[Excerpt] On October 30, 2009, an official report on the status of enforcement of the Labor Union Law was submitted to the Standing Committee of the National People’s Congress (“NPC”). The report outlined progress and continuing problems in protecting employee and labor union rights. Reflecting the importance of this report, the initial meeting to launch work on the report was attended by Politburo and top-level NPC Standing Committee members. A similar nationwide inspection was launched in 2004 and resulted in a sustained unionization campaign against foreign-invested enterprises.
The following were some specific action points highlighted in the report:
• The report recommended that new national legislation be passed that would encourage and regulate the establishment of employee representative councils (“ERC”) in private companies. Current national legislation related to ERCs focuses on state-owned enterprises.
• According to the report, employment disputes doubled from 2007 to 2008, and through the middle of 2009, the number of employment disputes is similar to the number seen in 2008. In order to address this issue, the report suggested that tri-lateral mediation mechanisms, involving the government, labor unions, and employer associations, be encouraged as a means of resolving issues before they become contentious disputes.
• The report also noted that many companies are using labor dispatch arrangements for long-term core positions even though the Employment Contract Law restricts the use of such arrangements to only temporary, substitute, and auxiliary positions. The report recommended that the State Council pass new legislation regulating the use of labor dispatch arrangements.