China: Foreign companies must have unions

China: The world's leading foreign companies operating in China must unionise by September 30 or face penalties says the country's official trade union body, the All China Federation of Trade Unions (ACFTU).

The ACFTU predicts that by the end of the month, 80 per cent of the top 500 global corporations operating in China will have unions. The 200-million strong union body announced the organising directive in June. At that time, less than half of the so-called "Fortune 500" subsidiaries in China had recognised trade unions, compared with more than 73 per cent for all foreign-owned firms in China. The Fortune 500 is a list published annually by Fortune magazine that ranks the top 500 US corporations according to their gross revenue.

Most recently IBM and Volvo announced that they would allow workers to organise in their Chinese manufacturing operations. The two join other multinationals such as Wal-Mart, Sony, Canon, FedEx, Intel, and Toyota, many of whom actively oppose and undermine union organising at their operations in other parts of the world.

Some see this as another positive step the government has taken to improve conditions for workers. In January 2008 a new labour law addressing the needs of contract workers went into effect limiting the use of temporary labourers and forcing employers to put all work contracts in writing. Sceptics however are concerned that while workers have increasing rights on paper, enforcement of these rights and true representation of workers' interests may still be years away.

Unions outside of the ACFTU are illegal and workers who have attempted to organise independent unions have often paid dearly facing two to three year sentences at forced labour camps or heavy jail time, including life imprisonment.

While the real gains for workers remains to be seen, one thing is clear- by 2009, China's labour movement will have grown enormously.