Wage Arrears Continue to Plague Chinese Migrant Workers, Experts Believe CCP the Root Cause

News AnalysisEvery year, Beijing reiterates its commitment to combat wage arrears affecting migrant workers, particularly around Labor Day (May 1). Despite these assurances, experts believe the persisting issue underscores deeper systemic challenges within the Chinese Communist Party (CCP) ’s governance.Rights Vs. StabilityThe recently released 2023 annual survey on migrant workers, the 16th such report since 2008 by the Chinese National Bureau of Statistics, paints a picture of a workforce of 297.53 million, with an average age of 43.1 years. Among them, individuals aged 50 and above make up 30.6 percent. Across six key industries, monthly earnings range from 3,965 yuan ($548) in household services to 5,488 yuan ($759) in construction.However, recent reports have not included data on wage arrears among migrant workers. In the 2016 report, wage arrears were last seen to have affected 2.37 million migrant workers, at an average amount of 11,433 yuan ($1,580).Right before Labor Day, the state mouthpiece, Xinhua, reported that Hebei authorities, aiming to prevent wage arrears at the source, have established 6,800+ migrant workers’ wage protection centers since last May. The centers were composed of major project leaders and contractors.Yet, the effectiveness of these centers is questioned by those directly impacted.Fu Ping (pseudonym), a seasoned migrant worker from Hubei Province, expressed his skepticism in the Chinese-language edition of The Epoch Times, recounting his experience in Baoding, Hebei, where, despite promises, his outstanding wages remained unpaid.Related StoriesMr. Fu said that the construction company at Baoding still owed him 25,000 yuan ($3,455.71), even though he was told it would be resolved by the end of April.“That company is quite well-known, but it’s still difficult to get paid. It claims the wage protection center can help, but I don’t trust it,” he said.“The injustice in this society is not a trivial matter,” he said.Mr. Wu (pseudonym), a Chinese lawyer, told The Epoch Times that the wage protection center is a formality. He believes the problem is severe, and the propaganda, although ineffective, helped to deceive people from the top down.Activist Lai Jianping, formerly a lawyer in Beijing, told The Epoch Times that the Hebei government is trying to create a false image of caring and diligent authorities.People would have taken to the streets directly, but with the so-called protection centers, “People go there to negotiate, and the centers would keep these people under control. So it serves the purpose of maintaining stability,” he said.According to data from the China Labour Bulletin, headquartered in Hong Kong, as of May 8, there have been 1,725 workers’ protest events in China this year.‘Wage Arrears Lie with The CCP’Attributing the root cause of wage arrears to the CCP, Mr. Fu alleged the prevalence of corruption within the construction sector. Projects often proceed without adequate budgeting, relying instead on kickbacks and favors.He said arrears have been severe for migrant workers involved in public projects. Mr. Fu said, “Ordinary developers wouldn’t dare to operate in such a manner; they only dare to do so with governmental support.”“The price of illegal activities is low for the government and the authorities. It’s easy to withhold wages and bully the most vulnerable migrant workers. This is the most unethical aspect of this society,” said Mr. Wu.Mr. Lai said that the authorities’ vigorous infrastructure policy forced entities such as construction companies or project managers to proceed with projects knowing that funds were not in place, leading to layers of arrears and leaving migrant workers with nothing. “Ultimately, government action prevents entities from contracting projects under normal conditions,” he said.Layers of contracting involve many intermediaries, and each link is prone to corruption. He said, “Virtually every construction project in China involves bribery. The contracting entities must bribe the government to secure the project.“The government department overseeing the project holds considerable power, and corruption is present at every stage.”Mr. Lai listed several situations that he believes led to the withholding of migrant workers’ wages:“In some cases, the entities failed to collect the expenditures because the properties weren’t sold or projects were not completed.“Another scenario is insufficient government budgeting. Then, there’s embezzlement and corruption at various stages of the projects. In any case, the migrant workers always take the brunt.”According to Mr. Lai, corruption occurs when “construction company executives may demand contributions or bribes from subcontractors. If they fail to comply, the subcontractors would face difficulties from the company’s management, ranging from arrears to outright denial of reimbursement of expenditures.”Workers construct a railway line in Haian, in China's eastern Jiangsu province on Aug. 9, 2023.

Wage Arrears Continue to Plague Chinese Migrant Workers, Experts Believe CCP the Root Cause

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News Analysis

Every year, Beijing reiterates its commitment to combat wage arrears affecting migrant workers, particularly around Labor Day (May 1). Despite these assurances, experts believe the persisting issue underscores deeper systemic challenges within the Chinese Communist Party (CCP) ’s governance.
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Rights Vs. Stability

The recently released 2023 annual survey on migrant workers, the 16th such report since 2008 by the Chinese National Bureau of Statistics, paints a picture of a workforce of 297.53 million, with an average age of 43.1 years. Among them, individuals aged 50 and above make up 30.6 percent. Across six key industries, monthly earnings range from 3,965 yuan ($548) in household services to 5,488 yuan ($759) in construction.

However, recent reports have not included data on wage arrears among migrant workers. In the 2016 report, wage arrears were last seen to have affected 2.37 million migrant workers, at an average amount of 11,433 yuan ($1,580).

Right before Labor Day, the state mouthpiece, Xinhua, reported that Hebei authorities, aiming to prevent wage arrears at the source, have established 6,800+ migrant workers’ wage protection centers since last May. The centers were composed of major project leaders and contractors.

Yet, the effectiveness of these centers is questioned by those directly impacted.

Fu Ping (pseudonym), a seasoned migrant worker from Hubei Province, expressed his skepticism in the Chinese-language edition of The Epoch Times, recounting his experience in Baoding, Hebei, where, despite promises, his outstanding wages remained unpaid.

Mr. Fu said that the construction company at Baoding still owed him 25,000 yuan ($3,455.71), even though he was told it would be resolved by the end of April.

“That company is quite well-known, but it’s still difficult to get paid. It claims the wage protection center can help, but I don’t trust it,” he said.

“The injustice in this society is not a trivial matter,” he said.

Mr. Wu (pseudonym), a Chinese lawyer, told The Epoch Times that the wage protection center is a formality. He believes the problem is severe, and the propaganda, although ineffective, helped to deceive people from the top down.

Activist Lai Jianping, formerly a lawyer in Beijing, told The Epoch Times that the Hebei government is trying to create a false image of caring and diligent authorities.

People would have taken to the streets directly, but with the so-called protection centers, “People go there to negotiate, and the centers would keep these people under control. So it serves the purpose of maintaining stability,” he said.

According to data from the China Labour Bulletin, headquartered in Hong Kong, as of May 8, there have been 1,725 workers’ protest events in China this year.
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‘Wage Arrears Lie with The CCP’

Attributing the root cause of wage arrears to the CCP, Mr. Fu alleged the prevalence of corruption within the construction sector. Projects often proceed without adequate budgeting, relying instead on kickbacks and favors.

He said arrears have been severe for migrant workers involved in public projects. Mr. Fu said, “Ordinary developers wouldn’t dare to operate in such a manner; they only dare to do so with governmental support.”

“The price of illegal activities is low for the government and the authorities. It’s easy to withhold wages and bully the most vulnerable migrant workers. This is the most unethical aspect of this society,” said Mr. Wu.

Mr. Lai said that the authorities’ vigorous infrastructure policy forced entities such as construction companies or project managers to proceed with projects knowing that funds were not in place, leading to layers of arrears and leaving migrant workers with nothing. “Ultimately, government action prevents entities from contracting projects under normal conditions,” he said.

Layers of contracting involve many intermediaries, and each link is prone to corruption. He said, “Virtually every construction project in China involves bribery. The contracting entities must bribe the government to secure the project.

“The government department overseeing the project holds considerable power, and corruption is present at every stage.”

Mr. Lai listed several situations that he believes led to the withholding of migrant workers’ wages:

“In some cases, the entities failed to collect the expenditures because the properties weren’t sold or projects were not completed.

“Another scenario is insufficient government budgeting. Then, there’s embezzlement and corruption at various stages of the projects. In any case, the migrant workers always take the brunt.”

According to Mr. Lai, corruption occurs when “construction company executives may demand contributions or bribes from subcontractors. If they fail to comply, the subcontractors would face difficulties from the company’s management, ranging from arrears to outright denial of reimbursement of expenditures.”

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Workers construct a railway line in Haian, in China's eastern Jiangsu province on Aug. 9, 2023. (STR/AFP via Getty Images)
Workers construct a railway line in Haian, in China's eastern Jiangsu province on Aug. 9, 2023. (STR/AFP via Getty Images)

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It’s to Maintain Social Stability

Mr. Fu claims that migrant workers often go months to a year without receiving payment, and they only receive a basic allowance to cover daily meals and rentals. However, most wage arrears are eventually settled, although the extent and duration vary.

It requires a lot of effort for the migrant workers to claim their wages, according to Mr. Fu.

He said there are two crucial times when migrant workers can demand their wages: Sept. 1, when schools start, and the Chinese New Year.

Mass protests from migrant workers can easily take place, as one concerns tuition and the other the New Year celebration.

Mr. Fu said subcontractors will do everything possible to secure the money. “They need to hire workers later; it’s a game of strategy,” he said.

“Of course, some developers won’t pay at all. But they won’t last long and will be eliminated by society. They won’t be able to stay in business for long.”

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Why Not Sue in Court?

Mr. Fu said migrant workers won’t resort to the court for unpaid wages. “Even if you win the lawsuit, recovering the money is very difficult. The boss is already bankrupt. You only waste your time and indebt yourself with lawyer’s fees.”

At one point, a company in Hubei owed Mr. Fu more than 70,000 yuan ($9,676). The local labor bureau advised him to file a lawsuit. However, he took matters into his own hands: He complained to the labor bureau, the local stability maintenance offices at the community, the police station, the national security, the media, and foreign journalists.

“I exposed their scam,” he said.

After he complained to the local city national security team leader, they communicated with the police station, street office, and labor bureau and negotiated with the company’s high-level executives. According to Mr. Fu, he received the 70,000 yuan without being taxed.

Mr. Lai explained that the punishment for entities withholding wages is as little as bank loan interest, at around 7 percent, which indirectly encourages these entities to continue withholding wages. “They find it difficult to obtain loans; keeping the funds in hand for other purposes is much more worthy than paying the wages on time,” said Mr. Lai.

Mr. Lai believes the regime has the major responsibility for the historical unpaid wage issue of migrant workers. The fundamental issue is that Chinese developers have been allowed to start projects without sufficient funds and rely on contractors and subcontractors to cover the expenses before the property can be sold, he said.

“The CCP government is overly ambitious, constantly expanding its investment, but in reality, its financial resources are insufficient. In the end, the government becomes a debtor and resorts to dodging responsibility,” according to Mr. Lai.

Song Tang and Yi Ru contributed to this report.

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