Pearl River Delta Shoe And Hat Enterprises Should Respond To The New Labor Contract Law

One stone stirred up waves.

After HUAWEI's "resignation" incident, when the media flocked to search for second or third HUAWEI, we visited the areas where labor intensive enterprises such as Shenzhen, Dongguan and Guangzhou were relatively concentrated. We tried to use objective data and cases to trace the real impact of the labor contract law on the heavy sector of the manufacturing sector.

Behind the impetuous phenomenon is an obvious paradox. If there is a large number of labor disputes in some media, it will be a contradiction with the long term "labor shortage" in the Pearl River Delta region.

In fact, from the result of our visit, although there are many enterprises who are eager to evade the new law by using the last bus and the edge ball to avoid the new law, we can not arbitrarily make a final decision. After all, more enterprises are thinking of how to minimize the impact of the new law.

In December 2nd, the all China Federation of trade unions (FTU), in a notice, avoided the "labor law" and "labor contract law" in the form of illegal layoffs, requiring employees to resign, re signing labor contracts, or turning into labor contracts, and so on. In December 2nd, the all China Federation of trade unions made a clear statement that Huizhou should resolutely put an end to such actions.

Forcing employees to resign, returning years of service to zero, and then re signing labor contracts, so that the old employees turned into new employees.

On the eve of the entry into force of the labor contract law, a collective resign event similar to HUAWEI's risk of hitting the ball has occurred in the Pearl River Delta.

In November 20th, nearly 1000 employees gathered in front of the company in Huizhou Dayawan Huili daily products company, protesting the company's efforts to avoid signing the labor contract in order to avoid the labor contract law.

"We were informed that we signed the labor contract to the HR department after work, and there was also an agreement named" notice ".

Later, after listening to others, I knew that after signing the agreement, the seniority would be returned to zero.

Xiao Zhang, an employee of Huizhou Dayawan Huili daily products Co., recalls.

Before that, Xiao Zhang, who did not care much about news at ordinary times, had no idea that there existed the labor contract law.

It's the first time for her to take part in such a large-scale activist action, and is lucky enough to succeed.

Due to the intervention of the local labor department, the notice "terminating the original labor contract" which was originally signed by Huili company is cancelled, and the labor contract will be renewed with all employees in accordance with the laws and regulations, and the original welfare benefits and length of service will be retained.

This is only one of the recent events in the Pearl River Delta region that allows employees to re sign labor contracts.

In October, Dongguan Tangxia yding Hardware Sporting goods factory forced employees to sign a new contract. Over 130 employees with more than 10 years of service were forced to leave because they were unwilling to sign new contracts.

In November 8th, the Guangdong Sheng Jie fire enterprise group in Shawan Town, Panyu District, implemented a human resource reform plan of "collective separation", which made more than 200 employees "fill out the separation agreement first and fill in the application form again", which triggered the controversy among the workers within the enterprise group.

All this stems from the stipulation of the labor contract law on the non fixed term labor contract.

Employees who have worked in a unit for ten years or have two consecutive fixed-term labor contracts will have the right to have no fixed term labor contracts automatically.

At the same time, unless serious violations are committed, employees have the right to freedom of movement.

Zhai Yujuan, an associate professor of law school at Shenzhen University and an expert in labor law, analyzed that enterprises were forced to re sign their labor contracts. They were basically afraid of unfixed term labor contracts.

In law, the dissolution of labor relations requires a series of complicated procedures, which can be counted without a single page agreement.

In fact, HUAWEI's employees did not leave HUAWEI, and their seniority would not be returned to zero.

Although HUAWEI employees agree to the company's practice through written agreement, the law is bigger than the agreement, and the agreement can not resist the law.

Form two shut down factories or pformation typical enterprises: Dongguan Chang Deng Footwear Co., Ltd. comment: the Pearl River Delta, which started from "three to one supplement", has never been out of the embarrassment of "high-tech products and low technology manufacturing".

In the past, enterprises had been relying on lowering wages, reducing labor conditions and welfare investment to achieve low cost and low level profits.

In October 24th, the employees of Dongguan Chang Deng Shoes Co., Ltd. were told that the factories would stop their shoes production and processing from December 20th because of the pformation of enterprises, so they would unilaterally terminate their contracts with employees and prepare a 40 million yuan economic compensation for their employees.

According to the staff of the factory, in September, an old employee of the Department came to the labor bureau because of labor disputes. Due to the fact that there will be more disputes after the implementation of the new law next year, the profits of the shoe industry will be low.

"At present, Dongguan's small and medium-sized enterprises are in a difficult situation and are in a very poor position.

It is estimated that more than 1/3 factories will be closed in a year. "

Liu Dabang, managing director of Hongkong SME Association and Dongguan Phnom Penh Metal Industry Co., Ltd., told reporters that it is estimated that the next two or three months will be the peak of the closure plant.

Because the boss of another company continued to work hard with him. Three of the members of the Hongkong Federation of small and medium enterprises (SMEs) were considering closing factories because they could not manage.

Some enterprises say that they will persist for another two or three months. If they really can't manage, they will have to close their factories.

In addition, some enterprises are actively seeking pformation.

"Under the influence of state policies such as the reduction or cancellation of export rebates, the appreciation of the renminbi, and the rising prices of raw materials such as pigment, oil, diesel, and the minimum wage, the profits of manufacturing enterprises in the Pearl River Delta have dropped."

Liu Dabang pointed out that "the implementation of the new labor law has a great impact on Hong Kong funded enterprises in Dongguan, such as the need for social security to be traced back to several years ago.

In the past, when the regulations were not perfect, the government's request is that you only need to help 50% or 60% of the employees in the factory to do social insurance, but when the new law is implemented, it will become one hundred percent. Social insurance, work-related injury insurance, old-age insurance, medical insurance and so on have to be made up. Even female employees have to help them to buy insurance, which undoubtedly adds a heavy burden to SMEs.

Like Liu Dabang's own company, the current profit is 3% to 5%, but after the implementation of the new law in 2008, it is estimated that the profits will be reduced by 1%.

Now, the "shortage of migrant workers" is also a major problem facing the development of enterprises.

In order to attract employees to work in factories, enterprises are doing everything they can. Some even pay for their employees to go home and gather friends and relatives to work in Dongguan.

"But now the labor force is different from the previous nature. Most of them are born after 80, and do not have to support their families. The money they earn is usually for their own use.

So when they quit their jobs, they said they would go away without much thought.

This makes it easy for enterprises to fall into the trap of economic compensation.

Form three employees turn to typical dispatched workers: Global cap products Co., Ltd. commented: instead of labor dispatching, the company's personnel mechanism is more flexible and greatly reduces the cost of management, but this will make employees feel no sense of belonging, which will, to a certain extent, cause the responsibility of the staff to be not strong, lack of long-term plans and professionalism.

In November 22nd, Guangzhou Technology Development Zone global cap Co. Ltd. was rejected by nearly 100 employees for requiring employees to sign new service contracts.

"We are obviously the employees of this company. After signing the new contract, we became the" labor force of the Guangzhou branch of the Qingyuan branch of the creative intelligence human resources service Co., Ltd. (hereinafter referred to as "Guangzhou Zhi Zhi").

A staff member who was forced to sign a contract told reporters that if he did not agree to become a laborer, the company would be fired according to the normal departure procedure.

Guangzhou's wisdom is a labor dispatching company.

The pfer to the labor dispatch workers means that these employees are working with Guangzhou to create a labor relationship. The global cap only needs to pay the wages, insurance costs and management fees to the dispatched companies, and the compensation for work age will disappear.

"Our company began to implement the labor restructuring plan very early, and turned the company's employees into labor workers, in order to reduce the management cost of the enterprises.

In the off-season, some employees can be cut off, or Guangzhou can create some of the staff to work in other companies that need manpower.

The head of the global caps explained.

Because the employees of the global caps did not voluntarily sign the labor contracts, the global caps chose employees to voluntarily choose the employment subject under the negotiation of the local labor and social security department.

It is understood that only 8 employees chose to sign a labor contract with the creative company as a laborer dispatched to the global hats.

Form four: actively respond to typical enterprises: Dongguan Phnom Penh Metal Industry Co., Ltd. commented: for most enterprises, they are more aware of the importance of rainy day.

"We must follow the requirements of the new law."

Liu Dabang, managing director of Dongguan Phnom Penh Metal Industry Co., Ltd. stressed that although the new law has brought some impact to the company, we are still developing it because we are actively developing new products.

"I understand the relevant provisions of the new labor law to our lawyers counselors, and will design a new HR operation system, but abide by the law is a must."

In addition to helping employees reorganize social security, medical insurance, pension insurance, etc., in order to retain staff and reduce employee turnover as much as possible, Liu Dabang has both substance and spirit.

For example, the task of a certain department is excellent, and the whole department can get extra bonuses. The company has set up a special department to understand the mentality of the staff and help them solve problems in their life. The company holds a birthday party every two months, and plays chess, basketball matches and so on.

"We hope to enhance employees' sense of belonging by increasing similar activities."

Liu Dabang said the company will also increase welfare to retain talented core personnel.

Wang Yilong, vice president of Igor Electric Manufacturing Co., Ltd., Foshan, Guangdong, said, "the company attaches great importance to the new law, and the human resources department is learning and understanding, but there is no specific plan yet."

For Wang Yilong, the new law stipulates that the terms of compensation that employers do not participate in social security for employees is a great influence on the company.

Because their company is facing a big problem, the proportion of employees unwilling to do social security is as high as 50% to 60%.

"This phenomenon is very common in Guangdong."

He pointed out that it is unlikely that workers should take part of their income to participate in insurance because of the frequent flow of staff.

"But at present, the company's human resources department will jointly carry out publicity and education for employees, and strengthen their enthusiasm for insurance. In addition, the company mainly uses various methods to supervise them, sometimes including forcing such short-term practices."

Yu Xiang, director of human resources at Dongguan, a production base in Dongguan, Guangdong, said: "we have done a lot of work to learn this law, we have done detailed training in the human capital system, but we have not yet trained the whole company system."

He also said that when the law had not yet been introduced in the beginning of this year, he set up a management center to take charge of the system construction of the group.

What worries him most is the problem of job hopping.

To this end, he asked the heads of departments to grasp the situation of their subordinates. "We should pay special attention to the development trend of the core personnel, so that excellent employees can stay behind. We should care for the employees who have problems in their work and track their work conditions."

But he also found that "a lot of things are vague, not very accurate, and we are waiting for the rules to come out."

In the form of five, the factory will be moved to the typical enterprises in lower cost areas: OLYMPUS and Yuncheng plastic and hardware products factory in Shenzhen, Longgang: as factory relocation is due to objective circumstances, where the labor site is changed, according to the existing labor law, the original labor relations will be automatically released after the employee's consent and certain financial compensation are obtained.

Japan's digital camera manufacturer OLYMPUS ranked fourth in the global digital camera market.