Defusion of Labor Disputes in China: Collective Negotiations, Mediation, Arbitration, and the Courts

Abstract

This paper addresses the uses of the arbitration and judicial processes in the resolution of individual and collective labor rights arising under contract or statute. These labor rights are in contrast to labor interests of yet-unsecured rights, such as wage increases. An interesting phenomenon occurred wherein the rapid rise in the arbitration cases following the 2008 Mediation and Arbitration Law has slowed whereas the number of court cases rose and then leveled off, though continuing at that higher level. Analysis is made whether this increase from administrative relief to judicial relief was a temporary aberration and whether judicial appeals may undermine the arbitration process. Also addressed is whether existing legislation would be improved by letting arbitration be the final remedy, absent illegalities. This paper first provides a larger context of “labor disputes” and how they “diffuse” in different ways, some illegal and more volatile than others, including, strikes (plant sit-ins), collective bargaining, etc. Secondly, the devices of mediation and arbitration are briefly introduced as methods of regulating and “defusing” labor rights disputes. The next section explores the actual uses of arbitration and the courts in the resolution of labor disputes and notes the continued use of the courts. Analysis is made whether the government’s new 2010 and 2011 policies of further promoting consultation, mediation, and arbitration of labor disputes will have an effect on requests for judicial review which fluctuated upwardly since 2008 or whether the policies need further adjustment to accord more finality to arbitration decisions.

Keywords: China labor arbitration, Chinese courts

JEL Classification: K