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Comment: Better institutions needed to protect labourers
By Guo Zi (China Daily)
Updated: 2004-12-04 00:29

With the year drawing to a close, whether migrant workers can get due payment on time has once again attracted wide attention.

The Ministry of Labour and Social Security launched on December 1 a two-month national inspection campaign on the defaulting of migrant workers' wages. According to the campaign, employers who intentionally embezzle migrant workers' wages will be punished. The campaign is designed to raise migrant workers' law awareness so they know how to protect their rights from being infringed upon. Most importantly, it aims to help more migrant workers get their deserved payments before they head home for the Lunar New Year that falls on February 9.

According to statistics from the All-China Federation of Trade Unions, up to 100 billion yuan (US$12.1 billion) in unpaid wages was owed to migrant labourers in China by the end of November. This has caused severe conflict between migrant workers and their bosses.

This serious social ailment is yet to be resolved.

Top-level government leaders, such as Premier Wen Jiabao, have shown great concern for the issue of helping migrant workers receive back pay. Some systems and laws are being designed and improved to protect their rights and interests.

Defaulting on payment is the most prominent problem facing China's migrant workers. The phenomenon is especially outstanding in the construction industry -- where over 70 per cent of such defaults have happened. Migrant workers are always hired by "Bao gong tou" or individual contractors, to work on construction projects. In many cases, "Bao gong tou" themselves don't get paid by the project developers or subcontractors.

In October, the Supreme People's Court issued a judicial interpretation, ruling that, besides project developers and construction companies, subcontractors can be held responsible in cases where "Bao gong tou" fail to get project payments.

To take effect from January 1, 2005, the decree is expected to help avoid a vicious chain of payment default in the industry.

The long-awaited Supervisory Regulation on Labour Protection issued by the State Council also took effect this month.

One of its most eye-catching articles regulates that, if employers default on employees' payments, labour protection supervisory departments will demand them to pay the wages before a required deadline or the employers will have to pay an extra compensation worth 50 per cent of the unpaid money.

This is the first document regulating specific compensation to employees.

Previously, employers who failed to pay labourers on time only received administrative and financial punishments. Like the draft Construction Law , it suggests that construction companies that deliberately default on labourers' payments be fined as much as 300,000 yuan (US$36,275). But such regulations only focused on punishing the illegal activities of enterprises and the fines usually went to the treasury. Labourers, the true victims of defaulted payments, got almost no compensation.

When formulating such regulations, assistance to labourers who suffer from the default should be the first thing considered.

The Labour Law passed in 1994 stipulates that compensation can be given if labourers cannot get their due payment. But such vague terminology may also be interpreted that labourers can get any interest on the defaulted payments and the cost recovering the payments.

In this aspect, the latest supervisory regulation marks a step forward, given its explicit language. Such a stipulation will also encourage labourers to protect their rights through legal means.

However, administrative and judicial approaches are needed to meet this end.

Labour departments have been entitled to issue notices of punishment to enterprises that fail to pay labourers, but in most case they can do nothing if enterprises fail to respond.

In its local supervisory regulation on labour protection, Central China's Jiangxi Province has ruled that its labour departments can distrain properties of enterprises or contractors if they default on labourers' payments.

Such a practice may work. However, it is not that prudent nor in line with the Constitution. Only the courts should have the jurisdictional right to take forcible action against citizens' or enterprises' properties. Such a ruling by an administrative department is not proper.

Therefore it would be better for labourers and labour departments to turn to the courts if enterprises refuse to follow up on the punishment notices. The courts could then follow a relatively simple process: after investigating the facts, the court can distrain the properties of relevant enterprises and contractors to pay the defaulted wages. But of course, it should be the judicial departments right to decide the exact procedures.

In this sense, better institutional designs are vital to ensure the proper functioning of this supervisory regulation, which aims to protect labourers' rights and interests through labour departments' punishment of employers' illegal acts.

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