.

“Strong grows the grass on plains made rich with blood, in winter-frozen earth spring starts to quicken.”[1] Let this couplet be the labor community’s New Year Greetings that also set our outlook for 2016.

January 1, 2016

[1] Lu Xun, “Strong grows the grass,” translated by W. F. Jenner. (鲁迅《无题·血沃中原肥劲草》).

———-

Related:

Chinese Authorities Orchestrate Surprise Raid of Labor NGOs in Guangdong, Arresting Leaders, Yaxue Cao, December 10, 2015.

Labour Activist Zhu Xiaomei speaking to workers,  2-minute Youtube video with English subtitles.

 
中文原文《寒凝大地发春华:中国劳工界2016年新年献辞》, translated by a volunteer.