A Chinese laborer at a brick factory in China. Photo: AFP
A Chinese laborer at a brick factory in China. Photo: AFP

Bitcoin might be all the rage in the rarified atmosphere of cyberspace, but “Brickcoin” has become the new currency of choice for 30 rural factory workers in China.

Trapped in a cycle of wage arrears, the employees agreed to be paid in the 290,000 bricks that they had made at a plant in the city of Nanchang, the capital of southeast China’s Jiangxi province.

Local government departments hammered out the deal with the owner of the factory after workers complained they were collectively owed 90,000 yuan (US$14,050), the state-owned Xinhua News Agency reported last week.

“The remaining 10,000 yuan will be paid in cash when he [the unnamed owner] works out how, and when, he can pay them,” Jiangxi Daily confirmed. “It appeared there were problems at the factory. Workers were forced to live by candlelight, with wood fire heating due to a lack of funds.”

Social media sites crackled with indignation after the story broke, rekindling the debate on how employees in factories are treated. Weibo and WeChat were inundated with people expressing disbelief and anger. “Why is it always rural migrant workers that are paid in arrears?” asked one Weibo user.

It is a question which frequently crops up when the issue of labor relations is discussed in China. During the winter months, disputes between migrant workers and employers tend to increase.

A BBC report revealed that the All-China Federation of Trade Unions had helped more than five million migrant workers claw back unpaid wages of 30 billion yuan ($4.5 billion) in the past five years.

The ACFT represents about 200 million employees, but the organization is not a typical workers rights group.

“China has a stated aim of unionizing 90% of its workforce, but its goal is not to uphold [their] rights,” Samuel Wrest, the managing editor at the consultancy Dezan Shira & Associates, said in an article for the China Business Review last year.

“Rather, the modus operandi of the AFCTU is to ensure that the country’s labor force runs smoothly and in line with CCP [Chinese Communist Party] targets,” he added.

“The reality is quite the opposite. In addition to industrial action spreading to new industries, the first half of 2016 saw strikes and protests rise almost 20 percent [compared to] the previous year, with the construction and transportation sectors hit hardest.”

A survey by the statistical online portal, Stastista, showed there were “around 76.7 million migrant workers in China” in 2016. But growing unrest across a wide range of sectors is not limited to this group of employees.

The influential China Labor Bulletin in Hong Kong spelt out the problems earlier this month in a report entitled, Economic recovery means more bad jobs for China’s workers, after Beijing announced that the economy grew by 6.9% last year. This was well above the official target of 6.5%.

“Higher economic growth last year merely created more low-paid and insecure jobs, especially in the rapidly expanding service sector, while factory workers continued to be laid off, often without any compensation, and construction workers fought a constant battle against wage arrears,” China Labor Bulletin stated.

“An analysis of the more than 8,000 incidents recorded on CLB’s Strike Map from 2014 to 2017 [showed] that the proportion of service and retail sector protests has increased steadily over the last four years. [This reached] 20.6% last year as the proportion of protests in manufacturing declined from 41% in 2014 to 21.3% [in 2017],” it went on to say.

“The construction industry, long plagued by wage arrears and dangerous working conditions, is now the main source of worker discontent and activism, accounting for 41% of the 1,255 worker protests recorded,” China Labour Bulletin concluded.

Still, Chinese President Xi Jinping reiterated in his New Year address to the nation that Beijing would press ahead with economic reforms in the next 12 months. A similar pledge was made at the 19th National Congress of the Chinese Communist Party in October.

How this will affect labor relations is unclear. But Johnny Choi, a partner at the multinational law firm DLA Piper, expressed his views in an article on the website Lexology, which specializes in legal analysis and insights.

“Chinese labor law is known to be rigid and heavily pro-employee,” Choi, who is also DLA’s head of employment, China, said. “Developments in the past 12 months suggest that there may be a relaxation of the law in certain situations where employers want to adjust employees’ work location or role, or even terminate the employment. But the pace of reform will be gradual and slow.

“The plan advocated by President Xi shows that the Chinese government is [treading a] a fine balance between maximizing employment and implementing structural changes. The government is also keen to minimize the amount of labor unrest caused by any potential structural changes,” he added.

Strikes and protests, of course, are nothing new in the world’s second-largest economy although they are rarely reported. But the “Brickcoin” saga has illustrated that this could still be a long winter of discontent for the country’s low-paid workers.