Managing Employment Relationship in China

China has moved from a closed, centrally planned economic system to a moremarket-oriented since the late 1970s and became the second largest economy after the US with the biggest labour force in the world. As a socialist country with the legacy of the state planned economy embedded in the country’s political and economic system, the role of the Chinese government in various sectors has remained dominant. This essay aims to analyse the role of the state in the management of the employment relationship as well as its future role in the development of this systemin China.
Characteristics of employment relations in China are now diverging across different ownership forms, industrial sectors and groups of workers. Due to the poor representation by unions as well as employer’s associations, employment relations in China are shaped largely between the employer and workers, with the majority of workers having little bargaining power. The role of state is crucial in shaping employment relations through the enactment of laws and regulations. However, employers seem to find ways to bypass legal constraints and workers tolerate unlawful employment practices for fear of job losses.To some extent, the employment relations are influenced by the Chinese traditional culture that emphasises social cohesion and stresses the importance of social values over individual interests, cooperation over conflict and trust over power.
During its process of economic reform, the development of the labour market has undergone three stages. The first one is the highly regulatedlabour market during the state planned economy period. The second period of deregulation was between the 1980s and the early 2000s.The third period began in 2007, in which the government sought to re-regulate the labour market to provide greater employment protection to workers.
Unions do not have much power and are generally ineffective in representing worker interests. The All-China Federation of Trade Unions (ACFTU)