Deterioration of situation at Ole Wolff Yantai plant, China

Despite a hard fought breakthrough in November 2008, involving the company paying compensation to dismissed workers, many of the demands of the workplace union have not yet been met. The OWYWU is continuing its struggle. Concrete demands include acknowledgement of the workplace union as an equal interlocutor, adequate compensation and discontinuation of the ongoing dismissals.

GoodElectronics has been following the ongoing labour dispute at a subsidiary of the Danish electronics company Ole Wolff Electronics A/S, the Yantai plant at the Chinese North Eastern coast. The conflict involves the Ole Wolff Yantai Workplace Union (OWYWU) that was founded in October 2006, the local management of the plant as well as the Danish ownership.

At the core, the conflict is about the right of the workers to get organised and to participate as an equal interlocutor with the management on labour matters, such as contracts, wages and holidays. At the moment, the greatest fear of the OWYWU is that the company has decided to close down the plant and that all workers will be fired.

The significance of the case lies among others things in the fact that the labour union is an initiative by rank and file workers, The All China Federation of Trade Unions (ACFTU), has been involved, but only to a limited extent. Of further importance is the international support to the workplace union extended by the United Federation of Danish 3F. Court complaints were filed by the work place union – resulting in court orders against the company.

GoodElectronics is supportive of the workplace union’s demands. Fair Trade Center Sweden is taking the lead in this , on behalf of GoodElectronics.

Summary

The Yantai plant of Ole Wolff Electronics produces electronics components including speakers, and is a supplier of the Danish multinational Danfoss. Other buyers identified by the OWYWU are Sony Ericsson and Foxconn.

Since February 2006, right after production had started, problems between the management and the workforce arose. Refusal to regularise workers employment through contracts, enforced wage cuts, unlawful dismissals, refusal to allow labour union activities, neglecting court orders – these are some of the accusations that have been levelled by the OWYWU against the company over the past two years.

Despite a hard fought breakthrough in November 2008, involving the company paying compensation to dismissed workers, many of the demands of the OWYWU have not yet been met. The OWYWU is continuing its struggle. Concrete demands include acknowledgement of the workplace union as an equal interlocutor, adequate compensation and discontinuation of the ongoing dismissals.

Background

Ole Wolff (Yantai) Electronics Co. Ltd was founded in October 2005 and started production in January 2006. In February 2006, the company enforced wage cuts and refused to sign labour contracts with the workers, despite previous promises. The newly engaged workers protested and sought advise at the ACFTU Fushan district office.

Thereupon, in April 2006, 68 workers were sacked, without formal reasons given. The majority of the women concerned challenged this decision and demanded reinstatement. Seven women succeeded in their goal. These incidents motivated the workers to set up a union, for which permission was asked at the plant’s management as well as with the ACFTU Fushan district office. The company flatly refused.

Then, in September 2006, another conflict arose over holidays. Women workers protested the decision of the company to give a mere three days off, in stead of the week to which the workers were entitled. In response, the company dismissed one of the workers. On October 8, 2006, fellow workers expressed their solidarity by staging a strike, with the explicit demand to be allowed to set up a union. After a 13-day strike, and with the involvement of the ACFTU, the company gave in and the Ole Wolff Yantai Workplace Union was formed.

On a national level, the All China Federation of Trade Unions has been limitedly supportive of the OWYWU. Where the national office has been helpful, the local Fushan district office has played a less constructive role. The main reason seems to be the fact that workplace unions are a very rare phenomenon in China.

Despite a series of orders issued by local courts on two levels ordering the company to reinstate six dismissed workers, the management of the company refused to give in to the demands of the workers. For a long time, the management continued to rally aggressively against the union as well as against the individual union members.

From October 2006 onwards, the situation remained tense and unchanged for months. The involvement of the United Federation of Danish Workers 3F did make impact, however. 3F put pressure on the company as well as on buyer Danfoss.

Consequently, after two years of struggle, the OWYWU won a partial victory against its employer. Early November 2008, the company agreed to compensate six dismissed workers with the equivalence of two months of wage. The acting chairperson of the workplace union was offered a compensation package as well, for being unlawfully dismissed.

Union demands

Although the November 2008 agreement of the management to pay compensation was celebrated as a partial victory, the workers insist this does not suffice. The Ole Wolff Yantai Workplace Union (OWYWU) is calling upon the management to:

respect freedom of association as stipulated by the Chinese Labour Law as well as by relevant ILO conventions;
respect court orders and the directives of the ACFTU’s offices;
reinstate all dismissed workers who wish to be reinstated;
fully compensate all dismissed workers – beyond the token compensation of two months wage, in accordance to the period of forced unemployment;
release the employment files of the dismissed workers – without which workers are not able to apply for other jobs would they wish so;
discontinue the ongoing dismissal of workers – or, if this is not feasible, to ensure that a decent exit strategy is designed and implemented, which carries the approval of the workers. Such an exit strategy should include giving due notice, providing full compensation according to the relevant legal provisions and assistance for the workers to find alternative employment.

OWYWU is calling upon suppliers and customers of Ole Wolff (Yantai) Ltd. to

use their influence as buyers to ensure Ole Wolff (Yantai) is to comply with the demands formulated above.

Since at least one of the identified buyers, Sony, is a member of the Electronic Industry Citizenship Coalition (EICC), OWYWU is calling upon the EICC, to address their member companies involved to use their influence as buyers to ensure Ole Wolff (Yantai) is to comply with the demands formulated above.

Company Profile

According to the company website, Ole Wolff Elektronik A/S was founded by Mr. Ole Wolff in 1983 in Denmark, where it is still headquartered. Nowadays, the company has several offices and design centres in Denmark and Korea, as well as manufacturing sites in China. Other sources suggest the company also has facilities in Denmark, the USA, South Korea, Hong Kong, Finland, Germany and Great Britain, mainly sales offices. The company is now focused on two product divisions - acoustics and magnetic components. At its peak, the Yantai plant employed 250 workers, of which now around 30 workers are left.

Union Profile

The Ole Wolff work Place Union was founded on October 20, 2006, within 10 months after Ole Wolff (Yantain) started producing. Initially the union had 116 members. At the time of writing, membership has decreased dramatically, due to the ongoing purposeful dismissals by the management. Since its foundation, the union subsequently lost its vice chair-and chair persons.

Sources of information

Information provided by Globalization Monitor, including a chronology of events and an abridged translation of the court verdict.

Articles by Peter Rasmussen (3F) http://forsiden.3f.dk/article/20080821/INTERNATIONALT/486430696

The blog kept by OWYWU (in Chinese)

An updated compilation of information by business-humanrights.org, including responses by Ole Wolff on recent accusations.

Contact data of involved organisations

Ole Wolff Yantai Workplace Union at Globalization Monitor

Contact person: Au Loong Yu

email: [email protected]

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