Elected trade union gives Wal-Mart unprecedented hassle

Laid-off Wal-Mart workers guard the closed store as people hired by Wal-Mart (front, in black) try to remove goods still in the store in Changde on March 22. Photo: Li Qian/GT

Encircled by a group of laid-off workers, Huang Xingguo, chairman of the labor union in their recently shut down Wal-Mart store, rallied his union members with a rousing speech about their ongoing battle with the international supermarket chain.

In order to boost morale, he introduced their legal consultant, Chang Kai, to the crowd. Chang, dean of the Institute of Labor Relations, Renmin University of China, briefed the crowd on the legal process they are engaged in, as the half circle of people, mostly women and some with small kids, watched hopefully and pressed the circle smaller and smaller.

"Your efforts to claim your rights have the potential to make a difference. You must strive for unity in order to win!" Chang told the crowd.

Most of them made 1,100 yuan ($176) a month at the Wal-Mart store in Changde, Hunan Province, but they lost their jobs on March 5 when the store announced it would close due to low turnover. Two weeks later, on March 19, the store was closed and started removing its stocks.

According to the compensation plan offered by the company, each of the 135 workers would have received a one-off payment based on their serving terms in the store. However, half of the workers have still been arriving at the store on time every day, refusing to accept the compensation plan, which they say was unilaterally made by the store owners and thus was illegitimate.

The labor union accuses the company of breaching China's Labor Law and the Trade Union Law by failing to inform the workers of the store closure one month in advance and failing to consult with the labor union regarding compensation for the workers.

Now the workers are trying to prevent products from being removed from the store unless their requirements are met. They erected a tent outside the store and took turns guarding the entrance 24/7. In the meantime, the labor union committee, led by Huang, is aggressively trying to bring Wal-Mart to the negotiation table through arbitration and legal means.

Independent labor union

In a structural reshuffle to get rid of less profitable stores, Wal-Mart has closed more than a dozen branches around China. It has previously used the same closing scheme as it did for the Changde branch without trouble.

This time, the campaign by the workers was led by their labor union, which is determined to rectify what they say is mishandling by the company, and is doing its utmost to maximize the compensation for the workers.

On April 22, the labor union delivered the arbitration application to the Changde Bureau of Arbitration for Labor and Personnel Disputes.

It was their second attempt to persuade the authorities to assist in resolving the labor dispute. Previously on March 24, the labor union demanded in its first arbitration application that Wal-Mart must withdraw its unilateral compensation scheme and sit down with the labor union to negotiate. It was rejected by the arbitration bureau, which cited the labor law as saying that only the employers or the employees are entitled to file a labor arbitration application. The labor union as an organization, even though it represents the workers' interests, could not initiate an arbitration application, according to the bureau.

However, the labor union and its legal consultants believe that the Labor Law did not forbid the labor union to represent the workers in the legal process to resolve such disputes.

This time, the labor union came back and filed two applications. One was in the name of five worker representatives, demanding Wal-Mart negotiate with the workers, the other requested that the arbitration authorities recognize the legitimate role of the labor union to represent the workers in the negotiations.

The arbitration bureau received their files and has five days to decide whether to open the case.

"The most conspicuous feature of this case is the role played by the labor union. Without it enthusiastically fighting for the workers' rights, it would have only been among the standard labor dispute cases in China," said Chang.

The only difference between the Changde store and other Wal-Mart branches, as Chang said, is that its labor union was elected by the workers.

Wal-Mart began establishing labor unions in its supermarkets in 2006, heeding the call of Chinese labor authorities, and has now covered all its stores. However, like the labor unions in many Chinese companies and institutions, the ones in Wal-Mart stores were usually appointed by executives and rarely defy the company's administration.