A study of the impacts of labor law on the stakeholders in Guangdong province

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A study of the impacts of labor law on the stakeholders in Guangdong province


Author: Pang, Hiu Kwan
Title: A study of the impacts of labor law on the stakeholders in Guangdong province
Degree: M.Sc.
Year: 2012
Subject: Labor laws and legislation -- China.
Labor laws and legislation -- China -- Guangdong Sheng.
Industrial relations -- China -- Guangdong Sheng.
Labor -- China -- Guangdong Sheng.
Hong Kong Polytechnic University -- Dissertations
Department: Graduate School of Business
Pages: 153 leaves ; 30 cm.
Language: English
InnoPac Record: http://library.polyu.edu.hk/record=b2531567
URI: http://theses.lib.polyu.edu.hk/handle/200/6767
Abstract: Labor law has a long history in market-oriented economies going back into the early 19th century. Most of the western developed countries such as United States, United Kingdom, and European Union all have well established Labor Law system. On the contrary, China, transforming from socialist economy to nowadays market-oriented economy, did not have a well organized labor law until 2003. Since then, a lot of scholars have developed interests in exploring the advantages and disadvantages of a reform of labor law in China. But little research has taken a holistic approach on the impact of labor law on stakeholders' (government, corporations, and employees) incentives. This paper examines the impacts and effectiveness of the development of labor law on the stakeholders in one of the representative labor-intensive provinces in China-Guangdong. Unlike many other provinces which relax the enforcement of Labor Law to attract investments, Guangdong government treats the establishment of Labor Law as one of the opportunities to upgrade its economy to high value added industrial structure. Because of the severe shortage of labor and policy of transforming the industry structure from low-value to high-value added industry, the enforcement of Labor Law did not threaten the stability of Guangdong Province. Although Labor Law leads some of the large corporations to relocate their factories to inland China or to increase investment in technology to offset the potential increase in labor costs, the impacts of establishment of Labor Law was much less than on small and medium enterprises which have less resources they chose to violate the Labor Law or simply go bankruptcy. Labor Law also increased the entry barrier to start up new companies. Labor Law doesn't seem to exert much impact on the migrant workers because although the implementation of Labor Law successfully raised the workers' salary, the living standard of Guangdong Province was still high compare to other provinces. Furthermore, as some companies treat local and migrant workers differently and some firms even did not follow the Labor Law, the impacts of Labor Law on migrant workers were not significant. Nevertheless, through our case study on a representative company in Guangdong, i.e. Foxconn, we found that sometimes even when the corporation follows the law, migrant workers did not get the same social benefits as local workers.

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