Under pressure from the Chinese federation of labor unions, the
world's biggest retailer, Wal-Mart Stores Inc., said on Tuesday it
would permit branches union in its Chinese stores if employees
The 123 million-member All-China Federation of Trade Unions
(ACFTU) threatened last month to sue Wal-Mart and other companies
based outside China if they refused to set up unions in their China
"Should associates request formation of a union, Wal-Mart China
would respect their wishes and honor its obligation under China's
Trade Union Law," said the company in a statement faxed to news
media. Wal-Mart, based in Bentonville, Arkansas, refers to its
employees as associates. "Currently, there are no unions in
Wal-Mart China because associates have not requested that one be
formed," the statement said.
The ACFTU has not yet provided an official response to
The ACFTU is the sole body permitted to organize workers in
China and it has been working to expand membership. It had about
131 million members nationwide in 2003.
"Wal-Mart is currently in full compliance with China's Trade
Union Law, which states that establishing a union is a voluntary
action of the associates," the statement said.
In an earlier statement, Wal-Mart said that its China operations
follow the company's global no-union policy and that "Companies in
China are not required to have trade unions, and therefore this
position is fully consistent with the law," according to a China
Radio International report on November 11.
Analysts admit that Chinese laws regarding unions have loopholes
of which many private companies take advantage. The Trade Union Law
states that companies should set up union branches and that
employees can voluntarily join them, but it does not require the
companies to push forward union branches. It also indicates that
all employees have the right to organize unions, and no company can
turn down employees' requests for their establishment.
However, surveys conducted by the ACFTU indicate that awareness
of unions and how they may benefit workers is generally low.
Federation officials have said that many workers hesitate to
express a desire to set up or join a trade union because of
concerns over job security.
In a statement of policy on its website, Wal-Mart indicates that
although it seeks to maintain an environment of open communication
with its associates, it does not believe there is a need for
third-party representation. The company is known for actively
discouraging unionization: earlier this year an outlet in Quebec
became the chain's only unionized store in North America.
Wal-Mart has more than 5,000 outlets in 10 countries employing
more than 1.3 million people. It opened its 40th outlet in China
early this month, and Bloomberg News has reported that it plans to
open as many as 15 new stores in 2005, focusing on smaller
provincial cities. Nationwide it employs about 20,000 people.
The company sourced $15 billion worth of products in China last
year, or 80 percent of its US imports. If it were a country, it
would be China's eighth largest trading partner.
(China Daily, China.org.cn November 24, 2004)