The temperature has been rising for the foreign food chains that have come under scrutiny for the - according to an investigation - breaking of the labor law.
China Hearsay has a "seen it, done it" approach of the case and paints the standard procedure for this kind of cases. I have to argue against it, since this does not look like a standard operation, this is real politics and the managers in charge of this crisis have reason enough to feel the beginning of a panic.
First, for Chinese standards this looks like a pretty well organized action. It was very clear after the trade union started to organize Wal-Mart and Foxconn against the will of the companies, they could not just go back to their offices and continue drinking tea. This looks like the plan for the moment and if I would be working at KFC, Pizzahut or McDonalds I would take this very seriously. This does not go away by itself.
Second, it is part of a policy shift on several levels. Until a few years ago, almost anything you did to encourage economic growth was ok and nobody really bothered about the negative side-effects. The different governmental institutions (and for the time being the trade union ACFTU is still one of them) are building a case, both for their bosses upstairs, but also for the Chinese citizens.
So, what is to be done? Raising the salaries over the minimum wages, paying the wrongly not paid wages and deeply, deeply apologize for mistakes being made. And set up a trade union of course. Again: this is not going over by itself.
Next, this is going to be a successful action on the part of the government and the trade unions. There is no ways this can be writing up by the state media without being a resounding success. That will cost some money, but will have consequences for other foreign companies too who will be next. In the long run, ok the very long run, it will also have consequences for the Chinese companies, since the Chinese workers know they will get support when they ask for their legal rights.
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