China: Land of Opportunity And Challenge

China's Developing Regulatory Climate

By Adrienne Fox

HR Magazine, September 2007 Here are a couple of developments in China that HR professionals should keep their eyes on:

Employment contract law. China enacted a labor law in June 2007 aimed at protecting workers' rights amid complaints about unpaid wages and other abuses. After a proposed law was introduced in 2005, Chinese government officials asked representatives of foreign companies for suggestions about the law for the first time, a move hailed by the American Chamber of Commerce in China, the U.S.-China Business Council and other foreign business groups. The legislation, effective Jan. 1, 2008, sets standards for labor contracts, use of temporary workers, layoffs and other employment conditions in a rapidly changing economy, according to a report issued by China's legislature.

Labor unions. According to the U.S.-China Business Council, in 2006, the All-China Federation of Trade Unions (ACFTU) employed "new, more-aggressive tactics in its campaign to raise unionization rates in foreign-owned entities." The legal bases for trade unions in China-the [People's Republic of China] PRC Trade Union Law and Labor Law-remain unchanged, but ACFTU has directly targeted some larger foreign companies and employers for unionization, especially in Guangdong. The Council goes on to note that U.S. companies tend to have higher standards on labor, environmental protection, and health and safety than required locally.

Click here for more information on these and other labor law developments in China.

Adrienne Fox, a freelance writer and editor in Alexandria, Va., is a contributing editor and former managing editor of HR Magazine

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