[Joint House and Senate Hearing, 107 Congress]
[From the U.S. Government Publishing Office]



 
       WORKPLACE SAFETY ISSUES IN THE PEOPLE'S REPUBLIC OF CHINA
=======================================================================



                               ROUNDTABLE

                               before the

              CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA

                      ONE HUNDRED SEVENTH CONGRESS

                             SECOND SESSION

                               __________

                 HONG KONG SAR, CHINA, NOVEMBER 7, 2002

                               __________

 Printed for the use of the Congressional-Executive Commission on China


         Available via the World Wide Web: http://www.cecc.gov









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              CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA

                    LEGISLATIVE BRANCH COMMISSIONERS

Senate

                                     House

MAX BAUCUS, Montana, Chairman        DOUG BEREUTER, Nebraska, Co-
CARL LEVIN, Michigan                 Chairman
DIANNE FEINSTEIN, California         JIM LEACH, Iowa
BYRON DORGAN, North Dakota           DAVID DREIER, California
EVAN BAYH, Indiana                   FRANK WOLF, Virginia
CHUCK HAGEL, Nebraska                JOE PITTS, Pennsylvania
BOB SMITH, New Hampshire             SANDER LEVIN, Michigan
SAM BROWNBACK, Kansas                MARCY KAPTUR, Ohio
TIM HUTCHINSON, Arkansas             SHERROD BROWN, Ohio
                                     JIM DAVIS, Florida

                     EXECUTIVE BRANCH COMMISSIONERS

                 PAULA DOBRIANSKY, Department of State
                 GRANT ALDONAS, Department of Commerce
                D. CAMERON FINDLAY, Department of Labor
                   LORNE CRANER, Department of State
                    JAMES KELLY, Department of State

                        Ira Wolf, Staff Director
                   John Foarde, Deputy Staff Director

                                  (ii)














                            C O N T E N T S

                              ----------                              
                                                                   Page

                               STATEMENTS

Leung, Trini, independent researcher, social development, labor, 
  China, and East Asia, Oxford, UK...............................     2
Han, Dongfang, director, China Labor Bulletin, Hong Kong SAR, 
  China..........................................................     4
Chan, Ka-wai, associate director, Hong Kong Christian Industrial 
  Committee, Hong Kong SAR, China................................     6

                                APPENDIX
                          Prepared Statements

Leung, Trini.....................................................    22
Han, Dongfang....................................................    28
Chan, Ka-wai.....................................................    33











       WORKPLACE SAFETY ISSUES IN THE PEOPLE'S REPUBLIC OF CHINA

                              ----------                              


                       THURSDAY, NOVEMBER 7, 2002

                            Congressional-Executive
                                       Commission on China,
                                              Hong Kong SAR, China.
    The roundtable was convened at 10 a.m., John Foarde (deputy 
staff director) presiding.
    Also present: Susan Roosevelt Weld, general counsel; Selene 
Ko, senior counsel for commercial rule of law; and Lawrence 
Brown, specialist on labor issues.
    Mr. Foarde. My name is John Foarde. I am deputy staff 
director of the Congressional-Executive Commission on China 
based in Washington, DC. With me are several colleagues whom I 
will introduce in just a moment. Welcome to this staff-led 
issues roundtable on workplace safety issues in the People's 
Republic of China [PRC]. This issues roundtable series is a 
continuation of a series that we have conducted successfully in 
Washington, DC, where we have experts come in to get very 
deeply into individual issues of human rights, rule of law, and 
legal reform. And having a roundtable here in Hong Kong is an 
experiment. We had the opportunity to invite these very fine 
panelists, whom I will also introduce in a moment, to come and 
speak with us today, and so we are grateful for the ability to 
do this in the Hong Kong Special Administrative Region. We are 
grateful to the Foreign Correspondents' Club [FCC] for letting 
us use this facility, and of course grateful to our panelists.
    On behalf of Senator Max Baucus, the chairman of the 
Congressional-Executive Commission on China, and Congressman 
Doug Bereuter, the co-chairman, we are delighted to be here and 
have this opportunity. Let me introduce my colleagues. 
Immediately to my left is Lary Brown. Lary is a specialist on 
labor issues with the Commission, and came to us earlier this 
year from Verite. To his left is Susan Roosevelt Weld. Susan is 
the general counsel of the Commission, and came to us from a 
long and distinguished career in academic life in the United 
States on Chinese law and Chinese history and a number of other 
subjects. Immediately to her left is Selene Ko. Selene is our 
chief counsel for trade and commercial law, and looks at WTO 
implementation and compliance issues as part of her commercial 
rule of law mandate. She came to us from the Department of 
Labor. She has also had a distinguished career in private law 
practice in the United States.
    I am delighted to introduce our three panelists this 
morning. Ms. Trini Leung is an independent researcher who has 
spent a great deal of time investigating a wide range of labor 
issues, and we look forward to her presentation. Han Dongfang 
is the director of the China Labor Bulletin and conducts a 
well-known and very popular call-in radio program on Radio Free 
Asia from here in Hong Kong. Mr. Chan Ka-wai is the deputy 
director of the Hong Kong China Christian Industrial Committee 
[CIC], and an expert on a number of labor issues, particularly 
in the toy industry. We are grateful for all three of you 
coming to share your expertise with us this 
morning.
    We are going to conduct this roundtable in the same format 
that we have used successfully in Washington, DC. That is, I 
will invite each of our panelists to make a statement for 10 
minutes. When there is 1 minute left, I am going to hold up 
this very elegant sign so that they know that they have 1 
minute remaining to wrap up their formal presentations. We are 
grateful for the written statements that they have given us, 
which will be posted on the Commission's Web site. When each of 
the three has spoken we will then open it up to questions from 
the four of us here, and we will go through as many rounds as 
we can before our time is up.
    So, without further ado, I would be delighted to hear from 
Ms. Trini Leung.

   STATEMENT OF TRINI LEUNG, INDEPENDENT RESEARCHER, SOCIAL 
           DEVELOPMENT, LABOR, CHINA, AND EAST ASIA, 
                           OXFORD, UK

    Ms. Leung. Thank you. Good morning everyone. I would like 
to start today's discussion by putting forward first a kind of 
analysis or assessment of the problems, and the situation of 
health and safety in China. The second part will be to discuss 
the possibilities of what are the better ways to address the 
problems, and what are the possible solutions to the existing 
problems.
    I think the main problem is that there are many laws and 
many rules and much official machinery for the monitoring of 
health and safety in China, but it does not get implemented. So 
that is the main problem, the main deadlock in China at the 
moment on health and safety. The overall strategy that I would 
recommend is that a new strategy is needed. The previous 
strategy over the past 10 years or more mainly has been 
focusing on facilitating or building up the capacity of all the 
official machinery, including the laws and regulations, 
government institutions and personnel, etc. But it has not 
borne fruit, so there has to be some review of this strategy. 
It has not worked.
    Concerning the current situation, there are a couple of 
quite significant legal landmarks, which took place this year. 
Of the three laws, the most important law is the Work Safety 
Law, which just came into effect on the first of November. Then 
the Prevention of Occupational Disease Law was implemented in 
May this year. The third one is a directive on the handling of 
dangerous chemicals, which will take effect on November 15.
    The Work Safety Law is being put forward as the main tool, 
the main success of the culmination in the past decade of 
efforts by the government trying to tackle this ever-
deteriorating health and 
safety problem in China.
    Other than the law, in the year 2000 a very important 
government machinery was established, which was the State 
Administration of Work Safety. And under it the State 
Administration of Coal Mine Safety was set up. Now, this agency 
was set up because previously health and safety was managed or 
inspected by various industrial ministries and health 
ministries, and it did not work. So then the government said 
they would put all their focus in one agency, so that is 
administrative progress. At least it rationalized the system a 
little bit. But the situation has still gone from bad to worse, 
and in my paper I have quoted some official figures, but I 
would like to draw your attention to the admission even by the 
government in many instances that the official record, the 
official statistics, represents only the tip of a huge iceberg 
of health hazards in the workplace in China.
    Now to spend a bit of time on the problems. I will try to 
identify or to focus on who are the worst offenders. In terms 
of ownership of enterprises, in my paper I have listed several 
types of ownership of enterprises. In general the state-owned 
enterprises are less of a problem, but still the situation 
there is quite bad, but the situation is 10 times worse in the 
private sector. And according to the government about 74 
percent of all serious accidents in industrial and mining 
enterprises took place in the private sector.
    Maybe I will not go into the details of why the private 
sector has the worst record, but it is explained a little bit 
in the paper. Both in the public and private sectors, the large 
enterprises are less of a problem and so the main problem lies 
with the privately owned factories all across China, be they in 
the villages or in towns or cities, be they foreign invested or 
locally invested. And, again, the least offenders are the 
large-sized high-tech investment joint 
ventures. Usually they are more mindful about health and safety 
requirements.
    Then in terms of industry sectors, where do the deadliest 
jobs lie? Well, I think we all know that it is the mining 
sector, which is definitely the worst offender, especially coal 
mining. It is quite astonishing to see when, in such a mammoth 
and supposedly very organized State administration, that 
actually most of the mines operating in China now are illegal, 
and that is the problem. But I do not think I will go into 
mining because Mr. Han's presentation will focus on it.
    I would also like to draw your attention a little bit more 
to the building and construction industry, which has been less 
reported in the press. I think because, unlike mining, the 
accidents there are less spectacular, so they do not get 
reported so often, but actually the situation in this sector is 
very bad. The problem again is that all the construction 
workers are migrant workers from rural villages, and they have 
almost no protection, no security, and no visibility in the 
cities. And of course, other than accidents, there are also the 
hazards of the long-term and invisible exposure to toxic 
substances like dust and asbestos, which lead to deadly long-
term illnesses.
    Dangerous sectors other than construction include the 
fireworks manufacturing industry. Fireworks factories are very 
often located in small villages--indeed they are village 
enterprises, and they operate illegally or quasi-legally. The 
worst problem in this sector is that quite often very young 
children work in these factories, because a lot of them are 
almost like a family or village workshop.
    I would also like to draw your attention to the situation 
of China's farmers, on which very little reporting has been 
published. 
Because of restructuring in the farming and agricultural 
sector, farmers have been using a growing amount of pesticides 
and chemicals. These pesticides are almost always highly toxic 
and 
legally banned, but nonetheless they are widely used and 
unregulated. And I would say that hardly any farmer receives 
any training or information about how to handle these 
pesticides safely. But a key problem is that there is not 
really any body of epidemiological data to identify or to 
locate specific problem areas.
    Then last, looking at whether the worst offenders are 
concentrated in certain geographical regions, I would argue 
that, whether an industry is located in the rich southeast or 
in the poor hinterland of north and west China, all are bad 
offenders.
    Since I have only 1 minute left, I think I will skip the 
analysis about why the rules are not implemented. I will go on 
to my recommendations. I think the main problem of non-
implementation of health and safety rules in China is that 
there is a deadlock of what I would call a triangle of 
interests between, on one side, the employers and the local 
officials, and, on a second side end, the central authorities, 
and the workers on the third side. I believe that the central 
authorities are genuine when they say they want to improve 
health and safety, but somehow their directives and laws do not 
get implemented. And of course the victims are the workers.
    Now, I would suggest that we have to find a way to open up 
the deadlock in this triangle of interests, and that the only 
way is to introduce more interests, and also to strengthen the 
different interests of employers and employees, and also 
strengthen civil society in China in terms of the press, the 
NGOs, the legal profession, and academia. So the focus of 
reform must be on this aspect rather than on improving the 
government machinery.
    Thank you.
    [The prepared statement of Ms. Leung appears in the 
appendix.]
    Mr. Foarde. Thank you very much. Ten minutes is not a long 
time, but we hope to pick up on some of the themes you raised 
in the presentation during the question and answer session. Mr. 
Han Dongfang, please.

STATEMENT OF HAN DONGFANG, DIRECTOR, CHINA LABOR BULLETIN, HONG 
                        KONG SAR, CHINA

    Mr. Han. Thank you. I will try not to allow you to raise 
that paper! As Dr. Leung has just said, a lot of laws have been 
passed in China and the government has done quite a lot of 
things, particularly the central government. I do not need to 
review how bad the Chinese health and safety situation is; I do 
not need to repeat information that is widely available and 
understood. Just to cite one figure from the end of October, 
there was a report in the Ta Kung Daily in Hong Kong saying 
that work-related deaths from January to September this year 
total nearly 100,000 people, with the worst sector being 
mining, including coal mining and other mining. This situation 
is very serious, but what causes this high death rate? Dr. 
Leung has already answered this question very clearly, but I 
want to quote one government official's speech on July 7, 2002. 
Mr. Wang, the head of the State Administration of Work Safety 
said very clearly that there are three principle causes of 
mining enterprise health and safety problems: not enough 
investment, not enough air circulation, and third, despite the 
high level of methane gas in coal mines, there is no automatic 
alarm system. A fourth problem is that there is no preparatory 
work before the miners go down to do their work underground. 
The official also suggested that the only way to resolve the 
problem is by the rule of law, to use the law to enforce the 
law. This is very clear, and I absolutely agree with Mr. Wang, 
the head of the government body.
    What are the traditional ways that the Chinese Government 
is monitoring or managing health and safety? One method is 
through propaganda, from the top down. Another is if they find 
any 
problem, they shut down the coal mine. Third, if a state-owned 
enterprise cannot pass the standard, it cannot restart again. 
Fourth, central authorities have said that they would like the 
local government to do more monitoring.
    But how effective is the traditional way of managing these 
issues? The top down way to monitoring and managing health and 
safety issues? What is the result? Let us see. From March of 
this year, the government decided that June would be the 
``Health and Safety Month.'' In May, there were 400 people 
killed in coal mines, and in June, the ``Health and Safety 
Month,'' there were 449 deaths in coal mines, and 1 month 
afterwards, in July, there were 482 miners killed. So that is 
the result. It is very clear. It is a top-down method, which 
cannot really make things happen. Particularly in June, the 
``Health and Safety Month,'' there was a big coal mine 
explosion in the northeast, in Jixi, Heilongjiang, which killed 
115 miners. That is exactly 1 day after the mine passed the 
safety exam from the State Council, so that was a big joke. 
Even the People's Daily reported that both the Heilongjiang 
provincial bureau and the Jixi bureau director of the State 
Administration of Work Safety, said, ``after we examined 
everything, that is it. We did our work and we asked them to 
stop and they did not stop. We cannot do anything.'' So it is 
quite obvious that the government, particularly the high-level 
officials of the central government, have done almost 
everything they could but they could not stop this disaster.
    So we can see that there is a big part which is missing, 
which is the involvement of the workers themselves. We know 
that the workers are the group of people being hurt most by the 
bad health and safety situation, but it is obvious that the 
top-down way of managing does not allow the workers to get 
involved. That is really is the key issue, and therefore my 
recommendation is that there must be a way to allow the Chinese 
workers, particularly those workers who are working underground 
in the mines, to find a way to get involved in this process. I 
suggest a workers' health and safety committee. That committee 
should be elected and managed by the workers themselves. All 
the committee members should be workers. The workers know best 
how badly they will be hurt if there is an explosion or some 
kind of a collapse.
    People will ask if there is any legal foundation for these 
workers' health and safety committees. Yes, just a few days ago 
in the newly passed Work Safety Law there are several articles 
which say the workers should be deeply involved in health and 
safety issues, so we can find the legal foundation for this 
type of committee.
    Some people will ask about the union's role, but I would 
say that because China's trade union is political, this point 
is very sensitive. If you push that official union to do more 
to represent the workers, that sounds like the American 
Government or some overseas people trying to change the nature 
of the Chinese official union. I would say that this approach 
is too sensitive. It sounds like some sort of political 
challenge. So I would recommend to go to something else rather 
than to challenge the trade union system. And there is a way, 
which is contained in an official document from the State 
Administration of Work Safety that was released last year, 
which says that the office of this Administration is the only 
office that can cooperate with foreign bodies on health and 
safety. So that is regulated already. That office is the only 
one.
    I would also remind people that, for workplace health and 
safety, the work has to be done at the lowest level, in the 
workplace. No more in the meeting rooms in the universities, no 
more in the meeting rooms of the Labor Bureau, no more in the 
meeting rooms of the provincial Labor bureaus, but this work 
will have to be done in the workplace through these workers' 
health and safety 
committees.
    So, this sort of committee, if we can set it up, I really 
believe that there will be a very, very good result on this and 
these workers can, for the first time, raise the issue whenever 
they feel there are dangers. And, for example, according to the 
new Work Safety Law, they can stop work and refuse to continue 
to work in a dangerous situation. So the committee really can 
give the workers 
confidence to use the law to protect themselves.
    When they have more collective confidence, the workers' 
committee will also be able to force the lower level management 
from the coal mine to buy insurance for the workers. And that 
will really get the insurance companies involved in this issue, 
because the insurance company has to go and check on the health 
and safety situation. If it is too bad, they will not insure 
this coal mine, and you will then bring another party's 
influence into the health and safety issue--an insurance 
company. It works.
    And as Dr. Leung mentioned the firecrackers industry, and I 
would also recommend the same things, which is a workers' 
health and safety committee. So that is my recommendation. 
Unfortunately you raised that paper!
    [The prepared statement of Mr. Han appears in the 
appendix.]
    Mr. Foarde. Mr. Han, thank you very much, and we will pick 
up on all the very interesting things that you just articulated 
a bit later after we have heard from Mr. Chan Ka-wai. Mr. Chan?

    STATEMENT OF CHAN KA-WAI, ASSOCIATE DIRECTOR, HONG KONG 
      CHRISTIAN INDUSTRIAL COMMITTEE, HONG KONG SAR, CHINA

    Mr. Chan. Thank you very much. Good morning everybody. We 
have just heard from my colleagues a macro description, and I 
will go to the micro way, talking about the enterprise level, 
especially in the foreign-owned enterprises in China.
    My presentation is already in written form so I will not 
repeat it, but what I want to say is that basically American 
investment in China now ranks around No. 4, and if you count 
those from Hong Kong, Taiwan, Macau, they are Nos. 1, 2, and 3. 
Half of these companies, or 70 percent of them basically, are 
working for American brands, so you can say that half of the 
foreign investment in China basically is from the United States 
or so-called U.S.-related investment. So you will see how 
American investment has an 
important impact on the workers in China.
    You can see that, if you are just talking about the number 
of workers in the foreign-funded enterprises, it is very small, 
around 6.5 million. This is around 3 percent of the total 
working population in cities in China. But that does not 
include those so-called joint ventures from local investment 
and other Hong Kong and Taiwanese investment, so the figure 
basically is under-estimated.
    But anyway, I have put two questions, or two problems in my 
paper. However, it does not mean that the foreign-funded 
enterprises only have two problems on health and safety. They 
have a lot more problems than just two--for example fire 
problems, illegal structures, or illegal architecture in their 
buildings. But what I want to say here is that these problems 
are more invisible. What Mr. Han mentioned, the mining problem 
basically is very visible. Everyone knows about an explosion 
and how many people have died, but there are other problems, 
which are also serious but invisible, for example the chemicals 
or occupational diseases or the overtime problems.
    You can see from the data, in China now there are more than 
16 million workers working in some kind of toxic or dangerous 
work in their workshops. Supposedly it should be 10 million 
workers who should have a regular health check but only one 
third of them have done so. Two-thirds have not had any 
physical checkup. And, what is more important, this data does 
not include the workers working in the so-called township and 
village enterprises or some kind of so-called individual 
ownership.
    So you see the picture is quite serious. From talking about 
China, I now turn to one province, Guangdong Province. This is 
my research area. Basically this province is full of foreign-
funded enterprises, and most of the workers working there are 
what we call farmer-workers, or Mingong in Mandarin. That means 
they come from the village. They are not entitled to stay in or 
enjoy any social benefits in the city, basically because they 
are initially farmers.
    You can see that there are around 10 million workers who 
are exposed to toxic or dangerous work every day when they work 
in the workshops. But, according to the Guangdong Government 
investigation this year, around 95 percent of the foreign-
funded enterprises violated the health and safety laws or 
regulations. They did not have an occupational health and 
safety law at that time. At that time, they only had a local 
regulation. And also more importantly, for occupational 
diseases the reporting rate is very low. They said the 
underreporting rate is 120 percent of the reporting rate. That 
is, if you report one case, there will be 2.4 cases that 
already happened. So you can see that the underreporting rate 
is much higher than the reporting rate.
    You see how many work specialists there are to monitor the 
health and safety. At the factory level in Guangdong, I think 
there are only one thousand specialists. Each one is 
responsible for one thousand enterprises, and each one is 
responsible for 10,000 workers, so you can imagine how little 
they can monitor the enterprises. And finally, more than half 
of the factories in the Guangdong area have not yet been 
examined, even from the date of commencement of their business 
up to now.
    Occupational diseases are so serious because they are 
invisible. Most of the workers will not associate their 
problem, especially a health problem, with the chemicals to 
which they are exposed every day. Finally, when they have a 
problem, they go and see a doctor. Their health is getting 
worse, so they go back to their hometown and it seems nothing 
has happened. But this is a big problem. This is not like a 
fire. When a fire happens everyone knows, but occupational 
diseases are so invisible that no one knows. If you talk to 
workers--and we have interviewed some of the workers, not a 
very big sample, but we interviewed 22 workers in eight 
factories in the coloring departments--they are exposed to 
toxic chemicals every day. None of them could name the 
chemicals they use. None of them. Talking to more than 100 
workers about the health and safety regulations, only 1 percent 
of the interviewed workers said they knew about occupational 
health and safety regulations. Talking about the human health 
regulation, talking about the young workers regulation, sorry, 
none of them know. So you will see how serious the problem is.
    The second issue is overtime. You know I think most of the 
big problem about overtime is not only that workers work 
overtime and only get very low pay, but overtime is also a big 
problem because the workers are exposed for a longer time to 
the chemicals, and thus their work is more dangerous or there 
is a higher exposure to dangerous machinery. In Shenzhen now, 
it is said that there are 50,000 workers with fingers or arms 
or legs cut. But those cases will not be prosecuted, or 
possibly only one or two cases. Even if a case does arise, 
maybe the worker will get very meager compensation and he will 
go home. So that is a big problem.
    Now, according to our research last year on the overtime 
situation, even up to this year we found that in some factories 
in the toy industry, especially in the high season, the workers 
will be forced to work 80 to 100 hours a week. Supposedly 
according to the law, it should be 40 hours a week, and then 9 
hours overtime on average a week. That means it should be 49 
hours a week. So you see the big difference.
    I only discuss these two questions because this aspect is 
related to a more fundamental problem regarding the foreign-
funded enterprises, especially as most of them are foreign 
brands. The companies claim they have a code of conduct and 
they will press their manufacturer to follow the code of 
conduct, to follow the labor laws in China, to respect and 
protect the worker's rights. But the big problem is who 
controls the pricing, who controls the delivery time? 
Accordingly to our research last year, most of the brands in 
the toy factories ask for very low pricing. The lowest labor 
cost share is 0.4 percent of the cost of the toy in the market 
place. That is the market price. And then the shortest 
delivery, lead-time, is within 2 weeks the manufacture should 
produce more than 10,000 pieces of toys. How can they follow 
the code of conduct? If they get such a low price, there is 
definitely no money to install health and safety equipment. If 
they require such a short order lead-time, there is no way but 
to order the workers to work overtime. Therefore the only way 
we address this problem is to go to back to monitoring of the 
foreign-funded enterprise, and especially work on how to get 
the workers' involved. That is more important finally, having 
the workers involved, because, as Mr. Han mentioned, workers 
basically know the factory best. But they have no say in its 
operation. So on that issue, how we can talk about monitoring 
the foreign-funded enterprises? And we are also talking about 
how to get more 
involvement by the workers.
    Thank you very much.
    [The prepared statement of Mr. Chan appears in the 
appendix.]
    Mr. Foarde. Thank you very much, Mr. Chan. We are now going 
to proceed as we usually do to a question and answer session. 
Since there are only four of us and we want the opportunity for 
each of you to expand a bit upon your comments on each of the 
issues that we ask you about, normally we only go for 5 minutes 
per staff member, but I think we will go for 10 if you have 
that many questions to ask. So I will begin, but I will also 
keep track of my own time.
    We can address questions to the whole panel, or to each 
panelist individually, but if you have views that you would 
like to express, please go ahead and jump in when your fellow 
panelist is finished.
    Ms. Leung, I would ask you what can be done practically to 
improve enforcement of the existing workplace health and safety 
laws, particularly the new laws? And is there a role for 
projects funded by overseas foundations or government-to-
government 
programs?
    Ms. Leung. Thank you. Yes, the enforcement of the laws, I 
am glad to have the opportunity to explain a little bit more 
about that, how we can try to strengthen more the key actors 
and more forces of interest in the whole game. So, if I can, I 
would like to go a little bit into what can be done about the 
different actors in the game.
    We know that the employers are the worst offenders, and I 
think they would need a lot of disincentives, deterrents. So 
more stringent and heavy penalties will help create that 
deterrence. The new law goes a little bit further in this 
direction, but I think it should go yet a little bit further. 
And this goal will only be helped by an adequate and sound 
litigation process, which again we can go on to discuss later.
    And then awareness and capacity training would help. At the 
moment, there is an embryonic formation of some industry or 
chambers of commerce in China. I think if these are better 
organized and can have better facilities, they can provide the 
necessary research and program support on health and safety. 
And maybe ``best practice'' awards given by these associations 
can again push things in the right direction.
    On the employee side, I think a lot of work needs to be 
done to enable the employees to form an interest group and 
represent their interests. And all the health and safety 
literature and analyses and solutions have said there must be 
workers' participation. There has to be. And it is essential to 
you are building a culture of health and safety and all that. 
But at the moment, the workers are given hardly any space, and 
so political intervention is needed a little bit. But more 
technically, the focus must be on more training for the 
workers, how they can participate.
    The new law actually protects the rights of the employees. 
There are eight rights of the employees. I will not go into the 
details because these rights are listed in my paper here. And 
the press, I think, can easily and most readily act as an 
actor, which probably can be most effective. It takes the least 
investment, because actually the press in China has been 
playing a crucial and helpful role in the last few years in 
exposing and reporting various workplace disasters. Without 
their reporting, I think, we would not be here even talking 
about the various new government institutions.
    Now, the Chinese press has met a lot of obstacles from 
local interests, from local employers, and from local 
governments. They have been stopped from reporting on some 
subjects, but sometimes they get a little bit of backing from 
the central government in Beijing. I think strengthening the 
culture of investigative reporting by the press would 
definitely help; one way might be for foreign 
agencies to give out some high profile press awards for Chinese 
journalists on health and safety. At the same time, there has 
to be a political environment for the press to be able to take 
up independent investigative reporting.
    And NGOs will play an indispensable role, I would say, and 
this aspect is already a promising entry point, because in the 
past few years there has been a slow but steady growth of NGOs 
in China. A few of them are working on workplace health and 
safety, so supporting this NGO community in this direction will 
help.
    Now, I would really like to focus, especially for foreign 
business and governments, on the legal and litigation insurance 
companies. The new law requires that all work units must take 
out industrial injury insurance. At the same time the insurance 
industry is being slowly privatized, and even foreign companies 
can operate in this sector. Usually the insurance sector in the 
United States and Europe actually has a positive role in health 
and safety culture, because it is in their interest to make 
sure that their clients do not make claims for compensation. So 
I definitely think it is worthwhile putting resources into 
engaging the insurance sector.
    And then litigation, because at the moment, the workers are 
the victims. They get very little legal support when they want 
to file a lawsuit against employers. And I think that 
increasing this type of support, maybe by having a pool of 
lawyers and perhaps even litigation funds would help in this 
direction.
    And last, I would talk about academia. I have come upon 
quite a few academic studies on these problems but there is not 
enough good academic research. And I think giving out 
scholarships on health and safety would help develop this type 
of research.
    Mr. Foarde. Very useful comments, thank you very much. Mr. 
Han, I would ask you, you were very eloquent about the problems 
in the mining industry in China. Are there similar workplace 
safety problems of the same magnitude in the other extractive 
industries such as oil and gas, or are they greater or less 
than the mining industry?
    Mr. Han. I put more of my time into monitoring 
firecrackers, as I mentioned. While I also mentioned coal 
mining, I would really recommend a focus on the fireworks 
industry, because this industry really is dangerous, not only 
for workers but children. Particularly in the Provinces of 
Shaanxi and Hunan, they have had this tradition of family 
fireworks factories for more than 200 years. They are doing it 
on a family basis, and not only do family members make the 
products in their home, but the whole neighborhood gets 
involved. Then it is much more difficult to control the health 
and safety of this type of enterprise.
    I really believe that a major step will have been taken if 
this coal mining workers' health and safety committee can be 
set up. I am not asking the United States Government to take 
care of everything in China--it is impossible--what I am trying 
to say is for U.S. donors to set up some sort of pilot program. 
For example, I would say in Wuhan and Guizhou there are very 
small coal mines, and sometimes each coal mine has only between 
20 and 50 miners. And if you can succeed in these smaller coal 
mines, that experience of successful workers' health and safety 
committees can be passed on to the firecracker industry, 
because the workers' health and safety committee is not really 
based on one or two individual coal mine enterprises. You 
really have to have, for example, a county level or regional 
level workers' committee, and each coal mine you would have two 
members to join this regional committee, and these two members 
would have to be elected by that small mine's workers.
    So if you have these regional organizations, if you have a 
meeting every month or two, everybody can bring their problems. 
If miners from the small coal mines can really set up useful 
meetings and discuss and publicize what happened last month, 
and plan for what they can do in the future, this experience 
can really transfer to the firecracker industry. And that type 
of committee can involve not only family members, I mean, those 
people who are working on making firecrackers, but also can 
involve the whole neighborhood. And even though they really 
might not be producing any fireworks from their homes, their 
neighbor is doing that, and they are in danger. They cannot 
really do anything if there is no opportunity for them to be 
involved in the solution to this problem.
    So I will say that this regional workers' health and safety 

committee, when it comes to the firecracker sector, could be a 
committee of workers and owners and small producers and also 
the representatives of residents.
    Mr. Foarde. Thank you very much. My time is up, and so I am 
delighted to turn the floor over to my colleague, Lary Brown.
    Mr. Brown. Mr. Chan in particular mentioned the magnitude 
of United States investment in China. I would like to ask who 
exactly are the outside groups besides civil society in China 
that have some leverage to bring about improvement in health 
and safety in China? And what is it that they should be doing 
that they currently are not?
    Mr. Chan. I think that there are few different levels of 
such a kind at present. It is certain that we need some kind of 
pressure from consumers. Consumers, including students, have an 
obligation and they should put pressure on the companies, and 
perhaps have input into their planning and try to foster 
cooperation.
    The second level is the shareholder. Certainly now there 
are some churches or even governments, at the county or city 
level that also have a certain code or regulation for their 
investment. If they find a corporation that does not respect 
the labor rights or chooses to ignore labor issues, they will 
encourage the corporation to follow this code of labor 
standards. So on that basis one party is the shareholder.
    A third party is some NGOs in south China and how they 
monitor the factories. For example, CIC monitors the foreign-
funded enterprises in China, especially in Guangdong. But more 
importantly for me, I think, is how to make the workers' voice 
heard. That is more important. It is not only heard by the 
public. It is also the voice coming up in workplace. So what 
the Christian Industrial Committee has done over the past 2 
years is to try to negotiate with the corporations and also at 
factory level to have some kind of health and safety training. 
The training is not only to impart technical knowledge. 
Everyone can do that, especially by profession. What is more 
important is how workers can get involved in the monitoring of 
the factory, especially the health and safety 
committee.
    We have now done more than seven factories, including some 
in the toy and the footwear industries. Last week, we met 
representatives of the Hong Kong toy industry. One of the 
agenda items was that they will propose that every member 
factory will try to set up a health and safety committee 
composed of workers, and the workers will have a say and a role 
in the monitoring of the factory. 
Basically this is also what was proposed by the Chinese 
Government. Now for the health and safety issue in China, a new 
term has come up, which we call ``the occupational health and 
safety management system.'' In the past, this kind of 
management system was basically limited to factory management. 
They were especially responsible for the health and safety, 
equipment, things like that, or they have a health and safety 
officer. But now the new concept which has been raised is that 
workers must also be involved. So the Chinese Government is 
also thinking about how to set up the mechanism in which 
workers can be involved. They have their representative there 
and then to also monitor the health and safety issues and 
facilitate solutions.
    I think that this activity is legally allowed, and also 
practically I think the some of this is already a habit, and 
even at the industry level some industries also want to promote 
it, so I think this is the time that we can talk much more 
about how we can set up such a mechanism, especially in the 
foreign-funded enterprises.
    Mr. Brown. I have one other question. American consumers, 
as you have mentioned, are increasingly concerned about the 
conditions under which the products that they buy are produced. 
What would you recommend their response should be when they see 
``made in China'' products on the store shelves?
    Mr. Chan. Well, I think that goes back to the two issues I 
mentioned earlier. If the U.S. corporations, especially those 
involved in investment, really want to listen to their 
consumers on health and safety issues, they should take up more 
responsibility to tell the manufacturer how to take such issues 
seriously. The big problem now, even if you talk to the 
manufacturers from Taiwan and Hong Kong, is that they complain 
that they have no weight, because the code of conduct basically 
shifts the burden totally onto the manufacturer. I have always 
said that the code of conduct is voluntary for brand names, but 
it is legally binding on the manufacturer on the basis of the 
contract. So if they cannot follow it, they will be punished. 
But in fact they cannot follow it because of the pricing 
system, the lead-time delivery problem. So I think that we must 
go back to examine the problems in such a system, the 
mechanism, how much cooperation, especially American 
investment, they would like to share the burdens of the code of 
conduct. It is quite certain that it depends on the cost, and 
then how they can help the manufacturer. At that level, I think 
there are still a lot of possibilities that we can do that.
    Mr. Han. Can I say something about this? I would say that a 
consumer campaign on this issue would be very easy to be 
misleading. As a trade unionist from China, I do not think that 
boycotting Chinese products is a good idea if the goal is to 
achieve labor rights in China, that is, to help Chinese 
workers. Basically, a boycott will reduce job opportunities for 
workers. I do not really think that this approach works, but it 
works at some level, which is by creating some sort of 
awareness in society, and get people to hear about this, but 
not really stop buying Chinese products, which really hurts the 
Chinese workers. Once you lose a job, what else do you have?
    So I keep saying that, including a code of conduct, 
monitoring ideas and their systems, I keep asking the question 
``are we talking about monitoring the animal rights or labor 
rights? '' They are very different. Animal rights should be for 
those animals that cannot help themselves. Human beings can go 
and help themselves, so that is one way to look at this 
question. Another way, if we are talking about labor rights, is 
that we have to assume that the workers in China and anywhere 
can help themselves. What we need to do is link them up and 
help them a little bit and push them, and they will be able to 
take care of their own problems. And that is why I said that 
with a boycott and a consumer campaign, we have to be very, 
very careful, because we do not want to see that campaign hurt 
Chinese workers, but rather to help them.
    Ms. Leung. Thank you. Just a point to add is that the 
choice of the consumers, and if they care about how products 
are being produced, then they should look for what are the 
``preferred products.'' There is always more competition in the 
market, and companies are always looking for an edge over their 
competitors, and I think this is where social standards come 
in. And if companies can actually promote their adherence to 
these standards as the selling point, that they are producing 
socially friendly or environmentally friendly products in 
China. I think this should be a policy direction, to give the 
consumers a better choice.
    Mr. Chan. I think, though, that the initial issue is to set 
up the kind of agenda that the consumer wants. If they just 
want to punish the corporation, that is one approach, or they 
may prefer to push the corporation and encourage the 
corporation to set up a more positive mechanism in which 
workers can be involved, and also even involve other 
stakeholders to improve the working conditions. For example, 
when the CIC fight the corporations, we will ask them ``if you 
just cut and run we will not give any information to you. If 
you want to do something really to improve the working 
conditions, OK, let us sit down and talk about how to set up 
the mechanism.'' So now I think that even when we talk to the 
U.S. partners, the consumer groups, or student groups, they all 
realize that they should not just ask, ``if you do not do that 
we will cut.'' Rather, they should encourage the corporations 
to set up some more positive mechanisms. I think that is be the 
genuine need that we should address.
    Mr. Foarde. We will move on to Susan Weld, please.
    Ms. Weld. Thanks, John. I am part of the Commission's law 
clique, and so I am interested in the rule of law aspects of 
this question. What are the specific tools that an individual 
worker or a workers' committee could use to improve the 
situation? For example, there is an Administrative Litigation 
Law. What is the success of people trying to use the 
Administrative Litigation Law in the health and safety context? 
Perhaps not under this new law, but previously existing 
workers' safety laws and so on? So that is one question.
    And the other question is whether or not there is a 
possibility of getting any kind of injunctive relief? And what 
about the use of class actions? Are any of these things tools 
that can now be used, or could they be built up into a form in 
which they could be used? I guess I will ask Ms. Leung to 
start, and if it is OK then go down the road with any other 
additional ideas.
    Ms. Leung. Yes, thank you. Even though I must make a 
disclaimer--I am not a legal expert--I am more of a political 
scientist! Yes, there have been already a lot of other laws 
existing before these new laws were enacted this year. The 
Labor Law, for a start, has a clause already saying that the 
union has the right to remove or to help restore the workers 
from very dangerous work places. The Labor Law also covers 
compensation. There have been a lot of lawsuits filed by the 
workers. I do not think they generally use the Administrative 
Litigation Law. They usually come under the Labor Codes. The 
problem is that the compensation is very little, even when the 
workers succeed. And, first of all, if the workers can find 
people to help them pursue these legal actions.
    In the past, I think, sometimes the official unions have 
helped employees file cases. Sometimes not, and so sometimes 
the workers, when they have nobody to help them, turn to the 
Labor Bureau help the them file lawsuits against enterprises. 
But a frequent problem is that the workers are not even 
registered or recorded in the official workforce because they 
are migrants, so they really have very little recourse to legal 
action. Another possibility for these workers is consulting 
lawyers in private law practice, but there have been a lot of 
problems, because the lawyers see very little incentive to get 
into this kind of litigation because migrants cannot pay very 
much in legal fees. Some lawyers try to provide subsidized 
services, for example, the very high profile cases of this 
lawyer called Zhou Litai, who has run into political problems 
because he has advocated for workers.
    But there have been a couple of interesting precedent 
cases. I do not know whether they can be called class actions. 
At the time, I thought they might be but then nothing happened. 
I think either a year or a year and a half ago, a group of 
workers, I think in Jiangsu, succeeded in filing a lawsuit and 
then won the suit and claimed compensation from their employers 
for injuries. And the employers happened to be the local 
government, and the compensation was a very big sum. At the 
time, people said this was the first time ever that the local 
authorities were found legally responsible and had to pay 
compensation. But then I have not come upon many similar cases. 
But maybe that can be the future in China, if more lawyers 
would take up these health and safety lawsuits, and I think 
that case will definitely be a helpful precedent.
    The new Work Safety Law actually says that the workers have 
the right to information, to put forward recommendations, and 
to expose and litigate against violations, to refuse to 
continue operations, to emergency departure, and to legal 
compensation. So these rights are very clearly stipulated in 
the new Work Safety Law, and I think this should be the focus 
of future legal practice in this field.
    Mr. Han. Dr. Leung has already mentioned the new Work 
Safety Law, and there are several articles contained in it--
Article 19, Article 45, Article 46, Article 47 and Article 50--
which put together say that any manufacturing enterprise and 
mining enterprise should set up a health and safety work group. 
In addition, the workers also have the right to understand the 
dangers and the mechanics of whatever equipment that they are 
using. They can also refuse to work in a dangerous place, in an 
emergency situation, they can choose to get away from the 
danger. They also have the right to receive health and safety 
training.
    But the Labor Law and the Trade Union Law also say that the 
trade union should do that work. So now the questions is--again 
I have to go back to my point--who are the people that are 
really interested in acting to enforce the law, to pick up the 
law and use it? It should be the workers, because they are the 
ones being hurt, but now the reality is that the workers are 
not doing it. Why? Because they do not trust the law, because 
the law in China is for ruling people and not protecting them. 
Very often when I receive telephone calls from Chinese workers, 
they always complain and complain and complain, saying that the 
laws are useless. And my response to them is, ``What about you? 
Have you done anything as a worker and as a victim or potential 
victim? '' So it sounds not very nice to them, but my idea is 
to find whatever way we can to encourage the workers to have 
more confidence in the law and to try to get together and make 
the law work for them.
    And, as I mentioned a little bit before, why we are talking 
here is because we want to reduce the dangers in the workplace. 
We want to have more workers saved from this ``death penalty.'' 
And what we want to do is to achieve this goal without making 
any trouble. That is why I especially mentioned that the trade 
union law works, but if you push the official trade union in 
that way, it will make them difficult and also make everything 
impossible to do. And that is why I recommend the creation of 
workers' health and safety committees. If we can set this up in 
some of these selected coal mines, then that committee can 
really do a lot of work that the trade union cannot do, and 
even do some work for the trade union and avoid embarrassing 
them.
    In December 2001, the Chinese central government passed a 
regulation that calls for a health and safety management system 
guidance paper, and also really encouraged the workers to get 
involved. That is under the ILO principles. So that regulation 
clearly shows that at least central government is willing to do 
something, and there is a legal foundation to do it. The 
government is willing to do that, and now the question is 
whether or not the government has resources to do it. So if 
there were any external resources, which could be put in to 
help them to start this process, I would say the central 
government would be really happy to see that.
    Mr. Foarde. Mr. Chan, do you have a comment on that 
question? Can I ask you to hold that to the end and we will go 
to my colleague, Ms. Ko, to ask some questions and then we will 
come back to your comment right at the very end, if you please.
    Ms. Ko. Actually I would like to start by allowing Mr. Chan 
to go ahead and answer this question.
    Mr. Chan. Thank you, Ms. Ko. I think on the legal 
framework, I am not a legal expert, but because our 
organization has also organized a kind of legal center in China 
for health and safety issues and has also been working with the 
lawyer Zhou Litai, we found that on the legal framework, it is 
not only the law itself that is important, but it also involves 
legal procedure and also some kinds of provincial problems. The 
first problem concerning the legal procedure is the litigation 
problem. Ninety-three percent of the labor disputes which 
included health and safety issues have been settled at the 
mediation or arbitration level. And also according to the law, 
if the case does not first go through the arbitration process, 
it cannot go to court. So that means that if I am the guy who 
rejects the case at arbitration level, the case cannot be moved 
to the court. A lot of workers complain that the local 
government does not want to threaten the foreign investment, 
because if more cases come to court, what will happen is that 
they will reject the cases, and finally the case cannot go up 
to the court. So the problem is the legal procedure itself. 
That means, according to the law, that the workers cannot go to 
court directly. They must go through the arbitration or the 
arbitration officer, who can say, ``I do not want to deal with 
your case, so I sign a piece of paper and you can go to court 
directly.'' If they do not have such permission, the workers 
cannot go to the court, so I think one of the big problems is 
the arbitration requirement.
    The second issue is about the legal procedures for worker 
health and safety issues. One of the jokes we often make is 
that if the factory has no insurance against worker injuries, 
the case will be finished within 2 years, because the court 
will order the company to surrender. But if they have 
insurance, because the insurance is centralized at the central 
government level--it is called the ``social interest group 
insurance''--they will say, ``Oh, this is government money.'' 
And they will appeal again and again, and the case will not be 
finished for 5 years. So how can you ask one injured worker, 
especially if he is not a local worker and he has to go back to 
his home town, to endure such a long time for a lawsuit? So the 
legal procedure is a big problem, especially for migrant 
workers.
    The only thing that I think we can do to strengthen the 
legal position is to have a labor court, especially on the 
labor disputes or other matters. The second issue is how to 
strength the legal system. Basically, at the provincial level 
the provincial government supposedly has a legal aid program. 
But if you ask how many cases they accepted, they will say 
``Sorry, very few.'' So I think at that level we are not only 
talking about the law itself, but we are talking about the 
legal procedure. And for some compensation cases the procedure 
also very stupid. This is because of the provincial protection 
problem. For compensation, if one is talking about needing some 
kind of artificial limb, something like that, the court will 
not ask the company or the social interest group, to pay out 
once and for all because they need to change it theoretically. 
They will not ask them at one time to pay all of the money. 
They will ask that you pay periodically. But when the injured 
worker is not from Guangdong, you must ask the worker to go 
back to Guangdong to change his artificial limb. ``I am from 
Sichuan. I am already disabled, you ask me to come from 
Sichuan, so far to go back to Guangdong and then to change the 
artificial limb, and then claim back the money.'' So you see 
how stupid it is. That is also related to protectionism in the 
different provinces.
    Ms. Ko. I would like to follow up on the discussion about 
the 
industrial association issues. Mr. Chan mentioned that the toy 
industry industrial association needs to make more efforts in 
this area of workplace safety. I was wondering if there are any 
other industrial associations working on such issues--how 
strong are they, what is their relationship with the local 
governments, and whether they have any influence to push local 
governments in the direction of forming worker committees or 
otherwise take steps to improve worker safety?
    Mr. Chan. I should say that anyone wanting to do any kind 
of labor issue is stupid in China. For example, even lawyers 
have problems with labor cases. That is why so few lawyers want 
to do health and safety because certainly you will antagonize 
the local government and businesses, and finally you will lose 
your business in other areas. So that is why there are so few 
lawyers working on these cases.
    But it is very clear that more and more individuals or 
small groups are coming up for the workers throughout the 
country. But I should note that they are more individual and 
they are not so well organized. From a positive point of view, 
you can see that there are fewer government cadres. Even though 
they are government-backed, there are more individual members 
and many fewer government cadres. So that is a kind of new 
civil force--I cannot yet call it ``civil society! ''
    One of the key issues, which we are also thinking about, is 
how we can strengthen the network among such people. They are 
not so-called independent NGOs, but they are concerned about 
labor issues. They also want to do something good, to work at 
lobbying the government, or of to provide some kind of 
education. I think one very important issue is how we can 
strengthen such a civil force, and also help it move from 
unorganized to, well, more formalized, not organized, more 
formalized. Up to now, it has not been that easy to do. It is 
difficult because they come from different centers and they 
have different agendas, but I would say that in the past 3 or 4 
years certainly there are more and more such people from 
different centers coming up. Maybe some of their work is for 
the benefit of their own business, but more importantly for me 
there are fewer government cadres.
    Ms. Leung. Yes, if I can, I would like to take your point 
further. I think the existing situation is there are not many 
chambers of commerce or industrial sectorial associations, 
which really work or focus on health and safety. That is 
exactly where the new initiative should lie. For example the 
American Chamber of Commerce should consider taking up a health 
and safety strategy and program for American companies, but 
again not only the American companies but also the suppliers 
and sub-contractors of all the American firms. And so I would 
say this is definitely a direction, which requires work.
    When I was in Beijing in August with a European mission, I 
learned that actually there was a kind of informal chamber of 
foreign companies, mainly European but I think the American 
companies were also there in Beijing. And they meet regularly. 
Now, if there were this kind of chamber or association of 
foreign companies, Beijing would be their headquarters and so 
they would be the right body and right foreigners to really 
deliberate a strategy on health and safety and also to 
recommend programs for individual companies.
    Mr. Foarde. Thanks to my colleagues for great questions, 
and to our panelists for great answers. We are fast closing in 
on the end of our roundtable this morning, but we do have time 
for one brief comment from each of you to wrap up, if you like. 
Perhaps we could begin with Mr. Chan, if you want to?
    Mr. Chan. I think we were talking about, especially how to 
make the foreign-funded enterprises follow the labor standard. 
I think there are two issues we must address. One is that they 
should take up more corporate responsibility especially on the 
pricing and also on the ordering system. The second issue is 
how to get workers involved in the monitoring. You can imagine 
how we can monitor the factory once a month, twice a month. 
Usually a lot of the companies are only monitored once a year. 
So the only way that true monitoring can become effective is if 
it comes from the workers. If they can have a say, if there is 
some kind of a mechanism inside the factory, the workers can 
monitor. I think that is more important and, moreover, it is 
legally allowed.
    Mr. Han. Thank you. I would say first that there is a great 
opportunity in China now, especially when we are faced with the 
very bad health and safety situation. Definitely the central 
government would like to act, but the local government has an 
interest in this matter, for instance, frequently being co-
opted against acting on this issue. And the enterprises that 
are cooperating with the local governments make the situation 
very bad. So, because we want to improve the health and safety 
problems and help the Chinese workers, we have to think how 
based on this reality we can use the central government's 
willingness to act against the local governments' and 
enterprises' bad behavior. That is the first point.
    The second issue, I would say, is to use the laws. How to 
use the laws? For example, in a courtroom you can have a good 
judge, you can have a good prosecutor, and you can have good 
lawyers, but that is not enough. You have to have clients. So 
that is why I said there is a need to create the workers' 
health and safety committees. The idea is to create the clients 
to require the rule of law, and without clients we cannot 
really set up an effective courtroom.
    And third, I would say stop putting a huge amount of money 
into inviting the government officials and the so-called 
experts from China to go to the United States for a free trip. 
That is really a waste of money, and even if you provide the 
money it is a shame, I would say, when it does not help the 
Chinese workers at all. And I would say whatever money there is 
to improve the workers' health and safety situation in China, 
it should be done inside the workplace. No more meeting rooms, 
no more conference rooms, and no more activities in offices. 
Thanks.
    Ms. Leung. Thank you. I would like to focus my last comment 
on the role of foreign governments, overseas governments, or 
overseas bodies. A strategy of intervention, I would suggest, 
best lies in local initiatives because that will gather the 
strength. The strategy should first target the worst problems, 
but more important is to identify what are the most effective 
entry points. I would say the most effective entry points are 
in the companies, be it the investors, the investing companies, 
or for all the brand names, the products which target the 
consumer market, but also the companies, the insurance 
companies and also the legal profession.
    And last, I think that maybe, because there is only very 
limited spectrum of ways that foreign bodies can exercise their 
influence, establishing flagships of best practices can be a 
most effective way for the outside players. Thank you.
    Mr. Foarde. On behalf of Senator Max Baucus of Montana, the 
chairman of the Congressional-Executive Commission on China, 
and Congressman Doug Bereuter of Nebraska, co-chairman, thanks 
to our three panelists for a rich and very highly focused set 
of presentations this morning. You have helped us to learn a 
lot, and I hope we can always keep up the contact and dialog to 
learn more about workplace safety issues in China as your views 
evolve.
    I would also like to thank my colleague Lary Brown for 
setting up this roundtable this morning here in Hong Kong, with 
the capable assistance of Pat Dyson from the Solidarity Center. 
Thank you very much, Pat.
    Again, thank you all for coming to attend this morning. 
Thanks to the FCC for hosting us. The papers that our panelists 
submitted should be up on our Web site, if not today in 
Washington, then in the next couple of days. The Web site is 
www.cecc.gov, and a full transcript of this morning's 
proceedings will be available on the Web site in about 5 or 6 
weeks. We get the transcript back and then give our panelists a 
chance to correct any errors, and when we get it back, then we 
put it on the Web site.
    With that, thank you again, and we will call this 
roundtable closed for this morning. Thank you.
    [Whereupon at 11:27 a.m. the roundtable was adjourned.]
                            A P P E N D I X

=======================================================================


                          Prepared Statements

                                ------                                


               Prepared Statement of Wing-yue Trini Leung

                            november 8, 2002

What Can Be Done for the Largest but Deadliest Manufacturing Center in 
                               the World?

    [Summary notes for discussion, presented by Wing-yue Trini Leung, a 
researcher on labour and politics in China. Contact address: 
[email protected].]
    As China achieves spectacular rates of economic growth during the 
last decades of the 20th century, its health and safety record has made 
nearly as sensational a leap, but in the opposite direction. Industrial 
and mining injuries, fatalities and occupational diseases have all 
risen at a rate surpassing the near double-digit annual growth rate in 
the economy. It is during the same period that China has become more 
deeply integrated into the international community and global economy. 
China at the start of the 21st century is the largest manufacturing 
center of the world. It is also the deadliest. Alongside the Chinese 
Government, the international community has been pumping millions of 
dollars trying to revert this chilling reality.
    This paper discusses the problems of improving health and safety at 
work in China. It argues for a new strategy, departing from the 
previous emphasis on strengthening official machinery and capacity. 
Building a sound and mature mechanism for representing plural 
interests, and a culture of participation would offer more promise for 
reversing the trend of ever worsening violations of rules and standards 
in China.

                         The Current Situation

    In 2001, 9,650 fatal incidents of industrial injury killing 11,047 
workers (5,670 of whom were miners) were officially recorded. 
Industrial accidents rose by 27 percent over 2000. The International 
Labour Organization (ILO) estimates that annual workplace fatality rate 
in China is 11.1 per 100,000 workers, compared to the rate of 2.19 per 
100,000 in the US. Official records of occupational diseases rose by 13 
percent in 2001 over 2000 figures to 13,218 cases with 2,352 deaths. 
And these are only the official records which, like all other official 
reporting of bad news in China, represents a small fraction of the 
reality.
    A total of 13,218 cases of occupational diseases were recorded by 
the government in 2001, a rise of 13 percent over the figure in 2000, 
when 2,352 people died. The government has publicly admitted that 
``this is only a tip of huge iceberg of health hazards at workplace in 
China.]'' Fewer than 30 percent of workers who are exposed to dusty 
environments received health checks for pneumoconiosis.\1\ 
Pneumoconiosis, chemical poisoning and leukaemia are the leading causes 
of early loss of working ability in China. The high-risk industries for 
occupational illnesses are coal production, metallurgy, building 
materials, non-ferrous metals, machinery and chemicals.
---------------------------------------------------------------------------
    \1\ ``Occupational illnesses on rise in China,'' Xinhua News, 04/
02/2002.
---------------------------------------------------------------------------
    The State Administration of Work Safety and the State 
Administration of Coal Mine Safety were set up by the State Council in 
2000, in a central government attempt to rationalize the State 
machinery of health and safety management. This new organ has 
galvanized considerable political backing and resources.
    The Prevention of Occupational Disease Law was implemented on May 
1, 2002.\2\
---------------------------------------------------------------------------
    \2\ ``Law to stem occupational diseases,'' Shanghai Star, 16/05/
2002, in http://www.chinadaily.com.cn/star/2002/0516/fo5-1.html.
---------------------------------------------------------------------------
    The first generic law on health and safety in China, the Work 
Safety Law (WSL), was finally enacted on 6 July, 2002, and becomes 
effective on 1 November, 2002. This law is the culmination of over a 
decade of efforts and resources, from both inside and outside China 
attempting to provide a legal foundation to address the problem. One 
week into its effective date, it's not too early to announce that this 
statute will, just like hundreds of other laws in China such as the 
Labour Law (1994), become another meaningless document sitting on the 
shelf while violations go from bad to worse.
    The Dangerous Chemicals Handling Directives will also become 
effective on 15 November, 2002. But this, like numerous other rules, is 
only an administrative directive from the State Council, and carries 
even less leverage than statutory law on business and plant operators.
    China has not ratified International Labour Conventions (ILC) 155 
and 161. The ratification of ILCs would put additional pressure on the 
government to be held 
accountable for its performance, and this is badly needed.
    As admitted by the Chinese officials, the main stumbling block on 
H&S does not lie with the institution of laws but rather with the 
implementation of laws. There are many government decrees and rules, 
and many more government organs and officials who have existed for 
decades for the task of enforcing H&S. During the past decade, there 
has also been a healthy rise in the provision of H&S training and 
capacity building for various official bodies and personnel. The bulk 
of the groundwork has been laid, but rules and guidelines continue to 
be flagrantly breached by 
employers, local law enforcement officials and, at a different level, 
the employees. Improvement in H&S will need to tackle this bottleneck.

                          The Worst Offenders

    Some sectors have been identified as the high risk group on H&S 
record.
   ownership of enterprises: soe, pie, fie, tve : who are the worst 
                               offenders?
    Businesses and manufacturers in China can now be categorized into 
the public and private sectors on the basis of ownership and control of 
the enterprises. By this measure, the state-owned enterprises (SOEs) 
belong to the public sector; while the private and individually owned 
enterprises (PIEs), foreign-invested enterprises (FIEs) and the 
township and village enterprises (TVEs) can be grouped under the 
private sector. About two thirds of the country's 400 million non-
agricultural workers are employed in the private sector.
    In general SOEs are subject to relatively fewer commercial 
pressures and hence are under less pressure to skimp on H&S provisions 
and implement a mean and lean labour regime. Presence of the official 
machinery, such as the party organs (including the official union), is 
usually stronger in SOEs. which should help with H&S enforcement. Most 
workers are employed on a relatively more long-term contract basis and 
hence have more leverage on the enterprises. Despite all this, however, 
it is not a rosy picture at the SOEs. Numerous non-implementation, 
negligence and outright violation of regulations still plague their H&S 
records. Refusal to provide legally required and adequate compensation 
to victims of industrial injuries is very common. Under investment and 
lack of resources also account for poor H&S provisions and training in 
the SOEs.
    But the situation is many times worse in the private sector. Most 
enterprises are small and medium sized and are situated in towns, 
villages and suburban counties. They are typically set up and owned or 
run by one or small handful of local entrepreneurs, often under the 
auspices of local authorities. Such factories form the back bone of the 
export-processing industries; many serve as sub-contractors and 
suppliers to the major MNCs around the world. The plants are set up 
with minimum planning and investment, for the pursuit of maximised, 
short-term returns. Nearly all the workers are employed on short-term 
contracts; many of them are very young migrants from nearby or from the 
remote countryside. An extremely exploitative and repressive, and often 
illegal, labour regime is imposed on the workforce. Workers commonly 
suffer from long working hours, forced overtime, deprivation of rest 
days and sick leave, low wages (nearly always on piece-rate), arbitrary 
penalties and dismissals, and denial of collective bargaining rights. 
H&S features very low in the investment and management priorities of 
these enterprises, if at all. The local law enforcement officials are 
usually willing to turn a blind eye to the situation, either because 
they are bought off or because they see it in their interests to keep 
the 
entrepreneurs and investors happy.
    According to the government, about 74 per cent of serious accidents 
in industrial and mining enterprises occurred in the private sector.\3\
---------------------------------------------------------------------------
    \3\ Source: China Daily, 01/02/2002, ``Production safety major 
concern in new year,'' http://www1.chinadaily.com.cn/cndy/2002-01-02/
50321.html.
---------------------------------------------------------------------------
    In general, both in the public and private sectors, large 
enterprises which have over 3,000 employees are subject to more 
stringent official supervision and are 
better positioned to provide better H&S regimes. Large hi-tech joint-
ventures with foreign MNCs are also more vigilant about H&S 
requirements.
 sectoral: agricultural, industrial, mining, construction, fireworks: 
                     which are the deadliest jobs?
    Mining has undoubtedly recorded the worst work-related casualties. 
Some 7,000 miners were killed in 2001, 5,600 of them in coal mines. The 
fatalities were largely caused by mining accidents and explosions. Very 
disturbingly, it has been established that most of the mines in 
operation in the country are illegal. Despite efforts taken by the 
central government in the last few years to clamp down on these illegal 
mines, only a third of them were officially closed down by 2001. These 
illegal mines are the death traps for thousands of miners. Independent 
researchers estimate that about one million miners have contracted 
silicosis. Most miners are typically transient workers from the poorest 
parts of China, who have no other means of livelihood than working on 
the deadliest jobs in the country. It is widely accepted that most of 
the regular injuries and casualties among miners go un-reported in 
official records. Many miners are asked to sign a waiver of any legal 
claims, other than a pitiful lump sum compensation payment in the event 
of any injuries or fatalities on the job. This is nicknamed as ``life-
and-death-contract,'' ``sheng si zhuang'' in China.
    The other deadly, but much less noticed, occupation is with the 
building and construction industry. There have been few reliable 
records on construction industry injuries and deaths. Just like the 
miners, nearly all construction workers are migrants from the more 
remote or poorer regions of China. Most injuries and casualties go un-
reported. Unlike the occurrence of spectacular mining explosions and 
disasters which have usually caught public attention, accidents in the 
construction are usually smaller in scale and hence go un-noticed more 
easily. But as well as accidents, occupational hazards also exist in 
long-term and invisible toxic exposure such as dust and asbestos. It is 
estimated that half of the world's pneumoconiosis victims live in 
China. The Ministry of Health estimates that these number 550,000. 
Exposure to asbestos is widespread and un-monitored.
    Fireworks manufacturing is another high-risk job. There are 
frequent incidents of explosions and fires in China's fireworks 
factories. Most such factories are small size or even family operations 
in small towns and villages. H&S provisions are practically non-
existent. Worse still, young children are employed and have been found 
among the victims of many of the accidents in this sector.
    Farmers are easily exposed to pesticide poisoning in the absence of 
health and safety information and training and regulatory regime. Sale 
of banned, toxic pesticides is widespread. There has yet to be a 
comprehensive body of epidemiological data to establish the extent of 
this problem.
    regional/geographical: the poorer is not necessary the worst off
    Overall, two dividing lines can be drawn in China to delineate 
level of development and economic affluence, one between West and East 
and the other between North and South. The pattern is that the southern 
and eastern coastal regions are the most developed, and the remote 
western and northern regions are the most depressed. However, H&S 
records do not coincide with these patterns of development. While 
mining disasters usually take place in the northern and western 
regions, frequent and serious industrial injuries also take place in 
the more developed regions of the south and eastern coastal areas. This 
reality illustrates that economic growth does not automatically lead to 
improvement in H&S.

          Factors Behind Non-implementation of Laws and Rules

    The following official analysis presents quite accurate diagnosis 
of the problems in health and safety by identifying the real causes in 
malpractice and corruption rather than in the institution of laws and 
regulations.

          The new work safety law just plugs the loopholes. But 
        accidents are never the result of a single cause. Other 
        malpractice, such as loose implementation of the existing 
        regulations, corruption, and protectionism, are also to blame.
          Had they been implemented, current regulations would have 
        been adequate, if not sufficient, to avoid the occurrence of 
        fatal accidents. Unfortunately they were not.
          Reports show that the owners of the small mines that exploded 
        did not take measures to create a safe environment for the 
        workers. But they also were not enforced by local law 
        enforcement officers.
          Where were those officers? Malfeasance, even corruption, can 
        explain this. Even if some were to rise up and enforce the law, 
        they could encounter a mountain of obstacles due to local 
        protectionism.\4\
---------------------------------------------------------------------------
    \4\ Source: China Daily (07/03/2002) ``Law enforcement more 
important,'' http://www1.chinadaily.com.cn/cndy/2002-07-03/76233.html.

    Laws and regulations fail to be implemented because there is an 
impenetrable mesh of intertwined vested interests between business 
operatives and local officials. In most instances, this has succeeded 
in fencing off the central authorities. There is a triangular deadlock 
between central government, local authorities (and employers) and 
workers. The primary victim of this situation is the exploited and 
oppressed workforce. The triangle is top-heavy with the workers at the 
bottom enjoying little power of leverage. Many factors account for the 
deadlock:
                       malpractices of employers
    Little or ineffective incentives and disincentives exist to deter 
employers from malpractice. It is often cheaper and easier to violate 
regulations than to observe H&S standards.
                      weak position of the workers
    The workers, who have the strongest interest in averting H&S 
violations, are in no position to assert their demands. They suffer 
from job insecurity, absence of labour contracts, long working hours, 
forced overtime, piece rate wages, lack of H&S provisions, and meagre 
injury compensation. These conditions dis-empower workers from forming 
a counter force to employers' violations.
                  ineffective government institutions
    The combination of a non-independent judiciary, powerless lawyers, 
and corrupt government officials have rendered laws ineffective. The 
central government often fails to exert or sustain its authority over 
local officials.
                        embryonic civil society
    The civil society is very weak. The interests which normally are 
vital for averting malpractice are not well organized nor represented. 
China lacks the basics of a healthy civil society which would include 
independent labour unions, insurance 
companies, industrial associations, chambers of commerce and community 
organizations.
                       watchdogs in civil society
    The essential actors who can function as watchdogs are weak. These 
include: the press, health professionals, advocacy and campaigning 
NGOs, academia.
    A breakthrough in improved H&S will only occur if ways are found to 
prise apart the existing complicit interests which leaves the H&S 
offenders freedom to continue their malpractices. The logical way 
forward is to begin by strengthening the 
interests which could counter the current power imbalance.

                           Possible Solutions

    Solutions to corruption and malpractices lies in better monitoring, 
effective 
penalty and rewards mechanisms and the existence of counter power or 
interest intervention. Improving H&S requires work on the government, 
employers, the employees and the society at large. A culture of H&S 
needs to be developed. A sound functioning of the civil society will 
actually assist the implementation of desirable policies and 
regulations decreed by the central government. In fact, the new Work 
Safety Law stipulates that monitoring and supervision of H&S should be 
exercised by four main actors: the labour unions, the media and public 
opinion, members of the public, and community organizations.
 civil society: companies, labour unions, ngo, press, lawyers, academia
Employers
    Solutions to corporate malpractices lies in an effective monitoring 
and punishment mechanisms to deter violations. Incentives can also help 
persuade companies the benefits of good H&S practices. Awareness and 
capacity training will help management personnel to embark on H&S 
schemes. Best practice awards can play the role of positive public 
reinforcement. Stringent and heavy penalties will help deterring 
offenders. Industry or business associations can provide research and 
program 
support on H&S for individual plant operators.
Employees
    The solution to the weak position and vulnerability of workers lies 
in strengthening their capacity to represent their interests and their 
collective bargaining power. A strong worker representation can act as 
the best monitor and enforcement of H&S at the workplace. Workers 
should be given information, training and capacity to play a central 
role in H&S practices at plant level.
    A great deal of research has emphasized the positive role that 
workers' participation can play in H&S. (Creedy) Existing laws (Labour 
Law, Trade Union Law, Work Safety Law) encourage the participation of 
unions in plant H&S committees. For example, Article 19 of the Work 
Safety Law stipulates that those operators in mining, construction and 
manufacturing and handling of dangerous goods which employ over 300 
workers must set up work safety management machinery, or full-time work 
safety management staff. The WSL also protects eight rights of the 
employees: the right to information, to put forward recommendations, to 
make criticisms, to expose and litigate against violations, to refuse 
operation, to emergency departure from dangerous workplaces, to legal 
compensation, to safety equipment and to H&S education and training.
    The weakness of current system, however, lies with the inability of 
the official unions to represent workers' interests and demands. The 
ACFTU officials are subjectively and objectively seen as accountable to 
the management and government rather than to the workers. Alternate 
means of workers' participation will need to be developed to enable 
meaningful labour representation.
The Press
    A watchdog mechanism functioning in a civil society is the most 
effective and efficient way to tackle malpractice. This role can 
usually be performed best by an independent press and non-governmental 
organizations (NGOs). The Chinese press has actually played a crucial 
role in the past few years in exposing and investigating industrial 
disasters and injuries. Nevertheless, investigating reporters have been 
subjected to intimidation and obstruction by local government officials 
and business owners. Sometimes these journalists receive backing from 
their media bosses or from the central government authorities; but on 
other occasions, they are also censored for pursuing ``politically 
sensitive'' subjects. Strengthening the culture of investigative 
reporting by the press will play a powerful role in exposing and 
deterring H&S malpractices. High-profile press awards on this subject 
may serve to 
encourage initiatives in this direction.
NGOs
    NGOs play an indispensable role in helping to draw attention to 
issues, in organizing community efforts and representation, in 
articulating non-official interests, in voicing demands and 
recommendations, in public education and information, and in providing 
community services. There is a slow but steady growth of NGOs in China. 
Some are working on H&S issues. Very few receive government support or 
even endorsement. Government needs to be persuaded to give more space 
and support to the NGO initiatives. Supporting the further development 
of the NGO community will help a rapid delivery of a cultural change on 
H&S.
The Legal system and insurance companies
    One of the main incentives for H&S violations is the general low 
costs incurred by employers and other offenders even when their 
violations are exposed. Offending employers often get away without 
paying much compensation to their victims. Workers have little support 
in pursuing compensation. Support for more effective litigation, 
including lawyers and litigation funds, would provide badly needed 
facilities to redress this imbalance.
    Insurance companies, given the right conditions, could also play a 
positive role in H&S management and monitoring. Article 43 of the WSL 
requires all work units take out industrial injury insurance. Insurance 
companies could add pressure to companies to clean up their health and 
safety practices or face higher premiums, or even fail to find 
insurers.
    Under the new Prevention of Occupational Disease Law, workers will 
be able to seek legal aid if their right to work is a safe environment 
is violated by employers. The highest fine for enterprises violating 
the Law has been increased tenfold to 500,000 yuan.
Academia
    There are many researchers and academics studying and investigating 
various H&S issues. Given adequate capacity and appropriate platforms, 
academia could play a crucial role in identifying problems and 
supporting solutions. Scholarships on H&S would help this development.
Government: labour ministry, State council, local government, 
        judiciary, ACFTU
    Current government thinking of its strategy on H&S is to offer more 
incentives to employers for good practices and harsher penalties for 
offenders.

          Because all these measures do little to alter the fundamental 
        problem 
        behind the many disasters--corporate failure to ensure adequate 
        safety measures and supervision, either due to negligence or 
        the blind pursuit of cost-cutting and profits.
          Unless enterprises take the initiative, it is only a matter 
        of time before more disasters occur. A close review of recent 
        coal mine accidents reveals that big disasters often occurred 
        in small businesses where workplace health and safety are 
        sacrificed to cut costs and maximize profits.
          While big companies may be more willing to provide a safe 
        working environment, there are few incentives for unknown small 
        enterprises to follow safety standards. And the penalties for 
        safety breaches are too little to bring a significant shift in 
        attitude among employers.
          Lax law enforcement and corrupt officials also play roles in 
        the failure to curb safety violations.
          Therefore, to build a safety culture, the government should 
        provide more incentives to get enterprises to ensure safe 
        working conditions for their employees and should also severely 
        punish enterprises that fail to maintain safety standards.'' 
        \5\
---------------------------------------------------------------------------
    \5\ Source: China Daily (06/11/2002), Opinion: ``Government has 
role in workplace safety,'' http://www1.chinadaily.com.cn/news/cb/2002-
06-11/73260.html.

    In addition to the role of the judge, the role of central 
government lies in creating and maintaining the macro environment for 
the sound functioning of policies and law and order at local levels. As 
part and parcel to this role, the government needs to provide the space 
for more independent and critical civil society to develop and 
function.

               Conclusion: a New Strategy of Intervention

    During the past decade or more, a great deal of resources and 
efforts have been invested in strengthening the capacity and resources 
of the various government 
institutions such as the labour ministry, the State council, local 
government, the 
judiciary, and the ACFTU. A vast amount of support has been given by 
numerous bilateral and multilateral bodies, foreign governments and 
non-government agencies to strengthen the Chinese Government's capacity 
in this regard. While this investment has borne some fruits in 
facilitating institutional changes in the central 
government, the H&S situation has gone from bad to worse.
    There is a need for a fundamental review of the previous strategy 
of focussing on the official machinery.
    The U.S. Government has in 2002 allocated 10 million U.S. dollars 
to aid China to improve labour standards and rights. Putting resources 
into supporting and facilitating the actors, interests, and forces in 
civil society outlined in this paper would be a more effective and 
efficient strategy for facilitating the cultural changes needed for 
workplace safety to be taken seriously.
    The strategy of intervention may best lie in partnership with local 
initiatives (gathering strength), targeting the worst problems (setting 
priorities) and seeking the most effective entry points (maximizing 
efficiency). Establishing flagships of best practice can also be an 
effective way for outside players such as foreign governments and 
companies to bring about broader change.
    Strengthening a society of plural interests and levels of 
representation is the most promising way to break through the existing 
impasse between the desire of the central government to improve the 
situation and the entrenched interests of local authorities and local 
business owners. Empowering a wider range of actors can shift the 
balance in favor of the millions of workers who currently face dangers 
to their health on a daily basis.
                               references
    China Labour Bulletin, in www.china-labour.org.hk.
    Creedy, David, ``Safety Management and Culture,'' in 
www.coalinfo.net.cn/safety1/pages/david.htm.
    Lam, Tony Fung Kam, 2000, ``Occupational Safety and Health in 
China,'' Asia Labour Update, Issue No. 39, April--June 2001.
    Liang YX, Xia ZL, Jin KZ, Fu H, Zhu JL, 2001, ``Surveys on work 
accidents and chronic cumulative trauma,'' in Asian Pacific Newsletter 
on Occupational Health and Safety, 2001:8:8-11.
    Luo, Yun, 2002, ``Shuzi hua Anquan Shengchan Fa (Work Safety Law in 
Numbers),'' Zhongguo Anquan Shengchan Bao (China Work Safety Herald), 
0926, www.chinasafety.gov.cn/jdaqyw/jdaqyw333.htm.
    Nash, James, 2002, ``Labor Dept. Gives Millions to Improve China's 
Mine Safety,'' in www.occupationalhazards.com/full--story.php?WID=5009.
    Pesticides News, 1996, December, No. 34, p. 18, ``Pesticide use in 
China--a health and safety concern.''
                                 ______
                                 

                   Prepared Statement of Han Dongfang

      Proposals to Improve Occupational Health and Safety in China

                            november 8, 2002
        china's coal mining industry requires of urgent measures
    Statistically, gas forms the most serious threat to coal miners. 
According to the People's Daily (September 26, 2002), gas-related 
accidents caused 43 per cent of all fatalities in coal mines during 
2001. Furthermore, in the 10-year period from 1991-2000, the number of 
coal miners killed in gas-related accidents nearly doubled. In recent 
years safety investment in China's key mines had fallen between 3 and 4 
billion yuan short of previously set targets. In Heilongjiang alone, 
investment in coal-mining safety was 570 million yuan short of the 
planned target figure. Moreover, the People's Daily report also stated 
that over the last 2 years investigations had revealed that many of the 
small-scale mines closed down by local authorities had failed to follow 
even the most basic safety procedures such as the installment of gas 
ventilation and monitoring equipment.
    In an emergency national telephone conference on coal mining safety 
convened in Beijing on July 7, 2002, the head of State Administration 
of Work Safety (SAWS) Wang Xianzheng emphasised that small coal mining 
enterprises must implement safety procedures in accordance with the law 
and that regulations on ventilation limits and gas density must be 
followed. When excavating gas-filled coal seams, procedures to release 
gas prior to excavation must be upheld. In accordance with the law, no 
excavation may take place in shafts that lack gas ventilation equipment 
or safety buffer layers. Production in coal mines that do not have gas 
monitoring and warning equipment with the ability to cutoff electrical 
power must stop production immediately.
    The above speech by Wang Xianzheng clearly maps out major problems 
in China's coal mining industry and that reveals how many coal mining 
companies are not fulfilling obligations to implement safe mining 
operations. Coal shafts without proper ventilation facilities, no gas 
extraction equipment in mines and coal seams with high gas 
concentration are extremely common as are shafts without adequate 
automatic warning facilities that guard against sudden increases in 
gas. Mr. Wang pointed to the coming implementation of China's new 
``Work Safety Law,'' which comes into force on November 1, 2002 as an 
opportunity to get safety work in the country's coal mining industry on 
to a sound legal footing.
    During the last 2 years I have carried out a number of interviews 
with those involved in coal mines where gas explosions and other 
accidents have taken place. I firmly believe that the problems pointed 
out by Mr. Wang are a very clear illustration of the serious 
occupational safety issues facing the Chinese coal industry. The 
situation we are in right now not only threatens the lives of millions 
of coal miners on a daily basis, but also the healthy development of 
the coal mining industry along with overall social stability. As such, 
improved safety in the coal mining industry is the responsibility of 
three major players involved: the employers, the government and the 
workers. I am in total agreement with Wang Xianzheng's assessment that 
only by addressing the problems via sound legal channels can the basic 
solutions be found.
the current system of safety management in coal mines: is it effective?
    At present, SAWS is the official organisation responsible for OSH 
laws, 
regulations and technical standards as well as inspecting compliance 
and safety management systems. The bureau's official website (http://
www.chinasafety.gov.cn) provides information on the measures the 
government frequently adopts to improve safety in the coal mining 
industry. These include:

        1. Top-down safety publicity campaigns on OSH, including 
        convening meetings and conferences of safety officials and the 
        regular issuing of OSH documents and guidelines;
        2. Closing down small coal mines that fail safety inspections;
        3. Suspending production in state-owned coalmines that fail 
        safety inspections;
        4. Demanding that local governments and employers take OSH 
        concerns seriously as well as guarantee investment in safety 
        procedures and equipment and adequate training for 
        personnel.\1\
---------------------------------------------------------------------------
    \1\ See the circular issued by SAWS No. 21 (2002): ``Urgent notice 
on strengthening the `one ventilation three precautions' work in coal 
mines.''

    But how effective is this top-down propaganda-based approach to 
OSH?
    In March this year SAWS proclaimed June 2002 as ``work safety 
month.'' However, according to figures posted on their website, 400 
coal miners died in May this year and 449 in June--the designated 
safety in production month. The ongoing tragedy continued into July 
when a further 482 coal miners were killed at work.
    In the aforementioned telephone conference SAWS deputy director 
Zhao Tiechui pointed out that the OSH system established in the coal 
mining industry existed in name only. Documents issued from the centre 
are simply passed on to the next level down and ignored. Meetings are 
held but the safety measures they discussed never got further than the 
conference hall. He also stated that the problems were exacerbated by 
old and outdated machinery in state-owned mines, inadequate safety 
operation procedures and a decline in these mines' fire prevention 
facilities and fire-fighting equipment. Using the recent accident at a 
mine owned by the Jixi Mining Group as an example, Mr. Zhao pointed out 
that the State Administration for Coal Mine Safety Supervision (SACMSS) 
had issued six warnings to the group. The warnings stated that its 
investment in safety systems and operations had fallen and as a result 
there was serious safety hazard. Yet the group both refused and 
procrastinated over instructions to rectify the situation, citing 
economic difficulties. On June 20, just as an inspection team 
despatched by the State Council had completed its work and issued yet 
another notice to cease production until safety standards were met, an 
explosion and fire ripped through the mine, killing 115 miners.
    Mr. Zhao also said that local governments, especially at county and 
village level were unwilling to close down small mines that failed to 
meet safety standards due to a dependence on tax revenues from these 
operations and that it was impossible to prohibit illegal small-scale 
mining. At the same time, some mine owners simply ignored ventilation 
and safety measures and organised groups of workers into working extra 
long shifts in dangerous pits so as to extract as much coal as possible 
before they were ordered to close down. Obviously, this tactic 
dramatically increases the chances of accidents.
    On July 19, the People's Daily quoted an interview with the head of 
the Jixi Mining Group Safety Inspection Office Meng Zidong and the 
director of Jilin provincial office of SACMSS Dong Xiangge: ``[W]hat 
can we do if a mine refuses to implement a notice to cease production 
following a safety inspection? We can't force them.''
    Clearly, we cannot expect miracles from this traditional top-down 
model of OSH inspection and management. The government is doing all it 
should be doing to regulate the industry and yet new ideas are still 
required to improve the situation unless, of course, we simply sit back 
and accept the crisis is insoluble. What then, is the way forward?
                             a new approach
    Clearly lacking in the traditional approach to OSH in China is 
direct worker participation. No matter from which angle we examine the 
issue of health and safety at work, there is one inescapable common 
denominator: namely that the status of workers themselves remains 
passive. As such workers are reduced to the level of a passive `target 
audience'. They are `targets' of OSH propaganda; `targets' of 
inspection and monitoring; `targets' to be restricted by various laws 
and regulations; and, inevitably, easy `targets' for OSH tragedies.
    However, if we take the significant step of moving on from this 
outmoded approach and place the right to actively monitor health and 
safety in China's coal mines into the hands of the miners themselves, 
the situation will take on a completely different appearance. Over the 
last 2 years, I have conducted interviews with coal miners, management 
cadres and government officials as well as with the families of miners 
killed in accidents. This work has led me to the conclusion that it is 
the miners themselves who are best placed to understand the importance 
of OSH. For them it is not simply a matter of reports and conferences. 
The issue is of paramount importance to their families and a matter of 
life and death to themselves.
    My interviews also testify to the fact that as far as OSH is 
concerned, miners are restricted to a totally passive status. Yet, if 
we begin by strengthening the legal system governing OSH and keep 
strictly to the letter of the law in order to implement guarantees that 
give face workers the right to refuse to work in an unsafe environment 
without risking punishment or any other repercussions from management, 
we can transform workers from being passive `targets' of OSH management 
and legal regimes to being active implementers of OSH monitoring and 
implementation. This paradigm shift will also move OSH in China on from 
the traditional, largely ineffective model of top-down management and 
implementation.
    The crux of our proposal is for underground face workers in China's 
coal mines to organise a ``workers' OSH committee'' in their workplace, 
elected by face workers themselves. Using this committee as a baseline, 
an ``enterprise OSH committee'' should be set up made up of members of 
the workers' OSH committee and enterprise management on a fifty-fifty 
basis.
   legal basis for a ``workers' osh committee'' in china's coal mines
    Article 19 of China's new ``Work Safety Law''(hereafter Safety Law) 
states that work units producing, operating and storing dangerous 
materials as well as mining and building work units shall set up OSH 
management organisations or allocate full time OSH personnel to 
administer safe practices at work. Other work units with over three 
hundred staff and workers must also set up OSH management organisations 
or allocate full time OSH personnel to administer safe practices at 
work. Work units with less than three hundred staff and workers must 
allocate full or part time OSH personnel or entrust such duties to 
technically qualified personnel in line with China's laws.
    Article 45 stipulates that employees have the right to be fully 
aware of all hazards present in their workplace as well as the 
associated preventative and emergency measures . Workers also have the 
right to make suggestions on OSH policy to their work unit.
    Article 46 stipulates that workers have the right to make 
criticisms, reports to the relevant department and take legal action on 
existing OSH problems. Workers also have the right to refuse orders 
that violate OSH rules or work in hazardous conditions.
    Article 47 states that workers who encounter a situation during 
work that directly endangers their personal safety have the right to 
stop work and, after taking all appropriate measures, to leave the 
workplace.
    At the same time, Article 50 stipulates workers legal obligations 
to accept 
education and training in matters pertaining to OSH and take steps to 
render themselves fully aware of the appropriate and necessary OSH 
knowledge. They must also improve their skills and ability in safe 
working practices as well as accident prevention and emergency 
procedures.
    The Safety Law also stipulates the functions of trade unions 
regarding OSH at work. Article 52 states that the trade union has the 
right to make suggestions and put forward opinions on the facilities 
for OSH which shall be designed, put into operation and monitored at 
the same time as the main project. Trade unions have the right to 
demand the correction of any aspects to work place operations that 
violate OSH laws and regulations or harm the legal rights of staff and 
workers. They also have the right to make suggestions aimed at solving 
problems that arise from the violations of OSH rules, orders from 
management to work in hazardous conditions or the discovery of hitherto 
unforeseen dangers at work. The work units are obliged to respond to 
the suggestion promptly. Trade unions also have the right to propose 
that management make sure that their employees leave a place of work on 
the 
discovery of life-threatening hazards. In such cases the work unit must 
act on the proposal immediately.
    As we can see, the problem lies not with the aforementioned rights 
and regulations but with the official trade union's ability to 
implement them. Given the nature of the official trade union, there is 
no way that it can legally and effectively put into practice trade 
union functions in the field of OSH inspection and administration in 
the workplace. Moreover it is unrealistic to expect it to be able to 
fulfill these trade union functions in the foreseeable future. Our 
proposal for the establishment of ``workers' OSH committees'' (WOC) 
must also be considered against the reality that many private, foreign-
owned, joint-venture and restructured state-owned enterprises as well 
as subcontracted coal mines and shafts do not even have trade unions. A 
WOC could therefore rapidly begin to address OSH monitoring and 
management on the basis of the aforementioned laws and regulations. In 
mines and enterprises where trade unions do exist, the WOC can 
cooperate with the trade union in improving OSH measures, inspection 
and management at the enterprise on the basis of the law. This 
cooperation between the WOC and the existing trade union can avoid the 
sensitive question of challenging or changing the nature of the 
official trade union and will be able to complement and complete the 
work and functions that the latter is unable to fulfill due to existing 
legal restrictions. We hope that the result will not challenge the 
existing trade union system, improve OSH in the mines and reduce the 
threat of injury and death to those who work in them.
    At this point we must also point out that what we are discussing is 
how to inject new ideas, thinking and content into a traditional top-
down system of OSH monitoring and management that reality has proved at 
best unsatisfactory and at worst impotent. In effect, we are trying to 
forge a new approach to improving OSH in the mines. The key focus of 
our proposal is to reposition OSH in the workplace itself and move the 
entire issue away from the meeting rooms of government departments or 
the remote discussions of academic conferences and seminars. It is our 
view that the starting point for improving protection must be to 
encourage workers themselves to get involved in OSH based on their 
legal rights which we have explained above.
      the establishment of wocs and the aims of government policy
    On December 12, 2001, China's State Economic and Trade Commission 
(SETC), with reference to the ``ILO Guidelines on Occupational Safety 
and Health Management Systems'' formulated a document entitled 
``Guidelines on Occupational Safety and Health Management Systems'' 
(hereafter Guidelines). The aim of this document was to ``encourage all 
employees of employing units, especially top level executives, 
managers, workers and their representatives to adopt rational 
principles of OSH management and methods in order to uphold and 
continue to improve effective OSH in China.'' The Guidelines also 
stated that the ``State Administration of Work Safety (SAWS) was 
responsible for drawing up, implementing and regularly evaluating 
national policy on work units' internal OSH management systems.'' The 
Guidelines also confirmed that ``work units shall voluntarily set up 
and maintain OSH management systems and support employees and their 
representatives to actively take part in OSH activities. They shall 
also confirm and guarantee that OSH measures and requests apply not 
only to their own employees, but also to subcontractors and directly 
employed temporary workers. Enterprises involved in high risk work 
along with those employing units that have suffered serious accidents 
have a special responsibility to set up and maintain OSH management 
systems.'' The Guidelines also stipulated that once enterprises had set 
up ``OSH management systems,'' they should also establish an ``OSH 
Committee'' in which a fair proportion of workers are to take part. As 
the Guidelines have had for little more than half a year to be put into 
practice, I believe that coal mining enterprises have not yet had time 
to set up these systems and committees.
    We believe that there is little difference between the voluntary 
participation in ``OSH management systems'' stipulated by the 
Guidelines document and the WOC that we are advocating as a practical 
and realistic response to dangerous workplaces in China.
    the chinese government's cooperation on osh with international 
                            statutory bodies
    Article 2 of the SAWS document (No.6, 2001) ``Temporary Regulations 
on the Management of Foreign Affairs of the State Administration of 
Coal Mine Safety Supervision under SAWS,'' which came into effect on 
January 1, 2002, states that ``the general affairs office (foreign 
affairs department) of the State Administration of Coal Mine Safety 
Supervision under SAWS (hereafter Foreign Affairs Department--FED) is 
responsible for foreign affairs work related to the OSH monitoring and 
management. This includes guidance, co-ordination, administration and 
co-ordination of all work and matters relating to foreign affairs.'' 
Article 3 emphasises: ``[T]he principle that `external affairs are 
important and all matters must be dealt with on the basis of requesting 
instructions'. All activities of work units involving foreign external 
matters where problems are encountered shall promptly request 
instructions from the leaders of the foreign affairs offices of the 
relevant national bureaux via the [aforementioned] FED. Where 
necessary, the national bureaux shall request instructions from the 
relevant departments of the Central Government.'' Article 7 of the same 
temporary regulations also sets out in detail the corresponding 
responsibilities in handling foreign external matters.
                 on the selection of members to the woc
    The process of selecting and organising a WOC should be as direct 
and straightforward as possible. Each workshop, mine (mineshaft) and 
even mine work team can organise a WOC Group from which workers in 
enterprises and mines can elect a WOC,

        1. In order to encourage the participation of the workforce, 
        the workers must elect all WOC members themselves. Most 
        important, the WOC shall not be appointed, either by management 
        or government departments. This would be no more than a return 
        to the traditional top-down approach and result in workers 
        having no confidence in the new WOC even at its inception. It 
        will also sacrifice the aim of encouraging workers themselves 
        to take part in OSH affairs.
        2. In large-scale State owned mines, the WOCs can be set up 
        within the enterprises.
        3. In Provinces such as Hunan and Guizhou where small-scale 
        mines are comparatively common, local coal sector WOCs can be 
        elected at county or city level with a ratio of one committee 
        member for every thirty members, with a minimum of at least two 
        members from each coal mine. WOC members must be coalface 
        workers able to inspect safety conditions in the mine at all 
        times. Membership of the WOCs should be 1 year, during which 
        time he or she may not be dismissed or fired. The WOC shall 
        meet once every 3 months during work hours and set up a working 
        committee that shall deal with day-to-day complaints and 
        reports from the workforce. Monthly reports on the results of 
        complaints and how they are dealt with shall be sent to the WOC 
        on a monthly basis. Where local coal mining WOCs are set up at 
        county and city level, they shall register with the Ministry of 
        Civil Affairs and filed with the Department of Labour and 
        Social Security and SAWS.
        4. A pilot ``OSH Co-ordinating Committee'' (OCC) shall be 
        established at county (or city) level composed of an equal 
        number of government, enterprises and WOC representatives. WOC 
        representatives to the OCC shall be elected by WOC members.
        5. A coal mining sector OCC Congress shall be convened once a 
        year during which negotiations between government, employer and 
        worker representatives shall take place. These will include a 
        critical assessment of the past year's problems and set a 
        figure for financial investment in OSH facilities for the 
        following year. Deadlines should be set for funding and OSH 
        investment and all parties shall sign an agreement on questions 
        relating to safety standards in coal mines.
        6. The WOC shall set up a fund to the meet legal fees of any 
        WOC member who is dismissed by his or her employer as a result 
        of activities related to the WOC.
             the woc as a player in enterprise development
    Once established, it is envisaged that the new WOCs will be a 
source of renewed energy and vigour in China's exhausted OSH system. 
The election of face workers who are only too keenly aware of the 
underground hazards they face will have a direct beneficial effect on 
OSH measures in the work place. Moreover, the capacity of WOC members 
to raise questions related to violations of safety rules and the 
existence of worn out and ineffective safety and equipment and 
installations will 
reduce the number of accidents.
    The fact remains that many small coal mines do not have even the 
most basic safety equipment and continue to operate in extremely 
dangerous conditions, usually under the protection of local government 
officials. While some of these officials are genuinely concerned to use 
tax revenue from coal mining in order to meet targets assigned to them 
by higher levels of government, their role is more frequently 
determined by bribes from coal bosses or their personal ownership of 
shares in local coal mining enterprises. Whatever the reason, the 
result is the same: a blind eye is turned toward safety concerns in the 
mines. WOCs will serve as an effective channel through which bribery 
and financial conflicts of interests caused by government officials' 
purchase of shares in local mining companies can be exposed and the 
practice ultimately stopped. WOCs right to monitor the workplace will 
gradually improve a situation where local officials ignore OSH matters 
due to factors relating to personal gain.
    Of course, the setting up of WOCs will have unavoidable effect of 
increasing investment in OSH measures and this will in turn reduce 
profits. However, we believe the WOCs can become a watershed in the 
development of China's coal industry--in line with government policy. 
For example, the WOCs will be in a position to urge employers to buy 
basic work injury insurance for their employees. The insurance company 
will need to be fully aware of the risks before offering insurance and 
as such will evaluate OSH systems in the mine before offering a policy. 
This will serve as another mechanism that will have a positive impact 
on safety. Of course, injury insurance will lead to an increase in an 
employer's initial investment, but it will lessen the risk of 
enterprises having to make large compensatory payments after an 
accident has occurred, thus reducing the likelihood of bankruptcy and 
consequent unemployment.
    I believe that planned investment in OSH aimed at preventing injury 
and accidents is part of the overall production costs and should be 
budgeted for as such. Managers' current mindset to OSH costs focus on 
one-off payments required as compensation following an accident. The 
establishment of WOCs will help the industry's managers to move on from 
this essentially passive reactive attitude to a rationale, budgeted and 
proactive policy on OSH matters. Seen in this light, the proposal to 
establish WOCs will actually assist in the healthy, sustainable 
development of 
China's coal industry.
                         the fireworks industry
    At present, the coal mining industry is beyond doubt the 
government's biggest headache as far as OSH is concerned. It continues 
to have the worst fatality rate of all China's industrial sectors. Our 
proposal for WOCs therefore starts with an urgently needed and feasible 
plan for the coal industry. However, the OSH situation in the fireworks 
and firecrackers industry is also extremely serious. The industry is 
plagued with regular explosions that kill and maim dozens of people. 
Worse still, because most of the assembly of fireworks and fire 
crackers takes place in the homes of villagers, the accidents always 
involve the deaths of children.
    The response of the government of Jiangxi Province to the problem--
where small-scale fireworks production is extremely widespread--has 
been to announce a policy of killing off the fireworks industry in the 
province over the next 2 years. However a number of factors make this 
problematic. Firstly, the fireworks sector in Jiangxi is enormous. 
Second, millions of peasants who cannot support themselves off the land 
alone rely on fireworks production simply to get enough to eat and send 
their children to school. The likely result of the Jiangxi government's 
policy will be to force production into illegal underground workshops 
that are even harder to regulate, especially from an OSH point of view.
    Fireworks production is frequently organised around a village-level 
enterprise that subcontracts out assembly work to local village 
residents who work at home. Nearly all the accidents are explosions 
followed by fire that affect those at the actual accident site, but 
more often than not those living nearby. Using the WOC model proposed 
for the coal mining industry as a model, we also propose that 
``villagers' OSH committees'' (VOC) be set up to monitor the safety 
measures of village-level work units and companies responsible for 
fireworks and firecracker production. The VOC members should be 
directly elected by village residents who would then elect a county-
level ``community OSH committee'' (COC). Finally a tripartite sector-
level OSH coordinating committee (OCC) should be set up composed of 
government officials from relevant departments, industry 
representatives and village residents elected by the local COC. The OCC 
should be registered with the Ministry of Civil Affairs and filed with 
the MOLSS and SAWS.
                                 ______
                                 

                   Prepared Statement of Chan Ka Wai

                            november 8, 2002

        Health and Safety Problems in Foreign-funded Enterprises

    Foreign investment has increasingly moved to China after its entry 
to the World Trade Organization last year. According to government 
statistics, by the year 2000, there were 28,455 foreign-funded 
enterprises (including investment from Hong Kong, Macao, Taiwan and 
other countries) in China. Their investment reached RMB 2,346.5 billion 
totally and more than 6.42 million workers were employed.\1\ Many 
industrial accidents occur in foreign-funded enterprises. Among 
different health problems, occupational disease has been a growing 
issue in the last few years.
---------------------------------------------------------------------------
    \1\ See China Statistical Yearbook 2001 and China Labour 
Statistical Yearbook 2001.
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                         occupational diseases
    Now more than 16 million Chinese workers are exposed to toxic or 
hazardous conditions in the workplace. By law, more than 10 million 
workers should receive regular health examinations, but only one third 
of them have done so.\2\ Many of the unexamined workers suffer from 
occupational diseases. These statistics do not include workers in 
village and township enterprises or small workshops. Their health and 
safety situations are more grave. It also does not include those 
workers whose occupational diseases have been certified and who have 
gone back to their hometowns. Among various occupational diseases, 
pneumoconiosis is the most common. At present, 558,000 pneumoconiosis 
cases have been reported in China, of these 425,000 people are still 
living. Each year, 15,000-20,000 more cases are reported and more than 
5,000 patients die of the disease. The death rate is 23.58 percent.\3\
---------------------------------------------------------------------------
    \2\ Laodong Baohu (Labour Protection), May 2000, p.14.
    \3\ Gongren Ribao (Workers' Daily) April 28, 2002.
---------------------------------------------------------------------------
    Among those factories in which workers are exposed to toxic and 
hazardous conditions, many are foreign-funded enterprises. In 2000, the 
Health Ministry of China examined 1,426 foreign-funded enterprises 
where they found that 37.2 percent of the enterprises had occupational 
hazards in their workshops, and 34.7 percent of workers are 
involved.\4\ Poisoning in the workplace is a very serious issue.
---------------------------------------------------------------------------
    \4\ Laodong Baohu (Labour Protection), May 2000, p.14.
---------------------------------------------------------------------------
    On January 27, 1999, eight workers of the Ruyi Manufacturing 
Factory in Fujian suffered benzene poisoning. One worker died, and 
seven workers were seriously poisoned. Among the victims, the eldest 
was 27 years old and the youngest, only 17; the most senior worker in 
the factory had worked there for 8 months, and the shortest for only 2 
months.\5\
---------------------------------------------------------------------------
    \5\ Ibid, p. 15.
---------------------------------------------------------------------------
    In July 2001, 26 workers suffered benzene poisoning in Shenzhen and 
it is 
believed that more than 200 workers were affected but have not yet 
displayed 
symptoms.\6\
---------------------------------------------------------------------------
    \6\ China Work Safety News, July 13, 2002.
---------------------------------------------------------------------------
    In February of this year, six women workers died of exposure to 
benzene at a shoe factory in Hubei.\7\ In July, 12 workers of the Anjia 
Shoe Factory in Dongguan, Guangdong were affected by benzene poisoning. 
Several of them are now paralyzed. The youngest victim was 16 years 
old.\8\ The Chinese Occupational Disease Prevention Law states that 
workers aged 16-18 are prohibited from working under toxic and 
hazardous conditions. However, factory management stated that they were 

unaware of the regulations. Clearly, education and monitoring efforts 
by the 
authorities are inadequate.
---------------------------------------------------------------------------
    \7\ Yangcheng Wangbao (Guangzhou City Evening Post), July 9, 2002.
    \8\ Ibid.
---------------------------------------------------------------------------
    After investigation of the Anjia factory, more workers were shown 
to be affected, but many of them had already left the factory. It was 
reported that 39 women workers, whom it is believed have been affected 
by the poisoning, have not yet been located. When workers at the 
factory felt sick, they went to see a doctor. If their health failed to 
improve, they could not work and had to return to their hometowns. They 
never associated their sickness with the chemicals that they were 
exposed to each day.
    Most workers know nothing about occupational poisoning. Cases come 
to light only when workers go to hospital or a large-scale poisoning 
occurs in a factory. Currently, the reporting of occupational diseases 
is very sparse. In Guangdong Province, from 1989-2001, 4,848 
occupational diseases were reported. It is estimated that the rate of 
underreporting for occupational diseases is more than 50 percent, so 
that the real number of occupational diseases from 1998-2001 should be 
about 10,600, or an average of 800 cases resulting in 214 deaths each 
year. In spite of low reporting, the reported rate in 2001 is 2.78 
times of that in 1997.\9\ Occupational diseases are more common in 
Shenzhen and Dongguan where most foreign-funded enterprises, joint 
ventures or the enterprises producing for foreign investment are 
located.
---------------------------------------------------------------------------
    \9\ Ibid.
---------------------------------------------------------------------------
    It is estimated that 10 million workers are exposed to toxic or 
hazardous chemicals or other materials each day in Guangdong, but there 
are less than 1,000 occupational disease inspectors in the Province. 
Each inspector is responsible for about 1,000 enterprises and more than 
10,000 workers on average.\10\ This is an absurd ratio. For instance, 
many enterprises established in Heshan City since 1991 continue to 
reject inspection by health authorities. Currently 50.84 percent of the 
factories in China, in which workers face exposure to toxic and 
hazardous conditions, have yet to be inspected.\11\
---------------------------------------------------------------------------
    \10\ Yangcheng Wangbao (Guangzhou City Evening Post), July 10, 
2002.
    \11\ Gongren Ribao (Workers' Daily), April 28, 2002.
---------------------------------------------------------------------------
    Recently, the Guangdong provincial government examined 59,091 
workshops of 8,410 enterprises. 96.43 percent of the workshops were in 
violation of health regulations.\12\ This depiction is verified by the 
Hong Kong Christian Industrial Committee (CIC)'s recent research on the 
working conditions of four famous American toy brand names. In summer, 
2001, CIC conducted in-depth interviews with 93 workers from 20 
factories associated with eight enterprises using a standardized 
questionnaire. All interviewees were 18-35 years old.\13\
---------------------------------------------------------------------------
    \12\ Yangcheng Wangbao (Guangzhou City Evening Post), July 10, 
2002.
    \13\ How Hasbro, McDonald's, Mattel and Disney Manufacture Their 
Toys (HK: Hong Kong Christian Industrial Committee, 2001)
---------------------------------------------------------------------------
    Among the interviewed workers, 22 worked in the colouring 
department. They were exposed to toxic chemicals daily. None of the 22 
workers could name the chemicals they used every day or describe their 
hazards. According to the regulations, a clear label about the elements 
of chemical and its hazards is required. During our interviews, some 
workers complained of headaches, skin diseases, fainting and easy 
susceptibility to Hepatitis B due to long time exposure to toxic 
chemicals.
                           excessive overtime
    Another serious occupational health and safety problem in foreign-
funded enterprises is excessive overtime. According to CIC's research 
in 2001, 20 factories forced workers to work 14-18 hours a day on 
average. This is much higher than the legal standard which is 8 hours a 
day and with overtime not to exceed 3 hours a day.
    The longer workers are exposed to toxic or hazardous materials, the 
higher the risk that workers will be injured. In 2000, a woman fell 
asleep because of several exceedingly long hour days. Her hair was 
pulled into a machine, and she was severely injured. In a previous 
research project by CIC, we found that some workers also complained 
that they suffered miscarriage because of long time exposure to toxic 
chemicals.
    It is common for workers to become dizzy because of intensive 
overtime work or long time exposure to toxic chemicals. Workers even 
claim that some of there 
co-workers have died of long working hours.
    According to CIC's researches in the last decade, many industrial 
accident victims did not receive adequate compensation. Most received 
only get meager compensation while being forced to leave work at the 
factory due to illness. CIC's research in 2001, revealed that very few 
workers knew about their rights under the Chinese Labour Law and the 
health and safety regulations. Only 20 percent of the workers 
interviewed had heard about minimum wages and the ceiling on working 
hours. None of them knew about the legal protection on women workers 
and young workers or about compensation for occupational injury.
    In China, many private and foreign-funded enterprises make products 
for famous transnational corporations. Most corporations have their own 
labour codes of conduct and request that their business partners 
strictly comply with their codes to protect basic labour standards and 
workers' health and safety. However, corporations' pricing and ordering 
systems make it impossible for their suppliers to observe the codes. 
Suppliers merely shift their financial problems to their workers. 
Corporations give very low payments for their manufactured goods and 
suppliers then give low pay to workers. When corporations give a very 
short lead-time to their suppliers who are forced to make workers work 
overtime hours for long periods of time. According to information from 
the toy industry in Hong Kong, the labour cost of some toys is only 0.4 
percent of the toys' market price. Toy brand name companies often give 
only 2-week lead-time for orders of more than 10,000 pieces of toys.
                           a matter of power
    The health and safety issue is not only a technical issue. It is 
directly related to the power structure throughout the whole production 
chain with its complicated sub-contracting system. The upper levels in 
the chain impose conditions on the lower levels. The lower levels can 
either fulfill these demands or receive no further business orders. 
Such pressure is endemic to the sub-contracting system. Workers are 
always at the bottom.
    Consumer campaigns in developed countries seldom address this 
problem. Most of the energy in these campaigns is spent on 
``independent'' monitoring or the implementation of corporate codes. In 
fact, such monitoring does not change the unequal power structure in 
the production chain, but rather it perpetuates the existing structure, 
and, in the end, creates hardships for workers. Some independent 
monitoring schemes, such as SA 8000, focus only on the manufacturing 
process and ignores the pricing and the ordering problems. This only 
forces manufacturers and workers to bear all burdens while corporations 
have to do nothing. Unless the pricing and delivery lead-time problems, 
as controlled by corporations, are addressed, workers' rights and 
safety cannot be guaranteed.
    Of course, manufacturers do not have clean hands. Manufacturers 
have to comply with the Chinese Labour Law and all health and safety 
regulations. Under no circumstances, can manufacturers excuse 
themselves when they violate the relevant regulations and basic labour 
standards. Manufacturers have to provide workers a safe and hygienic 
working place. However, in the keen competition to maximize their 
profits, many manufacturers disregard workers' safety.
    External monitoring, to a certain extent, may help improve the 
situation, but monitoring is more or less a game of ``cat and mouse.'' 
Both monitoring organizations and factory management try to use 
different ways to deal with each other. That only creates mistrust on 
both sides and cannot help solve the problems.
    Moreover, due to limited manpower and complicated sub-contracting, 
only a few big venders will be inspected, and their sub-contractors are 
usually neglected. The frequency of monitoring is also a problem. 
However, more fundamentally, even though a factory has very good health 
and safety program, there are still all kinds of occupational 
accidents. These circumstances are related to factory management and 
practices. Some health and safety facilities are not workers-friendly. 
For instance, in Mexico, a garment factory gave workers earplugs, but 
workers refused to wear the equipments, because it is more dangerous, 
for workers not to be able to hear.
                          the role of workers
    Health and safety is also a worker issue. It is heavily dependent 
on workers' involvement and a good communication system between 
management and workers. In fact, workers are the best monitors of their 
factories. They know the factory much better than auditors do. No 
monitoring groups can replace workers in improving work environments.
    In December 2001, the Chinese Government issued two important OHSMS 
documents, ``Occupational Health and Safety Management System Guiding 
Opinions'' and ``Occupational Health and Safety Management System 
Auditing Framework.'' \14\ In these guidance documents, the role of 
workers is clearly stated. Workers should be involved in the whole 
process, and a health and safety committee composed of workers should 
be established in each factory.
---------------------------------------------------------------------------
    \14\ It should be noted that the two documents are issued by the 
National Economic and Trade Committee, rather by the Labour and Social 
Securities Ministry. The Chinese Government takes health and safety 
issue as a trade issue, rather than a worker issue. For the two whole 
documents (in Chinese), see Laodong Baohu (Labour Protection), February 
2002 and March 2002.
---------------------------------------------------------------------------
    Health and safety committee composed of workers have already been 
established in several foreign-funded factories. In the last 2 years, 
CIC have tried hard to 
persuade different brand names manufacturers and factories to set up 
health and safety education programs in their factories in China. One 
of our main tasks has been to establish such health and safety 
committee composed of workers in factories and to make the committee a 
formal conduit for communication between workers and management. 
Committee worker/members should keep close contact with management and 
be accountable to the working masses in the factory.
    The two OHSMS documents affirm our effort and give the health and 
safety 
committee a more formal status in factories. It enables workers to 
monitor their 
factories and to work with management to improve the working 
environment. The Chinese Government should speed up such work and give 
workers real power to monitor their factories.
    Corporations also have their own role here. They should not just 
direct their 
suppliers or venders to comply with the Chinese Labour Law and their 
codes of conduct. They should take the initiative to help their 
suppliers to establish such health and safety committees and to give 
substantial assistance to improve the working 
environment.

                                   - 
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